TRAFFIC REPORT
Trafficology has partnered with data expert Casino City Press, to provide insight into website and traffic trends across affiliate industries – predominantly in gaming but including others. In this edition, we review affiliate programmes per vertical for August 2024 in Oceania. The below is a breakdown of the top 20 sites, including both desktop and mobile, sorted by: overall ranking, casino ranking, sports betting ranking, bingo ranking, lottery ranking and poker ranking
MAKING AFFILIATES SPEAK OUT ON RESPONSIBLE GAMBLING
Gambling Insider Editor Tim Poole spoke with Responsible Gambler Founder Paruyr Shahbazyan on the affiliate’s latest research, the importance of affiliates advocating for responsible gambling and whether regulation has gone too far or not far enough
YOU RECENTLY CONDUCTED RESEARCH INTO RESPONSIBLE GAMBLING. COULD YOU TELL US ABOUT THAT RESEARCH? WHAT INSPIRED YOU TO COMMISSION IT?
First of all, I would like to mention that we have rebranded as Responsible Gambler. The reason we did this was because some people were mistakenly thinking we are an organisation that treats addiction, despite the fact we openly say everywhere that we are an educational resource and an affiliate. But, since we’ve discovered those concerns we are not to be mistaken anymore and we are now called Responsible Gambler.
The reason we did this research is because in my previous businesses we did a wide range of research, researching the markets in general, but because RG.org is positioned from a responsible gambling perspective, we believe we should investigate this topic in particular.
WHAT MAKES THE RESEARCH UNIQUE?
The comparison to other addictions makes it unique. Comparing gambling addiction to other addictions is key because it allows us to get to the underlying mechanisms of different types of addiction. By comparing gambling addiction to substance use disorders, behavioural addictions and other compulsive
behaviours we can see how gambling affects the brain and behaviour in ways that are similar or different to other addictions. This research can inform prevention and treatment strategies as it highlights the neurobiological, psychological and social factors that contribute to gambling addiction and what it means for policy and public health.
Also, we’re doing it independently. We are not an operator or organisation which treats gambling addiction. We are an affiliate. This is another point of view and I think in that sense, we’re quite unique.
We chose to break the research into a series in order to cover each addiction comparison in detail. The six parts break down different types of addiction in relation to gambling and provide a full analysis of each:
Part 1: Gambling Addiction vs. Substance and Behavioural Addictions (Overview) – Introduction and broad comparison of gambling addiction with other substance and behavioural addictions.
Part 2: Gambling Addiction vs. Substance Use Disorders –Comparing gambling addiction with substance use disorders like cocaine, heroin and methamphetamine addiction.
Part 3: Gambling Addiction vs. Alcohol Addiction –Comparing gambling and alcohol addiction, including decision making and mental health.
Part 4: Gambling Addiction vs. Video Gaming Disorder –Comparing gambling and video game addiction, especially the compulsive behavioural aspects.
Part 5: Gambling Addiction vs. Sex Addiction – Comparing gambling with sex addiction, impulse control and reward seeking behaviour.
Part 6: Gambling Addiction vs. Food Addiction – Compulsive behaviours around food and shopping and the psychological overlap with gambling addiction.”
CAN YOU TELL US MORE ABOUT WHAT YOU ARE LOOKING TO ACHIEVE OVERALL AND WHAT YOU DO?
Our goal is to establish ourselves as a trusted source of information for the industry. Also, we want to make affiliates speak about responsible gambling and adopt those policies, because right now, we’re seeing that only the responsible gambling organisations and operators are doing it. We haven’t
seen many affiliates do it, but affiliates are the first contact for many new players. If we educate people and tell them from the very start that if you’re not betting professionally it’s very hard to win and there are addiction risks, I think we are going to get more quality players and less bad PR for the industry in general.
WHAT DO YOU MAKE OF RESPONSIBLE GAMBLING TODAY? THERE’S BEEN IMPROVEMENT OVER THE YEARS, BUT HAVE WE SEEN ENOUGH?
We’ve seen progress. In some countries, we’ve seen overkill moves that actually allow illegal operators or give an advantage to illegal operators. For example, I’ve noticed some countries are limiting the amount of deposits and are not considering the income level of players. We all know that a substantial part of the revenue for operators are high rollers, but they are losing this clientele to the illegal operators in these conditions. I think there is progress, but I think the rules have to be worked out in conjunction with the other members of the industry to prevent these kinds of situations. All sorts of prohibitions don’t lead to good things. Just like alcohol prohibition.
So in general, there is progress, but I think there is not enough conversation between sites and hopefully we will play our part in that.
EVERYONE SPEAKS ABOUT REGULATION, BUT IF WE’RE TO LOOK AT OPERATORS INTERNALLY, ARE YOU SEEING OPERATORS EMBRACING RESPONSIBLE GAMBLING, OR IS THERE A DANGER THAT, ESPECIALLY IN HEAVILY REGULATED STATES, IT BECOMES A TICK BOX, NOT NECESSARILY GOING ALL IN? Operators are public companies and shareholders are expecting only growth from them. But, I think operators play by rules -
and it’s the regulator’s responsibility to make rules that work. I don’t think operators should do anything more than they’re required. I’ve seen some cases, and I read about it, that some casinos and sportsbooks have seen that when players are losing too much, they are stopping them themselves from playing. The reason is that there is a psychological level of losses that players tolerate, and whenever they go beyond that level, they are becoming frustrated and that could be a reason not to come back or have some conversations or act in a way that hurts the industry. So some operators, I learned, are preventing players from reaching this level of losses. They don’t need these kinds of players, who lose too much and then go away. They need players that are gambling for fun all their life, instead of getting into trouble and suffering.
IF WE WERE TO LOOK AT THE OTHER END OF THE SCALE, HAVE YOU SEEN ANY INITIATIVES OR ANY PARTICULAR OPERATORS THAT YOU THINK ARE TRULY LEADING THE WAY IN THIS REGARD OR ARE DOING REALLY GOOD THINGS?
To be honest, I can’t remember any. But like I said, the operator’s responsibility is to abide by the rules and if those rules are made correctly, then I think everything will work fine.
FINALLY, IF WE GO BACK TO THE RESEARCH THAT YOU GUYS HAVE CONDUCTED AND WILL BE PUTTING OUT, IS THERE A LASTING IMPACT YOUR RESEARCH CAN HAVE ON THE INDUSTRY? WHAT ARE YOU HOPING TO ACHIEVE AND HOW CAN WE TAKE THE INDUSTRY FORWARD?
Yes. So, I hope our research will be read by all participants of the industry and will influence their decisions. We’ve seen it in other markets that we work in and so our research has been used in legislation. I hope all the participants, regulators, operators, affiliates and even players, can learn something and benefit from our research.
The bigger target is that our influence will lead to a better regulatory model and not the other way around.
“The operator’s responsibility is to abide by the rules and if those rules are made correctly, then I think everything will work fine”
SWEEPSTAKES: THE LATEST AFFILIATE TREND?
We spoke with Catena Media CEO Manuel Stan to learn more about sweepstakes, how affiliates can better utilise them in the market and how regulation may impact the trajectory of the vertical
If you’ve been keeping an eye on industry news as of late, the term ‘sweepstake’ is one you have likely at least seen in passing. No, this is not the ‘sweepstake’ you might be familiar with; the practice of collecting a set amount from a group of people with the winner collecting the whole sum. For offices and friend groups alike, setting up sweepstakes on the results of the Euro’s or Eurovision is a fairly typical yearly tradition. However in this context, sweepstakes means something a little different.
WHAT ARE SWEEPSTAKES?
“Sweepstakes is an old concept where players did not have to pay to enter and any purchases made after the entry did not increase the chance of winning,” explained Manuel Stan, recently appointed CEO at Catena Media. “That is the key differentiator from traditional gambling.”
Indeed, sweepstakes casinos provide an alternative way to play. Sweepstakes can be described as social games, a way to play without the use of traditional currency, where users can
play games with the chance of winning non-monetary prizes. These games are frequently played with some form of in-game currency, which can be acquired through a variety of methods – including free promotional methods of entry or as a reward for different purchases, such as that of virtual coins.
For affiliates, this provides a unique opportunity for generating traffic and engaging audiences with a new vertical. For Catena, “Casino content is a key part of our business, and sweepstakes are the fastest growing sub-segment within the casino vertical. In locations where online casino is not regulated, social sweepstakes casinos offer customers a viable alternative to traditional casino content.”
Sweepstakes have also, in our opinion, taken some inspiration from social media and the idea of ‘giveaways,’ which have proven to be particularly powerful tools in boosting engagement with online posts and accounts. Stan expressed a similar view - when asked if social media has been a factor in the proliferation of sweepstakes, he said: “I think so - social media was from
the beginning the key distribution channel for social casinos and has played an important role in the proliferation of social sweepstakes casinos.”
SWEEPSTAKES IN THE US
“There are many different types of casino games worldwide,” said Stan. “Some operate under a sweepstakes model, meaning it’s free to play and test out the games while also being eligible for rewards of some kind.”
As Stan mentioned earlier, sweepstakes offer the unique selling point of being an alternative to online gaming suitable in locations where the vertical remains unregulated. “In the US, social sweepstakes casinos have gained popularity mainly in places where they are the only alternative to online casinos. Actually, this is true for most states because only six have so far legalised commercial online casino gaming.
“In Europe and especially the EU, where the regulatory process is much further advanced, we don’t see the same interest in social sweepstakes casinos.”
This trend towards US interest has been reflected in the growing news attention the vertical has seen, particularly from regulators. In August, the American Gaming Association released a memo expressing concern regarding the vertical, pointing specifically to their use by unlicensed online casinos and sportsbooks to weave around laws and regulations.
The memo said there are “an increasing number of entities that have intentionally designed business models to circumvent or exploit ambiguity in state gambling laws and the regulatory frameworks within which the legal gaming industry operates... In the brick-and-mortar environment, unscrupulous operators have used ‘skill’ as an artifice to flood jurisdictions with unregulated slot machines. In the online
“In locations where online casino is not regulated, social sweepstakes casinos offer customers a viable alternative to traditional casino content”
space, some unlicensed casinos and sportsbooks are thriving by employing a ‘sweepstakes-based’ model to potentially skirt gaming laws and regulations.”
The AGA went on to point to a lack in oversight putting players at risk, as well as sweepstakes’ potential impact on “the integrity and economic benefits of the legal gaming market through investment and tax contributions.” A lack of oversight may also lead to weak responsible gaming protocols, a lack of fairness to players and a “prime opportunity for illegal activity,” according to the August memo.
SWEEPSTAKES REGULATION
As Stan mentioned, sweepstakes have become a way to skirt regulations in some regards, providing a gambling opportunity while, technically, not gambling under specific legal definitions. This is also the primary concern of the AGA, as stated above. When focusing on the US specifically, Stan clarified that “US gambling regulation is done on a state level.” This is why, in so many states, iGaming still is unregulated, though “the regulation of all online gambling verticals has been on top of the agenda for most states in the last few years.”
Of course, with each state overseeing what verticals are regulated and when, the number of sports betting states now drastically outweighs the number of iGaming states. “The lack of online casino regulation led to customers looking for alternatives to traditional casino content and social sweepstakes casinos are best positioned for that,” explained Stan, who added: “The growth of the social sweepstakes casinos sector and the attention it attracts will have a positive impact on state legislators to consider the future online casino regulation.”
On the AGA’s announced crackdown on sweepstakes, Stan made it clear that, while he is not a lawyer or regulator, “Sweepstakes are following a federal framework that regulates the mechanics and howprizes are awarded. States have the right to further regulate the vertical as some have done. Michigan legislators,
for example, have banned social sweepstakes casinos and Catena is no longer operating in Michigan nor work with partners who may.”
Still, the AGA’s efforts are not without reason – after all, any unregulated market can put players in harm’s way, and while brands like Catena are following the rules, it doesn’t mean everyone else is. As Stan put it: “Regarding AGA, I believe the intent is twofold - clarify the distinction between sweepstakes (and the many variants) and online casinos and secondly, ensure the appropriate customer protection tools are in place.
“We welcome this initiative and any development towards regulating markets and verticals for the benefit of the customers.”
Some operators have already taken regulation into their own hands; notably the Social and Promotional Gaming Association (SPGA), which described itself in a September press release as “an organisation dedicated to providing stakeholder education and advocating for the responsible operation of social and promotional games.” We will be looking into the SPGA further later in this issue, but for now it is important to note that, at least to some extent, where there is not regulation, the industry has come together to regulate things themselves.
THE FUTURE OF SWEEPSTAKES
With all this in mind, where can the sweepstakes vertical head next? For Catena, continuous development of the vertical seems to be expected, with Stan saying:
“We believe our social sweepstakes casino sub-segment will continue to grow organically as player interest in casino content rises. Slow casino regulatory process in many states is also fueling demand for social sweepstakes casinos. These legal alternatives to traditional casino gaming generate a lot of traction because they are often the only online alternatives for new and experienced players alike.
“We will continue to develop our products in this sub-segment. We will also make sure only to work with trusted partners that are compliant with current regulation because we believe this is the only sustainable long-term approach.”
On a wider scale, however, Stan emphasised that bringing further regulation to the market will be crucial in order for it to grow. He said: “For the industry generally, I believe online casino regulation will play a key role in the future. We are in favour of regulation and ensure we work exclusively with serious and trusted partners. We would certainly be happy to see progress in this space.”
“Sweepstakes are following a federal framework that regulates the mechanics and how prizes are awarded. States have the right to further regulate the vertical as some have done”
SWEEPSTAKES: OPERATING HONOURABLY
CogniPlay Co-Founder and CEO Allan Turner spoke with Trafficology about his white-label sweepstakes platform, his experiences with the vertical and where it might be heading
EARLIER THIS YEAR YOU LAUNCHED YOUR ONLINE SWEEPSTAKES AND SOCIAL GAMING PLATFORM SOFTWARE TO CLIENTS. IN SIMPLE TERMS, CAN YOU EXPLAIN WHAT THIS PRODUCT IS?
We have built what is essentially a white-label platform for both sweepstakes casino and pure social casino clients to operate their site(s) on. The back office includes all the player management tools you would expect, comprehensive reporting, packages and bonuses, and many settings and features that are tailored to the specific requirements for effectively managing a sweeps or social product.
There are a wide range of games from providers such as Relax Gaming, Pragmatic Play, 3 Oaks, Hacksaw, Playson and many more, which gives our clients access to well over 1,000 games. We also have integrations with third-party products that are imperative to success in this space such as KYC, Geo-IP, AMOE, payment processing, CRM, affiliate, ESP, SMS and gamification technologies. We feel all these elements provide our clients with a very effective sweeps or social casino product.
WHAT DREW YOU TO CREATING SWEEPSTAKES SOFTWARE IN THE FIRST PLACE? HAS THERE BEEN INCREASED DEMAND FOR SWEEPSTAKES GAMING?
ALLAN TURNER
Our new platform at CogniPlay came about because we were working with one of the US sweeps brands last year, with my marketing agency Mustard Digital, and we found their existing platform to be difficult to work with. So, we had a look around to see what was available and we discovered that there were very few options. As a result, I called my CTO and asked if he fancied building a new sweeps and social platform, and here we are today.
“Its exceptionally important for sweeps brands to behave as though they are regulated in terms of making sure that they... look after their customers in an honourable manner”
YOU APPLY A MODULAR APPROACH TO YOUR PRODUCT. WHAT ARE THE PROS OF THIS AND ARE THERE ANY CONS?
Working with tens of iGaming platforms over the years I have often felt that many of them build a product with what they think is a good setup, but maybe don’t offer the flexibility to tailor it much to the customers’ exact needs. With this in mind, we have tried to have lots of options available to our clients in each key area. For example, we don’t just have one
option for a CRM solution, we have four available currently for customers to pick from depending on their needs, and we are open to integrating with any system they want to use. This same premise goes for all the key areas, for payment processing we have four options to choose from again, for affiliate programme software we have three.
Ultimately, we want to give our customers the power to decide what they want the product to be, using our core foundations, which is really the key pro. I can’t think of any obvious cons to this approach, other than the extra development work required from the CogniPlay side.
WHEN DID YOU FIRST HEAR ABOUT SWEEPSTAKES GAMING AND HOW HAS THE VERTICAL EVOLVED SINCE THEN?
I have been aware of sweepstakes gaming for a couple of years now, initially with the VGW brands. The vertical has certainly evolved greatly since I have been following it with other major players such as Stake.us, Pulsz and more recently Wow Vegas showing tremendous growth.
ARE SWEEPSTAKES REGULATED? THE AGA RECENTLY CALLED FOR A ‘CRACKDOWN’ ON SWEEPSTAKES GAMING IN THE STATES
No, sweepstakes isn’t regulated, although like most sweepstakes’ casinos and platforms in the space, CogniPlay is committed to operating our platform in an honourable way, as though we are regulated and follow best practices. This of course means we have fair terms and conditions and game rules, good KYC, Geo-IP systems and player management features in our back office. We also have responsible gambling tools such as self-exclusion, cool-off periods and deposit limit management for the players, so they are in control.
I am aware of the slightly increased pressure that sweepstakes gaming is coming under in the US from the AGA and some of the regulated brands in the market. They seem to be suggesting that sweeps casinos are somehow dodgy, don’t follow responsible gambling rules and don’t look after players, which as outlined in the previous question above is simply not true in most cases.
WHO ARE THE SORT OF PLAYERS ENGAGING
WITH SWEEPSTAKES?
The demographic of players using sweepstakes casino sites is
very broad, as can be seen by a recent report that indicated that $5bn was deposited on sweeps sites last year. I think this is really driven by the fact that there are still relatively few states that have regulated online casino. This gives players two options really, either play at an offshore site, which comes with its own potential risks, or play on much more reputable sweeps casino sites that offer a different experience of course, but are none the less, great gaming products.
ASIDE FROM REGULATION, IS THERE ANYTHING ELSE HOLDING SWEEPSTAKES GAMING BACK?
Other than regulation I don’t really see too much else holding sweepstakes gaming back. I think the sweeps vertical will continue to come under pressure by the AGA, and other parties with vested interests in seeing sweeps struggle. I think it’s exceptionally important for sweeps brands to behave as though they are regulated in terms of making sure that they follow best practices, have responsible gaming tools and policies in place, and ultimately look after their customers in an honourable manner.
HAVE YOU NOTED ANY TRENDS OR BUSINESSES IN THE SWEEPSTAKES
VERTICAL THAT YOU FEEL MAY HAVE A BIG IMPACT GOING FORWARD?
Historically a small number of brands have dominated the vertical but with the launch of several new, exciting brands in the last couple of years, the market is swiftly becoming much more diverse. Brands such as Wow Vegas and Modo have made a significant impact in a short space of time, and I certainly think the number of brands will increase in the short to medium term.
WHERE DO YOU THINK THE SWEEPSTAKES VERTICAL MAY BE HEADING?
I think what we will see next is an explosion of innovation in the vertical. Even as recently as a year ago many sweeps brand’s websites were very simplistic in nature, and they have made huge strides in quality of product in 2024. With growth in the vertical I think that brands will increasingly use product innovation to set themselves apart from the competition and we will see huge progression in this area.
JOINT OPERATIONS: WHAT DO THEY MEAN IN ROMANIA?
After new legislation was passed by the ONJN in April outlining B2B / B2C joint operations, the Romanian authority followed up with Order 771/2024 on the Joint Operation of Gambling Activities. But did it make a difference? Beth Turner spoke with Andrei Cosma, Partner with Baciu Partners to find out
THE ROMANIAN NATIONAL GAMBLING OFFICE UPDATED ITS JOINT VENTURE ORDER AT THE END OF AUGUST. FOR THOSE THAT DIDN’T SEE IT, COULD YOU BRIEFLY SUMMARISE WHAT THE ORDER ENTAILED?
From the very beginning, the legislation regulated the possibility to operate under a joint operation. I would prefer to use the term joint operation rather than joint venture, because joint venture is a more general term. The law changed, and what changed in April, quite importantly, was an amendment saying that a joint operation can be conducted between a B2C licensed operator with one or several entities that hold a B2B licence. This is indeed a major change because before, we didn’t have a requirement for the partner in the joint operation to hold a B2B licence.
From my perspective, the legislator wanted to regulate a practice that has happened on the Romanian market for several years. Joint operations were conducted a lot in the land-based sector with B2C operators working with pubs, bars, cafes, etc, where they would place gaming machines, sign a joint operation contract and conduct their operations that way. Now, given the legislative change that was enacted
at the end of April, you cannot do this anymore. Meaning cafes and so on must hold a B2B licence.
This is a major change because obtaining a B2B licence, first of all, means you need to somehow offer one of the services that fall under the B2B spectrum, like gaming software, affiliate marketing, etc. So, being a general cafe, it’s hard to say what services you fall in. Secondly, to get a B2B licence, you need to pay annual fees to the gaming office. Those fees are not insignificant - the annual cost to hold such a B2B licence is €35,000 ($38,400) per year. This change, from my perspective, was to limit the practice.
At the same time, it was written that the regulator was going to issue an order within 90 days to describe in detail what it means to have a joint operation. This deadline ended at the end of July - we got this new order one month later at the end of August. What this order says is that joint operation means a contract signed between a B2C operator with a class one licence, together with one or several B2B licensed entities or another B2C operator (but that’s not common), whereby the B2B provider is going to conduct some operations that are specific to gaming. The issue is that these specific operations are very general... The order says a joint B2B means a situation where the provider collects the stakes or pays the winnings.
ANDREI COSMA
Another point is to fill in the documents that are specific to gaming - this is the exact wording - and the monthly statements describing the revenues that have been obtained, as well as filling in the reports that are, again, specific to gaming.
YOU’VE DESCRIBED THE ORDER AS HAVING “THE SAME GENERAL WORDING FROM THE ALREADY EXISTING LEGISLATION.” IN WHAT WAYS ARE THEY SIMILAR?
They use the same words that already existed in the law from the beginning. As I said, operating gaming machines; I wouldn’t say it’s clear, it’s evocative. But, all the other points the order describes, like paying winnings or collecting stakes, are super general. You could say that about a payment processor involved in the payment of winnings or collection deposits, operators have accounting companies that help fill in monthly registers. This doesn’t equal a joint operation.
I believe this is perhaps on purpose to give the authority more flexibility, to have the liberty to decide on a case-by-case basis if a certain deal represents a joint operation or not.
“What has happened here is that the regulator has issued an order because they were required to do so under the law”
HOW DO YOU THINK THE ORDER COULD HAVE BEEN WORDED BETTER TO MORE ACCURATELY REFLECT THE GOALS OF THE ONJN?
I think the goal here is, one, the core focus of a joint operation is, when you have this kind of a structure, the liability belongs to both parties; not only the operator, but also the licensed provider. Here it’s important to note, joint operation doesn’t mean joint venture. A joint venture is a contractual structure that is based on the general legislation in Romania where two commercial partners decide to do a venture together and split the results and assume the losses in certain percentages. You can have a lot of joint ventures drafted based on the general legislation, which would mean the provider contributes to the business of the operator in various ways and they split the results.
It’s important to emphasise that we can have a joint venture based on general legislation, which is not equal to a joint operation in gambling law. So, to make a clear distinction between these two, what should have happened? The order from the regulator should make it clear what kind of activities are so specific to gaming that they entail a joint operation and not only a joint venture.
If I’m a marketing affiliate, I may sign a deal with an operator saying, ‘I’m going to bring you this much traffic and you give me 10% of the traffic that I bring.’ This might be considered to a certain extent a joint venture, but it’s not a joint operation... I think what could have been done better was to describe in more detail how the provider is involved in the core business.
HOW MUCH OF AN IMPACT WILL THE NEW ORDER ACTUALLY HAVE ON B2B / B2C JOINT VENTURES?
I don’t think it’s going to change much. As I said before, we’ve had this requirement of a joint operation with a licensed B2B since April. That changed a lot, because it excludes a lot of potential partners. But, this order in particular is saying, once again, something that everybody knew. The change produced in April was something significant. But, what has
happened here is that the regulator has issued an order because they were required to do so under the law.
SO, THE ONE FROM APRIL IS THE ONE OPERATORS NEED TO KNOW ABOUT. WHAT ARE THE KEY THINGS GAMING BUSINESSES IN ROMANIA SHOULD KEEP IN MIND WHEN ESTABLISHING JOINT OPERATIONS?
First of all, you need to have a partner that has a B2B licence. Secondly, describe in the contract exactly how the provider is going be involved. Make it clear and specific to gambling. Take into account that you are going to have joint liability. So you need to have some sort of oversight on what the provider is doing because it’s also your licence at stake there. And, of course, they need to take into account it’s not only a formality; these joint operation contracts need to be notified to the regulator.
LOOKING AHEAD, ARE THERE ANY PLANS FROM THE ONJN TO RELEASE ANY FURTHER REGULATORY UPDATES? ARE THERE ANY THAT BUSINESSES SHOULD BE KEEPING AN EYE OUT FOR?
There is one which is actually more major than this one. Also in April, another change was, in very general terms, new text introducing a law saying all B2B licence providers should take technical measures to block access against unlicensed platforms. So against the black market. Also here, the law says the regulator should issue an order clarifying what the B2B providers need to do. A draft order appeared at the end of July, the purpose being to clarify what all licensed B2B providers need to do.
It’s weirdly drafted and imposes super cumbersome requirements. I will give you some examples. All licensed B2B providers (it may be read in this sense, it’s not law yet) should notify all contracts that they sign, anywhere in the world, to the Romanian regulator. Somehow, providers should oblige all their B2C operators that don’t have a licence in Romania to sign an affidavit saying that they’re not going to offer their services unless they get a licence. You can imagine this is unbelievably cumbersome. It would mean, if I have an international business operating in various markets, and of course not all my clients have a Romanian licence, somehow the Romanian regulator would say, ‘Well, you need to do something in relation to them because I want to take more measure against the black market in Romania.’ All operators you are servicing, no matter where, the regulator should be made aware of them and they should somehow commit that they do not target Romania unless they have a licence.
This order is still in draft, and rumours on the market are the regulator might still consider the final wording. Also, something quite odd in this order, is these obligations are technically only applicable to B2B providers that are Romanian companies or have a permanent establishment in Romania. Whereas the law doesn’t say that; it says all licensed B2B providers. It’s important to know that in Romania we have a lot of international businesses that have this B2B licence. I think most of them servicing the online market are international, not local. So, this is, I wouldn’t say, a grey area. But, it’s something that is unfinished. Depending on the final version of this order, it can create a huge impact. One more thing. The law which prevails and is already in forced says providers should take technical measures against the black market. Whereas the order speaks about notifying contracts and giving affidavits; it’s not technical, it’s paperwork.
HOW DO YOU THINK GAMING REGULATION IN ROMANIA WILL CHANGE IN A COUPLE OF YEARS?
We have a lot of legislative proposals aimed against gambling advertising, so we might see more restrictions there. We have seen several restrictions throughout the years. The history is that we have had, at some point, aggressive out of home advertising. So political stakeholders want to do something about it. We don’t know how they’re going to succeed, but something might happen here.
I would say that taxation is not over. In the last three to four years, taxation for gambling has been changed more than five times - it has been increased more than five times... Taxation might be a focus, as well as responsible gaming. There are a lot of initiatives and requirements in the existing law trying to protect people that have problems with gaming. So, we’re going to see a lot.
DATA LEAKS, DEEP FAKES AND DIGITAL MANIPULATION: A DEEP DIVE INTO SPORTS BETTING FRAUD
Trafficology spoke with Onfido Fraud Specialist Senoir Manager Simon Horswell on the increase in fraud around major sporting events and what fraud looks like in today’s market
DURING SPORTING EVENTS, THE LEVEL OF FRAUD AROUND SPORTS BETTING INCREASES QUITE SIGNIFICANTLY. DO YOU THINK THIS IS TO CAPITALISE ON NEW PLAYERS OR TRICK OLDER PLAYERS, OR EVEN A COMBINATION OF THE TWO?
I don’t think this is about new subscribers or old subscribers. This is about taking advantage of the situation. Whenever these sporting events crop up, it’s big business for gambling industries. All the companies are competing for the increase they know is going to occur around that event. How do you do that? You give people incentives to join you rather than one of the other gambling companies. So, you give someone £100 ($133) in free bets or £100 in credit, the next company will give someone £150 in free credit. This competing, this promotion to drive business through one platform or one company over another, is what makes it more attractive for fraudsters. It’s a honeypot. Any that are giving stuff away for a sign up will attract the higher amount of fraud. That’s how we see things pan out.
IN TERMS OF FRAUDULENT SPORTS BETTING TRAFFIC, WHAT EXACTLY DOES THAT LOOK LIKE? HOW DOES IT DIFFERENTIATE FROM ABOVE-BOARD TRAFFIC?
If account opening requires you to provide some form of identity, you’re going to see things like altered documents. It might be a counterfeit document. It might even be,
depending on the level of checks you have - if you don’t have a biometric component, if I don’t have to provide a photo or video of myself as the holder of that document - I can get away with potentially just uploading a picture I’ve found online or obtained from a data leak.
Then, if you include the biometric component, we’ll see photographs that may have been stolen from a number of different places. We’ve seen a large variety of things, from holiday snaps that someone’s cropped down, profile pictures, all the way to people uploading videos of chiropractors showing you how you should tilt your head from one side to the other or even deep fakes.
With all of these are elements, it’s the method of delivery. Is it something that’s been uploaded, or is it someone taking a video or picture of a screen? There are a lot of different tells around that, but those are typically the techniques we’ll see happen.
WHAT WOULD YOU SAY ARE THE THREE BIGGEST FACTORS THAT DRAW FRAUDSTERS TO SPORTS BETTING?
You have to understand the reasons why people are coming. You’ve got two different things happening. Number one, you’ve got that honeypot, the fact there are going to be bonuses for sign up and you’re exploiting that sign up to hoard as many bonuses as possible. But, on the other hand, this is why you’ve got regulations about account opening, because gambling can be used to launder money. In a month where you’ve got people coming purely for the bonus exploit, you’ve got people that
are also coming and trying to open fraudulent accounts so they can lauder money. Again, it’s the events that are driving that. Because you’ve got increased volume around that time, that’s the best time, if you’re committing some form of money laundering, to camouflage in with the herd.
If I’m going to commit the bonus exploit, the main thing is scale. I want to hit as quick as I can with as many attempts as possible to reap the benefits. Whereas if I’m doing money laundering, I don’t want to draw too much attention. I could be hitting at scale, depending on how many sleeper accounts I want to open. But, it won’t necessarily be as obvious, or it won’t be as unsophisticated as some bonus exploits.
WHAT TECHNIQUES ARE FRAUDSTERS USING TO GENERATE TRAFFIC? HAVE THERE BEEN ANY RECENT TRENDS IN THESE TECHNIQUES, SOMETHING NEW THAT THE INDUSTRY HASN’T SEEN BEFORE?
What we saw last year was a huge spike in the adoption of deep fakes... a year-on-year spike of 3,000%. We went from having a couple of 100’s to tens of thousands. That’s been the biggest trend - the fact that’s suddenly exploded.
There’s a couple of reasons for that. If you look at lockdown, it drove a lot of people into online fraud, and they’ve got better at it. One of my colleagues, another expert, has this disagreement where he says fraudsters are lazy. I say fraudsters are incredibly efficient. When you look at the number of attempts and the adaptation, you see what fraudsters will do is go just as far as they need to get past the line. So it might be, in terms of avoiding a document detection system, they’ll reduce the exposure on the image to get it just light enough that it gets accepted, but just dark enough that you can’t pick up on the alteration to the date of birth, for example, or they’ll play with resolution. There’s a lot of experimentation, which means there is a lot of work that goes into achieving what might
look like unsophisticated fraud when it eventually reaches the examination process.
What we’ve also seen is a growing trend to digitally manipulate images of documents. Where previously we would see people creating physical counterfeits, so maybe copying a document or getting an image of a document, altering it using photo editing software and physically printing it out and trying to pass it off as a real document, what we started to see was a growing trend of people skipping that last stage. We started to see more inventive ways for people to do that, more digitally manipulated images popping up here, there and everywhere.
NATIONAL IDS AND DRIVING LICENCES ARE A BIG TARGET FOR FRAUDSTERS. HOW ARE THEY GETTING THIS INFORMATION AND WHAT SAFEGUARDS CAN BE PUT INTO PLACE, OR ARE BEING PUT IN PLACE, TO PREVENT THIS AND PROTECT PLAYERS?
Rule number one is, it doesn’t matter how proud you are of it, if you pass your driving test, don’t post a picture of it on social media. I know it sounds silly, but you’d be surprised how many people post that online, even in this day and age. But similarly, national identity cards, anything like that.
You’ve got a number of issues now. We’re not just talking about people having images stolen. I think many people now dismiss when they hear news about data leaks, but the fact of the matter is these data leaks might not just have your personal details, which is bad enough. Depending on which source the data leak has come from, if it’s somewhere you’ve had to sign up and prove your identity, that might mean your identity documents are in that spot as well.
In addition to this, we’ve seen fraud as a service, where people have started opening up different platforms that essentially give people tools to create fraudulent checks. So, it could be a template for a national identity card for [different] countries.
They’re editable templates, or you can even do it on the platform. Obviously, it comes at a fee and there’s a subscription, or you’re paying piecemeal. But, the idea that’s now a growing industry? I think this is why national identity cards crop up in such a large percentage, because it’s a relatively easy document to get a hold of an image for.
DO YOU THINK THERE’S ENOUGH POLICY IN PLACE REGARDING IDENTITY FRAUD SAFEGUARDING?
The key is making sure you’ve got the right type of defence at the beginning of the onboarding process. We do see a difference between different companies in terms of what they’ve decided to do. You’ve got some companies that take the attitude of, if it’s not in the regulations, if I’m not required to do it, it’s an expense I’m not going to put my hand in my pocket for. Whereas you see other companies that are bigger, they’ve got more funds to play with, they’ll take a more robust approach.
It is really important you are establishing that someone is who they say they are through verification of an identity document, through biometrics that are linked to that particular identity. While those checks are going on, you can do a lot of passage checks in the background to try and ascertain if that transaction, that conversation where you’re establishing someone’s identity, if all the elements of are authentic.
ARE THERE ANY AREAS OF REGULATION YOU FEEL CAN BE IMPROVED TO HELP MITIGATE FRAUD?
In the financial industry, a lot a stuff has been in place for a while. It’s come about from the fact they’ve experienced fraud and have started to isolate where the risky areas are. Then you see an upping of the game.
You see the anti-money laundering guidance that comes out and regulations around that. We’ve started to see in the last couple of years a similar thing with crypto, we’re starting to see regulations around onboarding with crypto so that you know who’s creating an account. I would suggest with gambling, it’s taking a closer look at what those regulations are, to ensure it is ticking all the boxes.
But, things have changed. You can’t just work on the basis that someone’s got an email and I’ve sent them a password. We’re dealing in an environment where devices can be stolen, emails can be cloned. You need to think about these things and establish things on a more fundamental level with more scrutiny.
FINAL NOTE, GOING BACK TO SPORTS BETTING, THE NEW FOOTBALL SEASON JUST GOT UNDERWAY. THE CHAMPIONS LEAGUE STARTED UP AGAIN. WHAT DO YOU THINK COULD BE DONE FOR PLAYERS TO KEEP THEM SAFE FROM FRAUD AS WE GET INTO THIS BUSY PART OF THE YEAR FOR FOOTBALL?
From a consumer point of view, be wary about where you’re sharing material. But the protection really comes from the gambling sites and gambling companies themselves. You want to increase your security, be aware of the fact your promotion to improve business is always going to attract more fraud. I’m sure that’s not news to anyone that works in this industry. At least if you’re monitoring it, that’s what you’ll see. So, ensuring you’re putting protections in place, like having some kind of automated system so you’re covered around the clock. Something that’s consistent, that’s verifying someone’s identity from documents to biometrics but also covering that device layer as well. That’s as all-encompassing as it can be. That’s probably the best means they can perform to create that sense of trust, so people that are using those services feel like they’re dealing with someone that cares about their credentials.
SIMON HORSWELL
AFRICA AND ASIA: DO THEY HOLD AS MUCH PROMISE AS THE US?
Aaron Ko, Global Sales Director at payment provider and affiliate Sticpay, says there is plenty of iGaming potential outside the Americas
Since PASPA was repealed, the US has understandably been a major focus for many operators and affiliates looking to expand into new regions. The appeal is obvious – a huge player base with a natural affinity for sports and a GDP per capita in the top 10 worldwide.
But over the past couple of years, we’ve seen a number of operators – including some large ones – give up on the US, with many affiliates following suit. In fact, many affiliates struggled to get going Stateside due to the need for licences and the CPA-dominated market.
The good news is that our data suggests there are plenty of other emerging bright spots globally where there are similarly large player bases.
INDIA
Over the past two years, we’ve seen an almost doubling of both deposit volumes and gaming transactions in our Indian business. As an affiliate by virtue of our payment business, it would be great to think this uptick was due to our payments business getting a huge edge over our competitors, but in reality it’s due to the rise in interest in iGaming in India. We’ve seen increases in other sectors in the country, but they’ve been lower than those in gaming.
In particular, and this is perhaps no surprise given the population’s obsession with cricket, we see players gravitating more towards sports betting brands than casino sites. Interestingly, a site that offers betting on worldwide lotteries is consistently in our top three partners.
Some gaming companies dismiss the Indian market on account of the low spend of gamblers, but while we acknowledge the low deposit value – which averages $5-$10 – the traffic and interest is much higher than other regions and players tend to make multiple deposits. The introduction of GST on gaming turnover doesn’t seem to have dampened interest as much as some thought it would, though we have seen a slight increase in players using crypto casinos to avoid taxes and fees.
Indian players are very bonus-savvy. We offer cashback to players gambling with our operator partners and we consistently see those that offer the highest cashback and their own bonuses take the bulk of our traffic.
JAPAN
The recent past has seen a lot of talk about the country getting its first gambling resort. This may have brought the huge demand for gambling in Japan into the spotlight, but in fact it has been very popular online for many years, despite the challenges gamblers face due to the legal uncertainty. We saw the amount deposited for gaming transactions grow by almost 25% last year and this year is following a similar pattern.
The Japanese tend to prefer casinos to sportsbooks and they like to spend big - the average deposit size of Japanese players to our iGaming partners
is $2,000. On the payment side of our business, whenever we meet a potential new merchant, they always ask about transaction limits. In India or Africa, they always ask about the minimum transaction limit, but in Japan they only ask about the maximum.
It is therefore unsurprising that there is huge interest in Japan among foreign gambling operators. However, it’s worth noting that among our operator partners, four of the five most popular operate only in Japan.
AFRICA
The African continent has long been an area where online gambling companies have struggled to fully tap into the potential that comes with such a huge population, largely due to poor infrastructure and low player values. Payments have been a big issue in many countries, with people without access to formal bank accounts and a strong preference for cash. However, while e-payments were becoming more popular before the Covid-19 pandemic, once it hit this trend accelerated rapidly. Over the past couple of years, we’ve seen significant increases in gaming transactions in Africa, in line with other e-payment operators.
in the latter. In South Africa, the amount wagered has decreased in line with the lower transaction numbers. Kenya has continued to go from strength to strength, with a 400% plus increase in gaming transactions this year.
The fastest-growing countries this year in terms of number of gaming transactions have been Algeria, Botswana, Egypt, Namibia and Tanzania, with increases of 4,150%, 2,333%, 196%, 222% and 1,933%, respectively. Mozambique and Senegal have also performed strongly this year, growing rapidly from having no gaming transactions in 2023.
Africa still lags behind other regions of the world in this respect, but it is fast playing catch-up. A McKinsey & Company report from 2022 predicted the e-payments market in Africa would grow 150% between 2020 and 2025.
The online gambling market seems to be adapting to e-payments faster than other sectors; in Africa we’ve seen larger increases in gaming transactions than we have in forex, for example.
According to Statista, online gambling revenue across Africa is expected to reach $1.9bn this year. This may be a drop in the ocean compared to more established regions such as the US and Europe, but the industry is growing more quickly than those regions. This year’s estimate is almost double the $0.96bn of 2020.
Interestingly, of the three countries that have historically been the largest African online gaming markets, so far this year we’ve seen fewer gaming transactions in South Africa and Nigeria, although the amount wagered has quadrupled
The most popular operators tend to be the large, well-known grey market sports betting powerhouses, though we have noticed an increase in interest in both online casino and crypto casinos over the past year.
One factor holding gaming back is that many African countries have been slow to develop legal frameworks for online gambling, and some also have conservative cultural or religious attitudes towards gambling.
The low value of players has admittedly hindered growth in the past, however deposit values have steadily risen. The average deposit value across Nigeria, Kenya and South Africa has now reached $200, though the average for the rest of Africa is $20.
Taken alongside the more widespread use of smartphones, the improvements in internet infrastructure in many countries, the broader adoption of cryptocurrencies and better local payment gateways and fintech solutions, we see huge potential for iGaming in Africa.
SPGA: OPERATING AS IF IT’S REGULATED
Trafficology investigates the launch of the SPGA and the importance of keeping sweepstakes casinos above board while regulation attempts to catch up
September saw the launch of the Social and Promotional Gaming Association (SPGA), an organisation consisting of online social and promotional platforms that currently offer sweepstakes or other promotional games in the US. According to its site, the SPGA intends to be a “unified voice for the integrity and responsibility of its members’ offerings,” providing education to stakeholders on exactly what sweepstakes gaming is and the benefits it can afford, while also pushing for responsible gaming practices in the sector.
Regulation is currently not in place for sweepstakes gaming in the US – it is why the AGA has called for a ‘crackdown’ on the vertical, which Catena Media CEO Manuel Stan described as “twofold” in its reasoning. The AGA crackdown, in his opinion, is to “clarify the distinction between sweepstakes (and the many variants) and online casinos” and to “ensure the appropriate customer protection tools are in place,” while CogniPlay CoFounder and CEO Allan Turner suggested a misinterpretation of the market from the AGA’s perspective, making the vertical seem “dodgy” for not “following responsible gambling rules” and not “looking after players.”
Before we get started, it is important to clarify that sweepstakes are not some sort of wild west of gaming. For the most part, these draws are being carried out by reputable operators or affiliates looking to generate traffic and engage players in a new way, and because of this, failing to protect players can quickly result in a damaged reputation. Catena Media and CogniPlay, in their interviews with us earlier in this issue, made it emphatically clear that they are following regulation where it exists and are operating “in an honourable way, as though we are regulated and follow best practices” when not.
However, when regulation is not finalised, remaining legitimate as a practice often requires self-governance, holding others accountable for shortcomings while promoting good practices to others. Of course, this can lead to bad actors – the crux of the AGA’s concerns – but generally speaking, it seems reputable businesses at least are not taking this new vertical for granted.
The SPGA, therefore, seem to be acting as a legitimiser of the industry, quelling fears brought on by statements like those made by the AGA. Members will implement a range of tools typical of ‘normal’ online casinos, such as geolocation technology, age verification processes and responsible gaming tools for player safeguarding purposes, have established the legality of the games through regulatory analysis and advocate for education and awareness. Or as Turner said, operating “as though we are regulated.”
For affiliates, keeping an eye on potential regulation of the market will be key to keeping operations running safely and securely. If a state chooses to regulate, take note of the required system and apply it to any operations there, and note that such a system may be implemented in another state or territory in the future.
The sweepstakes market has shown its value and is something affiliates across the market have jumped on. And while regulation is not in place, it is the responsibility of those operating in the vertical to keep its reputation above board.
TRAFFICOLOGY VERDICT
The popularity of sweepstakes is not slowing down anytime soon. The Professional Fighters League (PFL) partnered with FanUp in September, bringing a range of sweepstakes and giveaway games to events in the Bellator Champions Series, and that is just the tip of the iceberg.
With more legitimacy through partnerships, white-label platforms like CogniPlay’s and self-governance and education initiatives like the SPGA, it is likely that authorities both in and outside of the US will need to make more permanent rulings on the state of sweepstakes soon. At present, the verdict seems to be that there are a few bad apples spoiling the bunch, but if regulation can have these businesses put in their place, who knows where this vertical could go next?
Trafficology is brought to you every month by the Gambling Insider team at Players Publishing.
For all editorial enquiries please contact us at trafficology@gamblinginsider.com
For advertising enquiries please contact commercial director Deepak Malkani at sales@gamblinginsider.com
We would like to thank the following contributors to this issue: Casino City Press, Paruyr Shahbazyan, Manuel Stan, Allan Turner, Andrei Cosma, Simon Horswell and Aaron Ko
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