Gaming America May/Jun 2022 by Gambling Insider

GamingAmerica.com

May/Jun 2022

SAME GAME, NEW PLAYERS Ontario and New York stake a claim in North America's online and sports betting booms

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Four years since PASPA

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Marketing gone mad?

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El Cortez made anew

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IGA and ICE return to form

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COO, EDITOR IN CHIEF Julian Perry SENIOR STAFF WRITER Cameron Saunders Cameron.Saunders@gamingamerica.com

EDITOR’S LETTER

STAFF WRITERS Henry Moore Henry.Moore@gamingamerica.com Michael Bartlett Michael.Bartlett@gamingamerica.com LEAD DESIGNER Brendan Morrell DESIGNERS Olesya Adamska, Christian Quiling DESIGN ASSISTANTS Radostina Mihaylova, Svetlana Stoyanova MARKETING & EVENTS MANAGER Mariya Savova FINANCE AND ADMINISTRATION ASSISTANT Julia Olivan IT MANAGER Tom Powling COMMERCIAL DIRECTOR Deepak Malkani Deepak.Malkani@gamblinginsider.com Tel: +44 (0)20 7729 6279 US BUSINESS DEVELOPMENT MANAGER Aaron Harvey Aaron.Harvey@playerspublishing.com Tel: +1 702 425 7818 ADVERTISING SALES EXECUTIVE Ariel Greenberg ariel.greenberg@playerspublishing.com Tel: +1.702 833 9581 SENIOR ACCOUNT MANAGERS Michael Juqula Michael.Juqula@gamblinginsider.com Tel: +44 (0)20 3487 0498 Martin Dilleigh Martin.Dilleigh@gamblinginsider.com Tel: +44 (0) 203 435 5628 ACCOUNT MANAGERS William Aderele William.Aderele@gamblinginsider.com Tel: +44 (0)20 7739 2062 Clive Waite Clive.Waite@gamblinginsider.com Tel: +44 (0)20 7729 0643 BUSINESS DEVELOPMENT MANAGER Michelle Pugh Michelle.Pugh@gamblinginsider.com Tel: +44 (0)20 7739 5768 CREDIT MANAGER Rachel Voit WITH THANKS TO: Stephen Crystal, Allie Evangelista, Oliver Lovat, Simon Hammon, Paul Burns, Victor Rocha, Ernest L., Stevens, Brandon Walker, Kyle Scott Laskowski, Bill Miller, Thomas Rosander, Keith Whyte, Joseph Solosky, Joseph Addabbo, Jr., Adam Wiesberg, Tom Soukup, Ryan Reddy, Eric Cunningham, Noah Acres, Reid Rooney, Mike Vanaskie

JULIAN PERRY,

COO, Editor in Chief Spring is the season for growth. Look outside: the buds are sprouting on the branches of trees, the grass is getting greener, the days longer. Just as the flowers bloom, so blooms the spirit of optimism in our hearts. But the weather – the turning of the world – is not the only thing prompting change around here. Just look at Canada. In this issue we celebrate developments in our industry, especially the growth of new markets. First and foremost among these is Ontario, a province whose size easily matches any of the US’ largest markets, and which saw iCasino and single-event sports betting go live at the beginning of April. The success of the launch is seen as a harbinger for other great things coming out of the north. We also take a look at the move to bring online casinos to the State of New York. In many ways, 2022 has been the year of New York, which saw a phenomenal debut of online sports betting in January. With the coming of iGaming (a bill is due to be introduced next year), this trajectory is set to continue. And with the growth of the industry comes the efflorescence of marketing. Another facet that we investigate in this issue addresses this question: what is the most effective way to advertise in this fledgling industry? Besides this, there are reviews: the Indian Gaming Conference & Tradeshow, ICE London, and the newly-refurbished El Cortez Hotel and Casino in Las Vegas. Finally, there are the moves for suppliers and operators as they jostle for a place in the North American gaming landscape: the European companies Amelco and Relax Gaming that have trained their sites on our fair shores, while we also hear from Circa and The Innovation Group in an insight-packed issue. So sit back and enjoy the ride. We hope you don’t get too dizzy.

FEATURED IN THIS ISSUE

Gaming America magazine ISSN 2632-766X Produced and published by Players Publishing Ltd All material is strictly copyrighted and all rights reserved. Reproduction without permission is forbidden. Every care is taken in compiling the contents of Gambling Insider but we assume no responsibility for the effects arising therefrom. The views expressed are not necessarily those of the publisher.

ALLIE EVANGELISTA

Hard Rock Hotel & Casino Bristol President

JOSEPH ADDABBO, JR.

New York State Senator

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GAMING AMERICA | CONTENTS

FROM THE TOP

MAPLE LEAF MARVEL

MAP FOCUS: ACROSS BORDERS

THE SUN RISES ON THE WEST COAST

BACK AND BIGGER THAN EVER

"THE OLD VEGAS STYLE IS OUT"

ICE LOOKS TO AMERICA

BRAZIL'S WINDING PATH TO REGULATED GAMBLING

GA HUDDLE

LAS VEGAS' WINNERS AND LOSERS

Gaming America takes a look at the health of Las Vegas' brick-and-mortar sportsbooks in the age of online betting.

Sharpening our focus, we look at the regional hotspot of the Northeast US and Ontario.

The Global Gaming Awards are just around the corner, coming to Las Vegas this October. Here we give a little preview.

Gaming America had boots on the ground in London at one of the industry's biggest shows.

Stephen A. Crystal of SCCG Management gives us the skinny on the path to legalization in mammoth Brazil.

We check in on Allie Evangelista, who will soon be opening the new Hard Rock Casino and Resort in Bristol, Virginia.

In his regular column, Oliver Lovat explains what Vegas casinos do to ensure the return of their loyal customers.

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We speak with Paul Burns to discuss the state of Ontario's newly-launched iGaming and single-event sports betting markets.

Two years after being cancelled and one year after a significantly reduced capacity show, the Indian Gaming Tradeshow & Convention was back.

His eyes on the prize, we speak with Brandon Walker of Amelco to get his take on where the American market is moving.

CONTENTS | GAMING AMERICA

MARKETING GONE MAD

BETSPERTS ON SCALING

IGAMING STATE OF MIND

SIT BACK AND RELAX

EL CORTEZ HONORS ITS HISTORY

WHAT'S NEW

TURNING TIDES

THE FUTURE OF ESPORTS

TALKING SPORTS, TALKING MEDIA

LIFE SINCE PASPA

Betting companies are spending too much on advertising to be truly profitable. How long can this last?

With sports betting in New York breaking every record, we consider what iGaming could look like in the Empire State.

One of Vegas' oldest casinos gets a facelift while Gaming America gets a sneak preview.

The Caribbean market, one of the most dynamic and overlooked in the region, proves its worth.

Fantasy sports is one of they key pillars of the sports betting world; we hear from one of the industry frontrunners.

Relax Gaming has set its sights on North America; we discuss how the company's European experience will aid in this new frontier.

From a new Narcos-themed slot to an AI-powered management system, Gaming America looks at what's new on the market.

Gaming America looks at whether esports betting can rise as prominently as esports itself within the US.

A panel of industry leaders discusses the importance of media partnerships between betting operators and sports entities.

The sports landscape in the United States has changed dramatically since the overturning of PASPA. Gaming America ponders the changes.

VIEWPOINTS

Industry experts discuss the future of casino management systems.

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GAMING AMERICA | FROM THE TOP

VEGAS SPORTSBOOKS CONTINUE TO SET THE BAR Is online betting the deathknell of brick-and-mortar sportsbooks in Vegas or a new beginning? Gaming America takes a look from the top.

Nevada had a monopoly on sports betting for decades prior to a 2018 Supreme Court decision. Now, sports betting is legal in 30 states plus Washington DC, and retail sportsbooks are being constructed all over the country, including in basketball/hockey arenas. So are those who run the books in Las Vegas sitting around fretting about how to keep visitors coming in from other states? Not exactly. “If you look before PASPA, were guests leaving other states to play in sportsbooks, or was it just Las Vegas as a destination resort and the book was an amenity?” asked Jason McCormick, VP of Race and Sports for Station Casinos. “Vegas still has advantages over some book in Michigan, or wherever. From 2018 until now, Vegas has become so much more sports focused with the Vegas Golden Knights, the Raiders, the NFL Draft, Formula 1 and the many conference basketball tournaments that are held here every March.” 8 | GAMINGAMERICA

Chris Andrews, Sportsbook Director for South Point Hotel Casino, said the newcomers may be trying a little too hard to compete with the established books in Las Vegas. From free bets to food and beverage giveaways, the newbies are spending so much in promotions. “The people I have talked to here in Vegas are not interested in giveaways,” Andrews said. “Vegas has a great product from A to Z. South Point has movie theaters, bowling, and great food options ranging from $1.50 hot dogs to a steakhouse.” No need to change what is working, Andrews continued. “We are doing a lot of things properly. Our ticket counts are up. The spread of legalized sports betting is growing the market overall. Las Vegas is still doing fine, with handle and with ticket count, from everyone I’ve talked to.” Agreed McCormick: “The more people are talking about betting on sports, the better.”

ARMS RACE IN FULL SWING At some casinos, the sportsbook is a centerpiece, at others, an afterthought. It takes just a glance to see which is which, because properties that invest in their books dedicate large amounts of space to viewing screens, betting boards and more. In the 1980s and ‘90s, two of the standard bearers were the books at Caesars Palace and the Las Vegas Hilton (now Westgate). But over the past two decades, the sportsbook arms race has heated up considerably as other Strip properties built increasingly grand facilities with dedicated restaurant options. Even the locals’ casinos scattered around the Vegas valley have gotten into the act, with Station Casinos investing in a palatial setting at Red Rock Casino in Summerlin, and the South Point at the southern end of The Strip building separate spacious rooms for sports betting and horse racing. It is not editorializing to say the Circa Resort in Downtown Las Vegas, which

FROM THE TOP | GAMING AMERICA opened in October 2020, was a push forward akin to the upgrade from the atomic bomb to the hydrogen bomb. The massive sportsbook has three stories, 350 stadium seats, room for 1,000 people total, and even private boxes for groups. Circa Sportsbook is so big, Station Casinos’ McCormick said admiringly, “Circa was a property built around a sportsbook. It raises the bar.” Jeffrey Benson, Sportsbook Operations Manager for Circa, couldn’t help but laugh when he heard the compliment from a competitor. “The factor that separates Vegas is the brick and mortar retail component, while other states are primarily just online,” Benson assessed. “When you have a phenomenal venue, such as a three-story sportsbook, it gives fans an experience like being at a game without being at a game.” Circa also went large with its swimming pool area, which it refers to as Stadium Swim. The space has six pools on three levels, all with views of a 40-foot-tall, high-definition screen. Benson said he and his management team are not resting on their laurels – or the physical space occupied by the book. He asserted Circa has the lowest hold on future and day-to-day bets, which said has “really driven business.” He also pointed to the popularity of two contests involving NFL games. The Circa Sports Million III, which had players make five weekly picks against the spread during the 2021 season, offered a $1m first prize and $4m in total prizes. Circa Sports Survivor attracted 4,080 entries and gave $6m to the last player standing in picking an NFL winner each week. “Those two contests, in which [Circa owner] Derek Stevens puts a lot of money, get people into Las Vegas, and gets them familiar with our property and our amenities,” Benson said. “They help educate consumers about our product.”

MINT JULEPS AND GOLF TOWELS Circa may have made a big splash, but the competitors aren’t giving up. Station Casinos’ McCormick said Vegas sportsbooks are always looking for

opportunities to have promotions. “We did a Masters giveaway of a golf towel, and we do mint juleps on Kentucky Derby Day,” he said. “Vegas brings people in, then it is the job of the books to give them a great time."

"WE ARE DOING A LOT OF THINGS PROPERLY. OUR TICKET COUNTS ARE UP."

South Point’s Andrews said one factor that hasn’t changed is when there is a big game going on, there is electricity in a sportsbook. “A lot of people enjoy just hanging out in the books – half of the people rooting for one side, half for the other,” Andrews said. “People love that feeling, and it is not fading away. We have a lot of things going for us, but number one is customer service. On Saturday and Sunday we have 12 windows plus 11 kiosks. We can get your bet in on time. We have easy, accessible parking that is free. Customer service distinguishes us from all the other books in town.” According to McCormick, running a successful sportsbook is all about bringing people back from day to day – which is accomplished by overall guest service, a clean and comfortable environment, and getting the lines up on a timely manner. “We offer funding options, kiosks, and other ways to put on a show once someone comes to our property,” he said. “We want them to know they will get a great experience at our books, and they will come back and they will tell their friends about the experience.” One accommodation the terrestrial books have had to make given online competition is expanding the number of proposition bets, McCormick continued. He said in the past five years, Station Casinos’ Super Bowl package has gone from 15 pages to 25 pages, and its books are offering first period lines,

first five-inning lines, and even “will there be a fight” during a given hockey game. “We are really trying to push the envelope,” he said. “When Covid hit, we were missing out on the big sports. All we had was Japanese and Korean baseball. But we found our customers gravitated to it.”

RISE OF TECHNOLOGY FUELS INGAME BETTING EXPLOSION All three sportsbook managers interviewed for this story said one of the most significant changes to the business model has been ingame wagering. One of the earliest adopters was the M Resort, which a decade ago lent tablets to bettors to use during games in the books. Today, nearly all permit the use of mobile phones to place bets via an app. McCormick noted Station Casinos has offered in-play wagering since 2016. “In Nevada, people were used to betting pregame. In other markets, people have been introduced to in-game wagering when they are introduced to sports betting,” McCormick said. “We let guests bet on our app in the book, both race and sports. Covid made mobile more acceptable, and kiosks let people bet without a human interaction.” Circa’s Benson predicted books will continue to follow the trend toward digitalization. “People play on our app, but we also get plenty of over-the-counter play. As a sportsbook you have to continue to invest and run a first-class operation. We try to do as much in-game betting as possible.” Andrews said South Point offers in-game wagering via an app for phones or tablets, or at the counter. “We handle setting the in-play lines ourselves, while other places farm it out. The problem is the labor shortage. Sometimes we don’t have all the people we would like, so there are certain days I can’t do it because I don’t have enough people.” Said McCormick: “If you blink, technology is going to pass you by, so sportsbooks have to keep up.” South Point’s Andrews gets the final word: “Our industry in Nevada is very healthy and I don’t see that changing.” GAMINGAMERICA | 9

GAMING AMERICA | US MAP

MAP FOCUS: ACROSS BORDERS We take a deep dive into the East Coast of North America, to examine one of the fastest-growing and most profitable regions in American gaming. ONTARIO

NEW YORK

Having launched iGaming on April 4, Ontario offers operators and suppliers an open market the size to rival New York. With that, there is no shortage of companies looking to profit off of this new opportunity, with Kambi, theScore and PointsBet, among others, looking to come out on top. Predictions for yearly revenue currently stand at $1.5bn.

Prior to the market's launch in January, it was widely expected that New York would rival the United States’ other gaming giants. Not many people saw the Empire State instantly becoming the nation’s largest market, however. In its first month of operation, handle came in at over $1.9bn, generating revenue of $138m for operators.

PENNSYLVANIA

CONNECTICUT

Pennsylvania’s land-based casino industry features six racetrack casinos, five standard casinos, two resort casinos and three properties described as minicasinos. Since 2019, the Keystone State is one of five states with a fully operational iGaming market, a factor that could spur its neighbor, New York, into legalization.

Connecticut is home to two of the nation’s most famed tribal casinos in Foxwoods Resort Casino and Mohegan Sun Casino. The Constitution State is also a leading iGaming region, with its online casino scene powered by FanDuel and DraftKings. Connecticut played a central role in helping generate $3.71bn in iGaming revenue for the nation in 2021.

NEW JERSEY New Jersey has long been the nation's gaming capital, surpassing even Nevada in a number of key metrics. While this may no longer be the case, with New York on the hunt for that crown, the Garden State is more than holding its own. With its lower tax rate and still-impressive handle, New Jersey has continued to be a key region for operators in 2022.

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US MAP | GAMING AMERICA

MA CT

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GAMING AMERICA | GLOBAL GAMING AWARDS

BACK AND BIGGER THAN EVER With the Global Gaming Awards in Las Vegas fast approaching, we preview what exactly makes these Awards special, from the sheer spectacle to the fair and equal judging process. This October, the biggest names across our industry will come together in the gambling capital of the world to celebrate the hottest new products, the most iconic properties and the leaders shaping the future of gaming. So get your dinner jackets and ball gowns ready, the Global Gaming Awards is returning to Las Vegas with all the iconic glitz and glamor that it has become known for over the years. Taking place on the Monday of the famed Global Gaming Expo (G2E), the Global Gaming Awards are the most esteemed and respected prizes this industry has to offer. This is the ninth year that these Awards have taken place, and the first time since 2019 that we can welcome you all in full capacity, with no limits on attendance. With a diverse, fair and experienced Judging panel that takes every factor into account when making a decision, the Global Gaming Awards are the most respected event of its kind for a reason. Categories range from Property of the Year to Executive of the Year and everything in between, with winners hailing from every corner of the Americas. “As we return to Vegas for the ninth year, we are excited to bring you the biggest and most expansive Awards show we have ever

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produced, reflecting the huge growth this industry has witnessed over the last 12 months,” said Julian Perry, Editor in Chief and COO of Gaming America. “As we look ahead to the Awards, it is important to honor the events and people that changed our industry for the better this year, from the legalization of iGaming in Ontario to the unprecedented success of sports betting in New York and those that brought it about. Good luck to all the nominees, we are so excited to see you.” Powered by sister publications Gambling Insider and Gaming America, in partnership with G2E, last year’s Awards were a roaring

success. Bally’s Soo Kim triumphed in the American Executive of the Year category after realizing the company’s vision to make Bally’s Corp a national gaming leader. Soo led Bally’s to 15 strategic partnerships and grew its market cap to about $400m. Meanwhile, the biggest winner was Aristocrat, which secured an impressive three Awards including Land-based Industry Supplier, Slot of the Year, and Land-based Product of the Year, with its In the Clear product. MGM Resorts International also had a great year, with its jointly owned sportsbook, BetMGM, picking up the Digital Operator Award, while it came second in both the Responsible Business of the Year and Customer Loyalty Program. So prepare for excitement, celebration and drama as the most esteemed Awards in gaming return to the neon-soaked streets of Vegas once more in celebration of the past and future of gaming. The Global Gaming Awards Las Vegas are powered by leading B2B gaming publications Gambling Insider and Gaming America, in association with the Global Gaming Expo, and are independently adjudicated by KPMG in the Crown Dependencies.

GAMING AMERICA | ICE 2022

ICE LOOKS TO AMERICA ICE had a European vibe this year, but that did not stop Gaming America from finding the best upcoming American products as we produced a slew of video interviews with industry experts.

On Gaming America’s first day at ICE London 2022, the editorial team arrived bright and early. As the stands and concourse slowly started to fill with top executives and industry innovators, the team was hard at work interviewing these individuals, finding out the exciting things that the Americas can expect from gaming in the next year. Indeed, while ICE London had a distinctly European feel this year, with limited attendance in part due to its close proximity to Easter weekend and the Indian Gaming Association Tradeshow & Convention, it was still an informative, jam-packed and exciting week. Despite this continental atmosphere, Gaming America remained on the hunt for products and companies that had their sights set on the Americas. Through the packed halls we traveled with our camera equipment, speaking to the biggest names at the biggest companies; in search of the most iconic games and products soon to hit the shores of the New World. One common theme we found throughout the show – a thread that connected every supplier, operator and regulator – was the 14 | GAMINGAMERICA

uncontainable excitement regarding the new opportunities that America presents to the gaming industry. “The United States and Canada are two of the main markets we are targeting right now. It is a separate string for us to make sure we reach player requirements in the best possible way,” said Jacob Lopez, Managing Director of Managed Platform services at Sportradar. This reflects a general theme we found across ICE: while many companies are already operable throughout the region, it is its potential growth that excites the most. “I have seen the American market evolve in the last few years and I know it will continue to evolve,” added Erik Nyman, EveryMatrix’s President for the Americas. Two key product types featured heavily throughout the show: sports betting and iGaming. On the latter, Galaxy Gaming CEO Todd Cravens noted: “The US market is big for us. We have a number of new iGaming products launching in the US this year, including baccarat style games, roulette products and poker offerings.” While excitement around iGaming in the US was

palpable, many agreed that it may be some time before the entire nation embraces this highly profitable form of gaming. These conversations and interviews were undoubtedly the highlight of our week at the ExCeL, as we saw new and familiar faces come together after so long. Despite the smaller scale this year, together really was better. If you would like to check out these interviews in full, simply scan the QR below to be taken over to our LinkedIn.

GAMING AMERICA | SCCG

BRAZIL’S WINDING PATH TO REGULATED GAMBLING Stephen A. Crystal, Founder and CEO, SCCG Management, looks at the tumultuous history of Brazilian gaming. We have spent a lot of time watching the ebb and flow of efforts to legalize and regulate gambling in Brazil, the world’s fifthlargest country. Despite its criminalization at the federal level in 1946, the value of the Brazilian gaming industry is significant. It’s a challenge to understand the precise size of the Brazilian gambling grey market. Land-based gambling activity consists primarily of sports betting, lottery games (including jogo do bicho), dog and horseracing, and poker. It is valued at nearly $6bn.

LEGALIZATION AND REGULATION OF HORSERACING On December 19, 1984, horserace betting was legalized under Federal Law No. 7,291/1984, with regulations defined by Decree No. 96,993, four years later, in 1988. This permitted the regulated operation

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of fixed-odds sports betting at authorized tracks. Horseracing is limited to non-profit organizations that own a racetrack and are licensed by the Ministry of Agriculture, Livestock and Food Supply.

LEGALIZATION OF FIXED-ODDS SPORTS WAGERING In December 2018, with Federal Law No. 13,756, Brazil legalized (but did not regulate) online fixed-odds sports wagering and was rewarded with four years of rapid growth. Still, demand is evident despite the absence of regulations, licensing and oversight. São Paulo and Rio de Janeiro are Brazil’s two largest fixed-odds sports betting markets, with nearly 19 million people. Here, things get interesting. There isn’t a legal definition of gambling in Brazilian law, but bets and games are types of

contracts covered under the Brazilian Civil Code. With this understanding, contracts between absent parties are executed in Brazil in the proponent’s place. This means that offshore operators, hosted in a jurisdiction where gambling is legal, are valid under the jurisdiction’s laws. The problem with this partial solution is that the execution of these financial transactions is not authorized under Brazilian law, exposing the operators to possible criminal action. With no attempts by any Brazilian law enforcement body to bring such action, offshore operators have been providing online sports wagering to Brazilians, with great success and strong year-on-year growth. Entain reported in its Q1 trading update at the beginning of April that Brazil, one of its top countries for growth, achieved doubledigit year-on-year growth for the first quarter.

SCCG | GAMING AMERICA casinos must be further than 100 kilometers from any other casino in a leisure complex or integrated resort. The law also accommodates riverboat casinos, which are authorized based on the river’s length in which it is deployed. Three floating casinos are permitted in rivers longer than 3,500km, two floating casinos in rivers 2,500-3,500km, and one floating casino in a 1,500-2,500km river. These riverboat casinos must be mobile, not staying anchored in the same place for more than 30 consecutive days. These floating casinos must have at least 50 luxury cabins, restaurants, bars, event spaces and retail stores.

THE CULTURAL POWERHOUSE: JOGO DO BICHO

Brazil's famous jogo do bicho game

Entain’s $326m in revenue generated outside Australia, Europe and UK markets, was “predominantly driven by Brazil.” Operators serving Brazilian sports bettors include BetOnline and Bovada. Many other digital platform operators who currently provide sports betting markets to Brazil are taking a lower profile. Operators such as bet365 and some fantasy sports brands are looking at the country’s market pending regulation. Still, there is a lack of clarity around how the Ministry of Economy will license the industry. Will there be a competitive process for a few high-value gaming licenses? Will the ministry open the door to all licensable operators and let the market choose the winners? These questions are currently unresolved. Brazil’s Ministry of Economy hopes to close the rules and licensing gap in time for the FIFA World Cup in Qatar, which aligns with the law’s December 2022 deadline for the Government to establish gaming regulations and issue operator

licenses. Once fully regulated, Brazil is likely to be a top-five regulated gaming market globally.

LEGALIZATION OF LAND-BASED CASINOS, BINGO, JOGO DO BICHO AND ONLINE GAMING On February 23, 2022, the lower house of the National Congress of Brazil approved bill PL 442/91, legalizing land-based casinos, bingo halls, sports betting and jogo do bicho. The bill affords São Paulo the right to license three casinos, the State of Minas Gerais and Rio de Janeiro to authorize two each, and one casino each in all other states -- a total of 30 casinos. Taxed at 17% of gross gaming revenue (GGR), integrated resorts may house a casino if it has at least 100 hotel rooms, conference space, food and beverage operations and retail. Tourist casinos are also provided for under the bill, in high-density tourist destinations with sufficient infrastructure, including tourist services. These tourist

Jogo do bicho operations licensable under this bill must run their operations through a computerized system that a Brazilian state agency may access in real-time, online, through a national audit and control system. Jogo do bicho, or “animal game,” is an extremely popular no-limit lottery-style game in Brazil, currently legalized in the state of Paraíba, but illegal throughout Brazil at the federal level. Originating in the late 19th century, jogo do bicho is commonly played by betting on one of 25 animals. Each animal in the five-by-five grid is associated with four numbers in a series, from one to 100. This grid of animals and numbers gives the player the ability to bet on one or more animals in any position on the grid or in specific places on the grid. Players can also bet on numbers rather than animals. The permutation of possible bets based on animals, numbers, or even numbers and animals, creates the kind of lottery combinatorics that support huge payouts on even small wagers. Beyond the mechanics of wagering, jogo do bicho, invented in 1892 by Brazilian nobleman Baron Joao Vianna Drummond, is a cultural fixture of Brazil. The game is filled with superstition and meaning tied to its animals and numbers. Bettors that dream of a friend or relative might wake up and place a bet on the numbers of their birthdate. The operators of jogo do bicho lotteries have given back to their communities for GAMINGAMERICA | 17

GAMING AMERICA | SCCG

decades, contributing to social institutions such as hospitals, orphanages, sports teams and the like. As expected, these activities go a long way toward maintaining their place in the culture, despite the violence associated with the organizations that run these lucrative lotteries.

DON’T COUNT YOUR ROOSTERS UNTIL THEY’VE HATCHED With PL 442/1991 to be taken up in Brazil’s Senate, a substantial bloc of senators strongly opposes the bill, arguing that legalizing these gaming operations will lead to money laundering and other social ills. Among the senators in opposition is the Deputy Leader of the Government, Carlos Viana. In opposition, President Jair Bolsonaro has publicly stated that he will veto it if presented to him. However, many senators are defending the bill, including Senator Angelo Coronel. They rightly push back against the argument that the legalization of gambling in Brazil will bring social ills. Everyone 18 | GAMINGAMERICA

knows that illegal gaming is ubiquitous and visible on every street in Brazil today. Still, Brazil’s Senate created an anti-gambling group, “Parliamentary Front Against Gambling,” through a single-round vote. Senator Angelo Coronel was the only no vote against the motion. Senator Eduardo Girão suggested the group’s passage indicated that the Senate might not be able to override a presidential veto. To further confuse the issue, the Supreme Federal Court of Brazil is pending a ruling on a lower court case that argues the legislature’s 1946 prohibition on gambling is unconstitutional and unenforceable. This Extraordinary Appeal No 966,177 to the Supreme Federal Court was scheduled for April 7, 2021. Still, it was not taken up in the session by the court as there wasn’t enough time to discuss the appeal in the time afforded. A new date for review has not been set by the court, leaving the motion in limbo. We believe this process will continue to move forward and that regulated gambling

will come to Brazil. The entrenchment of illegal gambling institutions such as jogo do bicho, combined with the substantial successes enjoyed by the iGaming grey market, will continue to build momentum; forcing the door open for legal gambling.

STEPHEN CRYSTAL SCCG Management Founder & CEO

GAMING AMERICA | THE HUDDLE

LAND-BASED DREAMS Gaming America sat down with Allie Evangelista, President of Hard Rock Hotel & Casino Bristol. The Virginia property is aiming to become a premier destination in the Southeast. Can you tell us about your professional life up to this point? How did you arrive in the position you are in now?

ALLIE EVANGELISTA Hard Rock Hotel & Casino Bristol President

I like to say that I am blessed. I have been blessed with the right people in my career and the right opportunities at the right time. I was born in Brazil, grew up there and attended college before moving to the US as an adult. I started in the hotel business in Florida. My first job here was as a hotel housekeeper. I cleaned rooms hoping I could make it to the front desk; that was my goal. That happened eventually and I went on to work in the hospitality business, and worked with some great people and leaders. At some point, I got the opportunity to enter the gaming industry; this was in 2006 in the state of Missouri. My first role was in the slot department. So I have been in gaming now for 16 years and, seven states later,

I am now in Virginia as the President of Hard Rock Bristol.

Given your history in hospitality, I wanted to ask which side is more prominent for you, the gaming or the hospitality? The hospitality industry really opened the door for me to enter gaming. I like to say that when I joined gaming, casinos were really starting to realize that every property had good slots and good table games; and thus began to see the importance of taking care of customers. This is how I got my opportunity to bring my experience in hospitality to the casino. I do not know if one is more important than the other, because you can’t do gaming without hospitality, not successfully, not well and not how Hard Rock wants to do it. Both sides are challenging and both sides are rewarding, I spend most of my time within the gaming operations, as this is

"GAMING WILL BE THE INITIAL DRAW. PEOPLE WILL COME FOR THE GAMING ASPECT BUT, ONCE WE ARE DONE WITH THE PROJECT, PEOPLE WILL STAY FOR THE LIVE ENTERTAINMENT, FOOD AND OTHER OFFERINGS" 20 | GAMINGAMERICA

THE HUDDLE | GAMING AMERICA the core of the business I have been working in for the past 16 years. This property, though, will give me an opportunity to work in all aspects of the industry.

When do you expect the property to be complete? What features does it have that make it unique? The property is under construction at what used to be a shopping mall. I am speaking to you right now from the dressing room of a department store. We are super excited for what we are building here. The first stage is to open a temporary facility we hope will launch this summer, and this will focus mainly on the gaming space; 900 slot machines, 21 table games, a sportsbook and a number of restaurants. All of this will be part of the temporary facility while we continue to develop the permanent property. The final location will feature a Hard Rock Cafe and two hotels, a live event space and an even larger gaming facility. This will take around two years to complete. The permanent facility will start at the mall, while the hotel towers will be a new construction.

What do you think the outstanding draw to people in the region will be for your property? Gaming will be the initial draw. People will come for the gaming aspect but, once we are done with the project, people will stay for the live entertainment, food and other offerings. Hard Rock has a slightly different following to other operators, because we offer live shows and well-known restaurants, among other things. Once all is said and done, people will come first for the gaming but then return for our other showings. Bristol, Virginia, where the casino is located, is literally on the border between Virginia and Tennessee. We are one town in two states. You can have dinner in one state and then pick up your dry cleaning across the street in another. Knoxville is only an hour away from the casino and, as a whole, I think there will be a real following coming to the casino from three different states. This will be the first new casino in Virginia in quite some time, so there is that draw too.

In terms of building the casino, I do not think there was much resistance at all. This has been one of the most welcoming places I have ever lived, with 70% of the population stating that they wanted the casino to be built. It is a community that is excited to welcome new people from lots of different backgrounds.

Do you think the Southeast is lagging behind the rest of the country in terms of gaming? What could it do to catch up? I think gaming in general has really expanded in this region in recent years, especially in terms of sports betting. Virginia is just now launching casinos and we are so excited to be part of this. It is true that the Southeast does not currently have as many offerings as other parts of the country, but I do not necessarily think this is a bad thing. As long as things are changing and progressing, there is more to come for this great industry for sure.

Does mobile betting pose a threat to land-based casinos, or will it be integrated? It will be integrated for sure. I believe in omnichannel. I believe people want different ways of interacting with gaming. Mobile is a new way for the industry to innovate; not everyone wants to drive to a property. However, I do believe this all complements what we offer. Ultimately, it gives our players more options and more access to our offerings.

Lastly, what are your hopes for the property in 18 months' time? 18 months from now I hope we are really getting ready for the permanent property to come. For me it is less about the property, less about our offering, because I know it will succeed. It is more about the community, for when we get into a location where there has not been much economic investment, a casino like ours can really change peoples' lives. From the money that will come in, the jobs or the tax benefits, I can see that this community is going to change from these additions. This is already a beautiful area and I am so excited for the community. GAMINGAMERICA | 21

GAMING AMERICA | OLIVER LOVAT

LAS VEGAS’ WINNERS AND LOSERS Over the past six months, regular Gaming America contributor Oliver Lovat been compiling research into customer behavior in Las Vegas, following up from his 2011 research into Strategic Competitive Advantage in Las Vegas’ casino resorts. After a decade that has seen industry consolidation, bankruptcy, restructuring, new properties and a visitor demographic transition, not to mention domestic terrorism, a global pandemic and an economic crisis, the landscape in Las Vegas is remarkably robust. Indeed, one could argue that from a strategic perspective, there has been considerable success.

YEAR 2011

2021

Generally Loyal

32%

57%

Generally Disloyal

66%

42%

Other

Table 1. Customer Loyalty

LOYALTY WON For those regular readers who are familiar with my thesis, strategic competitive advantage within casino resorts can be achieved in two ways: location and customer loyalty. Since beginning my research in 2011, it is clear that the decision to place customer loyalty at the center of decision-making has been the defining and most successful characteristic within strategic thinking over the past decade. The headline outcomes in understanding customer loyalty are seen in Table 1. In 2011, 32% of Las Vegas’ visitors usually stayed in the same resort. This was 57% in 2021.

TABLE 1. CUSTOMER LOYALTY With customers increasing their loyalty from a decade ago, the winners are amenity-heavy with a clear target focus. Throughout the market, systemic growth (and post-Covid gaming spend) has benefitted all and mitigated the potential downside to the losers. What should be of concern is that 22 | GAMINGAMERICA

customers are less inclined to “try something new” or move between properties in Las Vegas.

RESPONDENT LODGING BEHAVIORS (AT LEAST ONE STAY 2011-2021) The winners of capturing loyalty in the past decade, compared to the previous decade, are new properties Aria and Cosmopolitan (coming from a lower base) but also The Bellagio, Mandalay Bay and Wynn. The losers are The MGM Grand, TI, Venetian, Excalibur and Tropicana. With loyalty established between many customers, this makes it significantly harder for new entrants to come to market. For those seeking entry, the “if you build it they will come” mantra belongs in the 1990s.

HOW DID LAS VEGAS OPERATORS WIN THE LOYALTY BATTLE? The key to this is understanding the drivers of loyalty and developing the appropriate management tools to make

effective decisions. In January 2011, MGM Resorts launched the MLife Player Club to compete with Caesars’ Total Rewards program. Both clubs recently rebranded as MGM Rewards and Caesars Rewards, explicitly emphasizing the benefits element.

TABLE 2. PLAYERS CLUB MEMBERSHIP The value of having a players club is evident, even if they are now ubiquitous. On the surface is the customer benefit. By accruing points with a particular operator, the customer is incentivized to focus his or her spend within that property or group, with appropriate and targeted rewards awarded based on spend. Historically, this gave Harrah’s/Caesars a competitive advantage until MGM Resorts aggregated its players club into a single card, thus eroding Caesars’ advantage. Spending outside the main operator implies a theoretical cost (potential loss of points) to the customer.

OLIVER LOVAT | GAMING AMERICA However, the real value within players clubs is in the data collected by the operators. To manage effectively, you need to measure accurately. The data obtained by players clubs allows almost real-time updates in customer behavior, allowing for the more effective management of resources. Historically, managing casinos was an intuitive discipline, with expert managers offering insights based on experience, observed knowledge and a degree of intuition. By collecting data, this process became structured, with data scientists emerging as prized assets within the decision-making chain. As we note, a decade ago, Caesars led the way; however, MGM Resorts has surpassed Caesars in the number of visitors to hold its cards. Furthermore, 77% of those holding MGM Rewards cards also hold Caesars Rewards cards, but 92% of Caesars Rewards members hold MGM Rewards, proving the success of MGM Resorts’ investment in challenging Caesars’ competitive advantage in information. Commanding customer loyalty via transactional methods, and applying the data collected to enable management decisions, is of great value. Once collected

YEAR

Total/Caesars Rewards

2011

2021

70%

69%

Mlife/MGM Rewards

68%

84%

Wynn Rewards

43%

37%

Grazie/Vene�an

40%

29%

None

16%

Table 2. Players Club Membership

and analyzed, resort operators make decisions from this data, investing in amenities based on customer profiles. Only 7% of Las Vegas visitors are not members of a players club (down from 14% in 2011) implying that 93% of visitors are being targeted with offers to stay. Despite theoretically being focused on customers within the database, the effective practice of multiple casino operators repeatedly targeting the same customers with discounted packages was a method to drive competitive advantage; but today, with customers being multiple card holders, direct marketing has reduced

WHICH OF THESE ARE IMPORTANT TO YOU WHEN SELECTING A RESORT FOR YOUR LAS VEGAS TRIP?

effectiveness and, with rising postage costs, is a practice done at increasing cost with diminishing results.

NEW LOYALTY DRIVERS? Our research shows that transactional loyalty, which was once dominant, is only part of the marketing mix; and there are equally important findings in what drives the customer decision-making process going forward.

TABLE 3. CUSTOMER DECISION-MAKING Table 3 shows the aggregated decision-making behaviors of Las Vegas visitors. Although there is variance between the customer segments, there is near agreement that the resort experience and offering is the primary rationale for which property to choose when coming to Las Vegas.

Resorts Experience and Oﬀering

72.19%

Loca�on

65.09%

Loyalty Program/Level of Comp

61.24%

EXPERIENCE THE CLICHÉ

Guestrooms

55.33%

Previous Experiences

52.37%

Prices

51.18%

Design and ambiance

45.86%

Pool

34.32%

If I had a dollar each time an executive commented that Las Vegas was all about “the experience” I would be a wealthy guy; but the truth is, Las Vegas’ success isn’t just about the experience, it's about the range of experiences.

Range of Food and Beverage

32.54%

Resort Apperance

32.54%

Friendliness of Staﬀ

26.92%

Property History and Reputa�on

24.56%

Range of Ameni�es

19.53%

Table 3. Customer Decision-Making

TABLE 4. WHICH OF THESE STATEMENTS BEST REFLECTS YOUR FEELINGS WHEN STAYING IN A LAS VEGAS RESORT What this research shows us is that the range of experiences attracts customers. If delivered strategically and holistically, GAMINGAMERICA | 23

GAMING AMERICA | OLIVER LOVAT those experiences make customers feel good; and if customers feel good, they will want to repeat those experiences.

NO POINTS, NO DISCOUNTS, NO TRANSACTIONS. PERHAPS EVEN A PRICE PREMIUM. THAT IS REAL LOYALTY. The question, therefore, is how is it done? We can deconstruct the experience delivery into several elements. One of the notable trends over the past decade is the centralization of operations as part of the wider strategic initiatives and programing. This has led to a further codification of operations, with pros and cons. However, efforts have been made to create efficiencies in operations that lead to a more fluid and consistent customer experience. Many resorts now offer alternatives to the long check-in-and-out lines, with improved mobile and digital elements. For some customers this is an anathema to the hospitality experience, but for others – especially business and frequent travelers – this is a welcome use of technology. The ability to capture customer data has allowed operators to understand the customer and invest in functional elements that meet customer needs, whether this is a choice of restaurants, bars, slot games or room amenities. Across all aspects of the business, a positive outcome of analytics has been to eliminate risk and improve functionality of the experience. However, that experience is difficult to communicate, hence the use of selected brands and endorsements to align with the targeted customer profile. The business problem is condensed into an 8-ounce fillet by longtime observer John Curtas, in his “High Stakes in Vegas” commentary on steakhouses. An example in the variance of management decision-making can be seen by those operating 55-year old Caesars Palace and the newest Strip addition, Resorts World. Caesars, with more than 20 years of 24 | GAMINGAMERICA

I get a range of experiences in Las Vegas that I cannot get in my hometown

35.91%

I feel good being in Las Vegas

28.49%

I don't think Las Vegas is as good value as it used to be

16.62%

I get treated well because I am a good casino customer

9.79%

The property I select has everything that I need

5.04%

I don't get treated well as I am not a big gambler

2.37%

I feel that I am in a place with people like me

1.78%

Table 4.

detailed data analytics into customer behavior, insights and knowledge, identified that established New York brand “Peter Luger Steakhouse” would best align with its customers. Resorts World, making early steps with a new property, with a nascent understanding of who its customer is, selected newly formed operator Carver Road Hospitality to open Carversteak, its first restaurant. Undoubtedly, both are formidable additions to the culinary landscape, with different customers in mind. Further accepting Curtis’ observations that neither the product (nor even the experience) is significantly differentiated, it falls to the brand, design and aesthetic to make the difference. Considering that each of these restaurants is a multi-million-dollar investment, each has a dual role; to be profitable and to act as a marketing tool to bring people to the property. Each has a different customer seeking a certain experience, if not a different product. And that is what the past 10 years tells us in a couple of steakhouses; the transactional loyalty battle is over. Players clubs, although important, are no longer a driver of competitive advantage, but remain a valuable tool in management decision-making. It falls on how skilled management is in using this data that will drive competitive advantage. The critical observation is: in order to

drive competitive advantage through loyalty, resorts need to know who their customer is, identify what their needs are and meet those needs better than their competitors. This research highlights the successes of the past decade, but within, there also contains a warning. Several casino resorts that featured in the 2011 research are no longer in existence in 2021. Several more will not make it to 2031, unless they reassess the strategic element of their business.

OLIVER LOVAT Denstone Group CEO

GAMING AMERICA | CANADA

MAPLE LEAF MARVEL The road to a legalized iGaming and single-event sports betting market in Ontario was a long one. To celebrate its launch just over a month ago we look back on what led to legalization, speaking with Paul Burns, CEO and President of the Canadian Gaming Association. Four years ago, when the current Ontario Government was elected, its officials sat down to consider ways to raise funds for the province. Politicians convened, producing a dossier with every possible solution to this issue. Approximately 40 pages in, buried toward the bottom of the list, was a single sentence suggesting the legalization and regulation of the region’s iGaming market. Among other things, it cited losses of over $500m of handle per year to offshore operators. With that, the Ontario Government held its first iGaming consultations and, in the weeks and months that followed, the province’s legislatures would meet with operators and experts to form an idea of

26 | GAMINGAMERICA

what an iGaming market in Canada’s most populous province would look like. The road to the single-event sports betting market we know today was rather more tumultuous. Prior to 2021, the criminal code of Canada prohibited betting on singular sporting events. During this time, billions of dollars flowed out of Canada to unregulated sportsbooks across the globe. Questions began to be asked of this practice in 2008, when proponents of a regulated single-event sports betting market approached the Government for a change in this criminal code. These attempts – which came as three separate proposals over a number of years – initially failed to garner the support needed, getting as far as the Senate in 2011, where it was never voted on. The tides began to turn, however,

as the evidence of sports betting’s success in the United States became irrefutable. As the money flooded into the states that legalized the pastime, operators, suppliers and professional sports teams alike came together in Ontario to push the proposal through. These efforts would pay dividends, and, in 2021, Bill C-218 was passed, paving the way for Ontario’s citizens to legally bet on single sporting events for the first time in the province’s modern history. As things stand, we are just over a month on from the launch of a market big enough to rival the Empire State. For an informative chat on where things stand, we sat down with Paul Burns, CEO and President of the Canadian Gaming Association. *This interview was conducted a week prior to the market’s launch.

CANADA | GAMING AMERICA gross gaming revenue per year. I think this is fair but also slightly conservative. We will need to see how much growth there is, especially on the sports betting side; I think this is where the opportunity is. In the last week we have seen a real advertising push from theScore, BetMGM and PointsBet as they prepare for launch. This estimate is what people are talking about, but I say let’s see. As operators join the market and offerings grow, we will see where this goes.

Can you give us an overview of Ontario’s iGaming and single-event sports betting market? Ontario’s gaming market is unique to North America because it is open license, meaning any company that wants to apply to operate is free to do so. There is no tethering and no restrictions on this. A unique feature of this market is that operators will be registered with the Alcohol and Gaming Commission of Ontario, the regulator, and they will also have to sign a commercial agreement with iGaming Ontario, which is an agency that was created to manage the iGaming marketplace. This is required because under Canadian law, the federal criminal code states that all gaming in Canada is illegal unless it is conducted and managed by the provincial government and its agents. The commercial agreement with iGaming Ontario allows the operator to become an agent of the province of Ontario and thus satisfies that legal requirement. The market will also feature a revenue share model, 20% to the Government, 80% to the operator.

PAUL BURNS Canadian Gaming Association CEO & President

so far. Obviously, the simultaneous launch of both sports betting and online gaming creates a unique opportunity, especially for sportsbook operators that want to launch casino games with their offerings. Overall, the Ontario Government came at this with

"THE ESTIMATE WE HAVE HEARD IS ROUGHLY $1.5BN IN GROSS GAMING REVENUE PER YEAR." Being the fifth largest jurisdiction in North America, Ontario has a wide open market. Licensing will cost just $100,000 per year. It is ultimately a regulatory model based on the potential of outcomes. This puts a lot of the compliance pressure on the operators, with suppliers having to be registered but not quite licensed per se. In some ways this is more similar to a European-style market, rather than the ones we have seen in North America

the aim to enhance consumer protection and choice. This is why operators that previously existed and thrived in the gray market have been allowed to transition into this fully legal one.

How big can the Ontario market be? Any revenue estimates for the first year? We are not certain at this point. The estimate we have heard is roughly $1.5bn in

Will Ontario spur the rest of the nation’s provinces into launching? And will every province adopt the joint iGaming and sports betting idea? In regards to the second part of that question, no, I think each market is going to take a different approach. A lot will watch and see what the Ontario situation is. Will we see a replication of Ontario’s open market? My inclination is to say I don’t think so. I think we will see a version of tethered markets; this is partly because of Ontario’s high population. Along with population, there is a strong land-based tradition in a lot of provinces that the Government has to take into account. Other provinces will take on more of a hybrid method.

How will land-based – more specifically indigenous – operators be impacted by this launch? Each province’s approach to indigenous gaming is different. Ontario shares in revenue with First Nations. The percentage of this revenue is decided by the Ontario Lottery and Gaming Corporation and currently the province is in the process of negotiating a similar deal in regards to online revenue. The five land-based operators in Ontario are free and anxious to be in the online market. We want to see red tape disappear for these operators and a more streamlined approach arise. All the operators are working hard to enter the market. They already have strong customer bases and we need to make sure that the regulatory structures are in place for them, but it is still a work in progress. GAMINGAMERICA | 27

GAMING AMERICA | IGA REVIEW

THE SUN RISES ON THE WEST COAST Cameron Saunders of Gaming America made it out to the West Coast in April, to report on the Indian Gaming Association tradeshow. It was a joyous occasion, marked by relief that things were getting back to normal and much optimism for the future. A path cleared before Ernie Stevens Jr. as his hulking frame entered the tradeshow floor. At over six feet and nearly 300 pounds – a fact he announced to the assembled masses at the previous day’s luncheon – the Chairman of the Indian Gaming Association (IGA – formerly the National Indian Gaming Association) is a man whose very presence commands respect, if not awe. “His rings are the size of a regular man’s bracelets,” said one joshing commentator at the same lunch. Stevens, who is of the Oneida Nation of Wisconsin, is in his twenty-first year at the helm of IGA. As he walked across the floor that morning, he held a microphone to his mouth and announced the return of the 28 | GAMINGAMERICA

Indian Gaming Tradeshow & Convention (April 19-22, 2022, Anaheim Convention Center, Anaheim, California). Dressed in black, a line of braided hair falling down his back, he towered over most of his retinue, with the possible exception of legendary Dallas Cowboy defensive end and old friend, Ed ‘Too Tall’ Jones. Relief and rejoice were the notes struck in his words. Relief that the pandemic was subsiding; rejoice that the industry was once again openly convening. The 2021 NIGA convention was one in which smiles were hidden by blue masks, and its size paled in comparison to this year’s; the 2020 convention, of course, had been cancelled. But now people were no longer

afraid. Science and human ingenuity had allowed us to overcome the crisis posed by Covid-19, and the industry was ready to get back to work. “It feels wonderful,” said Conference Chair Victor Rocha. “Walking through those front doors, it feels like the pandemic never happened. Business is back. The booths are packed. It was a surprise that I almost didn’t expect. It’s almost emotional. We’ve been out of business for almost two years, we’ve been struggling, and this feels like we’re back.” Indicative of the tribal sector’s longer-term success even through the pandemic, Rocha went on to note that attendance had, in fact, grown over the last few years:

GAMING AMERICA | IGA REVIEW

“Attendance will be above pre-pandemic levels. Everyone is just starved to get back to business, and here we are. I think we’re all over the pandemic.” Walking around the tradeshow floor, one could find this refrain constantly repeated. The good vibes abounded. But first, education. Tuesday and Wednesday – the first two days of the festivities – saw no fewer than 54 panels informing attendees about a range of subjects related to the tribal sector. From these, I was able to learn (among other things): about the rise of tribal involvement in commercial operations as a way for economic portfolios to be diversified; about the debate surrounding cashless payments running through the industry, of how everyone wants to go cashless while maximizing profit but that there is disagreement about how to get there; I heard seasoned experts discussing the prospect of mobile sports betting coming to California, where it is on the ballot in November, and where the tribal stance on the issue is firmly in conflict with that of commercial operators; finally, there were panels covering issues tangential to gaming but important to tribes, such as the rise of the cannabis industry (which tribes, with their degree of reservation autonomy, are primed to exploit). 30 | GAMINGAMERICA

Thursday we walked the floor. I had my microphone in hand, my colleague was close behind with camera. We were there to interview the exhibitioners. And what interesting products – presented by some fabulous people – did we find… Brooke Fiumara of OPTX told us how good it felt to be back: “The show so far has been absolutely amazing. People are in great spirits. They’re excited to be here. You see people bringing their families, which is awesome, and you see people just wanting to connect. So, it’s a fabulous show.” Jean Venneman of Gaming Arts LLC told us that her company’s products had been well-received: “We have a cabinet that we launched at the end of 2021 called the VertX Grand Cabinet. That’s really been a focal point at this show. We have a couple of themes that we haven’t seen before. In other words, we have a world-debut going on here.” And then I asked Chris Wieners at Velvix what he hopes to get out of the show: “What we’re trying to understand is where gaming is headed from a tribal perspective here in the US. Post-Covid, obviously, there has been a lot of misconstrued information about where things are going. As a result, we hope to meet, not only with our peers and introduce our new products, but really

we hope to get a better idea of what the future of tribal gaming holds, here in California and across the United States.” That night were the parties, where people got liquid and galivanted effusively. It was a nice capstone to a good week, especially as the fireworks display exploded over Disneyland. The show came full circle for me later on Friday, as things were dying down and I saw him again: Ernest Stevens Jr. on the floor surrounded by his retinue. Now, instead of ‘Too Tall’ Jones, he was next to the equally formidable Laker great, A.C. Green. Despite his aura of intimidation, I did not hesitate. He assented and, five seconds into the interview, I could tell that he was a warm, big-hearted man. “I think that we’re getting back on our feet, and I think we’re doing it better than expected. We estimated last year that the overall sector was down 50%, which is a huge, huge hit on our industry. That we came out of this thing last summer at about 28% down was a major success on behalf of the operators, the businesses, the regulators and, most importantly, the tribal leadership… We’re still recovering, but we’re doing good, we’re strong and we’re excited. I’m excited that we can get back to work, get back to spending money, and get back to playing our games.”

GAMING AMERICA | AMELCO

"THE OLD VEGAS STYLE IS OUT" Gaming America sat down with Brandon Walker, Head of Amelco USA, to discuss the company’s designs on the American market and why he thinks Las Vegas-style odds are diminishing. In a macro sense, what are the biggest challenges facing sports betting operators in today’s climate? In the US, it is the fact that every state is different and regulated in its own way. It’s probably the single biggest constraint because it’s extremely expensive. If you want to roll out in a new state, you have to deal with all of the legal costs, you have to invest in all this new hardware. It would be ideal if you could run everything on one cloud and be able to service the whole of the United States. It’s a big barrier for entry. Market access across different states is also completely different: you may have plans for your operator to join 10 or 15 states but, in practice, that might not be possible. You’re dealing with all the lobbyists, you’re dealing with all the land-based casinos, you’re dealing with all the tribal casino laws. There are a lot of moving parts – a lot of barriers – and it will be interesting to see if it opens up in the future. But, before anything like this happens, it will likely become more complicated and constrained.

Do you find you need to change your product in a significant way from state to state? I wouldn’t say in a significant way, but I would say that different states have different demographics and different cultural features. For instance, you can go further down South and find that 32 | GAMINGAMERICA

BRANDON WALKER Amelco Head of USA

people are more into sports. In poorer areas of the country, you may find more of a parlay demographic. They might not have a huge amount of money to place up front, so they might put a $10 bet down and win $100 or $500. But then betting behavior changes. You go to New York City, and there will be people with more money, with $1,000 to place on a single bet. So I think it varies city by city. But, in terms of the product that sportsbooks are offering, I don’t think it has to change too much. I think all of the terminology is essentially the same across the United States. In terms of American odds style, I think everybody is familiar

with that across the country. And then you have retail versus online. In the former, people are used to an older style book, or Vegas style lines. But I think that’s being flushed out now. Right after PASPA – two or three years ago, when sportsbooks started opening up across the states – people who were involved in the Vegas scene were pushing what they thought was the way forward. Now the online way has taken over completely and the old Vegas style is out. Anyone who is still hanging on to the Vegas dream, to how Vegas operates, has already fallen behind. It will be interesting to see what happens with that: whether Vegas changes and adapts or if they stick to their ways.

That leads well into my next question: what do you think the American sports bettor is going to look like in 18 months’ time? Obviously, the way the younger demographic bets is different. They are very data driven and they understand sports very well. They watch a lot of it. At the tip of everyone’s fingers there is access to every event and every game. In the past it wasn’t necessarily like that. You perhaps followed your favorite teams or your home team and you’d bet on those. The age of bettors will get younger overall. Especially in the States, where college sports are so big. You’ll have these students who perhaps can’t bet just yet, but who will begin doing so a few years

AMELCO | GAMING AMERICA after school has ended. So I think in 18 months or two years we’re going to be seeing a lot of this younger demographic who are betting. In terms of pure access to knowledge, younger people latch on and understand much quicker, especially when it comes to technology. As these younger people earn more money, betting will grow. We haven’t even seen the tip of the iceberg yet.

Do you see the profile of online casinos rising in the US? How much does Amelco have riding on the success of these platforms? I think that the sooner the land-based casinos adapt and realize that online is going to be massive, the better. I do understand why land-based casinos are lobbying against online casinos – if I was in their shoes, I’d be doing the same thing – but they need to adapt and start providing these services before third parties and other operators start coming into the space; and offer advanced technology for iGaming. Since Covid-19, we’ve been seeing things like streamed table games provided by the likes of companies such as Evolution. People can essentially be playing blackjack, roulette, any table

game from the comfort of their own home. So, iGaming will definitely be a big player. Right now there’re only five states that permit it; but once that opens up, it’s going to be the next big wave in the industry. If you just look at the numbers in Britain and the rest of the world, you can get an idea of how big it’s going to be. I just hope the casinos can adapt and at least be part of the action.

"SO THEY MIGHT PUT A $10 BET DOWN AND WIN $100 OR $500. BUT THEN BETTING BEHAVIOR CHANGES." From Amelco’s perspective, we have a full online gaming solution. We don’t build our own games per se; but in terms of the lobby, the online casino, the technology, we have the ability to integrate every single third-party gaming provider into the platform. In the States, we have a live

social casino at the moment with Super Draft. We’re looking to roll out a few others in New Jersey and Pennsylvania in the next few months as well.

What do you think of the notion that one day in the not-too-distant future, betting on esports will be bigger than traditional sports betting? Esports is an interesting one. The hype around it, from what I understand, is presupposed by the notion that an esports bettor is different from a typical sports bettor. Esports attracts a much different gaming audience than traditional sports would. That’s not to say that it’s never going to be bigger. My reasoning, though, relies purely on the continued popularity of traditional sports. You only have to go to a college game across the United States and see that every stadium is sold out to know the popularity of traditional sports. People are going completely crazy. I understand that from an esports perspective, it happens indoors and it is a slightly different set-up, but I just struggle to see that happening anytime soon. It is an interesting space, so potentially in the future. It’s also a completely different experience. If you go onto a traditional sports betting platform today versus an esports betting platform, they are totally different products.

GAMINGAMERICA | 33

GAMING AMERICA | SPORTS BETTING

MARKETING GONE MAD: TOO MUCH PER CUSTOMER? As operators spend mountains of cash on customer acquisition, Gaming America speaks to industry experts to find out if this apporach is sustainable.

Mobile sports betting’s debut in New York at the beginning of this year was the most anticipated since the overturning of PASPA in 2018. Following the playbook used in states across the country, sportsbooks made a mad grasp for customers, offering deals and spending on marketing in a manner that defied the laws of economics: Caesars Sportsbook would match your initial deposit up to $3,000; FanDuel promised to refund losses of up to $1,000; at WynnBet, first-time bettors were able make a $10 deposit, place a $10 bet or parlay wager, and then receive $200-worth of free bets; and the list goes on. Such methods are effective ways for sportsbooks to bring in customers, to 34 | GAMINGAMERICA

establish a relationship with a bettor so that they will keep coming back. But these methods are also very, very expensive. On average, a major sportsbook using this heavy-handed marketing will spend $100-$150 per customer. And still the results are dubious: DraftKings, for instance, dropped $1bn on marketing over the course of 2021 yet is still not profitable. Its share price may sustain itself, but its profit/loss margin remains in a stale, slumping funk. It is so expensive that sportsbooks across the nation – even in ludicrously active markets such as New York – are struggling to cut a profit. Some have already started adjusting their marketing strategies. Caesars, for instance, spent wildly after New York

went live in January to claim a market share on par with what is normally achieved by the big two – FanDuel and DraftKings. The gambit worked. Caesars was second in New York, behind only FanDuel. But its place came at a steep price, a fact not lost on shareholders: within hours of announcing that it would be curtailing its advertising spend, the company’s stock price was up by 6%. Defenders of these marketing ploys are adamant that these are temporary measures, put in place to try and stake a claim in what is still a fledgling industry, a Wild West-like market that is yet to reach full maturity. No one, after all, really knows what the future of the industry looks like. But for how long

SPORTS BETTING | GAMING AMERICA

"LASKOWSKI AGREES THAT MARKETING MUST BECOME MORE DATA-DRIVEN IF BETTING OPERATORS ARE TO BE VIABLE IN THE AMERICAN MARKET."

can this marketing madness continue? What purpose does it serve? Is it creating a mirage, whereby marketing dollars prop up the entire sports betting industry? And, since it is indeed unsustainable, what comes next? Kyle Scott Laskowski, who as VP of North America Sports for large affiliate XLMedia, is uniquely positioned to detect patterns and project future trends in the industry. He is adamant that there is no mirage and that, thus far, the marketing has been adequately fulfilling its purpose. But, seeing the issue in terms of loan-to-value (or how much is spent against the worth of your holdings), he concedes that the verdict is still out surrounding how well it works. As Laskowski told Gaming America: “If the

primary goal of the ad spend is to acquire customers, and that is in fact what happens, then the effort is successful. It all depends on loan-to-value, and at this point, I’m not sure anyone really knows long-term player value.” In order to play the game, you must take the long view. “If you listen to DraftKings talk, they claim to be profitable by year 3 or 4 in New Jersey and Pennsylvania. That means that short-term losses, even large ones, will break even in a few years.” It is a sad irony, though: just as the major sportsbooks need to be trimming their sales and spending less on advertising is also when attracting new customers is going to be increasingly costly. Much of the initial spike

in sports betting came from people who had been placing bets for years, albeit illegally and in an unregulated market. Now that they are on board, how will the customer base continue to grow? Bill Miller, the President of the American Gaming Association, summarized this conundrum neatly to Gaming America: “We saw last year that there was a huge spike in the early weeks of the NFL season; but then, as the season went on, you saw a decline. Once you get the low-hanging fruit, the early customers, all of a sudden it becomes harder and harder to convert someone who is watching an ad into a customer.” Some, though, emphatically disagree with this indiscriminate marketing. Some GAMINGAMERICA | 35

GAMING AMERICA | SPORTS BETTING even scorn it. Enter Thomas Rosander, CEO of Real Luck Group, an esports stalwart out of Europe that has also ventured into the much-hyped Ontario sports betting and iCasino market. He was blunt when asked by Gaming America if this aforementioned marketing approach was sustainable: “No. I think companies have very little imagination, this is what they know – they have the money – so they are trying to gain as large a market share as they can.”

"DEFENDERS OF THESE MARKETING PLOYS ARE ADAMANT THAT THESE ARE TEMPORARY MEASURES." Rosander sees a better way. It is a way, however, that requires not just adequate data models, but also control over that data, something which the big players in the field most certainly have. It’s also about having a relationship with traffic sources, i.e. affiliates of the European mold. He goes on: “What we do is buy traffic and then make sure we have a margin on it; because there are a lot of traffic sources out there. They are mainly interested in the smaller brands. They send traffic to the big ones, too, but it’s all about conversion and retention. If you develop your conversion/retention together with traffic sources, it’s of course better than just having a big black box where you send your traffic. This way is more concentrated and coordinated.” With these targeted methods – and not the heavy-handed acquisition of customers – Rosander believes he has the right vision: “For us, I see an opportunity. There is a chance for us to do what we want to do. I see a lot of panic now in the business. For 36 | GAMINGAMERICA

KYLE LASKOWSKI XLMedia VP, North America Sports

instance, we saw Penn National buying theScore for an insane amount of money. That is such a clear indication that they are thinking: this is so expensive, what are we going to do? Ah, we will buy a big user base.” Laskowski agrees that marketing must become more data-driven if betting operators are to be viable in the American market: “At XLMedia, we own and operate and network of websites, along a network of partner sites, and work with sportsbooks to refer them players. We are only paid when a player signs up a deposit — this is a much more efficient and trackable route than spending millions on a TV ad. So I think you’ll see more targeted spends over the long term.” The general verdict is that this ‘spend large’ model will continue to be the status quo, especially with states that are newly arrived on the market. It helps to remember that sports betting is active in just over half of the states in the country, and that there are still major markets – some would say the major markets – to come on board. NASCAR Sports Betting Managing Director Joseph Solosky noted: “As states legalize, and this is not a fully mature market in terms of where you can be and where you can operate, it will continue to ramp up; especially in states like Texas and California,

whenever they legalize. But it will definitely taper down over time and we’re already seeing that in terms of individual cases.” There is still a final element to this debate: the issue of problem gambling. This avaricious marketing, detractors claim, encourages sports betting in an irresponsible manner. Here is $1,000 in refunds, $300 to spend on sign-up, let us get our tentacles wrapped around you while you are still vulnerable and unsure. Let us plaster you with ads before a championship game which, previously, you had never thought to bet on. Scruples inevitably emerge. And this is something that gaming companies must worry about because, despite any stereotypes, problem gambling is not good for business. Keith Whyte, Executive Director of the National Council on Problem Gambling, firmly believes in the negative potential that aggressive advertising can have on the bettor. “Unfortunately, the culture of the United States is such that this advertising has very few restrictions. For instance, language around risk-free bets is incredibly popular. We don’t support that language. We think categorizing that language as ‘risk free’ is highly misleading. We do see marketing spend tamp down once a market starts to mature. And I don’t know if these offers are going to be here for a long time, or if they’re necessarily sustainable; but, at the moment, many Americans who are new to sports betting are being bombarded with ads that may have sufficient negative impacts because of the way they’re characterizing sports betting.” So, the dialogue appears to be evolving. There appear to be two approaches to marketing. The first is the marketing blitz that comes as states go live. This approach is marked by great expense, one which cuts into the ability for major operators to turn a profit. As well, the specter of problem gambling rises with this blanket marketing. The second is far more targeted and data-driven. It seems to be showing a path to what marketing will look like in a more mature market when, hopefully, sportsbooks will figure out how to be profitable.

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GAMING AMERICA | NEW YORK

IGAMING STATE OF MIND With mobile sports betting in New York a roaring success, we look to the future and consider what iGaming could look like in the Empire State. In its first month of operation, New York became the nation’s leading mobile sports betting market, generating over $70m in tax revenue and collecting almost $2bn in wagers. This staggering handle led to around $138m in gross gaming revenue as 1.76 million separate users logged into sports betting apps throughout the state. Undoubtedly, New Yorkers have a taste for gaming, and despite a tax rate that exceeds any of the country’s other states, operators do too. With this success comes whispers of expanding the Empire State’s offering beyond just that of sports betting and into legalized iGaming, otherwise known as online casinos. This would allow players to play poker, slots and blackjack from the comfort of their own homes. The legalization of iGaming would make New York one of just a select few states with a regulated online casino market, bringing in crucial tax dollars and allowing it to compete with its neighbors who have

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already embraced the sector. So, what would a regulated iGaming market in New York look like? What are the challenges it faces? And can we expect to see the state launch in the near future? We spoke with the man who proposed the bill to find out.

THE PROPOSAL A number of politicians throughout the New York Government have voiced support for a legal and regulated iGaming market in the state. The leading proponent, however, is Joseph Addabbo Jr, a State Senator for New York. Addabbo, who also played a key role in the state’s launch of sports betting, has put forth Senate Bill 8412 to the Empire State’s Racing, Gaming and Wagering Committee; and is looking to see the legislation discussed before June.

Bill 8412 proposes a fully regulated, but limited in terms of licensed operators, iGaming market that would allow citizens to play casino games from home. This bill suggests a 25% tax rate for operators, far less than the 51% sportsbooks are currently paying. “Building upon the success of mobile sports betting in New York, we see that there is an appetite to launch a regulated and safe form of iGaming or online casino using a mobile device,” Addabbo told Gaming America. “Other states are already doing this very successfully. With the outbreak of the Covid-19 pandemic, we saw a lot more people want to gamble from the comfort of their own homes.” To gain access to the state’s market, operators would have to go through a similar, and equally rigorous, process as they did when bidding to become one of New York’s nine regulated sportsbooks. “We don't want a proliferation and over-saturation of the market. It will be very similar to the

NEW YORK | GAMING AMERICA way that it was done by the state’s Gaming Commission in terms of sports betting, which was very well done,” Addabbo continued.

THE BENEFITS Addabbo believes that this proposal could bring the state between $475m to $500m a year in tax revenue. This is not a far-fetched number, especially considering the size of the New York market (it is the fourth most populous state in the Union) and the iGaming sector in general. Indeed, according to the American Gaming Association, iGaming grew by 475% in 2020-2021, seeing revenue reach $399.5m in January 2022. Moreover, fueled by the launch of iGaming in one of New York’s closest neighbors, Connecticut, online casino revenue reached $3.7bn in 2021 alone. Impressively, this revenue came from just five states. There is also the pertinent fact that much of this yearly revenue comes directly from New York’s borders, notably New Jersey and Connecticut. With that in mind, a legalized iGaming market in the Empire State would theoretically both increase state revenue and put the region on equal footing with its closest competitors. Where will this money go? $500m per annum is a lot of cash, and many in the state would be against all that money being funneled back into the gaming

industry. Addabbo argues, however, that almost all of these funds will go towards education, an impressive 90% in fact. Resolving the state’s problem gambling issue will also be a focus should iGaming be approved. This bill calls for $11m per year to be spent on the prevention of problem gambling, almost double that of what the recently approved sports betting legislation asked for. Speaking on this, Senator Addabbo told Gaming America: “There is always an addiction issue, problem gambling needs to be at the forefront of the discussion and it is for me. Think about it this way, if we wanted to help a New Yorker who has a problem gambling issue but bets in another state, we can’t. Once iGaming is regulated you can help people who are addicted and are already gambling today."

THE CHALLENGES The benefits are there for all to see; more revenue, increased educational funding and the ability to address problem gambling issues that now go unnoticed, but what challenges will iGaming face before it can go live in New York? The first is, as with all attempts to pass legislation, timing. Addabbo suggests that this current attempt to pass the law may have come too late to be discussed and approved by June. However, the Senator

is confident that by next year, preparations to launch the market will be well under way. “It isn’t a question of if, but when,” Addabbo remarked. Despite the overwhelming success of sports betting, some in the state’s government are still resistant to the incoming wave of gaming. This is not surprising, but these dissenting voices are beginning to quiet, as the results of the state’s existing gaming market coalesce with the sheer amount of revenue being made by New York’s neighbors, to create an undeniably compelling argument for iGaming. Lastly, from an operator’s perspective, there remain some questions over how profitable this market actually is for them. Specifically, if we examine the current numbers out of the region’s sports betting industry, we can see that a number of operators are making impressive strides, notably FanDuel, DraftKings and Caesars Entertainment, while the other six operators have failed to hold more than a 3% market share. Should this remain the case for iGaming, some operators may avoid New York, given the huge advertising budgets needed to break into this highly competitive market. When one examines these facts, the pros and cons, the money available and the people that can benefit from a regulated iGaming market in New York, the coming of online casino ultimately seems inevitable. Indeed, while we may have to wait to see the industry fully realized, New York has been compelled by its neighbors’ undeniably successful iGaming markets to enter the fray.

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GAMING AMERICA | EL CORTEZ

EL CORTEZ HONORS ITS HISTORY WHILE LOOKING FORWARD This downtown Vegas icon is the only standing casino on the National Register of Historic Places; today, it looks to the future. Thanks to Hollywood and the 1991 movie “Bugsy,” many people believe the glory days for Las Vegas began with the opening of the Flamingo Hotel Casino in 1947. However, the honor really goes to El Cortez, which was the first casino resort in Downtown Las Vegas when it opened in 1941. Today, El Cortez is the longest continuously operating casino in Las Vegas, and the management and staff are fiercely proud of the history behind the property. For proof, look no further than the fact that 47 rooms of its total 360 are “Vintage Rooms” that date back to when the original structure was built 81 years ago. The Vintage Rooms have a cult following and

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are frequently requested by guests. They are located on the part of the property closest to the corner of 6th and Fremont, beneath the iconic El Cortez neon sign that has been in place since 1952. They are reachable by a narrow stairwell that begins next to the craps tables at the heart of the casino. General Manager Adam Wiesberg invited Gaming America to El Cortez on National Blackjack Day, March 2, to announce a long-awaited facelift for these living bits of history. After eight decades,

the floorboards were a bit squeaky, and some other signs of age were showing, so all Vintage Rooms closed in April for an overhaul that is expected to be completed by this fall. “We have wanted to remodel them for some time but there are challenges with remodeling an 80-year-old building,” Wiesberg said with a laugh. Two Vintage Rooms already received their facelift, and were shown to outsiders for the first time on March 2. “We are limited as to how much we can do to the structure, but our mock-up rooms look amazing, and we cannot wait to welcome guests into those new rooms,” Wiesberg said.

EL CORTEZ | GAMING AMERICA

"THAT HISTORY IS VERY IMPORTANT TO US, AND WE FEEL A RESPONSIBILITY TO PRESERVE IT THE BEST WE CAN." AS NOSTALGIC AS VEGAS GETS Las Vegas is well known for continually reinventing itself, and one consequence of that mindset is older casinos are demolished and replaced, not venerated and preserved – even those that were extraordinarily popular in their heyday. Just to name two examples that used to be kings of The Strip, Bellagio was built where the Dunes used to reign, while across the street Venetian and Palazzo loom over the long dead bones of the legendary Sands. Many of the casinos that have survived and still are on their original sites bear little or no resemblance to their humble beginnings, such as the Flamingo, Tropicana or even Caesars Palace. All of which makes the longevity and continuity of El Cortez all the more remarkable, and its history rather compelling. According to a timeline carefully tracked by the casino’s marketing department, El Cortez was built in 1941 when John Kell Houssels partnered with John Grayson and Marion Hicks, the latter a Los Angeles architect and developer. Construction cost $245,000, and the result was a resort with 59 rooms that was designed in a Spanish ranch theme. In 1945, El Cortez was sold to some of its most notorious owners: Gus Greenbaum, Meyer Lansky, Moe Sedway and Bugsy Siegel (later investors in the Flamingo) purchased it for $600,000. Geoff Schumacher from the Las Vegas Mob Museum recently confirmed El Cortez was the first hotel casino in the city to be owned by the Mob. In 1946, Houssels reacquired El Cortez. He and partner Ray Salmon tacked on a $250,000 expansion that included a

barber shop, nightclub, swimming pool and a four-story wing. The property then underwent a remodel in 1950. In 1952, the “new” Hotel El Cortez held its grand opening. The property’s neon arrow, marquee and signature sign were installed and still shine on the property to this day. Over the years, El Cortez has undergone numerous renovations to the interior of the hotel but has maintained the same façade since the early fifties. Eleven years later, in 1963, Vegas legend Jackie Gaughan purchased El Cortez from Houssels for $4m. Gaughan maintained ownership of the hotel casino for five decades, and resided at the hotel until his death in 2014. Gaughan is credited with being instrumental in the development of Downtown Las Vegas. At one point in time, he owned one-third of the land in the area. His residence at El Cortez is described as a time capsule, with much of the suite preserved as it was in the 1980s. This includes a pale pink-and-gold interior, dramatic lighting, statement furniture pieces and more, all of which combine to transport guests into a different era. The Gaughan Suite is kept alive as a hidden gem, located on El Cortez’s 15th floor and available to book by special request only. Speaking of the Eighties, the El Cortez Guest Tower II was built in 1980, bringing the hotel’s overall room count to 297. The next major upgrade took place in 2006, when El Cortez renovated the casino and its guest room interiors. In 2007, all Downtown properties got a tourism boost when the Fremont East

Entertainment District became official. There now is a trail of trendy bars and restaurants leading visitors from the cluster of casinos on Fremont Street to El Cortez, a few blocks east. One year later, in 2008, Gaughan sold El Cortez to his longtime family friend, partner and gaming pioneer, Kenny Epstein. Since then, the property has been one of only a few family-owned and operated hotel casinos in Las Vegas. In 2009, El Cortez added 64 El Cortez Cabana Suites in the former Ogden Hotel, bringing the property’s room count to 364. El Cortez completed a $25m renovation just in time for its 80th anniversary celebration in November 2021. As part of the remodel, El Cortez revamped the casino floor with brand new ceilings and a woven Axminster carpet by Brintons, a renowned manufacturer. When devoted El Cortez guests heard its vintage rose patterned carpet was to be replaced, thousands flocked to the hotel to purchase a square of the carpet they knew and loved from years past. Other features from this extensive renovation included 200 remodeled, premium tower rooms and suites that inspire a modern take on historical themes. The suites are said to draw inspiration from the Spanish Colonial Revival era, with decorative elements including black-and-white floor tiles, traditional-style rugs, modern accent furniture, and carved wood details. El Cortez also unveiled a new high-limit room and an updated hotel lobby in 2021.

BALANCING PRESERVATION WITH MODERN COMFORT Wiesberg told Gaming America the latest renovation was no small task. “Our Tower was originally built in 1980, and it has seen various updates with new carpet, paint and furniture over the years,” he recalled. “But in 2021, we did a complete remodel, costing about $100,000 per door. We removed material down to the framework, so everything is truly brand new. The Tower rooms offer great views of The Strip and surrounding GAMINGAMERICA GAMING AMERICA | 41

GAMING AMERICA | EL CORTEZ mountains and now include a modern design that maintains the authentic, vintage Las Vegas experience El Cortez tries to preserve.” Asked to describe the balance of venerating history and offering guests a comfortable stay, Wiesberg noted El Cortez not only was the first casino resort built Downtown, it is the only standing casino listed on the National Register of Historic Places. It received the honor on February 22, 2013. “That history is very important to us, and we feel a responsibility to preserve it the best we can,” he explained. “We rely

on our team to produce brand new, modern designs and fixtures but we insist the authentic, historic feel to come first.” On National Blackjack Day, Wiesberg reported El Cortez had 15 blackjack tables, eight of which were single-deck, with five double-deck games and only two six-deck games – a highly player-friendly mix in an era of analytics pushing for a higher house advantage. According to Wiesberg, making single deck and double deck blackjack available is a sign of loyalty toward existing customers, and a way to attract new customers who research “best blackjack in Vegas” online.

"WE RELY ON OUR TEAM TO PRODUCE BRAND NEW, MODERN DESIGNS AND FIXTURES BUT WE INSIST THE AUTHENTIC, HISTORIC FEEL COMES FIRST."

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“El Cortez benefits from being owned by true casino pioneers and great operators. Our current CEO, Kenny Epstein, was partners with Jackie Gaughan, so the property has really been under the same operating team for decades,” he said. “We have always been known for great value and it has served us well and will continue to be a primary focus. What really sets El Cortez apart, though, is the personal attention we provide, and the unique, authentic experience guests can find here that can’t be found in any other property.”

GAMING AMERICA | THE INNOVATION GROUP

TURNING TIDES We hear from Mike Vanaskie, Vice President, International Development at The Innovation Group, on whether the Caribbean is the next land-based opportunity for US operators. Throughout The Innovation Group’s history, we have helped our clients look at numerous gaming development opportunities in the Caribbean. Interestingly, many of these developments have yet to come to fruition and when compared to our work in the domestic US, there is a vast difference in the ratio of that outcome. There are many reasons why gaming-related development in the Caribbean, especially from US-based operators and developers, has remained minimal – everything from natural disasters to funding issues for emerging markets. Perhaps the most common reason is that many of our clients simply had higher priorities in their development pipelines. The tide may be turning, however, as a confluence of trends make us consider whether the Caribbean is the next, great, land-based opportunity for the gaming industry.

TRENDING UPWARDS While few markets were hit harder than the Caribbean from the abrupt halt of tourism during the Covid-19 pandemic, some Caribbean markets are seeing strong recoveries in arrivals and many Caribbean countries are looking for creative ways to grow tourism arrivals to pre-Covid levels and beyond. For example, many countries have enacted “work-from-home” visas to encourage remote workers to travel to the islands and work remotely. Many island nations are hopeful these infrastructure improvements

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MIKE VANASKIE The Innovation Group VP, International Development

and favorable incentives will attract developers and their investment dollars. It is well documented that major casino developments can generate incremental increases in tourism, which put gaming resort developers in a favorable light for Caribbean governments. Turning to stateside trends with positive implications for the Caribbean, the first is the growing number of direct flights to Caribbean locales, Covid-19 impacts notwithstanding. Not only is the number of direct flights to the Caribbean growing (with some destinations having 20 or more direct arrival flights per week from the US),

the number of domestic airports with direct flights is growing as well. The continued westward expansion of direct flights opens up the Caribbean trip as a realistic, high-value-gamer reward to an increasing number of domestic operators. As the number of flights to the Caribbean from the US increases, land-based gaming development opportunities stateside continue to dwindle. Where development opportunities do exist, they often result in more competition, leaving existing and new operators to compete for pieces of a pie that is only slightly larger. Offering a Caribbean outpost as a reward for an operator’s highest value players – and being able to own the player experience – could prove to be a key competitive differentiator for increasingly competitive domestic markets like Chicagoland.

EARLY ADOPTERS There have been a number of domestic developers and operators diving headfirst into Caribbean waters in recent years. One such company is Wind Creek Hospitality of the Poarch Band of Creek Indians. According to Arthur Mothershed, Executive Vice President of Business Development and Government Relations, and Olena Nall, Director of Business Development, Wind Creek began looking at development and acquisition opportunities outside of its home state of Alabama as early as 2012. It wasn’t until several years later that the Caribbean market came on their radar. “We

THE INNOVATION GROUP | GAMING AMERICA EXISITING CARIBBEAN LAND-BASED GAMING MARKETS

Source: Casino City, The Innovation Group NOTE: BUBBLE SIZES ARE BASED ON THE NUMBER OF EXISTING GAMING MARKETS had been sending players to the Caribbean for years and were looking for ways to diversify our land-based gaming revenue stream,” explains Mothershed. They were made aware of two casino resorts looking to sell – one in Aruba and the other in Curaçao – and closed on the acquisition of both properties in May 2017. “The properties were making money prior to our acquisitions and we were able to plan renovations around seasonal tourism lows,” says Mothershed. Complimentary trips to Aruba and Curaçao are now published benefits for Wind Creek’s highest player tiers. As far as player behavior at the Caribbean properties, Mothershed offers a straightforward summary, “when the sun shines, they’re in the sand… when the sun goes down, they still go to the casino.”

KEY CARIBBEAN CONSIDERATIONS There are a number of factors developers and operators must consider when assessing Caribbean market opportunities. First, there is a different development equation for Caribbean resorts compared to domestic US properties. While non-gaming amenities can be subsidized by significant gaming revenues at many US resorts, the Caribbean casino

is very much an amenity versus the leading development component. Even the highest-grossing Caribbean casinos – the Atlantis and Baha Mar, which generated a combined gross gaming revenue of more than $260m in 2019 – are still not the primary drivers of resort revenue and visitation. It’s worth noting that the US development equation may be transforming to something that’s closer to that of the Caribbean, with more and more of our domestic clients engaging us for non-gaming expansion assessments and more Vegas-like (non-gaming driven) development visions. Developers and operators must also consider the goals of host nations. Many Caribbean nations do not want casino gaming as their respective face of tourism. A more nuanced development and marketing program, placing less emphasis on gaming is often necessary. There are other important development options to weigh, such as whether to pursue a greenfield development or enter the market via acquisition, such as Wind Creek’s strategic decision. As for operations, an operator must consider whether to be the sole resort operator or take a specialist’s

approach and focus on gaming only. Finally, developers and investors would be wise not to ignore the countries with limited gaming or those that have yet to legalize or implement casino gaming. It may be easy to focus on the proven Caribbean gaming markets of the Bahamas, Dominican Republic and Puerto Rico, with historically high levels of tourist arrivals, numerous casinos and market-leading gaming revenue figures. As this article has touched upon, however, many Caribbean countries are looking for new ways to fuel tourism growth and islands that are less apparent gaming destinations could create equally compelling opportunities. As the world emerges from Covid-19 and travelers reengage with their domestic and international travel habits, tourism will continue to recover and grow beyond pre-pandemic levels, including tourism to the Caribbean. For US land-based gaming developers and operators, the Caribbean market presents opportunities to create a competitive advantage within your home domestic markets, diversify your geographical revenue exposure and drive brand awareness on an international scale. GAMINGAMERICA | 45

GAMING AMERICA | IGA

TALKING SPORTS, TALKING MEDIA Clifton Ma, Casey Clark and Sara Slane discuss the importance of media partnerships between sportsbooks, teams and leagues.

The Convergence of Gaming, Sports and Media was a panel held at the 2022 Indian Gaming Association Tradeshow & Convention. Moderated by Brendan Bussman (Managing Partner at B Global), it consisted of three industry players discussing a vital aspect of the sports betting world: media partnerships in the furtherance of the industry. Clifton Ma (VP of Partnerships/ Strategic Initiatives at FanDuel), Casey Clark (SVP at the American Gaming Association), and Sara Slane (Founder at Slane Advisory) all appeared on the panel. An abbreviated transcript follows.

there isn’t a much better entry point. I also think they saw the value of working with the teams, along with other people who could bring them along and help educate them. From our standpoint at the American Gaming Association, it’s important that we make them understand how to do this the right way – not for them to hurry up and get involved in the business – and that takes some time. We continue to do that every day: to teach how to behave in this environment in a responsible way and create a sustainable marketplace that’s going to be good for everybody.

How have the views of professional sports leagues evolved regarding the matter of partnerships with betting operators?

And how about the role of the teams? What role do they play?

Sara Slane: They’ll tell you they’re dipping their toes in the water. I think they’ve probably got a foot in the water at this point, but they’ll probably be all the way in – with their bodies in the water – at some point soon. As far as the partnerships are being structured, it’s a natural evolution. Casey Clark: I agree. I think, once they realize how much money there is to be made, 46 | GAMINGAMERICA

Clifton Ma: It’s worth calling attention to both leagues and teams. With teams, for us it’s about brands, something that can be awareness or affinity. It’s also about some level of activation. We’re getting some people to sign up or to convert. And then it’s also about our VIP experiences, and whether that’s access to games or to something else. We want to make sure we are catering to a certain subset of our users in a way that makes them feel special. Teams are

essentially an aspect of marketing. In the same way that when we enter a new state, we determine whether to buy TV or radio space or print advertisements, teams are an alike consideration. It doesn’t mean we’ll do a team deal every time we enter a state; it’s just a core part of what is important to us as we seek to elevate our brand.

How do you talk to a team about how they enter this space in an appropriate manner? Slane: The perspective that I always try to bring is the operator point of view: that death-by-a-thousand-cuts is not going to work. It really should be viewed through the lens of a partnership: what should be good for the team and for the operator is going to benefit everyone. Sometimes what ends up happening – and thank you for making a distinction between the leagues and the teams – is that the leagues are the sort of grandparent of the teams, setting the tone and the rules for how the teams can engage from a commercial perspective. What’s nice about this arrangement is that the leagues provide some form of regulation for the teams (unlike in Europe). The leagues dictate

IGA | GAMING AMERICA

"THE LEAGUES DICTATE WHAT THE TEAMS CAN DO AND HOW THEY CAN MONETIZE OFF OF OPPORTUNITY - ADVERTISEMENTS, PLACEMENTS, RESPONSIBLE GAMING MEASURES THAT NEED TO BE PUT INTO PLACE, ETC."

what the teams can do and how they can monetize off of opportunity – advertisement placements, responsible gaming measures that need to be put into place, etc.

What is the significance of pushing responsible gaming measures in these partnerships? Clark: I think part of the education that has happened with teams and leagues over time has been making them understand what their responsibility really is in this space, in order to create that viable market. It’s not just about how you activate the most commercially viable opportunity you can get your hands on, but how do you build something that the community will like; that will engage fans meaningfully and not detract from the experience for fans who don’t like to have gaming as part of their sports experience. For us, it was very focused on consumer education: that people now seeing sports betting content during their baseball or football watching experience knew how to adequately respond to it. A lot of people are avid gamblers or sports bettors and they understand how to react to that, but a lot of people are watching it for the first time.

We built a public service program called Have A Game Plan. We have 30 partners, including operators, leagues, teams and other providers involved in the ecosystem of sports betting. This brings everyone together around the common theme of sports betting.

Can you speak about some specific partnerships that have come about between leagues and operators? Ma: The Phoenix Suns partnership with FanDuel was an interesting one that literally happened on the concourse of the United Center in Chicago during All-Star Weekend. We got an email from the Suns saying, "we’d love to talk about what’s happening in Arizona [mobile sports betting was on the cusp of becoming legal]." So we met and we talked, and it was a lot of conversation around education; what do you think is going to happen here, or notes about what they were hearing from the Governor’s office. I think what we realized was that there was an opportunity to partner with a group like the Suns. The interesting thing about the Suns for us was that they had a lot of assets – such as the arena,

which is under its control – but it also controlled its regional sports network inventory. By controlling the broadcast, you were able to take one aspect of the market – buying media surrounding the local games – and create incredible market access for yourself.

MODERATOR BRENDAN BUSSMAN BGlobal Managing Partner

IGA PANEL CLIFTON MA FanDuel VP of Partnerships/ Strategic Initiatives

CASEY CLARK American Gaming Association SVP

SARA SLANE Founder Slane Advisory GAMINGAMERICA | 47

GAMING AMERICA | PASPA

A BRIEF MEDITATION ON LIFE AFTER PASPA Sometimes monumental change can happen both gradually and suddenly. Cameron Saunders of Gaming America takes a look back at life since PASPA’s 2018 overturning in the hope of gaining perspective. The levees broke on May 14, 2018. It was on that date that the United States Supreme Court overturned the Professional and Amateur Sports Protection Act of 1992 (PASPA). The upending of the act – a move instigated by a state of New Jersey looking to allow sports betting in what was its otherwise surefooted gaming landscape – opened the floodgates to the widespread legalization of sports betting across the nation. Lawyers arguing on the side of the Garden 48 | GAMINGAMERICA

State cited the Tenth Amendment which, since its promulgation in 1791, has been widely considered the most potent distillation of the principle of federalism. Anyone who has sat through eighth grade history knows that federalism protects the rights of states to regulate themselves in matters not otherwise delineated in the Constitution. States’ rights, baby. In this case, it was the right of states to regulate sports betting. After PASPA fell, the strictures melted away,

and it seemed as though a carefully erected domino set was crashing down across the nation. With every fallen piece came new markets to open, more money to be made. Rarely in American history has such a dynamic industry so suddenly emerged out of nothing. In the four short years since PASPA was overturned, sports wagering has become available in 33 states, while people can make legal bets on their mobile devices in 18 states. According to one tally by the US Census Bureau, these

PASPA | GAMING AMERICA markets have opened gambling to 166.9 million people (very nearly half of the entire population). And there is much more to come. On the very day I write these words at the end of April 2022, lawmakers in both Kansas and Massachusetts have given the green light to mobile sports betting, all but ensuring this pastime’s arrival in these states in the not-too-distant future. Nor have all the golden eggs been found: while New York – which went live in January of this year – is currently the national leader, there are still large swathes of the sports-mad South where the fate of sports betting continues to hang in the lurch. Texas – a nation unto its own – will still have to wait until 2023 before discussion can commence, due to its bizarre practice of having the state legislature meet

of PASPA, none perhaps stand out as much as the experience of sports fandom in the United States. At first, when the reality of legal sports betting began to set in, both teams and leagues were adamiant in their objection, seeing nothing but controversy and divisiveness ahead. That was before they realized how much money was to be made... Now when sports betting goes live in a given state, teams are eager to strike partnerships with betting operators, for this is the best way to maximize profitability. Today, one cannot watch sports in large parts of America without being reminded – through TV ads, sponsorship deals, what have you – of the rising star of this industry in American life. Traditional sports fans will always be marked by loyalty and

"NOW WHEN SPORTS BETTING GOES LIVE IN A GIVEN STATE, TEAMS ARE EAGER TO STRIKE PARTNERSHPS WITH BETTING OPERATORS, FOR THIS IS THE BEST WAY TO MAXIMIZE PROFITABILITY." every other year (only three other states do this). California is the largest state in the union and has the issue of sports betting on the ballot this November. Of course, sports betting as an industry has undergone such breakneck growth in large part because it was already so popular, albeit illegal. The American Gaming Association today estimates the illegal gambling industry to be worth $150bn. It used to be that gambling fell under the shadow of vice. In this, it shares much with the fledgling cannabis industry in America: where the removal of moral opprobrium has created a legal and regulated juggernaut overnight. Of the many things in society that have been affected as a result of the overturning

devotion – hometown pride – but what we see emerging is a new species of viewer, something which the leagues are happy to encourage. A viewer who cultivates the pastime of betting will watch a game regardless of loyalty. If they happen to have money riding, they will watch mighty attentively. Indeed, it is a fact that, with the rise of betting in America, sports viewership has been on the rise. In the year prior to the overturning of PASPA, the National Football League saw its most sluggish ratings of the previous decade: according to Forbes, per game, viewership for the 2017-2018 season was down to 14.9 million, a 10% dip over just the season before. Then

came PASPA. Besides the disastrous season of pandemic, viewership is up 20% since 2017. The 2021-2022 season – when sports betting is more popular than ever before – saw games average 17.9 million viewers per game. The same can be said for all sports that are favored by American bettors. Leagues, no doubt, are pleased with this return to form, and you will not hear them complaining about the proliferation of sports betting anytime soon. But it wasn’t just viewership for the teams and league. Entire cottage industries have sprung up as a result of sports betting, opening new avenues for the fulfillment of capitalism and free enterprise. Private equity in the realm of sports has been having a field day. Operators have been importing European technology en masse, Europe having had betting for far longer and, therefore, already in possession of a robust technological infrastructure. Homegrown infrastructure – those B2B systems that connect operator with bettor – have proliferated. PASPA has not affected sports betting alone, rather its repeal planted a seed that will ultimately produce an industry that will rival, if not surpass, the sports wagering segment. IGaming, which at time of writing is live in six states with more on the horizon, has been called the true prize of the American gaming industry and would not be as far along on its journey without the 2018 PASPA decision. Indeed, with its resistance to the seasonal whims of sports betting and lockdowns that close casinos and sportsbooks, and its appeal to the youth, who are every day gravitating away from traditional sports, online gambling has the potential to be the United States' most potent gaming offering. Currently, New Jersey, Connecticut, Pennsylvania, West Virginia, Michigan and Delaware allow players to play online casino games. Together, this limited selection of states raised profits of almost $400m in January alone, according to the American Gaming Association. Perhaps even more impressively the nation’s market earned $3.7bn in 2021. These numbers pale in comparison to what may be on the horizon, however, with New York contemplating the GAMINGAMERICA | 49

GAMING AMERICA | PASPA legalization of iGaming. The Empire State has already seen the boon that is online sports betting, with it generating handle of $2bn in a single month of legal wagering, and many in the region believe iGaming could be even more profitable. Joseph Addabbo Jr, a New York State Senator, is one such man. He has proposed Bill 8412, a call for the legislature to implement a fully regulated iGaming market before the end of the year. Addabbo claims that this new market could bring in around $500m in state revenue per annum. Ultimately, none of this would be possible had PASPA not been repealed back in 2018. It opened the

door not only for legal sports betting, but an industry that appeals to the American youth and is unaffected by pandemics. With this we see the far-reaching effects that the 2018 decision had, changing the gaming landscape, in all aspects, for good. In the end, the online casino sector is preparing itself to be the next big thing as betting goes mainstream. And, finally, the land-based sector is reaping benefits from the growth of betting. One can only wonder what the next four years will bring (besides more open markets) as sports in America continues to be recast in the light of legal betting.

"AS OPERATORS FROM ACROSS THE GLOBE FLOCK TO THE SHORES OF THE UNITED STATES IN THE HOPE OF CAPITALIZING ON THIS LUCRATIVE MARKET, WHAT BEGAN AS AN ISSUE OF STATES’ RIGHTS HAS MORPHED INTO SOMETHING GREATER."

50 | GAMINGAMERICA

Ultimately, the period since the repealing of PASPA has been one of growth – unprecedented growth in fact. As operators from across the globe flock to the shores of the United States in the hope of capitalizing on this lucrative market, what began as an issue of states’ rights has morphed into something greater; into one of the most profitable and wide-spanning industries in American entertainment. 2018 marked a sea change for our industry, beginning a new paradigm in gaming. The journey it began has only just started.

VIEWPOINTS | GAMING AMERICA

CASINO MANAGEMENT SYSTEMS For our inaugural Viewpoints segment, we take a look at the current state of casino management systems in US gaming.

TOM SOUKUP

RYAN REDDY

ERIC CUNNINGHAM

NOAH ACRES

SVP & Chief Systems Product Officer, Konami

SVP Product Marketing & Payments,

Director of Training & Marketing, Table Trac

of Acres Manufacturing

Tom Soukup is responsible for the development of all components of the SYNKROS casino management system. He oversees Konami’s systems product vision to provide accurate, robust, real-time casino enterprise management to properties of all specialties and sizes. Soukup joined Konami Gaming, Inc. in 2001 with more than 20 years of experience in the field of computer science.

SVP of Product Marketing and Payments, Ryan Reddy is the lead on International Game Technology's casino central systems, video lottery terminals and central systems. Having spent 14 years with IGT, has held a slew of key positions throughout the company. Reddy is an expert in the field and has a Master of Science in Finance from Northeastern University in Boston.

Having joined Table Trac in 2017, Cunningham has proven successful in developing learning strategies to reach all levels across multiple platforms in the casino management system space. With a focus on customer integration, ensuring strong familiarity with software through user guides and process alignment, he has overseen the CasinoTrac CMS in its expansion across the United States.

Playing a central role in the casino management system sector for a number of decades, Acres can be found in a variety of properties across the US. Its most recent product, Foundation, allows casinos to access real-time data from every slot machine in the property. With this, the company aims to help casinos adopt newer technologies and increase revenues by bringing in a new and younger generation of players.

IGT

GAMINGAMERICA 51

GAMING AMERICA | VIEWPOINTS

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THE WHAT AREES FACED CHALLENG ELOPING A WHEN DEV NAGEMENT CASINO MA SYSTEM

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52 GAMINGAMERICA

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VIEWPOINTS | GAMING AMERICA

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GAMINGAMERICA 53

GAMING AMERICA | VIEWPOINTS

ATIONS DO V O N IN T A WH LD SEE U O C E W E V YOU BELIE MARKET IN S M C E H T CHANGE TO COME S R A E Y E H T

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54 GAMINGAMERICA

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VIEWPOINTS | GAMING AMERICA

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G R-EXPANDIN E V E E H T HOW IS ONLINE D N A G IN T T SPORTS BE ALTERING T E K R A M CASINO CASINO A IN D E D E E WHAT IS N T SYSTEM? N E M E G A N MA GE OR AN N E L L A H C IS IT A ITY? OPPORTUN

our closely with e’re working approvals for an W Y: D ED R cure RYAN ts team to se ion. Some IGT PlaySpor GE-PlaySports integrat emphasis more of an t as the IGT ADVANTA mers place u of our custo gration than others; b anticipate on this inte ing market matures, I system tt t US sports beng casino managemen industry. e ti th et b in ts d or ar d sp will be stan opportunity integrationsobile casinos is another eir players th m nd The rise of s to better understa with them for operator meaningful interactionsfour walls. ’s ve o n ha si to ca a and nnecting confines of beyond the lopment perspective, coex process, pl ve m de is a co From a d online play standard over time; ry land-based an st u d in e congruent om but will bec ser will come to expect platforms. ss u ro d ac en offers as the personalized rewards and

as rts betting ho GHAM: Spo n ERIC CUNNINgnificant impact on casie to not had a si t systems providers du ose p managemenes and jurisdictions pro ant ic ti how proper tation. The most signifplayer its implemenuring and quantifying rgeted , to use in ta ers. hurdle is capt e properties m data for thes for those distinct custo marketing

GAMINGAMERICA 55

GAMING AMERICA | BETSPERTS

"WE ARE IN SCALE MODE" Gaming America caught up Reid Rooney, CEO of Betsperts, to take a look at the fantasy sports and sports wagering platform. From its humble beginnings as a social sports betting platform in September 2018, Betsperts Media & Technology Group has seen its popularity and reach take off over the past 12 months – starting when it made a major acquisition of a popular fantasy app in May 2021.

"ROONEY SAID THE MANAGEMENT TEAM SAW AN OPPORTUNITY IN THE MARKET TO CREATE QUALITY DAILY FANTASY GOLF AND GAMBLING CONTENT." Now, as sports betting legalization continues to sweep across the United States, the Chicago-based company is pursuing the convergence of fantasy sports and sports wagering, and CEO Reid Rooney is very bullish on its momentum. In a recent interview with Gaming America, Rooney ticked off some of the key

56 | GAMINGAMERICA

REID ROONEY Betsperts CEO & Co-Founder

milestones in the company’s brief history. He noted its first major step was securing a seed round of $1.25m from Parlay Capital in January 2020. This was followed by a “seven-figure bridge raise” in October 2020. In May 2021, Betsperts shouldered its way into the limelight when it acquired the Fantasy Life from Matthew Berry, ESPN’s senior fantasy analyst, with Berry becoming an equity owner as part of the agreement.

“I had been introduced to Matthew Berry, we saw synergies, and eventually we struck a deal,” Rooney recalled. “The social aspect is important to both fantasy sports and sports gambling. The Fantasy Life app is a social media platform. People use it to ask for advice, they complain about poor performances, or they brag about how good their picks were.” In August 2021, Betsperts closed a $6m Series A fundraising round that included several new investors in the company, including HBSE Ventures and Verance Capital. Just weeks later, the company announced it had closed on its acquisition of 4for4. com, a web-based sports betting and fantasy football research, analysis and information subscription service. Rooney said because 4for4.com offered analysis and tools for the purpose of enabling subscribers to improve in their betting and fantasy football endeavors, its purchase gave the company’s Fantasy Life app and Betsperts app customers an immediate increase in premium content. In January 2022, Betsperts added Dynasty League Football, a premium

BETSPERTS | GAMING AMERICA fantasy football subscription service focused on content and tools for owners of dynasty teams.

GROWTH AHEAD According to Rooney, both the fantasy sports and sports gambling categories will grow “quite significantly” over the next four or five years.

for partnerships. We are getting as many users into our ecosystem as possible. We want as many fantasy players and sports bettors as possible, so we can have multiple touchpoints every day.” To that end, the company soft launched its newest venture, Betsperts Golf, in March. Rooney said the management team saw an opportunity in the market to create quality

"I HAD BEEN INTRODUCED TO MATTHEW BERRY, WE SAW SYNERGIES, AND EVENTUALLY WE STRUCK A DEAL." “If you look at the past 18 months, the pace of growth has been faster than people expected,” Rooney said of fantasy and wagering. “This is partially due to the pandemic, and states needing revenue. We have not seen massive issues with problem gambling, which some state legislatures might have feared. We also have found out people were gambling anyway, just doing so illegally.” In May 2021, Betsperts had five employees and one app. Ten months later, it had 40 employees across five countries with six properties, “so it has been a big nine months,” Rooney said with a laugh. “We are in scale mode. There are lots of people knocking on our door looking

daily fantasy golf and gambling content. The plan is for the Betsperts team to provide tools on matchups and golf tournament simulators, all from what its users have been asking for. Last year the properties under the Betsperts Group umbrella generated

10,118 written pieces, 981 streams and podcasts, its apps hosted 36 million sessions, and its sites had 4.3 million unique visitors. “We will be expanding the team soon,” Rooney predicted. “Football moves the needle more than anything, even in the offseason. We want to make our traffic more year round, so we invested in golf as that is growing at a record clip. 2022 is going to be quite an incredible year for us.”

MORE MARKETS EXPECTED TO LEGALIZE Asked what he sees ahead for sports betting, Rooney noted every state has its own laws and relationships, but the next dominoes to fall are expected to be Maryland, Ohio and Minnesota, with California putting multiple ballot propositions before voters in the November 2022 General Election. “I think 2022 and ‘23 will be a sped up process for states we did not expect until 2025/26,” he asserted. “The numbers New York is putting up are incredible, Ontario [Canada] went live in April, and lots of people are watching what happens in Texas, Florida and California.” Watch this space.

GAMINGAMERICA | 57

GAMING AMERICA | RELAX GAMING

SIT BACK AND RELAX We spoke with Simon Hammon, Chief Product Officer at Relax Gaming, to discuss the company’s designs on the North American market, and how experience in Europe can prepare a brand for this new frontier. growing number of suppliers aiming to reach this lucrative customer base. The previously dominant online position of land-based incumbents, built on a paranoia of synergy and familiarity, has proven not to be the case and is definitely changing. New suppliers with more online expertise offer a wider range of innovative mechanics to a more maturing market.

SIMON HAMMON Relax Gaming Chief Product Officer

How have you seen the North American landscape evolve? Movements in the North American market are incredibly exciting to see. Over the years we have seen a gradual opening of key states, most recently Ontario in Canada, which offers unrivaled opportunities on a scale unlike ever before. We are seeing the rise of gaming results quarter-on-quarter, which is incredibly encouraging for all involved in the North American market. This widespread success has given both operators and suppliers alike the push they needed to enter this truly exciting market. Over the last few years, especially in the online sphere, there has been a slowly 58 | GAMINGAMERICA

"ULTIMATELY, THE CHALLENGES ARE LIKE THOSE FOR ANY NEW MARKET: ENSURING FULL LICENSING, CERTIFICATION AND ADAPTATION AND THEN ABOUT VISIBLE MARKET PRESENCE WITH THE PLAYER COMMUNITY."

With that in mind, could you give us an overview of how Relax Gaming plans to increase its brand presence in the North American market? Relax has already made a big step towards

gaining a stronger North American presence with the recent acquisition of its Ontario gaming license. When North America is discussed, Canada can sometimes be overlooked, which should not be the case, as the region promises to be one of the most highly captivating and potentially lucrative regulated markets out there today. In recent years, Relax has been building up its presence in Europe and is now well placed to expand its territorial reach with more global ambitions in mind. Naturally, our first steps into the North American market start with Canada; but we are of course incredibly excited about the consistent growth potential in the US market where we feel the Relax proposition has amazing potential.

How do you see Relax differentiating in the North American Market? We already see that Relax highly differentiates itself on several fronts in Europe; from our commercial strategic approach, highly efficient and robust platform, agility and of course our content provisions. This is not only from our own studios, but from the broad array of partner solutions we offer. I am confident that these same principles will apply in the North American market, and will be both highly effective and appreciated. Players in the North American market are hungry for new concepts, math profiles and trusted reliability - all of which Relax can offer. Our approach, even down to marketing and comms efforts, will be tailored to suit these customers.

RELAX GAMING | GAMING AMERICA Due to its rapid growth, the US is obviously a difficult region to break into. What are the main challenges Relax faces in this regard? Like all new markets, each one comes with its own challenges both from a commercial penetration point of view, and from a regulatory requirement and specification point. The procedure for entering the US market is not a light undertaking and takes a concerted effort to ensure accuracy, as the license procedure itself is arguably the most stringent in the world for a state entry. The challenge will also be about creating effective brand awareness in the market – for most players, they are not aware of Relax content and this will take time to resonate. The players, from what I have seen, are indeed embracing new games and content. If it’s high-quality content, then it will rise to the top quickly. Ultimately, the challenges are like those for any new market: Ensuring full licensing,

"RELAX HAS ALREADY MADE A BIG STEP TOWARD GAINING A STRONGER NORTH AMERICAN PRESENCE WITH THE RECENT ACQUISITION OF ITS ONTARIO GAMING LICENSE." certification and adaptation; and then it's about visible market presence with the player community.

What lessons can be learned from your time in the European market when entering the US? A key undertone is that players in the North American market generally have the same tastes for game content that they do in

Europe. On this basis, we are confident that Relax will perform extremely well. The success in Europe is about sticking to our key principles of speed, agility and technical excellence, mixed with a high value proposition. Our growth in Europe has been exceptional and we feel that with those applied principles, the North American market has something to truly look forward to.

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GAMING AMERICA | PRODUCT REVIEWS

WHAT'S NEW Gaming America takes a look at some of the market's newest and most exciting gaming products across the country. OCEAN PHOENIX BY GAMING ARTS AND JUMBO TECHNOLOGIES First revealed in 2021, Ocean Phoenix features a seven-foot-long gaming console to accommodate six different players. At the center of the table is a 66-inch screen on which players compete to capture each of the game’s four characters. Specifically, players work independently to capture the game’s “Four Beasts” – the Mighty Phoenix, the Ancient Crocodile, the Flawless Octopus and the Elegant Mermaid. The premise is to fire upon the invading creatures, including the Fantastic Beasts, and capture them. Each shot taken counts for game credits. When a player has captured the target, he or she receives credit awards. Players can

NARCOS MEXICO SLOT - RED TIGER, EVOLUTION Based on the hit TV series, Narcos Mexico, this latest game from Red Tiger brings players a world of fast money and dangerous vices. Through this new slot game, players can take on rival bosses

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also earn additional weaponry within the game that aids them in their quest to capture their targets. “Ocean Phoenix is unlike any gaming machine now on casino floors. We are pleased to work with Jumbo to bring this exciting game to the North American market. The arcade style cabinet will attract players and build a loyal fanbase as they encounter exciting characters and numerous opportunities to

Win Big!” said Jean Venneman, CCO of Gaming Arts. Since launch, Ocean Phoenix has become available at the Pechanga Resort Casino in California.

and infamous gangsters to win prizes. Featuring high volatility where players can take on cartels with Cartel Wars, the game has a maximum possible multiplier of 10,500x. When players win 100x their stake or more, they have the option to exchange 100x their stake for three Cartel

Spins with Win Exchange. The chance of winning the gamble is shown through a spinning wheel – the bigger the green segments, the higher their chance to win. Todd Haushalter, Chief Product Officer at Evolution, said: “This is our second Narcos game, with the first one being done by the team at NetEnt. We have had a lot of success sharing IP between NetEnt and Red Tiger, for example with Gonzo’s Quest and Piggy Riches. It’s always exciting working with branded games, and we’ve been part of some brilliant partnerships. This new Narcos Mexico Slot is a great example of this and it’s going to attract new and casual players in a big way. Narcos Mexico Slot gives players the chance to enter this fast money world in a completely fresh way and we can’t wait to see what players think of it.”

GAMING AMERICA | PRODUCT REVIEWS OPTX: THE NEXT GENERATION IN CASINO OPERATIONS

and satisfaction, and increase database marketing campaign profitability.

The OPTX platform ingests and simplifies all the information from multiple internal and external data sources to provide operational functionality for marketing, campaigns and events, player development, slots and artificial intelligence, in a single easy-to-use platform. Designed to evolve with your data and react to your operations in real time, OPTX enhances best practices, eliminates inefficiency and helps casino operations of all sizes create a sustainable competitive advantage. Leveraging the most advanced principles in artificial intelligence and data modeling, OPTX provides actionable insights and recommendations that have been proven to increase win per unit, increase player visitation

SHARK TRAP Shark Trap is a GLI-approved, high-tech shuffling machine, offering a table game platform that will increase productivity, reduce card costs and attain neverbefore-realized levels of game protection. Shark Trap is the smallest shuffler ever developed. Shark Trap offers unparalleled protection that eliminates all slugs, peeks, coolers, camera-based, paper, machine manipulation, and other scams while making it impossible to have “missing cards” remain in their machines at the conclusion of a shuffle. Super Shufflers are simple, sleek, low profile, versatile, easy to operate, ergonomically advanced, competitively priced, and feature fewer than half of the moving parts found in other commercial shufflers. In addition, the company’s patented “No Flash” delivery method on novelty games completely eliminates all hole card plays; and once again will allow operators to safely offer certain novelty games that have been all but eradicated by advantage players in several jurisdictions. 62 GAMING GAMINGAMERICA AMERICA

PRODUCT REVIEWS | GAMING AMERICA IGT: DIAMONDRS International Game Technology (IGT) showed off a range of products at the most recent Indian Gaming Tradeshow and Convention (IGA) in Anaheim, one of which was an exciting and innovative gaming machine. IGT’s DiamondRS gaming machine was the star of the company’s stepper portfolio at IGA. The impressive mechanical reel cabinet retains many player-preferred classic stepper elements and features an attention-grabbing top box. The cabinet’s IGT Diamond Glass allows for supreme player engagement and increased content innovation. The DiamondRS also allows for multi-denomination and multi-game configurability and is supported by a world-class game library including legendary titles such as Double Top Dollar and Fortune Coin Extra. Speaking on the company’s excitement to be showing this product at IGA, Renato Ascoli, IGT CEO Global Gaming, said: “IGT’s IGA portfolio will feature in-demand technologies such as our Resort Wallet

CM-300 TICKET REDEMPTION KIOSK CasinoMoney's CM-300 is the latest in ticket redemption technology combining fast transaction processing, ATM service with EMV certification, precise payouts, bill-breaking and banking cash access services within a single, self-service destination on the gaming floor. The CM-300 Ticket Redemption Kiosk is the latest generation in self-service kiosk technology. With one of the smallest footprints in the industry, our customizable kiosk is stacked with modern technology,

and IGTPay cashless solutions, which align with evolving player preferences and reflect our commitment to maximizing growth opportunities for our tribal gaming customers via future-forward innovations.”

a Linux operating system, and the latest generation of financial services hardware. The new CM-300 is versatile and flexible with a simple customer interface, large touchscreen monitor, large banknote capacity, reliable coin hoppers with coinless option, multi-language capabilities, currency exchange conversions, loyalty card management and so much more! GAMINGAMERICA GAMING AMERICA 63

GAMING AMERICA | PRODUCT REVIEWS BLAST BINGO MANAGEMENT SYSTEM (BMS) BLAST Bingo Management System (BMS) provides operators with the functionality to highlight new games and upcoming events; and a customizable carousel to tailor their entertainment center offerings (including food and beverage specials and embedded short promotional or community videos). For faster and smoother operations, BLAST BMS minimizes the number of keystrokes required to complete each transaction, quicker repeat sales features, and the option of issuing paper bingo inventory and cash floats on a

ARUZE: GO GO CLAW Part of Aruze Gaming’s Active Play game line, Go Go Claw Cash Grab reimagines the player’s casino experience. In this unexpected blend of arcade and casino-style play, a physical claw is used to attempt to place one of the prize balls in the collection bin, where (hopefully) a jackpot is unveiled. This livelyand innovative take on a traditional slot machine captures the attention of all who encounter it. A product that appeared for the first time at IGA, Gold Bars, the new Go Go Claw theme aims to ‘wow’ players. Like Cash Grab, players use a joystick to maneuver the claw just right as to grasp a prize ball, now filled with gold bars, and move it to the collection bin to unveil a prize. With Gold Bars, casino players have a blast while going for gold! Speaking on these new products, Aruze stated: “Casinos need to continually offer a portfolio of games that offer a new experience, drawing on familiarity while also leveraging new technologies to create active gameplay and new play styles. Aruze’s extensive collection of compelling game titles provides fun for everyone.” 64 GAMINGAMERICA

session-by-session or daily basis, depending on the needs of the operator. BLAST BMS includes a full-featured, wireless point-of-sale terminal that provides all the same

functionality of a standard point-of-sale terminal, including top-ups, product sales, bingo verification, and more. The scheduler gives operators the option to set up recurring sessions (much like a meeting request in calendar programs) so if the same session is played every day at the same time, it can be set up once and it will schedule per your parameters: daily, weekly or particular days. With today’s high operational costs, heightened security requirements and the need for maximum flexibility, BLAST BMS back office can be cloud-hosted, thus reducing on-prem hardware costs, providing greater security and minimizing downtime.

PRODUCT REVIEWS | GAMING AMERICA

ECLIPSE GAMING SYSTEMS - BIG SHAKE CARNIVAL Step right up and try your luck on this classic penny arcade machine brought to life for the casino floor. A first in any casino, this incredible player experience capitalizes on the arcade favorite coin pusher, to offer a Big Wheel Bonus and perceived skill feature game that the player controls for non-stop excitement. Players can choose their favorite tune

ROULETTE XTRA TCSJOHNHUXLEY Roulette Xtra is an exciting new game offered exclusively from TCSJOHNHUXLEY that combines the traditional game of roulette with a thrilling random multiplier bet. Allowing users to add another level of excitement to their live table games, Roulette Xtra is developed exclusively from TCSJOHNHUXLEY. Quick and easy to understand, Roulette Xtra combines the traditional game of roulette with a thrilling random multiplier bet, with a maximum payout of 500 to 1 available. Players will place their bets as normal and once the ball is spun and “No More

to play by touching the track pick button on the front of the coin deck, for a truly immersive audio and visual gameplay experience. Speaking to Gaming America at the recent Indian Gaming Association Tradeshow and Convention, Brennen Lawrence, Chief Business Officer at Eclipse Gaming Systems, gave us the lowdown on its Big Shake Carnival product. He said: “We are really excited about this product; for us it has been a project we have spent a lot of time and effort on, bringing a digital representation of the coin pusher to life. This representation is captivating. We have integrated a spin feature and have made it interactive, allowing players to change the songs on the jukebox. Overall, we hope this product brings that arcade feeling players experience at a carnival.”

Bets” is called, the game randomly selects four Roulette Xtra numbers along with random multiplier amounts, ranging between 50 to 1 and 500 to 1. The multipliers are allocated to each Roulette Xtra number and displayed on the winning number display. The winning Roulette Xtra number and combinations are determined by the result of where the ball lands on the Roulette wheel. Among the key features of this new product are: the chance to win big payouts, four random Roulette Xtra numbers that are selected each game, a random multiplier that pays out up to 500 to 1 and the option to vary pay tables.

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GAMING AMERICA | ESPORTS

WHAT'S NEXT FOR ESPORTS? Gaming America looks to the future of esports betting, asking what's next for the vertical in a changing landscape. For so long it was seemingly impossible to imagine a world in which esports betting matched, or even surpassed, traditional sports wagering. That was before 2020 happened. As businesses closed and leagues were postponed, punters looked to esports as a means to get their betting fix. Suddenly, esports betting was the leading gaming activity in the country and, as reported by EveryMatrix, the medium grew fortyfold during the pandemic, with games such as FIFA and NBA2K seeing betting volume increase by 80%. Indeed, as sports betting faced the reckoning that was Covid-19, esports betting thrived, but in the months that followed – when players and fans returned to stadiums and sportsbooks – the influence of esports on the gambling industry diminished. It once again descended behind the shadow of its more established older brother. With that in mind, what is next for esports betting? Can the medium return to the place in the sun it experienced for a brief moment in 2020? The state of esports betting in 2022 is a curious one. Undoubtedly, as both sports betting and video games enter further into the national mainstream, betting on esports has continued to grow steadily. New Jersey recently passed legislation allowing betting on esports tournaments, becoming the first state to do so. With that, other states – including Nevada – are increasingly eager

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to allow regulated, taxed and legal esports betting. Despite this growth, esports betting operators are yet to capitalize on the gargantuan audience video games can bring to gaming. Indeed, perhaps the main attraction for legalizing and regulating esports betting across the nation in 2022 is the sheer number of people it can bring to gaming. In recent years, video game audiences have grown to surpass those of both traditional film and television, with upwards of 80% of Gen Z and millennials playing video games regularly. This potential user base, which is separate and distinct from the traditional sports betting crowd, could provide mountains of revenue for any operator willing to throw its hat into the esports ring. Ultimately, the esports betting industry in 2022 is a nascent one, an area of limitless potential that is yet to be tapped. Despite this, there has been growth, with products such as Counter Strike: Global Offensive and DOTA 2 dominating the market. As things stand, esports betting has the potential to be huge, with an audience that can match even that of traditional sports. But what will the market look like

in future? Can it capitalize on potential to create real growth? Currently, neither the right video game nor betting platform exists to bring esports betting into the mainstream, with games such as Counter Strike and DOTA far too impenetrable for general audiences. Furthermore, big operators are currently unwilling to bet big on esports. Is there a guarantee that the avid gamer can become the avid bettor? There is hope, however, that with the right technological advances and creativity, the industry could very well experience an esports boom in the coming years. These advances will include better data tracking in video games, allowing for more accurate and in depth bets, and a generation of games designed with betting in mind. As Ari Fox of the Casino Esports Conference said: “If developers do not make these games, operators eventually will.” Ultimately, if esports betting is to become the juggernaut it can be, operators and games developers must take a different approach to that used in sports betting. Video gamers value community, engagement and personality more than traditional sports bettors. In turn, for esports betting to truly explode in the years to come, these must be the central focus of the esports betting industry,;fusing the hugely successful aspects of the sports wagering world with the things this generation of gamers value themost. When that is achieved, the audience will come and the gambling industry in the Americas will have a new powerhouse on its hands.