GIQ - Gaming Intelligence Quarterly Jan-Mar 2019 by Gaming Intelligence Quarterly

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G A M I N G

I N T E L L I G E N C E

Q U A R T E R L Y

January – March 2019

2019

Q4 REVIEW

Did you make it? Check inside

Kindred takes on the monopolies Exclusive interviews with Kindred chief Henrik Tjärnström and Svenska Spel managing director Fredrik Wastenson

CONTENTS

LEADER Q4 REVIEW

2019

FEATURES 33 2019 Preview Regulated markets and responsible gambling: two themes, plus a look at which markets will be regulating during 2019 42 Sweden focus: Kindred Group CEO interview Henrik Tjärnström tells GIQ about the operator’s plans for Sweden and beyond

48 Sweden focus: Svenska Spel Sports & Casino MD interview Fredrik Wastenson says the former monopoly will open for competition from a standing start 52 Playtech people The changing face of Playtech’s management team and a look at what its alumni are up to 60 The Gaming Intelligence Awards 2019 Operator and Supplier Awards: including socially responsible operator of the year, management team of the year and ones to watch 70 The Hot 50 2019 The most influential, inspiring and successful people working in iGaming

ANALYSIS & OPINION 4 Snapshot Top stories, top quotes, top deals and deal of the quarter 8 Thought leadership Betradar, SBTech and Sporting Solutions 14 People Gavin Isaacs talks about his new job at SBTech; plus new appointments at Roar Digital, SG Digital, William Hill and more 16 Technology & new products SG Digital’s two-sided network; plus new products from Endemol, Playtech and more 20 Lottery IWG partners Inspired to launch virtual sports; plus news from the Croatia, Michigan and elsewhere 22 Games The launches that caught GIQ’s eye in Q4 26 Legal & regulatory The latest legal developments from around the world; plus an update from the Netherlands 30 Marketing The year of the advertising ban: Italy, Sweden and the UK crack down on gambling ads

FINANCE 83 The Gaming Intelligence Stock Index 2018 85 The GIQ20 Q3 2018: listed operators’ results

AND ANOTHER THING…. 94 He said what?! Quotes of the year 2018

EDITOR IN CHIEF Bobby Mamudi bmm@gamingintelligence.com

DEPUTY EDITOR Kio Dawson k.dawson@gamingintelligence.com

EDITOR Steve Hoare sah@gamingintelligence.com

STAFF WRITER Macarena Rodicio m.rodicio@gamingintelligence.com

SUB-EDITOR Camilla Cary-Elwes info@thecopyeditor.co.uk

CONTRIBUTORS Caroline Parry, Jake Pollard

ART EDITOR Alan Bingle alan@forty6design.com

GIQ Q4 REVIEW

ADVERTISING & SUBSCRIPTIONS Omer Uziely omer@gamingintelligence.com

Steve Hoare

E D I TO R

NEW YEAR’S FIREWORKS HIS YEAR STARTED with a bang – several bangs. We had Sweden opening, severa l US states announcing sports betting plans and the DoJ attempting an industry assassination. The opening of the Swedish market went fairly smoothly (although you can read about the bumps on page 36). Sweden’s re-regulation and the legitimisation of its trailblazing operators and suppliers has been a long time coming. Given the fact that Swedish citizens and companies have done as much for the industry as any nation, this re-regulation feels like a major breakthrough, even if the market is relatively small compared to other regulated markets. Sweden is about the same size as New Jersey and has a similar GDP per capita as the first US state to regulate iGaming. Like New Jersey, Sweden’s re-regulation feels like a symbolic landmark as much as an economic opportunity. The industry’s opponents will continue to rant and rave, but it is difficult to turn back the clock on markets that have already regulated. The news that Sheldon Adelson’s influence extends to the US Department of Justice (see

page 34) brought a depressingly familiar feeling, but the momentum of the US market and the legal precedents should prevent this from being anything more than a hiccup. The industry’s political opponents can have a positive effect on reining in our worst excesses and ushering us towards sustainability. Sweden’s Kindred Group wins this year’s award for Socially Responsible Operator. It makes chief executive Henrik Tjärnström a worthy cover star (see page 42). Sweden’s operators have driven a huge amount of the innovation in this area and none more so than Tjärnström’s Kindred Group. The industry is changing and while the name of the game remains profit, such changes can only make the job more interesting. These changes are always reflected in the Gaming Intelligence Hot 50 (page 70), which we try to refresh each year rather than reproducing a staid list. It is the feature which gives us the most pleasure to publish each year. It is our chance to honour the people who make their companies tick – and not just senior management. However, we like to recognise everyone who does things differently and successfully throughout the year. Are you? If so, get in touch at sah@gamingintelligence.com

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GIQ Q4 2018

Snapshot most popular news stories on GamingIntelligence.com Gamenet completes €273m Goldbet acquisition European gambling regulators take aim at unlicensed operators William Hill swoops on Mr Green with £242m offer William Hill signs New Jersey Devils broadcast sponsorship English Premier League and EA launch new eSports tournament MGM GVC Interactive names Adam Greenblatt as CEO Scientific Games acquires Don Best Sports Portuguese online betting and gaming market reaches €38.5m in Q3 Evolution Gaming snaps up rival live casino provider Ezugi GVC acquires Australian operator Neds for initial AUD$68m

Quote of the Quarter We are better than them” Kindred Group chief executive officer Henrik Tjärnström doesn’t mince his words when dismissing the competition from the former monopoly Svenska Spel (page 42).

William Hill heads to Malta with Mr Green deal WILLIAM HILL’S £242M acquisition of revenue, this move should not cause a huge Stockholm-listed iGaming operator Mr Green amount of disruption. Management hopes the & Co looked pricy in most analysts’ eyes. move will reduce the operator’s exposure to BrexThe UK bookmaker is not buying a market it risk and help drive synergies. It will also place leader but Mr Green is a smartly-run operation responsibility for Spain, Italy and elsewhere in that has grown fairly consistthe hands of the team in Malta. ently throughout its lifetime. William Hill’s chief digital Furthermore, William Hill’s officer Ulrik Bengtsson has If William Hill CEO Philip Bowcock made some responsibility for the integration can maintain encouraging comments sugof Mr Green with the William Mr Green’s annual Hill group. Bengtsson is a veteran gesting that Mr Green will be growth rate of allowed a level of independence, of the Swedish-Maltese market 23 per cent, it rather than being consumed by from his time as COO and CEO the larger company. of Betsson and could be ideal for will be money William Hill will move its the job. He was involved in the well spent international online operations integration of many of Betsson’s from Gibraltar to Mr Green’s hub in Malta, but acquisitions and will plan to avoid some of the pitGibraltar will remain the hub for William Hill’s falls, which caused the occasional profit warning UK and Ireland online operations. With interduring Betsson’s M&A spree. national operations (excluding Australia and Some analysts thought this an odd acquisithe US) accounting for only eight per cent of tion at a time when the UK retail estate is in peril

THE QUARTER’S DEALS IN 60 SECONDS The flood of B2B deals in the US continues to flow, with bet365 making its weighty presence felt with a $50m investment in New York’s Empire Resorts and plans to provide it with a sportsbook and iGaming operation, when regulations allow. The world’s favourite sports betting website has also signed a deal with Hard Rock International, which gives it access to the New Jersey market right now. The deal will introduce bet365 to New Jersey but the Seminole-owned operation has turned to Sweden’s Gaming Innovation Group to provide its own-branded iGaming and sports betting operation. In a similar manner to Hard Rock, Eldorado Resorts is cutting deals left, right and centre. Hot on the heels of taking

a 20 per cent stake in William Hill US, in return for retail and digital sports betting rights in its 13 states of operation, Eldorado has agreed terms with The Stars Group. The Stars Group will have the option to own, operate and brand online sports betting, poker and casino offerings in each of the applicable states where Eldorado has a property. For sports betting, The Stars Group will gain first skin access in states where Eldorado operates more than one casino property, and second skin access in all other applicable states. William Hill US remains Eldorado’s exclusive provider for land-based retail sports betting and has consented to the company’s agreement with The Stars Group, and will share in the economics of The Stars Group transaction. It is becoming a complex web Stateside and that is sure to continue. Wynn Resorts has taken a road less travelled, acquiring a 22.5 per cent stake

GIQ Q4 2018

Get the latest news from our website

GamingIntelligence.com

The quarter in numbers LEGAL & REGULATORY

Approved licensees in Sweden’s re-regulated market as of 21 Jan 2019

£16m+

Penalty payments made by UKlicensed operators in lieu of fines MARKETING

DEAL OF THE

QUARTER

(after the UK government’s ruling on FOTBs) and the US operation is in hyper-growth mode. It is hoped, however, that Mr Green’s strengths outweigh the disruptive or distracting elements of the acquisition. Mr Green’s roots lie in Sweden and it won a licence during the recent re-regulation of the market, while William Hill did not apply for one. The company is also licensed in Denmark, Italy, Latvia, Malta, the UK and Ireland. Bowcock claimed 77 per cent of Mr Green’s revenues come from regulated or soon-to-be-regulated markets,

but this includes Germany (where regulatory uncertainty is fuelled by incumbents who are hostile towards online casinos) and the Netherlands, where Mr Green will be hit by an onerous tax charge upon regulation, with a risk it will not win a licence, given a recent fine. One would think Hill’s lawyers would be able to deal with that little wrinkle. If William Hill can maintain Mr Green’s annual growth rate of 23 per cent, while integrating its own operations, it will be money well spent. n

Official gaming partnerships signed by the NBA in Q4 2018 FINANCE

£52.6bn

bet365 turnover for 2017/18

£676m

Savings for GVC from Ladbrokes Coral deal after FOBT stake reduction

£1bn

William Hill’s annual digital revenue target by 2023 BUSINESS

in Malta’s Betbull in a deal that will see the pair leverage Wynn’s brand and Betbull’s technology. 888 Holdings is taking matters into its own hands with a $28m deal to buy-out its joint venture partner in the All American Poker Network (AAPN). The AAPN was established as a US-facing joint venture between 888 and investment firm Avenue Capital in 2013. 888 is acquiring the remaining 53 per cent shareholding in AAPN held by Avenue for a total cash consideration of $28m. Back in Europe there were a few M&A deals worth mentioning. Italian betting and gaming operator Gamenet Group has completed the acquisition of GoldBet for €273m, giving it a network of 990 betting shops in Italy, as well as an online betting and gaming platform. Åland-based gaming operator Paf is taking its bingo platform in-house with the acquisition of GIQ Q4 REVIEW

Swedish online bingo provider Proactive Gaming Scandinavia, which has supplied Paf with bingo software since 2014. GVC Holdings strengthened its position in Australia with the acquisition of online betting operator Neds International, which launched online last October. It’s a fast-grower. This year the business expects to achieve AUD$1bn of wagers and gross gaming revenue of approx. AUD$100m. That translates to an initial acquisition price of AUD$68m (£37m), which could rise to AUD$95m. Finally, Stockholm-listed operator and B2B supplier Cherry has received a SEK9,193m (€805.1m) take-private offer from European Entertainment Intressenter, a company consisting of private equity firm Bridgepoint Advisers and Cherry shareholders such as Betsson chairman Pontus Lindwall and Cherry chairman Morten Klein.

Teddy Sagi’s stake in Playtech M&A

SEK9.19bn

Proposed deal to take Sweden’s Cherry private

£242m

William Hill’s bid for Mr Green PEOPLE

Years at SG for Jordan Levin before becoming SG Digital chief 5

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S P O N S O RE D E D I TO RI A L SBTECH

Putting regulation and innovation at the heart of sustainable growth SBTech chief compliance officer Jeremie Kanter says marketing and responsible gambling efforts should work together in harmony NOVEMBER 2018 SAW the most fines ever complete one another with operators and supimposed on gaming operators in the UK. On pliers using the same technology to offer playthe day the news broke, Jeremy Wright, the ers safety, fairness and entertainment. Playnew UK Secretary of State for the Department ers are entitled to receive tailored marketing of Digital Culture, Media & Sport, gave a stark opportunities, as well as full and unapologetic warning, saying that “any operator that thinks protection in an environment clear from any it can ignore its duty should take note”. suspicion or evidence of criminal proceeds. We certainly did. However Our current efforts are the issue of improving indusguided by our ambition to lead try compliance best practice the way in providing custom“It is SBTech’s runs far deeper than just ers with the most innovative box-ticking exercises. Yes, the role as a leading software to not only support sector needs to improve over- supplier to assist their regulated operations, all compliance practices and operators to but to also help them put social processes, and training and connect compliance responsibility at the heart of education will largely achieve with products to their business model, shifting this over time, but we can, and ensure a fairer, more the mindset from considering should, look to take a different, compliance as a blocker to it sustainable offering” becoming an enabler to busifar more positive and collaborative approach. It is, as Mr Jeremie Kanter, SBTech ness growth. Wright suggests, “our duty”. Marketing and compliance Regulation and compliance are welcome both focus on similar areas (player journey and but conversely are often seen by operators and experience) and use similar tools (algorithms suppliers as time-consuming and costly. If we and behavioural analytics, flags and scoring). are to avoid further fines and confusion around Therefore, if we head in the same direction and government-imposed regulatory measures, use the technology and significant expertise we and instead emerge as an innovative and more have at our disposal, we can spot marketing or widely accepted element of the entertainment harm-prevention opportunities. industry, then we need to turn this attitude and approach completely on its head. Connecting comfort zones We are taking this ‘Reg-Tech’ approach to new Complete not compete levels of excellence both by enhancing and At SBTech we have always adhered to extremedeveloping in-house initiatives and prodly high regulatory standards. Our role as a ucts, as well as partnering with best-inleading industry supplier has helped us realise class third-parties, such as our recent that compliance is no longer just a mandatory agreement with the SMP Compliance requirement, it is a mindset at the heart of the Academy to provide training and operator’s business model, and one that can eLearning methodologies throughout significantly benefit both social responsibility the SBTech group. and sustainable commercial growth. Operators are highly successful Central to this is the convergence of techmarketers. This can and should nology and mindset. Gaming has pioneered be replicated, connected to and the use of innovative marketing technology, implemented within social and we continue to do so, with data-driven responsibility measures and platforms and functionality able to segment targets. This means linking and target players down to an individual level players’ affordability and based on specific behaviours. Instead of regubehaviours, in other words lation and marketing competing, they should their financial and personal 8

‘comfort zones’, with operators’ financial revenue forecasts. Consequently, we must encourage the use of sustainable player lifetime value and ensure operators are not pushing players beyond their affordability, checked and validated through proper KYC policies and procedures. I strongly believe it is SBTech’s role as a leading industry supplier to assist and engage with operators to connect compliance with the most innovative products to promote a disruptive mindset and ensure a fairer, more sustainable offering. Without considering this approach we will be failing to do our duty to our customers and their players, and we can look forward to a far more uncertain future than we have today. n

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S P O N S O RE D E D I TO RI A L SPORTING SOLUTIONS

The more things change, the more they stay the same IN THE SPORTS betting industry, technological advancements have delivered an offering that is unrecognisable to the end user compared to the in-shop experience of the late 1990s. A world of pre-match-only betting on horse racing has been superseded by in-play betting opportunities on tens of thousands of events across multiple sports. However, while there have been developments in the front-end and product levels of sports betting, the most fundamental part of the sportsbook operation – risk management processes and the ability to generate profit – has not improved at all. It is still fundamentally the same manually driven, subjective process as used last century, even though the underlying product offering is now much more dynamic and diverse. Why? If “necessity is the mother of invention” then the reason risk management didn’t evolve ten or 20 years ago is because it didn’t need to. The initial growth of in-play and the channel shift to online betting (opening more jurisdictions than bricks and mortar alone) provided a boom time for many operators. Sportsbook focus shifted away from investment in traditional skills associated with differentiated pricing and risk management. The ability to buy in content cheaply from outsourced providers led many operators down a path of increasingly homogenised pricing – you do not need risk management expertise if your strategy is to scrape and copy prices and limit customers to small stakes. Turnkey suppliers have ridden this growth wave through commoditised product offerings in an environment of low data costs and liberal tax regimes, coupled with little regulatory focus on aspects such as responsible gaming and AML. However, this type of growth (as characterised by the ‘dot.com’ era) is over. Operators – and their supply chain – need to compete in a more heavily taxed and regulated market environment, under the burden of higher costs in areas like data and technology – with much finer margins of turnover than even a few years ago. Even with consolidation, for many operators looking to survive and thrive, this is going to require a fundamental change to their business model – in particular, how they generate profits through changing the way they price and manage risk. 10

Sporting Solutions chief executive officer Simon Trim says risk management is a dying art that needs to be resuscitated in the era of regulated markets Differentiation through automation Managed, or manual, trading services (MTS) are aimed at providing a solution to the operational cost problem of managing a sportsbook, including betting exposure. However, swapping one manual head for a cheaper one doesn’t solve the issue for operators when the underlying problem is not just one of cost. The industry now has a systemic issue caused by a fundamental part of its value chain (pricing and risk management) no longer being fit for purpose in the modern market landscape. The exponential increase in the number of in-play events means they are impossible to risk-manage manually, which is why current techniques focus on cutting off the exposure at source (by limiting customers’ stakes). The need for improved returns, differentiation, scale and business efficiency is why we at Sporting Solutions developed our unique automated Risk Adjusted Pricing (aRAP) service to

complement our existing market-leading B2B trading and software propositions, all under the banner of Risk Management Services. The dynamic pricing function of aRAP has been developed using risk management algorithms similar to those developed in the financial sector for managing portfolios of correlated exposure on vast amounts of real-time positions. Initially, events are priced and traded via a combination of Sporting Solutions’ existing algorithms and expert trading teams, meaning operators offer their customers the best ‘base prices’ in the market. This service (‘Connect’) can be integrated into any system. As operators build up exposure, aRAP adjusts prices on a peroperator basis according to the operator’s own appetite to risk on that event. Settings are configurable to the operator according to how defensive or aggressive they want to be, and the operator retains control of how customers are treated in respect to the size of bet accepted. As a result, the operator is able to offer pricing that is fully automated, customised and optimised according to the actual exposure they have on their book and according to their level of risk averseness.

Delivering on new risk dynamics Automation of the risk function is necessary with a view to embracing trends in big data, artificial intelligence and behavioural economics – all of which are important themes for the industry and none of which can be carried out via a manual trading service. To enhance aRAP we developed Profile – automated customer analytics tooling built to query reams of anonymised information and ‘grade’ the client base. Profile provides a basis for objective risk management based on the skill level of the customer placing the wager and can be integrated alongside aRAP, allowing for real-time price optimisation based on specific consumer activity rather than total exposure – let alone following generic market movements as is the way of the industry today. Combined, our Risk Management Services and aRAP solution reduce operational cost, support differentiation through bespoke pricing, improve margin on turnover and reduce volatility in earnings, especially under our Guaranteed Returns model. In an increasingly harsh environment it is an innovative solution that will deliver the market leaders of tomorrow. n

S P O N S O RE D E D I TO RI A L BETRADAR

A world of opportunity Sportradar managing director for Asia, Michael Maerz looks at the differences between the Asian, Latin American and US sports betting markets IT’S CLEAR. THE opening of more and open. For example, I expect there is likely to more legalised betting markets is good for the be wider coverage of baseball and football in industry. Not least because it can help bring nearby Latin America to cater to that market any potential threats to integrity out from the as the increased demand for betting and enterdark, but also because of the key learnings it tainment has a domino effect. Would this then can create worldwide. These include the longnot have a knock-on effect on the markets in term potential for operators to gain increased that region that are yet to open their doors to market share and the many other opportunilegalised betting? ties it offers the sports environment in generGoing even further, I expect this will also ating greater engagement, following and other potentially play on the minds of some within commercial opportunities. Asia where future markets are full of potenThis has been evident in the US. As we tial due to the diversity of sports interest and speak, we are staring at the formation of a spread of regional areas subject to various billion-dollar industry that is set to redefine influences. On the one side, it’s all about footAmerican sports as we know ball, as well as basketball, it, whetting the appetites of badminton, sepak takraw, fans and businesses across table tennis and eSports, on “We take a ‘glocal’ the globe. the other, cricket, field hockWithin the American approach, providing ey and kabaddi present an landscape, depending on how services that opportunity for the exchangeregulations are rolled out, take into account style betting format. legalised betting will spin In Asia, the range of differand utilise global its web from the traditional ent sports that can be wagered expertise, but can retail gaming epicentres of is much wider than in the Las Vegas to online platforms be tailored with US. The existing growth and and mobiles across the nation. a local approach” high penetration of mobile This could see the concept of Michael Maerz, Sportradar technology across the conin-play betting, which, unlike tinent provides a welcome in Europe, hasn’t seen much traction in the US foundation for the increased engagement and yet, erupt. The potential for in-play, minute-byentertainment opportunities that mobile betminute interval betting on popular American ting provides. sports is huge. And, with this, so is the proposiI imagine legislation in Asia could possibly tion betting too, which again is already estabmove faster as well, simply because the US marlished in other markets. ket is more complex due to the state-by-state But the engagement and excitement of the nature of legislation. The licensing regime new betting opportunities is not just expected in the US also creates a high barrier of entry, to launch the most popular American sports meaning existing major international operato an even higher unprecedented level, it will tors are probably better equipped to go through also expand to other sports, such as golf, boxthat process. ing and mixed martial arts. All of which is There are, however, ways that operators, likely to have an impact on markets worldwide. no matter how big or small, and no matter at And not just on the markets that are already what stage of the business life-cycle they are at, 12

can get in on the new market excitement. And that’s, largely, where and why Betradar exists. In the grand scheme of things, while betting products across the world are ultimately similar, there will always be different requirements at a regional level and a country level. This is why we take a ‘glocal’ approach, providing services that take into account and utilise global expertise, but can be tailored and targeted with a local approach. It is all about staying ahead of the latest trends and technology across the latest markets – the US, Asia and Latin America in particular. We are continuing to grow our presence across all of these areas with our partner-focused approaches and initiatives. We also continue to work closely with existing operators and start-ups to arm them with the tools to enter and thrive in these new markets. It is why, for example, we have widened our coverage of Latin American football leagues and to include other sports like kabaddi, field hockey and sepak takraw. We are also expanding our virtual sports offering into baseball and cricket. In terms of market trends, we have launched minute-by-minute betting with a new and allimproved bet-builder to follow. Our latest Numbers Betting solution, launched late last year, is also generating more impact with improved technology and responsiveness, while our allencompassing risk management Managed Trading Services (MTS) still remains one of our most popular solutions, and continues to thrive. n

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SBTech adds experience to aid big ambitions Former Scientific Games chief executive Gavin Isaacs joins SBTech – a company on the up and up GAVIN ISAACS IS so new to SBTech he hasn’t what he wants. There is no BS. And I found that yet met the team he will be sharing an office very refreshing. He wants to grow the busiwith. Officially, he joined SBTech as chairman ness. He doesn’t like being in second place. He on 1 January. He will be based in Las Vegas, likes to be the leader – as do I.” where SBTech has a fledgling office of just five We talk a week before Isaacs is due to people at the moment, but when we speak at the embark on a whistlestop tour of SBTech’s beginning of January he is yet to visit the office. European offices in the UK, Bulgaria and the The sports betting supplier will be scaling Ukraine, where he will be finding out a whole up Stateside over the next few months as it suplot more about the business. ports a mushrooming US client base, which Isaacs has been involved in the senior already includes the likes of Churchill Downs, management of four big gaming compaGolden Nugget and Resorts Casino. nies, but up until now his involvement in Having Gavin Isaacs’ name at the top of sports betting and iGaming has been relativethe team sheet as it embarks ly sparse. He could probably on its recruitment spree will have got another job at an IGT do the supplier no harm at or a Novomatic but SBTech’s all. A quick look at his CV “The American focus on new technolog y reveals his status as an indus- market will take excites him. try heavyweight. He was the some time to adopt “The American market chief executive of Scientific sports betting and will take some time [to adopt Games and of ShuffleMassports betting and iGaming], iGaming. But it ter. Before that he was chief so you don’t lose focus on what will happen” operating officer at Bally and you do elsewhere. But it will before that he was a president Gavin Isaacs, SBTech happen,” says Isaacs. at Aristocrat. He will be helping out with It would be tempting to say that Isaacs adds strategy and opportunities for investment. But a few grey hairs to SBTech’s youthful managehe will also be able to use his contacts to make ment team were it not for his famously bald sure SBTech’s executives can meet the right pate. Isaacs is a little out of the loop. He has people in the right organisations – particularly effectively been on gardening leave as vice among US casinos. chairman of SciGames, since he was replaced Isaacs’ recruitment also looks like the as SG CEO at the end of 2016. He has met and appointment of a company that is due to list on bonded with SBTech founder and majority the stock market. The company has recently shareholder Shalom McKenzie. recruited a new chief operating officer in the “It was the right chemistry,” says Isaacs. shape of former Paddy Power Betfair executive “He is very true to his word. He knows exactly Dave Hammond and a new chief compliance 14

officer, Jeremie Kanter. A listing has been rumoured (some would say presumed) since chief executive Richard Carter joined from Deutsche Bank, where he worked on various initial public offerings, including the likes of 888 and 32Red. Isaacs denies any knowledge of an upcoming listing, but it is clear that the pieces are being put into a place that would allow it. Similarly, Isaacs’ presence alongside Carter, with Hammond running operations, gives SBTech the type of structure to make an M&A splurge run a lot more smoothly. SBTech is growing up. It has emerged from a position where it seemed like every second-tier operator’s favourite sports betting choice to the point where it can claim a focus on regulated markets with a straight face. From the aforementioned land-based US casinos to some of Europe’s leading lotteries, SBTech is now a serious alternative to Scientific Games’ OpenBet solution, which a few years ago seemed to have a stranglehold on the big contracts. Now the field has opened up and Isaacs is looking forward to helping SBTech enter a whole new era. n

P EO P L E Q4 NEWS

NEW RESPONSIBLE GAMBLING CHAIR

IN THE NEWS

THE UK GAMBLING Commission (UKGC) has appointed Dr Anna van der Gaag as the new chair of the Responsible Gambling Strategy Board (RGSB). She will join the RGSB as a member with immediate effect and take over the role of chair from Sir Christopher Kelly, whose term comes to an end in March. Van der Gaag is a visiting professor of ethics and regulation at the University of Surrey, and has held regulatory roles in the health, social care and legal sectors.

“She brings with her a wealth of experience in health, social care and the prevention of harm that will be an asset in advising on how to implement the next National Strategy, which will launch in April 2019,” said UKGC chairman Bill Moyes. The UKGC has taken the lead with instilling a responsible g a mbl i n g st r at e g y throughout the industry. The installation of a health professional in this role will continue that work.

WILLIAM HILL US APPOINTS DIGITAL CHIEF

Gaming executives who have been making headlines and what’s in their inbox QTECH APPOINTS GLOBAL CEO ASIAN RESELLER QT ECH Games has named former Catena Media chief financial officer Markus Nasholm as its global chief executive officer. He takes over from founder Jonas Alm, who remains with the company as managing shareholder. QTech has experienced rapid growth over the past two years and aims to be “the largest provider of digital entertainment in Asia by 2021”. Note: not just the biggest gaming company, but the biggest provider of digital entertainment. That puts it head-to-head with the likes of Renren and Alibaba. That is a big ask. To make matters more complex still, Nasholm has been given the brief of extending the company’s coverage from Asia to Africa and Latin America. Until now, QTech has prospered largely due to its founder’s contacts book. It is asking a great deal of its new CEO. GIQ Q4 REVIEW

WILLIAM HILL HAS app oi nt e d K en ne t h Fuchs as president of digital at William Hill US. Fuchs most recently served as chief executive of sports data provider STATS, whose clients include William Hill, prior to which he was VP of Yahoo Sports, Yahoo Finance and Yahoo Entertainment and Music, where he led the development and growth of fantasy sports.

DAVEY LEAVES SG DIGITAL The revolving door at Scientific Games continues to turn. Former NYX and SG Digital chief executive officer Matt Davey has left the company with the integration between NYX and SG complete. No doubt Davey leaves a very wealthy man. And perhaps he is a CEO best suited to growth companies, rather than corporate monoliths like Scientific Games, but his energy will be missed. SG installed Barry Cottle as its third CEO in as many years last year but has turned to the old guard to fill its other divisions. Longstanding Lottery chief James Kennedy has been made chairman and has the gravitas to fulfil the role handsomely. Former WMS executive Jordan Levin takes over SG Digital, having been the first boss of interactive products at WMS and then SG. North American chief Pat McHugh takes over the all-important lottery division.

William Hill US operates over 100 sportsbooks in Nevada and New Jersey, and provides sports betting solutions as a licensed supplier in Mississippi, West Virginia, Pennsylvania and Rhode Island. However, these are retail solutions. Its digital product is still in its infancy. It is in the process of linking its betting engine and trading services to the NeoGames account management system. The implementation of this system will be the biggest factor in ensuring Hills’ US ambitions are satisfied.

ROAR DIGITAL TEAM TAKES SHAPE ROAR DIGITAL, THE newly named US joint venture between MGM Resorts International and GVC Holdings, has appointed Matt Prevost as chief marketing officer (CMO). Prevost was previously CMO for Gibraltarbased Coral Interactive between 2011 and 2015, and part of the initial management team that developed the marketing plan that has been a key driver of Coral.co.uk’s success over the last seven years. He joins Roar Digital, previously known as MGM GVC Interactive, from North American beauty company New Avon, where he has served on the board as chief digital officer for the past year. He is Roar CEO Adam Greenblatt’s first appointment as he builds a team capable of taking the US sports betting market by storm. He has a huge market to attack and the backing of one of the biggest brands in the US. It’s a big job but boy, it’s a good one. 15

SG Digital embraces the Platform Revolution C O LU M N Steve Hoare

SG Digital is aiming to be the Facebook of iGaming. Gaming senior vice president Dylan Slaney explains how, while Big Time Gaming chief executive Nik Robinson tells us about life on one side of the two-sided network

IT ALL STARTED with a book: Platform Revolution by Geoffrey Parker, Marshall Van Alstyne and Sangeet Paul Choudary. You can buy it on Amazon or any other leading bookstore, no doubt. “That’s where the philosophy comes from,” explains SG Digital Gaming SVP Dylan Slaney. “It’s the bible for two-sided networks.” Platform Revolution studies the likes of Facebook, Airbnb, Uber and PayPal, and analyses the reasons for their success. In essence all these companies provide a platform for two different communities to come together. “In our world, the two-sided network is about having operators on one side of the equation and content on the other, with a stable platform in the middle with rich features that can drive the value equation for the communities we serve,” says Slaney. The OGS platform – originally developed by NYX – is the stable platform that brings these communities together. The communities that SG Digital serves comprise some 125 companies operating 300+ brands, 60 thirdparty studios, and its own content studios supplying some 1,800 titles to players hailing from 20 different jurisdictions. “We believe operators should be operating and be in control of their Casino business. We don’t run end-to-end casino businesses, we provide the features and content that delivers next-level player experience for our customers,” explains Slaney. “We are a content aggregation platform with a bunch of features that can enhance player experiences.” Some operators might only connect to OGS, but most take content through a number of sources, whether that is through a direct integration or through other aggregators. “It’s a very simple model that allows quick access through one integration to a plethora of

regulated content,” concludes Slaney. And the network is growing rapidly. In 2018, some 50-60 new operators hooked up to the OGS platform. The list now includes the likes of The Stars Group, William Hill, Paddy Power, LeoVegas, Mr Green, Golden Nugget, Svenska Spel and British Columbia Lottery Corporation.

BTG and SG While operators sit on one side of the two-sided network, suppliers such as Big Time Gaming sit on the other. Big Time Gaming founder and chief executive officer Nik Robinson has a long history with SG Digital. He founded NT Media in 1997, which merged with Orbis in 2005 and became OpenBet in 2010. He was part of the management team that grew the company from 50 people to 500 and then left on good terms when his earn-out expired. When he launched Big Time Gaming (BTG) a few months later, the relationship was still strong and he turned to OpenBet to get some of BTG’s games to market. Robinson also turned to NextGen to get more games to more operators. “As you know, NextGen became NYX and went on to purchase OpenBet before being acquired by Scientific Games to form SG Digital,” Robinson tells us. “At this stage, the long-standing relationships at both businesses were key to keeping the delivery process streamlined post-acquisition. This period can often be chaotic, but the fact it wasn’t was testament to the incredible team at SG Digital.” A fair percentage of Big Time’s revenue now comes through the OGS platform and that is set to grow in 2019, with a raft of new content being delivered into the British Columbia Lottery Corporation, Loto-Quebec and Ontario Lottery and Gaming, thanks to SG Digital’s presence in Canada. This will be boosted further by Big

F I NA NC E

GIQ20 Q3 2012

ON THE FOLLOWING PAGE

18 Tech news

Time Gaming’s first steps into the US via an exclusive launch with Golden Nugget. Robinson is hugely excited about the opportunities offered in the US market. Over the past year or two, Europe’s operators have been raving about Big Time’s games and Robinson is confident US operators will be similarly impressed. “Our games are like nothing the land-based or embryonic online market in the US has seen to date,” claims Robinson. “We know it will take time but we’re prepared to build the foundations to make our games become some of the topperforming online slots in the US market. We also believe we can extend this success to the land-based sector. We will deliver our slots into properties via server-based games while leaving the RTP unscathed, bringing the big wins back and making casino floors thrive once again.” He acknowledges that this omni-channel approach would be much harder without SG Digital’s support. And he says there are other technical features that distinguish the OGS platform from other aggregators. “A lot of aggregation platforms are fairly vanilla in their offering, but over the past 12 months this is something that SG Digital has put its foot on the gas to change. In particular, the latest promotional tools are as good as any out there and in most cases set the standard for others to follow,” says Robinson. “We have actually been working very closely with SG Digital to spec and build a number of bespoke bonus systems for them to offer on our games.”

NYX becomes SG Slaney is hoping to extend this development assistance following the recruitment of new studio director Rob Procter, who joined the company in November from Sky Betting & Gaming where he was content and commercial manager. SG Digital has what it calls a “second-party development team”, which builds some 60 or 70 games a year on behalf of different content providers. Slaney is aiming to double that number over the next few years. “We have the expertise and we have our own content studios where we are building in excess of 150 games a year. Our heritage is building great games. So why wouldn’t we help operators and content GIQ Q4 REVIEW

SG Digital Gaming SVP Dylan Slaney

“The industry needs to slow down and concentrate on quality and innovation. Content can only be king if you give it the royal treatment” Nik Robinson, Big Time Gaming providers come together to create compelling content for their players?” continues Slaney. It is another part of the open two-sided network philosophy. You can just connect into the OGS to distribute a game, but if you need help building the game or want to build it on the SG Digital game engine then the team can help with that, too. “There are a number of routes that we allow operators and partners to come together to use our expertise, scale and size to serve players more efficiently.” Efficiency is not a quality that has been readily associated with OpenBet in the past. Operators have often moaned about integration times, or suppliers have felt marginalised as they sit and wait to be integrated with an operator that has asked for its content. This has been a big focus for SG Digital since its acquisition of NYX over a year ago. There has been a lot of investment into the process. Slaney now feels confident enough to say that if all the compliance requirements are in place then he can hook up a new operator in four weeks.

Big Time Gaming founder Nik Robinson

Robinson has a slightly different take on this issue: “In terms of speed, the design, development and launch of a game should not be a swift process. In many ways, the industry at large needs to slow down and concentrate on quality and innovation. Content can only be king if you give it the royal treatment. Not necessarily polishing every pixel, but most certainly getting into the game and making sure it is exactly what players want now and into the future.” Robinson says operators are in competition with everything the internet has to offer, from Facebook and Netflix to other entertainment options and information services. “It’s the toughest competition imaginable,” he continues. “If we’re not taking that competition seriously, then we’re wasting our time, operators’ time and the time of the player. Of course, we take a different approach to some operators but SG Digital understands our way of doing things. Once our game is ready, they then have an incredible delivery team that ensures launches happen in the fastest and most efficient manner possible.” SG Digital is changing. Just before Christmas, the departure of former NYX chief executive Matt Davey was announced. It was his vision that first attracted Slaney to NYX. But Davey was always aware that NYX needed the backing of a giant like Scientific Games to truly thrive. Davey might have gone but his legacy is a smoother, more efficient SG Digital than OpenBet or NYX could ever have been on their own. n 17

T EC H N O LO GY Q4 LAUNCHES

SCIENTIFIC GAMES ENHANCES US SPORTS BETTING PLATFORM Scientific Games’ SG Digital division has launched an enhanced sports betting platform in New Jersey and Mississippi for casino operator Caesars Entertainment.

What’s the big idea? Complementing the

Playtech launched the first B2B online poker network across France and Spain at the end of November, with operators from Portugal and Italy expected to join the network in the future.

What’s the big idea? While individual

BIG LAUNCHES

OpenBet sportsbook, which already powers sports betting offerings at Caesars’ Atlantic City, Gulf Coast and Tunica properties, SG Digital has integrated solutions from newly-acquired Don Best Sports to its Managed Trading Service (MTS) platform. Alongside the recently established Gibraltarbased Sportsbook Operations service, SG Digital said that the launch provides a new era of quick installations for the US sportsbook market. “This is a major milestone for us,” says Keith O’Loughlin, senior vice president of sportsbook at SG Digital. “Following a quick and simple integration that took less than two weeks, following the Don Best acquisition and the recent formation of our Gibraltar Sportsbook Ops team, Caesars now has one of the most comprehensive sports betting offering in the US, with Managed Trading Service delivering a complete product.”

Five of the quarter’s major product launches and what they mean for those involved

ENDEMOL AND IPRO LAUNCH DEAL OR NO DEAL SOCIAL APP

PLAYTECH POWERS POLAND’S FIRST REGULATED ONLINE CASINO

PENNSYLVANIA’S PARX CASINO PARTNERS KAMBI Stockholm-listed supplier Kambi has signed an agreement to provide its sports betting technology to Pennsylvania’s Parx Casino.

What’s the big idea? Sports betting arrived in Pennsylvania in November as Hollywood Casino at Penn National Race Course opened the state’s first legal sportsbook in partnership with William Hill. This was followed by SugarHouse Casino and Rivers Casino Pittsburgh with their Rush Street Interactivepowered sportsbooks in December. Next up will be the state’s largest casino operator, with Greenwood Gaming and Entertainment signing Kambi to launch new sportsbooks at Parx Casino and the South Philadelphia Turf Club. “Greenwood Gaming represents another exciting partnership for Kambi, as we establish ourselves as the premier choice for operators looking to enter the US sports wagering market with a quality product and trusted partner,” says Kambi chief executive Kristian Nylén. 18

PLAYTECH LAUNCHES SHARED LIQUIDITY POKER NETWORK IN FRANCE AND SPAIN

Endemol Shine Gaming has teamed up with Seattle-based gaming technology provider iPro to launch a new social gaming offering based on the popular TV gameshow Deal or No Deal.

operators such as PokerStars, Winamax and partypoker have been operating shared online poker pools for some months now, Playtech’s iPoker.EU is the first B2B poker network to share liquidity across the two territories. The launch allows players from Betclic and Unibet in France to play online poker against Spanish players from bet365, Betfair, Casino Barcelona and Sportium. It also includes the potential for additional operators from Portugal and Italy to join the network in the future. “This is a significant move for us, our operators and our players,” says Playtech chief operating officer Shimon Akad. “The presence of six key operators as launch partners highlights the opportunities that exist, while also giving encouraging signs towards the future of the network. This move reinforces Playtech’s position as a leader in regulated markets, as well as our commitment to poker.”

In other Playtech news, the London-listed supplier launched Poland’s first regulated online casino for state-owned National Lottery operator Totalizator Sportowy in December.

What’s the big idea? The two companies

What’s the big idea? The Totalizator

have developed a free-to-play Deal or No Deal Live app that can be played alongside the TV show, which recently returned to US televisions following a 10-year hiatus. It is the production company’s first-ever live play-along companion app in North America and gives players the opportunity to make choices along with the TV contestants, as well as make predictions on what contestants will do next. “Deal or No Deal is a truly evergreen format and we continue to grow the brand’s off-air presence through innovative gaming,” says Endemol Shine Gaming commercial director Mark Woollard. “We are delighted to partner with iPro to offer our US fans new ways to engage with the show and we look forward to exploring opportunities to further this partnership for Deal or No Deal audiences all around the world.”

Sportowy project continues Playtech’s recent strategy of partnering with World Lottery Association members in regulated and newly regulated jurisdictions, including Greece’s OPAP, Portugal’s Santa Casa, Italy’s Sisal, Finland’s Veikkhaus, Denmark’s Danske Spil and Norway’s Norsk Tipping. Playtech is providing the underlying platform, its games portfolio and support services for Totalcasino.pl, the new iGaming brand for Totalizator Sportowy, which has run Poland’s lottery services for six decades and currently has a network of more than 17,000 points of sale across the country. “This is a significant day for Totalizator Sportowy and for Playtech,” says Playtech chief executive Mor Weizer. “A lot of hard work has gone into the last nine months to build an exciting, robust, safe platform for Poland’s players.”

MEET US @ICE TO SEE THE BIG BANG TUESDAY, FEBRUARY 5TH, 2:30 PM STAND S3-110

F I NA NC E GIQ20 Q3 2012

IWG creates instant win virtual sports games to accelerate US growth C O LU M N LOTTERY

Kio Dawson

Instant win games provider IWG has been making significant moves in the North American lottery market in recent years. Chief executive Rhydian Fisher explains how the supplier is looking to accelerate this growth by developing a new instant win vertical with Inspired Entertainment. IWG HAS BEEN carving a niche as a disruptor of the global lottery market since emerging on the scene more than seven years ago. Having launched over 250 instant win games for some of the leading European lottery and online casino operators, the company’s recent strategy has been to replicate this growth in North America. Last September, IWG launched its portfolio of games on Pennsylvania’s Scientific Gamespowered iLottery site, including instant win game titles such as Cash Buster Extreme, Rainbow Fortunes, and Fast Buck Lucky. The launch added to the supplier’s growing customer base in North America, which includes the Georgia Lottery and Michigan Lottery, as well as Canada’s Atlantic Lottery Corporation and Loto-Québec. IWG’s new collaboration with Inspired provides the supplier with an easy route into US lotteries, with Inspired already working with lotteries including Pennsylvania and Michigan. In a market dominated by suppliers such as Scientific Games, IGT and 20

in the European market, there are also definite possibilities to launch this game with European lotteries.” In the game, players select their ticket price and a virtual football video clip is played. Once the clip starts, a prize table is revealed. If the result of the video matches an outcome in the prize table, the player wins the matching prize as shown in the prize table. Possible results include touchdown pass, touchdown run, turnover and field goal, among others. “What stands out is it isolates a single football play to produce a result, which is a growing trend in the betting and gaming industry,” says Fisher. “The animation is still rich but the game is quick enough to be successful. With sports betting becoming more mainstream in the US, this game suddenly becomes even more interesting from a lottery’s perspective.” The proliferation of sports betting throughout North America means that lotteries need to get creative to stay competitive. Intralot, the success of NeoPollard Interac“As time goes on, lotteries will start to tive, which is powering iLottery platforms see different game verticals develop,” confor Michigan and Virginia, has shown that tinues Fisher. “We see this as a possibility to lotteries are increasingly looking to innovaopen a new instant win vertical in the space, tive, niche suppliers. targeted at a different player I WG wi l l be creati ng that may not have the lottery unique instant win games on their radar. At the end of “As time goes on, that feature Inspired’s realistic the day, this is a product that lotteries will start to can be used as an effective virtual sports content. The first of these is Endzone see different game acquisition tool to bring in Payout, an American foot- verticals develop” new players.” bal l-themed game which Rhydian Fisher, IWG While most of the attenlaunched in January with the tion Stateside is focused on Michigan Lottery, ahead of the Super Bowl in sports betting, IWG and Inspired are looking early February. for innovation to deliver new products for the “There is a lot of interest from other jurislottery sector. dictions in North America and the consensus “We’re happy to develop these games for is it is a strong enough game to launch at any lotteries and they’ve proven to be a hit,” adds time of year,” explains IWG chief executive Fisher. “As sports betting picks up, I suspect the Rhydian Fisher. “Professional football in the demand will only increase for sports games.” US has done a tremendous job in keeping its Inspired has itself only recently begun rollproduct relevant for the entire year, and we ing out virtual sports with lotteries in North feel our games here will only benefit from that. America, but with IWG in tow, there could be a With American football growing in popularity lot more to come. n

LOT T E RY

Q4 NEWS

NEOPOLLARD EXTENDS ILOTTERY DEAL WITH MICHIGAN LOTTERY

BIG LOTTERY STORIES This quarter’s lottery lowdown SPORTECH IN TALKS TO ACQUIRE LOT.TO LONDON-LISTED SPORTS BETTING provider Sportech agreed a strategic alliance and entered exclusive negotiations with a view to acquiring UK-based lottery supplier LOT.TO Systems, which powers Gambia’s Lotto-Bi and Nigeria’s Western Lotto among others. The alliance will provide mutual clients with a broader suite of gaming opportunities, with the acquisition further expanding Sportech’s global gaming offering. “Our future with Sportech is exciting because our clients can benefit from the combination of Sportech’s proven processing technology and hardware, and our innovative iLottery platform in a single offering, as well as the obvious synergies in sports betting platforms,” says LOT.TO co-founder Andrew Lindley. “Together, we can offer clients a world-class omni-channel solution that’s incredibly powerful.” GIQ Q4 REVIEW

THE MICHIGAN LOTTERY awarded a new four-year contract to NeoPollard Interactive, the joint venture between NeoGames and Pollard Banknote, which has been providing its iLottery platform to the lottery since 2014. In its most recent financial year, Michigan’s iLottery products generated over $100m in net win, contributing towards the lottery’s fourth consecutive record contribution to its beneficiary, the state School Aid Fund. More

than 890,000 players have so far registered for the lottery’s online services. “We are thrilled to continue our relationship with the Michigan Lottery,” says NeoPollard Interactive general manager Liz Siver. “Since the launch of iLottery in 2014, the Michigan Lottery has become a leader within the digital space, providing innovative digital products to players and continuing to seek out new experiences to enhance its technology, games, and services.”

EUROPEAN LOTTERIES CREATE JV FOR SHARED LIQUIDITY GAMES

ZEAL MAKES OFFER TO BRING LOTTO24 BACK INTO THE FOLD

FOUR OF THE leading national lottery operators in Europe have established a new joint venture to develop an enhanced range of content, which will include shared liquidity games. Based in Norway, the Lotteries Entertainment Innovation Alliance (LEIA) has been set up by Denmark’s Danske Lotteri Spil, France’s Française des Jeux, Norway’s Norsk Tipping and Finland’s Veikkaus. The JV will be used to share resources in order to build a “wider and efficient” digital gaming offering, allowing the lotteries to address some of their challenges in the digital space and foster open innovation. “The consumer behaviour in the lottery industry is changing rapidly, which requires faster development from both the operators and suppliers,” says LEIA chairman and Veikkaus CEO Olli Sarekoski. “We are happy to announce this new joint venture, and I believe we will be stronger together in the long term in delivering strong value propositions to each market.”

ZEAL NETWORK HAS made a takeover offer to acquire German lottery broker Lotto24, which was spun off from the company in 2012. The company intends to reacquire control of its myLotto24 and Tipp24 subsidiaries and transform its German secondary lottery business into a locally licensed online brokerage model. On completion, the deal will create a digital lottery group with more than five million combined customers globally and combined billings of around €500m. Zeal CEO Helmut Becker says that the agreement creates value for shareholders of both companies and their customers, as well as the German federal states and their lottery beneficiaries. “This transaction will reunite Zeal with Lotto24 and put us in a position to accelerate online growth in the German and international lottery markets,” says Becker. “I look forward to joining forces with Lotto24 and driving growth in Germany and beyond.”

INTRALOT WINS LONGTERM DEAL WITH CROATIAN NATIONAL LOTTERY Intralot was awarded a 10-year contract by Croatia’s Hrvatska Lutrija to support the National Lottery’s growth and expansion into new product verticals. The supplier will integrate its omni-channel Lotos10 ecosystem with the lottery, provide software for 3,000 terminals across the country, and provide its interactive gaming platform to support all of Hrvatska Lutrija’s products, including numerical and instant games, sports betting and online casino. “This new partnership will cover all business requirements and operational procedures required for our business to grow in the upcoming years,” says Hrvatska Lutrija president Mario Musa. “We look forward to a smooth implementation, followed by 10 years of partnership with Intralot which will support our vision to strengthen Hrvatska Lutrija as the leading gaming operator in the Croatian market.”

GIQ games round-up

New games that caught GIQ’s eye in Q4 2018

PLAYTECH EXPANDS AGE OF THE GODS INTO BINGO Playtech has expanded its award-winning Age of the Gods series of games with a new 90-ball bingo variant. The Age of the Gods Bingo room boasts enhanced in-game animations and an added element of excitement with an extra chance to win. When the bingo game ends, a 3x3 grid of golden coins appears on screen and is visible to all players. The full house winner then turns the coins one by one to reveal a god until they match three icons, with different prizes paid out depending on the god. “Age of the Gods has been a huge success and driven exceptional growth for Playtech and its partners, so bringing the brand to bingo is a natural next step,” says Playtech managing director of digital bingo Angus Nisbet. “The development team has done a fantastic job in recreating the look and feel of the series in the new Bingo room, and I’m confident players will love features such as the golden coins bonus.”

RED TIGER DEBUTS CONNECTED WAYS PAYOUTS IN FRUIT BLOX

GREENTUBE ROLLS OUT ASIAN FORTUNES FOR ONLINE PLAY

Red Tiger Gaming released a fruit-themed game offering over 6,000 potential ways to win through its new Connected Ways payouts feature. In Fruit Blox, the bigger the tile, the bigger the win, and if two or more matching mega tiles are adjacent to each other, the resulting win is doubled. The game also debuts Red Tiger’s new Connected Ways payouts, where symbols connected either vertically or horizontally on at least three reels starting from the left result in a win. “Connected Ways is a unique innovation from Red Tiger with the aim of bringing clarity to slots gameplay,” says Red Tiger product specialist Carl Ejlertsson. “Instead of trying to remember every single payline, Connected Ways offers players a clear rule-set of how the game is going to pay.”

Greentube has released Asian Fortunes, an online version of the popular land-based slot game developed by parent company Novomatic. The game focuses on four friendly panda bears, with features including free games and varying jackpots for players to win. There are two wild symbols in the slot game, with the blue wild symbols appearing on reels two and four, and substituting for all other symbols except the red wild. The red wild symbol appears on reel three and doubles all wins when substituting symbols to form winning combinations. Each time a wild lands on a reel, a mystical coin is added to the bonus chest, which explodes randomly to take players to the Lucky Panda mini game. During this game, 12 gongs are presented, with a guaranteed chance of winning one of four jackpots.

BIG TIME GAMING LAUNCHES WHO WANTS TO BE A MILLIONAIRE? SLOT Big Time Gaming released its hugely anticipated Who Wants To Be A Millionaire? online slot after being granted licensing rights by Sony Pictures Television. Based on the hit TV game show, the slot was initially launched with LeoVegas in November, with the first spins played by popular YouTuber Kim Hultman (also known as LetsGiveItASpin), before a wider rollout via the Scientific Games and Microgaming platforms. “Who Wants To Be A Millionaire? is a nextlevel branded product; it combines a hugely successful and recognisable brand with our patented and trademarked mechanics such as MegaWays to deliver a unique and compelling player experience,” says Big Time Gaming CEO Nik Robinson.

G A M ES

Q4 RELEASES

GREEN JADE GAMES LAUNCHES FIRST SLOT TITLE MRG Group’s in-house development studio Green Jade Games has released its first slot title, Hammer of Fortune. The 6x4 slot features Brin as the unlikely hero tasked with saving his village from Gunnhild and her rock troll army. It features a personal hammer that changes with every spin and is used by the player to knock out symbols, which gives them a chance at triggering cash pots and free spins. “Hammer of Fortune is the ideal game to introduce Green Jade Games to the market,” says managing director Benedict McDonagh. “With its focus on entertainment, we are proud of the high degree of quality and relevant differentiation achieved.”

QUICKSPIN LAUNCHES IVAN AND THE IMMORTAL KING Playtech-owned Quickspin has brought ancient Russian folklore to life with the launch of its Ivan and the Immortal King slot. Featuring a treasure trove of free spins, multipliers and bonus scatter symbols, the game centres on Ivan Tsarevitch and his quest to slay evil King Koschey and rescue the warrior princess Maria Morevna, who is imprisoned in his mountain lair. “Our development team delved into the passages of ancient Russian folktales to bring this story to life,” explains Quickspin chief executive Daniel Lindberg. “We enjoyed every minute creating this game and are sure players will treasure this fantastic slot for years to come.”

RELAX GAMING INTRODUCES EPIC JOKER SLOT

NETENT RELEASES VIKINGS BRANDED SLOT GAME Following an agreement with A+E Networks earlier in the year, NetEnt launched a new branded slot game based on the hit TV series Vikings. The five-reel, three-row, 243 slot features characters including Ragnar Lothbrok (Travis Fimmel) and Lagertha (Katheryn Winnick), along with immersive footage and imagery inspired by the historical drama TV series, which was recently renewed for a sixth season. “With its epic storytelling and loyal global fanbase, Vikings is an iconic franchise. It is a perfect brand for us to partner with and bring to life for slots players,” says NetEnt director of game products Bryan Upton. “Since first announcing the partnership at ICE in February 2018 the anticipation and excitement built all year. At NetEnt, we are huge fans of Vikings too and are delighted with the product we’ve created.” GIQ Q4 REVIEW

Relax Gaming went live with its third proprietary slot title with the launch of Epic Joker. Offering players a modern twist on a classic slot formula, the 3x3 slot game features reels packed with recognisable symbols including cherries and bars, as well as the unmistakable Joker. Super Mode Spins, triggered on a full-screen takeover, offer players five free respins, with the possibility of hitting Joker respins. “We are delighted to have expanded our video slot portfolio with Epic Joker, an engaging title that captures all of our flair for rich and expertly constructed gameplay,” says Relax Gaming chief product officer Simon Hammon. “Well-timed pay-outs encourage longer play sessions, and we are sure that both new players and veteran slots fans will love the game’s fresh twist on a classic formula.”

SG DIGITAL LAUNCHES LATEST IN RAINBOW RICHES SERIES… Building on the successful brand, SG Digital’s Rainbow Riches Home Sweet Home brings a new twist to the popular game series. The Knock-Knock bonus allows players to unlock up to four enchanted doors, revealing wilds that remain on the reels even during the eight free spins bonus round. The new slot sees everyone’s favourite leprechaun return for the seventh instalment in the Rainbow Riches series, this time boasting classic features and new mechanics. The supplier said that Rainbow Riches Home Sweet Home capitalises on the success of past omnichannel titles, while simultaneously carving its own path to reach new players and seasoned slots enthusiasts alike.

…AND BATTLESHIP DIRECT HIT! SLOT GAME Another SG Digital release sees players prepare their fleet as new ships glide in on every spin in the MEGAWAYS-powered slot game, Battleship Direct Hit! Players can land a missile and eliminate all symbols above for more chances to win and destroy ship sections in their line of fire. During the game, players can also listen to the gun motors whirr as behemoth battleships glide in, delivering the potential for massive victories and high-octane anticipation. Players can take charge of their own battleship, sink an entire ship and move full steam ahead into free spins, where jackpots and more free games await. Demolishing two aircraft carriers at once provides 100 free spins.

L EG A L

WORLD REGULATION

World regulatory update GIQ outlines legal developments around the globe in Q4 2018 Australia Federal Australia’s first National Consumer Protection Framework for online betting launched in December and will be implemented progressively over the course of this year and into 2020. It is made up of 10 measures designed to minimise gamblingrelated harm by offering tools to players to better control their gambling, from a voluntary opt-out pre-commitment scheme, through to a national self-exclusion register. It will reach around 130 betting operators and their account holders, equivalent to approximately 2.5 million active online accounts in the country.

New South Wales Online sports betting operators in New South Wales (NSW) became subject to a new 10 per cent point of consumption tax on 1 January under legislation introduced in October. The tax applies to online wagering by NSW residents and is expected to provide AUD$5m per year for measures targeting gambling-related harm. To ensure the racing industry is not negatively impacted by the tax, it will receive two per cent of total taxable net NSW wagering revenue. This is expected to be around $40m for a full financial year, split between the three racing codes.

South Australia The state of South Australia adopted legislation to dissolve the Independent Gambling Authority (IGA), with all regulatory and policy activity to be undertaken by the state’s Consumer and Business Services (CBS). The transition took effect on 1 December. 24

Western Australia The government of Western Australia passed legislation for a new point of consumption tax on bookmakers, which came into force on 1 January. It requires online bookmakers to pay a 15 per cent tax on net wagering revenue for bets placed by players in Western Australia, subject to an exemption threshold of $150,000 per year. Two existing betting taxes were abolished by the introduction of the new tax.

Ireland Finance Minister Paschal Donohoe raised taxes on bookmakers on 1 January, with betting duty doubling from one per cent to two per cent of sports betting stakes from Irish customers across retail, online and telephone sportsbooks. The government also increased betting duty on the commission earned by betting intermediaries and exchanges from 15 per cent to 25 per cent. This has not deterred new market entrants, with Aspire Global and Bethard both securing licences. The Irish government also brought into force legislation to tackle money laundering, bringing gambling service providers within the scope of the country’s anti-money laundering law and completing Ireland’s transposition of the EU’s Fourth AML Directive. Lawmakers in the country have also proposed legislation to ban betting on the outcome of lotteries over fears that offshore providers are diminishing the National Lottery’s returns to good causes. The National Lottery (Protection of Central Fund) Bill would attach a licence condition to bookmaker licences prohibiting them from offering bets on domestic or international lotteries.

Italy The gover nment increased gambling taxes for 2019, with the online gaming tax rate rising from 20 per cent to 25 per cent, and online sports betting tax climbing by two percentage points to 24 per cent. The tax on virtual sports increased from 20 to 22 per cent, while retails sports betting tax climbed to 20 per cent. The new rates came into force on 1 January.

Slovakia Slovakia’s National Council approved new gambling legislation that allows European operators to apply for online licences for the first time. Operators based in the European Union or European Economic Area may apply for online gaming and betting licences from the new national gambling regulator, while national lottery operator TIPOS retains its monopoly on lotteries. Licence applications will be accepted from 1 March, the effective date of the legislation, with online gaming operations expected to go live under the new licences from 1 July. Each type of online licence will be valid for a period of 10 years and costs €3m each, or €5m for both. Operators who have appeared on the country’s blacklist of illegal operators in the 12 months prior to submitting their application will be ineligible for licensure. This rules out some of the industry’s biggest operators. 24

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Casino Cosmopol SEK8m (approx. €775,000) for what it described as “serious and in many cases systematic” anti-money laundering regulations. Casino Cosmopol has appealed the fine, arguing that the gambling regulator provided insufficient guidance on the AML regulations.

Switzerland Switzerland’s gambling regulations came into force on 1 January, legalising online gambling and authorising the government to block unlicensed online gambling sites. The new law enables the country’s licensed land-based casinos to launch games such as poker and roulette online for the first time. The legislation sets a minimum tax rate of 40 per cent of gross revenue from online gaming, up to maximum of 80 per cent, with the proceeds used to fund Switzerland’s insurance programme for older citizens, as well as cultural, sporting, environmental and social projects.

South Africa The country’s parliamentary committee on trade and industry adopted a slimmed down National Gambling Amendment bill in November, deferring action on substantive issues related to dog and horse racing, electronic bingo, betting on lotteries and online gambling. The adopted bill replaces the National Gambling Board (NGB) with the National Gambling Regulator (NGR), with the new body gaining extensive powers to combat unlicensed gambling. These include the authority to order payment providers to withdraw processing services and ISPs to block access to unlicensed sites. These sites will also be prohibited from obtaining a licence in South Africa for five years.

Spain The ministry of finance unveiled new online gaming regulations aimed at preserving the integrity of sporting competitions and preventing gambling with unlicensed operators. The regulations require all licensed operators to develop policies and procedures for combating match-fixing in

This marks the first time online gaming and sports betting operators have been legally permitted to operate in Sweden, despite having done so for years GIQ Q4 REVIEW

United Kingdom

sport, and also classify gambling with an unlicensed operator through the use of virtual private networks (VPNs) as a serious offence, liable to a fine of up to €100,000.

Sweden Swedish gambling regulator Spelinspektionen, formerly Lotteriinspektionen, awarded licences to 60 applicants by the turn of the year, enabling them to launch in the re-regulated Swedish gambling market on 1 January. The licensing marks the first time that online gaming and sports betting operators have been legally permitted to operate in the country, despite having done so for years. The Swedish Football Association attempted to block the licensing process with legal action, seeking control over the types of football bets that licensees may offer. Its challenge was rejected. The regulator also fined

Q4 of 2018 saw the UK Gambling Commission continue its crackdown on operators who fail to protect consumers or abide by anti-money laundering regulations, with Rank Group, Paddy Power Betfair, Mark Jarvis, Daub Alderney, Casumo, CZ Holdings and Videoslots all subject to penalty packages totalling more than £16m. Stride Gaming’s Daub Alderney subsidiary was the hardest hit with a penalty of £7.1m for failings in its anti-money laundering and social responsibility procedures, while fellow online operator Casumo agreed to pay a penalty of £5.9m and Paddy Power Betfair a penalty of £2.2m for similar failings. Rank Group agreed a £0.5m penalty for failing to protect a problem gambler at its land-based Grosvenor Casino and online at Grosvenorcasinos.com, allowing him to lose £1m in 24 hours. Alongside gambling regulators in Austria, France, Germany, Italy, Portugal and Spain, the UK Gambling Commission has also pledged to deepen cooperation between authorities to combat unlicensed online gambling and bettingrelated manipulation of sporting competitions. This saw the UK belatedly sign the Council of Europe Convention on the Manipulation of Sports Competitions, which was launched in 2014 and aims to prevent, detect and punish match-fixing. The UK government also set the implementation date for the reduction in stakes on FOBTs from £100 per spin to £2, to April 2019. The new 21 per cent duty on online games of chance, previously 15 per cent, will come into force in October, and will compensate the Treasury for loss or revenue from FOBTs. 25

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United States Arkansas Voters in Arkansas approved a constitutional amendment to allow casinos in Crittenden, Garland, Pope and Jefferson Counties. Southland Racing Corporation will offer casino gaming at a casino located at or adjacent to Southland’s greyhound track and gaming facility in Crittenden County. The Oaklawn Jockey Club will offer casino gaming at a casino at or adjacent to Oaklawn’s horse track and gaming facility in Garland County, with voters also approving casino gaming at two other casinos. One will be in Pope County within two miles of Russellville, and the other in Jefferson County within two miles of Pine Bluff.

Louisiana Voters in 47 of the state’s 64 parishes voted to allow fantasy sports contests. The yes vote accounts for the bulk of state residents, with the most populous parishes voting in favour of the measure. As a result, fantasy sports providers will have to ensure that contests are only available to players within the parishes that approved fantasy sports. Louisiana was one of a small number of states with gambling statutes that prohibited fantasy sports. It remains to be seen when fantasy sports will be launched in the state, where no enabling legislation currently exists.

for Class A licences (major sporting venues) and $100,000 for Class B licences (retail venues), double the previous amounts. The Council aims to launch sports betting in the first half of 2019, subject to approval by the mayor and Congress.

Federal Senator Orrin Hatch (R-UT) and Senate Minority Leader Chuck Schumer (D-NY) introduced the Sports Wagering Market Integrity Act of 2018 in late December, which would put in place safety measures to protect consumers, preserve the integrity of sporting events, and ensure the propriety of the sports wagering market. The bill prohibits the acceptance of sports bets, with exceptions for social gambling and sports betting in states that meet certain minimum standards approved by the Attorney General. The bill also requires operators to use official sports data provided or licensed by professional sports leagues to deter mine the outcome of sports

Michigan Michigan got within a whisker of legalised online gambling and sports betting in late December when lawmakers in both legislative houses worked through the night to pass the Lawful Internet Gaming Act. However, the bill was vetoed by the outgoing Governor Rick Snyder, who expressed concern over the potential impact on the state’s successful iLottery programme.

Pennsylvania The Pennsylvania Gaming Control Board (PGCB) got the state’s sport betting industry up and running, licensing Hollywood Casino, Parx Casino, South Philadelphia Turf Club, SugarHouse Casino, Rivers Casino, and Harrah’s Philadelphia Casino & Racetrack. The PGCB also issued iGaming permits to numerous operators, although it has yet to set a go-live date.

Washington DC Washington DC council members voted in December to allow online and retail sports betting in the district under the supervision of the DC Lottery. The legislation had to be amended after approval to correct an error regarding the cost of licences, which are now set at $500,000 GIQ Q4 REVIEW

bets through 2024, and establishes a national self-exclusion list. “This bill is the first step toward ensuring that sports betting is done right in the states that choose to legalise it,” said Hatch, who was one of four original authors of the Professional and Amateur Sports Protection Act of 1992, which was overturned by the Supreme Court in May 2018. American Gaming Association senior vice president of public affairs, Sara Slane, described the bill as “the epitome of a solution in search of a problem”.

Argentina In November, Buenos Aires governor María Eugenia Vidal proposed regulated online gaming as means of boosting the province’s struggling economy, with the proposal gaining approval in December. It authorises up to seven licences covering online sports betting, casino games, poker, and horse race betting, with a tax rate of 15 per cent of gross gaming revenue. This is expected to generate round ARS$2.2bn (US$60m) for the province annually. The Buenos Aires Institute of Lottery and Casinos (IPLyC) will regulate the market. The move by Buenos Aires province prompted lawmakers in Buenos Aires city, which has its own legislature, to vote 34-22 in favour of legalising online gambling and sports betting for the first time. The resolution calls for all state income from these activities to be directed at social development programmes, and will see authorities in Buenos Aires city and province work together to develop their respective regulations under a coordinated framework led by a newly formed coordination commission. Meanwhile, authorities in the Argentinean provinces of Entre Ríos and Cordoba stepped up their efforts against online gaming operators by requiring internet service provider to block access to such sites.

Brazil

American Gaming Association senior VP of public affairs, Sara Slane, described the Sports Wagering Market Integrity Act as “the epitome of a solution in search of a problem”

President Michel Temer of Brazil signed a bill to authorise online and retail sports betting, which is expected to contribute over R$2bn annually to fund public safety, sport and culture. The bill allows the Ministry of Finance up to four years to implement regulations for the new activity, although the need to generate revenue should see the ministry develop new regulations as a priority. 27

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the latest news on Dutch gambling legislation What are the key points of the bill?

Alan Littler of Kalff Katz Franssen believes 2019 is a make or break year for Dutch remote gambling reforms

Operators from the EU/ EEA will not need a physical presence in the Netherlands, but licensees will be required to have a local addiction prevention representative GIQ Q4 REVIEW

The remote gambling bill, designed to amend existing legislation dating from 1964, was submitted to the House of Representatives back in 2014. Will its fifth anniversary see it blossom into life? Under the proposed changes, remote gambling operators will be able to get a licence for offering services to residents of the Netherlands, with licences falling into one of two categories; sports-betting or casino gaming (secondary legislation will spell out exactly which activities will be licensable under these two umbrellas). Operators from the EU/EEA will not be required to have a physical presence in the Netherlands, but all licensees will be required to have a local addiction prevention representative. The bill will also introduce a central nationwide database of excluded players, covering remote operators and land-based slot machine and casino operations. A bill to liberalise the land-based casino market is also pending.

Is there consensus around certain items and which bits are more likely to change? The bill passed through the House of Representatives in July 2016 and is now before the Senate. No changes to the bill will occur, but we are still awaiting accompanying secondary legislation. The week that ICE is taking place – the first week in February – will prove very important. Last December the competent Senate committee proposed that a plenary debate on the bill should be held on Tuesday 5 February. If the bill is not put to the vote then it will likely take place on the following Tuesday. Put simply, this will be make or break for the new regime. Many key details of the regulatory regime are to be found in secondary legislation. So far, not all layers have been published for consultation. September 2018 saw the Ministry of Justice & Security publish the draft decree on remote games of chance for consultation, while the ministerial regulation has not yet been released for consultation. A consultation process on this should be factored into events for 2019, assuming that the bill passes the Senate.

When is it scheduled to go live? Hasn’t Dutch iGaming legislation been in the pipeline for some time? Is there a likelihood it can be stalled again? Everything rides on what happens in the first half of February. Assuming the bill passes the Senate, various steps will still have to be taken before the Gambling Authority (Kansspelautoriteit) can open the licensing process. Unsurprisingly, these steps can further push back the moment that licensing actually commences. Secondary legislation will be sent to the House of Representatives which will provide MPs with the opportunity to pose questions, although they will not be in a position to ‘pass’ the legislation in the same manner as the bill. Secondary legislation will also have to be notified to the European Commission and be sent to the Council of State so it can render advice to the government on the proposed legislation. Should the bill pass in February, then it will likely enter into force on 1 July 2019 at the earliest. Yet it remains difficult to say when the licensing process will open, towards the end of 2019 is not an unreasonable guesstimate. Yet this depends on what happens in Q2 and Q3, assuming the bill does not fall in the Senate. Another unknown is how the Gambling Authority will manage the licensing process. Previously it has stated that it intends to take a ‘big bang’ approach where all successful licence applicants are able to go live on the same date. Whether this is the case and how it will be arranged in practice is not yet known. Given that the Gambling Authority has indicated that it will require six months to assess a licence application, locally licensed operations will probably not open until six months after the licensing process commences. The Gambling Authority has previously indicated that it too will run a consultation process, on the licensing process. It is currently unclear when this will take place. All in all, early February will set the tone for the year ahead. n To keep up with the latest developments, contact Alan Littler at littler@kalffkatzfranssen.nl 29

The year of the ad ban C O LU M N MARKETING

Caroline Parry REGULATORS ACROSS THE world are turning their attention to the advertising and marketing practices used by the industry, and they do not like what they see. Last October, the Spanish government announced it is considering plans for tobacco-style regulations on gambling ads. In September, Lotteriinspektionen, the Swedish gambling regulator, won a fiveyear battle to ban the promotion online of overseas betting websites, and in the same month, Australia extended its ban on betting ads during live sporting events on broadcast media, originally introduced in March 2018, to streaming platforms. The most severe regulations seen to date were passed in Italy following the election of a new coalition government last summer. All gambling advertising, including radio, TV and online, as well as sponsorship deals, were banned from 1 January. Operators have until June to be compliant. In the UK, 2018 saw a crackdown on bonus promotions by the Competition and Markets Authority, while the Gambling Commission made it easier to fine operators for breaking advertising rules.

A watershed moment To stave off the drastic measures seen in Italy, the Industry Group for Responsible Gaming (IGRG) is introducing a voluntary ban on gambling advertising during pre-watershed live sport in the UK. This will include prewatershed sponsorship of sports programmes by betting and gaming operators. The changes to the IRGR’s Gambling Industry Code for Socially Responsible 30

With enforced advertising bans and beefed-up regulations introduced or discussed in several key betting markets, 2018 will be remembered as the year the tide turned on marketing in betting and gaming. And this is only the start, writes Caroline Parry Advertising, which will be implemented by this summer, will also extend to ads shown during highlights shows and re-runs. As expected, horse racing and greyhound racing will be excluded. The IRGR, which is made up of The Bingo Association, the Association of British Bookmakers (ABB), The National Casino Forum, amusement machine body Bacta and the Remote Gaming Association (RGA), claims the move will effectively stop betting and gambling ads being shown during televised live events. Speaking as the changes were announced in mid-December, John Hagan, chairman of the IGRG, said: “The gambling industry is responding positively to public concerns about the amount of gambling advertising on television before the watershed. “We believe that these new voluntary TV measures will drastically reduce the amount of gambling advertising on television, and they complement the strict controls that already govern gambling companies around advertising on digital platforms.” Hagan described it as “a watershed moment”, while Sarah Hanratty, chief executive of the Senet Group, the industry-funded body dedicated to tackling problem gambling, adds: “We will look back on this moment and see it as the time the industry decided to step up.” The move has been welcomed as evidence the industry is listening and responding to public concerns about the sheer volume of gambling advertising, and its impact on children and young people, vulnerable people, those with problems around gambling, and those at risk.

Yet, it has also been roundly criticised as a move aimed at helping the major operators look good at the expense of smaller brands that rely on advertising, rather than a high street presence, for brand awareness. A host of industry commentators, from campaigners to broadcasters, have also pointed out that it does nothing to tackle online advertising. According to research from GambleAware, five times more is spent on marketing online than on TV. Either way, the industry has reached a crossroads, and having seen the Association of British Bookmakers (ABB) lose an undignified battle against the government on cutting the minimum stake on fixed-odds betting terminals, the writing is on the wall. Demonstrate self-regulation, or be regulated. “We’d be mad not to listen to the concerns of the public, politicians and the media,” says RGA chief executive Clive Hawkswood. “We have been accused in the past of just sitting back and waiting for bad things to happen, instead of getting ahead of the game. That’s what we are doing here.”

Scratching the surface Momentum has been building. GVC stuck its flag in the sand by announcing support for a pre-watershed ban, alongside a raft of corporate social responsibility measures. Meanwhile, Sky Betting & Gaming’s chairman Richard Flint has spoken out several times about increasing the standards required for operators to become licensed, and thus allowed to advertise on TV, as well as making more of available technology to help identify customers with potential issues.

In a move applauded by all sides of the “We need to see behind the ‘greenwashing’, debate, broadcaster Sky announced it would which is about looking good and polishing limit gambling ads to one per ad break from things, but deep down nothing is happening,” the beginning of the Premier League season she says. “There is a lot happening on the in August. With reports suggesting gaming surface – ‘the announcement effect’ – but there operators spend £200m on TV advertising is no follow-through.” every year, and Sky accounting Industry regulators and for around half of that market, it critics alike will be watching will cost the broadcaster millions “We’d be mad h ow It a ly ’s t o t a l b a n o n in lost revenue. not to listen to advertising pans out, and will The RGA’s Hawkswood says look at research to tell us if it the concerns the decision to adapt the code is effective. was driven by multiple factors. of the public, “W hat is certain is that “It hasn’t happened overnight. politicians and the attention needs to also We had to get consensus and sell the media” be online,” Da Silva explains. it to the wider industry. It is not a Clive Hawkswood, RGA “A complete ban might not be knee-jerk reaction to the Gambling effective on its own, but the Commission report [on betting among young kind of advertising we are seeing isn’t right people].” either. It is too aggressive and completely The pre-watershed ban may tackle the lacking in creativity.” growing complaints about the number of gambling and betting adverts on TV, Just the beginning particularly around live sports. This For campaigner David Bradford, a former reached fever pitch around last summer’s problem gambler turned campaigner, a preWorld Cup, where it was claimed there were watershed ban can only be part of the solution. 90 minutes of such ads in one game alone. It must also include toning down the content But it only scratches the surface of the issue of ads, and measures such as banning the use for many industry experts. Laura Da Silva of credit cards to pay for bets. Bradford, who Gomes, founder and director of DigitalRG, campaigns with his son Adam, also believes which specialises in responsible gaming, says in the value of ramping up educational the IGRG move demonstrates once again UK’s advertising. trust that certain industries will self-regulate, “More needs to be done to highlight places but often such action lacks depth. people can go for support,” adds Bradford, who GIQ Q4 REVIEW

is currently working to turn the campaign into a national movement for people who have been affected, but also to advocate for greater change in the industry. “The When the Fun Stops Stop campaign didn’t get into my head. It needs to be bigger and bolder,” says Bradford. Senet Group’s Hanratty admits the campaign has been around for some time, and the time has come for a review, which will be completed early this year. “We are working with research to understand how to motivate players to stay in control of their gambling.” RGA’s Hawkswood says the voluntary ban is “not trying to solve all of the problems”, and he does not rule out additional measures in the future. “The reputation of the wider gambling industry is on the floor. We hope measures such as this will start to rebuild trust.” The indication so far is of another battle brewing over the online market. Sky TV chief executive Stephen Van Rooyen has already openly criticised the voluntary ban, saying it will have a minimal impact. He points to the GambleAware report about online spend. Meanwhile, deputy leader of the Labour Party Tom Watson, a key voice in the campaign against fixed-odds betting terminals, was clear where his sights were set, even as he welcomed the pre-watershed ban. He said: “The next stop will have to be addressing the gambling adverts that children and vulnerable problem gamblers see online.” n 31

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19 P R E V I E W

Regulated markets and responsible gambling are the two Rs set to dominate 2019. Sweden leads the way, with several US states to follow â&#x20AC;&#x201C; including maybe New York GIQ Q4 REVIEW

F E AT U R E

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2019 PREVIEW: THE US

DoJ spanner fails to disrupt legislation momentum Pennsylvania will get the ball rolling in 2019 but New York will be the most exciting prospect – unless the DoJ ups its game THE ONE THING that can be predicted with very little fear of getting it wrong is that more US states will pass legislation to regulate sports betting during 2019. Beyond that, we can predict little, with the Department of Justice throwing a spanner in the works during the third week of January. Completely out of the blue, the Department of Justice released a reinterpretation of the Wire Act that overturned its 2011 opinion, which stated the Wire Act only applies to sports betting and not other gaming activities. The immediate and full-throated support of the Coalition to Stop Internet Gambling suggests this was a politically motivated announcement. The American Gambling Association was caught slightly off guard; only promising to review the opinion and its implications on the day after publication. “No matter how the department attempts to dress this up, to revisit a subject after only eight years, where there has been no relevant factual or legal development that would warrant reconsideration is highly unusual. Against the backdrop of demands from some of the administration’s most prominent political supporters to take this step, the conclusion that this was politically driven seems unmistakable,” one lawyer tells us. 34

Gaming attorney Jeff Ifrah of Ifrah Law agrees: “It is unfortunate that the Office of Legal Counsel appears to have been manipulated to issue an opinion for purely political purposes.” Motivation aside, the question industry executives will be asking is whether this changes anything. Since the 2011 opinion was delivered, New Jersey and Pennsylvania have gone on to legislate for all types of online gaming, while a whole host of others have legislated for sports betting (some online, others just land-based). The states have all enacted ‘intrastate’ online gaming regimes, while the Wire Act is generally only understood to apply to ‘interstate’ online communications, i.e. ones that cross state lines. Unfortunately, the wording is not clear-cut. The Wire Act applies to any transmission in “interstate or foreign commerce”. The courts have held that the internet, by its nature, is an instrument in interstate commerce. Mobile works similarly. So the DoJ could take the view, and a court could agree, that even an intrastate internet or mobile transaction falls within the statute’s compass. “I think there are many reasons why the statute should not be construed that way, but it can’t be dismissed as a possibility,” says

Behnam Dayanim, the chair of Paul Hastings’ advertising, gaming and promotions practice. Dayanim continues: “The opinion does not state whether the Wire Act should be construed to prohibit transactions that occur wholly intrastate, even though they may involve internet or mobile transmissions that may cross state boundaries. It simply says – indirectly – that UIGEA (which includes a provision addressing intermediate routing) does not stand in the way of any such interpretation. There remain multiple reasons why the Wire Act should not be construed to apply to intrastate transactions.” This is not the only issue that the opinion fails to clear up. Dayanim continues: “The opinion argues that the statutory language is not ambiguous, so the legislative history is not relevant, but feels compelled to spend nearly 15 pages explaining its understanding of that language. Requiring 15 pages to explain why a single paragraph is not ambiguous does not strike me as support for the proposition that the language is unambiguous. “Put another way, it shouldn’t be so difficult to explain why language is clear. The reality is it is not, which is why the legislative history is relevant, and that legislative history is not supportive of the OLC’s new position,” concludes Dayanim.

2 0 1 9 P R EV I E W THE US

The legislative history to which Dayanim refers takes in the 2002 Mastercard case and United States v. Lyons from 2014. Both concluded that the Wire Act only applies to sports betting. “The opinion also runs contrary to the intent of Congress expressed in UIGEA and language in the recent decision by the US Supreme Court in Murphy v. National Collegiate Athletic Association,” argues Ifrah, referring to the case that brought down PASPA. Another lawyer, wishing to remain anonymous, says: “The opinion itself, although carefully crafted and well-written, ultimately is an exercise in legal sophistry, designed to dazzle with references to hoary legal doctrine while distracting the reader from the fundamental illogic of its conclusion.” Given all that, it is little surprise that Ifrah can confidently state that this “changes nothing and is of no significance or value”. Lastly, and importantly, the opinion is not law. It reflects the department’s legal position. The spanner thrown in the works is purely a political one and not a legal one. It allows the industry’s opponents to claim the legal high ground and shows that the political fight has not yet been won. In a country as conservative (small ‘c’) as the US, that was always likely to be the case. The opinion was written in November but only published in January, three days after the state of West Virginia published bills aiming to legalise online poker and other interactive gambling games. The timing is probably not coincidental. The DoJ is unlikely to stop West Virginia’s plans and, while its opinion is a reminder that iGaming’s political opponents remain influential, it probably shouldn’t derail any company’s US strategy.

New York, New York Alleged DoJ misfeasance aside, the most exciting prospect for the industry in 2019 is likely to be New York state. With a population of almost 20 million people, it is double the size of neighbouring New Jersey and has a GDP per capita

The DoJ’s opinion is not law. It reflects the department’s legal position. The spanner thrown in the works is purely a political one and not a legal one GIQ Q4 REVIEW

that lags behind only Massachusetts (another neighbour) and the District of Columbia. Some of the sports betting industry’s biggest names have already announced deals in anticipation of the New York State Gaming Commission passing regulations. Caesars greeted the new year with the announcement of a deal with Oneida Indian Nation to build Caesars-branded sports betting lounges at the tribe’s Turning Stone, Yellow Brick Road and Point Place casinos during 2019, using Scientific Games’ OpenBet platform. Meanwhile, the world’s leading online sports betting company bet365 has invested $50m in New York’s Empire Resorts and – in a similar manner to Caesars – will build a bet365-branded betting lounge at the company’s Resorts World casino. An online sportsbook will be offered under the bet365 brand, as will an iGaming site, if and when regulations allow it. Those regulations were still not forthcoming at the time of going to press, despite acting director of the Gaming Commission Ron Ochrym promising them “in the short term” in mid-2018. New York passed legislation to allow sports betting in its four commercial casinos back in 2013. The law should allow for online sports betting given a requirement that all servers are based in data centres at the casinos. The argument is that if online bets are processed on servers in the casinos then these are, in effect, bets taking place at the casinos. However, there are some doubts with regards to mobile betting and a bill was introduced in June 2018 that specifically mentioned mobile betting. The sponsor of that bill has said he will reintroduce it after New York passes its budget in April 2019. Unlike the 2013 law, this bill states that any licensed casino can offer sports betting. That is where Oneida and Caesars came in. One can expect the Seneca Nation of Indians, which operates six casinos in the state to follow suit. The tribe is a good customer of Scientific Games. Seneca is a member of the supplier’s Play4Fun Network and uses its land-based casino systems. MGM Resorts is eyeing Native American gaming partnerships. It has retained California-based TFA Capital Partners, a specialist investment banking firm focused on tribal affairs, as a strategic adviser to assist the company in identifying opportunities to develop tribal sports betting partnerships with the MGM GVC Interactive joint venture ROAR.

Problems in Pennsylvania While the industry is clearly expecting action in New York some time in 2019, the action in Pennsylvania began in late 2018 when Hollywood Casino at Penn National Race Course accepted the state’s first bets. SugarHouse Casino in Philadelphia and the Rivers Casino Pittsburgh soon followed, with Parx Casino and South Philadelphia Turf Club opening sportsbooks in January. GAN will be supplying the platform and an iGaming site, with Kambi supplying the sportsbook technology. The likes of Betfair Interactive (and its FanDuel subsidiary) and William Hill were still waiting for their licence applications to be approved at the time of going to press. Others such as Rush Street Interactive and The Stars Group have conditional approval but were waiting on sign off for some employees. It is notable that operators have not rushed into the market as they did in New Jersey. There has been a great deal of concern about the $10m cost of licences, the limitation on skins and the high tax rates. However, there has not been much active lobbying from operators other than from Penn National, which has been very keen to protect its own patch. The state has undergone a massive expansion of gaming and the ensuing battles have left legislators with a certain level of gaming fatigue. It will take some time to change things but when the numbers fail to match expectations that might well spur them into action.

More states reveal plans The prospect of Connecticut and New York joining active sports betting states such as Delaware, New Jersey, Pennsylvania, Rhode Island and West Virginia has had executives drooling at the prospect of a market across the Eastern Seaboard with a population of around 50 million people. These sorts of numbers – as well as the plethora of regulations and existing interests – make it clear how there really could be something for everyone. In the opening weeks of 2019, the states of Indiana, New Hampshire, Tennessee, Kansas, Massachusetts and Virginia unveiled sports betting bills. The DoJ can issue all the opinions it wants but one senses it will take a lot more than opinions to stop this bandwagon rolling. n 35

2 0 1 9 P R EV I E W

RESPONSIBLE GAMBLING

A sustainable future The industry’s move towards responsibility dominated the UK market in 2018 and the trend is set to continue elsewhere WITHIN TEN DAYS of the re-regulated Swedish gambling market opening, the Swedish gambling regulator Spelinspektionen had warned operators to ensure compliance with the market’s new regulations after discovering that several licensed operators had not successfully connected to the new national self-exclusion system for gamblers. It was unfortunate that it took a local newspaper to uncover the failure, but Spelinspektion’s response was swift. The UK Gambling Commission has led the way with its attempts to force the industry towards more responsible practices. If at times its communications have led to confusion, there can be little doubt that its intentions are pure. The UK Gambling Commission is not immune to political pressure, and political pressure is rarely without bias but most operators will accept that they have had it easy for too long.

Corrective action Sweden’s actions suggest that the UK will not be fighting this battle on its own. The new Spelpaus.se system went live with the opening of the liberalised gambling market at the start of this year, with the regulator revealing that 10,000 people excluded themselves from gambling during the first week of the new regulatory regime. “Gambling abuse is a widespread social problem, so it is positive that so many find the new service and use it as a tool to refrain from gambling and avoid direct advertising from gam-

Most operators have had a drop in profits as they have implemented responsible gambling measures. But the response from most has been encouraging 36

bling companies,” said Spelinspektionen communications manager Anders Sims. “We can see, not least in social media, that these people welcome Spelpaus.se and are encouraging those who have problems or are in the risk zone to block themselves from games.” However, the regulator was alerted to four operators’ failure to connect to the Spelpaus. se system, which means that some selfexcluded players could still access their accounts. “We have, in the last few days, investigated what this is due to and have found that everything seems to work well with Spelinspektionen,” Sims explained. “But for some reason there are a handful of gaming companies that do not meet the requirements set by the law.” Spelinspektionen contacted the operators concerned, urging them to quickly submit an explanation as to why these customers have been able to gamble despite appearing on the exclusion list. Some operators responded quickly. Within four days Genesis Global had corrected the problem that had enabled selfexcluded players to play.

Responsible Gambling Week was a crossindustry initiative in 2017

Walking the walk Such actions cost money. And back in the UK, most operators have had to cope with a drop in profits as they have implemented responsible gambling measures. But the response from most has been encouraging. Even privately owned companies such as bet365 are raising their game. The world’s favourite sports betting operator opened up on its responsible gambling efforts when it released its financial results in November. “The group is progressing research projects with external partners on early risk detection and using behavioural science to develop more effective ways of helping customers bet responsibly,” it said in a statement. “In addition to its work with external partners, the group is now exploring new technologies through its Research and Development function. For example, the group is currently investigating the potential usefulness of machine learning and artificial intelligence to develop more effective ways of identifying harmful play.” The lack of research in this area has been one of the reasons the industry has failed to fight the onslaught of media, public and political opprobrium thrown at it in recent years. The most exciting part of bet365’s statement was its determination to raise standards across the industry. The UK’s leading operator has been heavily criticised by rival CEOs complaining bitterly that bet365 never joins with industrywide approaches to responsible gambling or to political lobbying. But now the operator has committed to sharing the knowledge from its research into this topic. The industry needs research and scientifically-proven methods of dealing with problem gambling to clean its image. The industry’s opponents are unlikely to disappear completely. Some argue that the phrase “responsible gambling” is a tautology. It is up to the industry to prove them wrong. n

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2 0 1 9 P R EV I E W

SWEDEN

All eyes on Sweden T H E OPEN I NG OF the re-regulated Swedish iGaming market is well overdue. This is, after all, the country that gave birth to online pioneers such as Boss Media, Betsson, Cherry and Unibet. Sweden could conceivably claim to have more iGaming entrepreneurs per head of population than any other country in the world – although many of them now reside in Malta, of course. It took threats from the European Commission and the European Court of Justice to finally push the Swedish government over the line but on 1 January 2019, Sweden opened a fully regulated online gaming market. The newly renamed regulator Spelinspektionen (formerly Lotteriinspektion) had granted 60 gambling licences at the time of going to press – the vast majority of these for online gambling companies (see box, right). Former horse racing monopoly AB Trav och Galopp (ATG) and Svenska Spel will enter the new era as overwhelming market leaders, with around a 34 per cent and 16 per cent share respectively on the opening day. They will be fiercely challenged by the old guard in the shape of Kindred Group and Betsson. Kindred Group enters the market with five brands (unibet.se, mariacasino.se, storspelare. se, bingo.se, igame.se), while Betsson received GIQ Q4 REVIEW

Sweden has finally licensed its online gaming operators. This will be a competitive market featuring some of the industry’s most innovative operators

three approvals (betsson.com/sv, sverigeautomaten.com.sv and Nordicbet.com/sv). Newer arrivals such as LeoVegas and Casumo will enter the market from a position of strength, while even newer operators such as the ambitious Skill On Net will begin with an eye-catching 22 brands. Most of the major international operators have licences, with GVC winning a licence for its bwin.se and partypoker.se but not applying for a licence for any of the other brands in its portfolio. So, no Ladbrokes, Coral or Sportingbet as yet. Similarly, William Hill is yet to win a licence but its pending acquisition of MRG will yield two licences for its flagship Mr Green brand, and for newly acquired Evoke Gaming, which will launch four sites in the market at redbet. com, vinnarum.com, bertil. com, and mamamiabingo. com. With operators such as Mr Green and Unibet increasingly keen on marketing themselves as responsible operators, Sweden will be an interesting test case of their ability to challenge the former monopolies, which regard responsibility as their raison d’etre. This competitive tension with responsible gambling at its heart might well make Sweden a truly groundbreaking market. n Turn the page for exclusive interviews with Kindred CEO Henrik Tjärnström and Svenska Spel MD Fredrik Wastenson

Licensed online operators, as of 1 January 2019 l8 88 Sweden

lC asinostugan

lK indred Group

lS afeEnt

lA B Trav och Galopp

lC asumo

lL &L Europe

lS killOnNet

(ATG) lA G Communications lA HA Bingo lA spire Global lA uto Nordic lB ayton lB et365 lB etfair International lB ethard Group lB etspawn lB etsson lB etway lB lue Star Planet lB S Nordic

lC erberus Technology

lL eisure Spin

lS nabbare

lC herry Casino

lL eoVegas Gaming

lS uprNation

Sweden lC o-Gaming Sweden lC omeOn Sweden lD umarca Gaming lE nlabs lE voke Gaming lE xpekt Nordics lG enesis Global lG VC Holdings lH ajper lH ero Gaming l I nterwetten Gaming

lM andalorian

lS venska Spel

Technologies lM T Secure Trade (Gaming Innovation Group) lM OA Gaming Sweden lM r Green lM ultibrand Gaming lN GG Nordic lP af Consulting lP olar

lT ipwin lT ombola lT SG (The Stars

Group) Interactive lU nited Lottery

Solutions lV ideoslots lV iral Interactive lX C Gaming Sweden lW hite Hat Gaming lZ ecure Gaming

SW E D E N FO C U S KINDRED GROUP

Kindred Kindred Group has been lobbying for Swedish re-regulation for 21 years. Chief executive Henrik Tjärnström is more than ready for it. Interview by Steve Hoare

GIQ Q4 REVIEW

spirit WHEN HENRIK TJÄRNSTRÖM moved from the chief financial officer’s office to the chief executive’s seat in 2010, the company was known as Unibet. It was a single-brand operator, which was vying with Betsson to be known as the Nordic region’s number one. During his eight years in charge, the company has blossomed into Kindred Group, a multi-brand powerhouse with a market capitalisation of SEK20bn (€1.9bn) that is double that of its rival Betsson. It enters the re-regulated Swedish market as the most credible private sector rival to the former monopolies ATG and Svenska Spel. And it is ready to spread its wings far beyond its Nordic roots with its first entry into the US market. We speak to Tjärnström a week after Kindred won the Swedish licence it fought some 21 years for, and three weeks before the re-regulated market opened on New Year’s Day. Kindred was one of 23 operators granted a licence at the time of writing. Lotteriinspektionen had another 72 licence applications to process – although some of these applicants have been asked for more information. “The regulator has estimated there are 500 brands advertising in Sweden. Even with

companies submitting one application for several brands, it will not make 500. So, there is an automatic culling of the market already,” says Tjärnström. Following state-owned ATG and Svenska Spel, Kindred Group will be the market’s third largest operator and the only one of that triumvirate with a foothold established in all the major product lines. It is an operator in rude health. Revenue for the first three quarters of 2018 was up 28.1 per cent on the previous year to £657.5m. Revenue for the 12-month period to October 2018 was £895.5m. At the end of 2017 that figure stood at £751.4m. If Kindred continues its current growth rate throughout the final quarter it will be very close to hitting that magical £1 billion landmark. Tjärnström states that Sweden accounts for between 10 and 20 per cent of total revenue. Given other hints and calculations, Kindred’s home market will account for between £110m and £150m in revenue. “It is fair to say that ATG and Svenska Spel will have market leadership online from the outset,” notes Tjärnström. “But they are not as far ahead as Danske Spil was at the time of re-regulation in Denmark.” 43

SW E D E N FO C U S KINDRED GROUP

The long road

“We have the scale, portfolio and size internationally to deploy more money into the Swedish market than a start-up can do. Scale will be the critical factor and regulation will benefit larger operators” Henrik Tjärnström, Kindred Group

Unibet was founded in 1997 and has been lobbying for re-regulation since then. The company sued the Swedish government in 2003, demanding an end to the gambling monopoly of Svenska Spel. The European Commission and European Court of Justice went on to issue opinions declaring Sweden in breach of European Union treaties before the government finally responded with liberalisation. Tjärnström has been with the company throughout that journey. First as a board member from 2003 and then as CFO from 2008, before his ascension to the top job as CEO in 2010. In tandem with the licence application, Kindred has been preparing its product, marketing and communications strategy for re-regulation. In the summer it announced a long-term deal to usurp Svenska Spel as sponsor of Swedish football’s top two divisions. “This highlights the opportunity available with re-regulation,” says Tjärnström. “We can do local sponsorship deals. One could argue the Swedish market has been more or less open from a media landscape point of view but sponsorships have been restricted to the monopolies.”

It is the most expensive sponsorship deal in Swedish history and a prize that looks hugely symbolic. From a public relations standpoint, it shows Kindred supporting local sport in a way that only Svenska Spel has been able to before. In a market in which Svenska Spel will be selling itself as the safest online gambling option, these gestures are significant. “We are confident we are better than them,” states Tjärnström. “We live and breathe online 24/7 and 365 days a year, and have been doing that for 21 years. We know what the customer wants and how to do it. We are the only online gambling company with a triple A rating from Morgan Stanley on Environmental, Social and Governance factors. We pride ourselves on taking the lead on responsible gambling and player safety and have done for many years.” While conceding that Svenska Spel “might not be much worse” Tjärnström is confident that Kindred is the market leader when it comes to responsible gambling. For Tjärnström this amounts to fighting talk. He is a much bolder leader than the accountant who walked into the chief executive’s office eight years ago.

SW E D E N FO C U S KINDRED GROUP

2010-2018 EBITDA (GBP) 960 (est)

185.0 123.7

2016

63.4

2015

2012

77.0

2014

52.5

2013

48.0

2011

751.4

43.8

2010

115.7

2017

REVENUE 2010-2017 (GBP)

REVENUE FROM REGULATED MARKETS 544.1

354.1 312.0

234.7 197.2

2014

34.3%

35%

2016

27%

2015

29%

2013

147.5 154.4 42%

Consolidation games In his very first interview as CEO in 2010, Tjärnström told Gaming Intelligence: “There is a change with local licensing and we will now have to live with lower margins. That is obviously something I will be able to do. I’m working very hard on that and it’s the strategy of the group for the next three to five years.” That scenario played out in France and Denmark and has continued throughout Europe in Belgium, Estonia, Germany, Italy, Romania, the UK and finally to Sweden. “The market will consolidate in the coming years like we have seen in Denmark, where there was a big flurry of investment in media and marketing in the first couple of quarters and gradually it has stabilised,” says Tjärnström. “That is what I hope and believe will happen in Sweden as well.” In the lead-up to re-regulation, Tjärnström believes there has been “almost too much” marketing as everyone jostles for position. “It will be a good thing for society in general as well. Not only will it mean that as much gambling as possible will happen in the regulated market but the introduction of betting duties GIQ Q4 REVIEW

will lift the barrier to entry, meaning fewer operators in a couple of years time.” Throughout his time in charge, Tjärnström’s attitude towards M&A has been one of gentle accumulation rather than transformative splash. After initially operating solely under the Unibet brand – acquiring smaller operators and migrating them to the Unibet brand and platform – Unibet has evolved into the multi-brand Kindred Group. It operates five brands in Sweden today: unibet.se, mariacasino.se, storspelare.se, bingo.se, igame.se. Tjärnström is comfortable the mix covers different demographics but does not rule out acquisitions that add more scale. I have yet to hear a CEO that will. Historically, it has bought brands such as Maria, iGame or 32Red, but last year it launched what Tjärnström calls “organic brands” in the shape of Norway’s Storspiller and Sweden’s Storspelare, which translate as ‘high roller’ in English. Tjärnström believes the company’s scale and ability to launch organic brands might mean that it is less likely to acquire start-ups looking for a good exit value.

2017

2012

2018

2017

2016

2015

2014

2013

2012

2011

2010

18%

“We have the scale, portfolio and size internationally to deploy more money into the Swedish market than a start-up can do. Scale will be the critical factor and I think regulation will benefit larger operators.”

A question of culture There has been talk in the past linking the company with larger operators such as Ladbrokes and 888, but Tjärnström has yet to find the “culture, strategic fit and value” that would make such a deal worth the upheaval. Kindred’s hesitancy to indulge in the transformational deal goes against the fashion that has seen GVC Holdings gobble up Sportingbet, bwin. party and Ladbrokes Coral but Tjärnström has guarded and encouraged Kindred’s culture throughout his tenure. Kindred Group has benefited from the stability provided by a core team of executives. Longserving chief commercial officer Ebba Ljungerud and chief product officer Daniel Eskola left for CEO roles with Paradox International and Relax Gaming during 2018, but others such as chief programme officer Britt Boeskov and chief strategy officer Rhodri Darch remain. 45

SW E D E N FO C U S KINDRED GROUP

“There has been more change than might be perceived outside the company,” points out Tjärnström. “It shows we are not dependent on me or the executive team. We have an extremely strong team throughout the company and that is what has enabled us to grow significantly faster than the market.” The rebranding of Unibet Group to Kindred Group in 2016 played a fundamental role in reinforcing this culture. Tjärnström describes it as a “milestone” but he says the company’s focus on sustainability has existed for many years and plays a key role in talent acquisition and retention. “We are not just talking about sustainability. It is not just empty words. It permeates the whole organisation,” he says. T he K i nd red na me rei n forced t he company’s values. A lot of time and effort has been spent on communicating those and continues to be. Tjärnström cites the company’s Sustainable Gambling Conference, which has been running for three years, as evidence of the company’s commitment. “That work never stops,” says Tjärnström. “It is about culture, and that is quite difficult for operators to copy. The operational things are easier to copy but the culture and the way of working and how we are as a team are unique to us.” It is about a culture that is about more than gambling. “We like to say that we have created a holding company for gambling-related assets,” he continues. “B2C is what we do and where our expertise lies but it also gives us an opportunity to look at tech and other avenues. At the end of the day, we are a tech company in the entertainment industry with gambling as our focus. You could argue that our competitors are the likes of Netflix, Spotify and Amazon, and we fight for a share of the customer’s entertainment budget.” bwin.party tried to implement a similar philosophy when it branded itself bwin.party digital entertainment but its merger problems meant it was never able to fulfil this vision. “We have been good at the follow-through,” says Tjärnström. “We try to be clear internally and get everyone buying into the plan.”

Future plans The grand plan spreads far beyond Sweden. In August 2018, Kindred signed an agreement with Atlantic City’s Hard Rock Hotel & Casino, which will give the operator access to the New Jersey market. The company’s US entry has been in the pipeline almost as long as the re-regulated Swedish market. Unibet started looking at the 46

“Our competitors are likes of Netflix, Spotify and Amazon, and we fight for a share of the customer’s entertainment budget” Henrik Tjärnström, Kindred Group

US before the passage of the Unlawful Internet Gambling Enforcement Act in 2006 but decided to keep its hands clean. “It forced us to be more efficient than others because we did not have that high-margin revenue stream coming in,” says Tjärnström. “Then, when UIGEA kicked in, we were happy that we had not taken any US customers, and it was not an issue for us as it was for certain larger competitors.” Since then, it has looked at Nevada and New Jersey. In 2012 it was quite close to striking a deal with a potential partner for entering the New Jersey market when it first opened. “The structure at the time did not suit us,” says Tjärnström. “The terms and conditions were not attractive enough. We more or less had to do a JV with a casino group and if they did not have a licence in Atlantic City then we would have to do a partnership with another casino to get a licence. There was a limit on the number of skins per licence then as well. The economics did not stack up for us and we had better returns in Europe.” The change to multiple skins has changed the commercial viability of the state. Tjärnström says that the team had decided in mid-

2017 that it would launch in New Jersey and that the addition of sports betting after the Supreme Court decision on the Professional and Amateur Sports Protection Act (PASPA) was just an “additional upside”. The company had been planning to launch in 2018 but might have underestimated the length of the licensing process. It now hopes to go live in early 2019. It chose the SG Digital platform precisely because it was already licensed in New Jersey. It will plug a Kambi sportsbook and Evolution live casino into the SG Digital account management system. However, Tjärnström says he plans to switch to Kindred’s own platform in due course. He likens the state-by-state nature of the US market to the regulated markets of Europe. Following the repeal of PASPA, there is a flood of states endeavoring to launch, while Europe has tended to open just one or two regulated markets a year. But Kindred has a team on the ground in the US now and is negotiating deals in other states as we speak. “We are humble and realise that our brand Unibet is not known at all in the US. That’s not new for us. It was pretty much the case in the UK in 2012 as well.” Tjärnström appreciates it will be a long, slow, complex process but there is clearly potential for the US markets to match and eventually eclipse Kindred’s European presence. When Tjärnström took charge in 2010, its annual revenue was £147.5m. Eight years and 10 regulated markets later, it has grown by over 500 per cent. The rise of regulated markets has been the defining feature of the past eight years and will probably dominate the next eight as well. Sweden and New Jersey will follow in 2019 and the Netherlands will be re-regulated in 2020. It does not seem too far-fetched to suggest that the rollout of US states will accelerate Kindred Group’s growth rate so the next eight years are even more successful than the last eight. Tjärnström’s relentless focus on regulated markets and responsibility has served Kindred well and if these two themes dominate the next eight years Kindred will continue to be well placed. “We are very happy we saw that in 2010 and have pushed ourselves in that direction. We see a clear business value from responsible gambling and sustainability. To be profitable in the long-term, you have to take responsibility. That is our ethos and that is what we live by,” states Tjärnström. “That’s what the UK Gambling Commission has shown over the past couple of years and that is where the industry is heading.” n

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SW E D E N FO C U S SVENSKA SPEL

Brand new

Heavyweight Svenska Spel has been waiting to launch online casino for over a decade. Its rivals will be waiting. Fredrik Wastenson speaks to Steve Hoare

FREDRIK WASTENSON IS the managing director of Svenska Spel Sport & Casino, a whole new company arising from the Swedish business’s restructuring into monopoly and non-monopoly operations. The wider Svenska Spel company will continue to offer land-based gambling through its Casino Cosmopol and Vegas brands in one division, while another division assumes responsibility for retail and online lotteries. Wastenson takes charge of the sports betting and online gambling part of the company. All three will be supported by a number of group-wide functions. Wastenson’s Svenska Spel Sport and Casino is a newly-formed business, and online casino is a new line of business for the operator, but the new company does not launch from a standing start. This is a SEK2 billion (€195m) business already. Last year’s annual report revealed that net gaming revenue from sports games amounted to SEK1,790 million, while online poker brought in a further SEK101m. If you compare that to other leading operators, LeoVegas reaps around €80m from

Sweden, and Unibet around €110-150m. LeoVegas is almost entirely an online casino operator, while sports betting accounts for around a quarter of Unibet’s revenue in the Nordic region. Figures from other licensed Swedish brands such as bwin and bet365 are unavailable, but Svenska Spel will enter the market as the sports betting market leader at least. Wastenson estimates that Svenska Spel will account for 16 per cent of the newly competitive market on day one. He says horse racing monopoly ATG will account for around 34 per cent of the market (2017 NGR SEK4.2 billion). Indeed, this will be the first time that Svenska Spel and ATG will operate as competitors, with Svenska Spel offering horse racing for the first time, and ATG widening its offering to include other sports. Swedish analyst Redeye has predicted Svenska Spel’s online casino will be a SEK500m business in three years, and Wastenson says this is in line with his expectations. “If you look at the Svenska Spel brand we have a very high image value,” says Wastenson. “We also have very satisfied customers. That is due to the fact we have been around a very long time. We have invested a lot in this society. We are very closely connected to the national teams. I think people understand that they are contributing to good causes.” He welcomes the competition with overseas and Swedish commercial businesses and the level playing field that re-regulation introduces for the first time. “It is something we should support and not ban,” he continues. Redeye estimates that the overall online casino market in Sweden comprises just 200,000 players bringing in SEK3.2 billion. Wastenson estimates that around 70 per cent of those players might well be Svenska Spel customers already given the fact that Svenska Spel’s database holds over a million players. “When we open up it is not as if they will all move to Svenska Spel, but they might at least spend a portion of their money with us from day one,” says Wastenson. He is less confident about horse racing in the short-term given ATG’s dominant position, but

SW E D E N FO C U S SVENSKA SPEL

“We can say: when you play with us you will be more secure and you will have more control over your gambling” Fredrik Wastenson, Svenska Spel

is hopeful that will pick up in year two. “We will not be the one that invests most in marketing,” he states. “We will always invest less than our competitors – at least for the short-term. It will then come down to how valuable the brand is and the recognition of the business.”

Waking up on New Year’s Day Svenska Spel Sport & Casino entered the newly regulated Swedish online gaming market on 1 January 2019 from a unique perspective. As an offshoot of the state-owned monopoly, it will perhaps be the market’s most recognisable brand, but it started with a considerable handicap. Unlike its competitors, Svenska Spel Sport & Casino had never operated an online casino and it started doing so with a tricky migration of its existing database over to its newly-acquired SG Digital platform on New Year’s Eve. We spoke to Wastenson before the turn of the year and he is hopeful the migration will happen smoothly GIQ Q4 REVIEW

overnight, while others were toasting the start of the New Year. “We don’t know, but it’s a bit like a bypass operation – you hope that the patient will wake up the day after,” says Wastenson. “It’s a major operation and it is the toughest thing we have ever done.” Svenska Spel will be the only operator in the new market forced to start its regulated operation with this onerous task. SG Digital supplies the player account management platform and online casino, which will plug into the platform. Games from NetEnt, Yggdrasil, Evolution Gaming and more will connect to the platform, as will the company’s existing online poker operation from IGT and its sportsbook and pool games, which were developed in-house. Wastenson claims that Svenska Spel started the world’s first online sportsbook. It opened in retail premises in 1986 and launched an online

platform in the 1990s, with a fully-functioning sportsbook in 2001. “We have to decide whether to invest more in a third-party platform to keep up with the competition or whether we see a strategic value in retaining our own platform,” he states. The company is evaluating this dilemma at present. Svenska Spel has invested in the product in recent years, with more coverage of live events a particular priority. It has been rewarded with an increased share of its revenue from the internet. The split between online and retail was around 50-50 just two years ago but today around 70 per cent of revenue comes from the internet. “Going into the new market I am OK with what we can deliver today. If it is not exactly on equal terms [with private competition], we are quite competitive at least. Going forward there are functions like BetBuilder and CashOut that can be developed. That will continue to happen but it might be a challenge to keep 49

SW E D E N FO C U S SVENSKA SPEL

up if we do not invest in more people to develop the platform.” Unlike many of its new competitors, Svenska Spel has a retail presence, which will be unrivalled in Sweden. ATG and Svenska Spel both operate over 2,000 retail premises. This will form a large part of the picture that points to a huge brand advantage. It is part of the picture that Wastenson will be evaluating when considering the technology platform. Omnichannel developments will be a crucial factor but are not the immediate priority. “It has been a challenge in terms of time,” Wastenson admits. “We started to develop our online casino at the end of 2017. We wanted the most requested games at the start and have to implement functionality to meet the regulator’s demands. We hope to have a competitive product from day one, but it will evolve over time.” Going forward, the company has a licence to take bets on eSports and fantasy sports. Customers should be able to make bets on eSports tournaments from fairly early on, but Wastenson hopes to develop that beyond a mere betting product. “Hopefully it will have its own channel and its own community with social functionality integrated into an app. It is about prioritisation at the moment.” 50

A similar philosophy will be applied to fantasy sports games, where there might be a crossover from the company’s existing pool games. That might go live in 2019 but will certainly launch in 2020 at the latest.

A new era of responsibility Svenska Spel has been running land-based casinos since 2000 and online poker since 2006. It was obvious from this time that customers wanted to play online casino, and a series of Svenska Spel CEOs lobbied for online casino games to be added to the company’s portfolio. It eventually applied for a licence in 2014 only to be denied by the Swedish authorities. This has been a long time coming. If the product itself will be a work in progress, the philosophy behind it is clear. “As the state-owned operator it is important to not include a product in our portfolio that has a higher risk than some other products and could lead to bad behaviours and addiction. We can provide an alternative to all the commercials and bonuses that are offered in the market today,” says Wastenson. “We would like to offer something that a player at Svenska Spel would feel he has more control over his gambling.” This attitude will be reflected in a slightly different online casino product. For example, it will

default to a smaller stake when a customer plays, and never to a higher stake. The Svenska Spel team will call players that are showing signs of addictive behaviour and it will not call players to encourage them to play more. It will not have a VIP programme or offer bonuses on casino games, which the GameGuard system describes as medium or high risk. “We will have a clear alternative to what exists in the market today,” states Wastenson. Commercial operators such as Unibet and Mr Green are also keen to claim market leadership based on their responsible gambling efforts. “It might be difficult to say that you are more responsible than someone else, but I still think there is a lot of room for a company that positions itself as someone who delivers more tools and more limitation on what you can do. We can say: when you play with us you will be more secure and you will have more control over your gambling,” concludes Wastenson. Sweden will be the first re-regulated market to test this theory. It will be the first regulated market to emerge in the new era of responsible gambling awareness. With two state operators pushing this agenda and a core of experienced commercial operators intent on bettering them, it will be a fascinating test case of a responsible gambling market. n

F E AT U R E PLAYTECH

The changing face of

Teddy Sagi has left the company he founded – as have dozens of other Playtech alumni. But the iGaming powerhouse keeps finding talented personnel to manage an increasingly diverse workforce. By Steve Hoare

While revenue has grown around 800 per cent, employee numbers have grown around 1,000 per cent during Weizer’s reign 52

NO COMPANY CAN match the 22 entries that Playtech has managed in the Gaming Intelligence Hot 50 during the past eight years. Only The Stars Group comes close, with 18 Hot 50 alumni. The very first Hot 50 in 2012 featured five Playtech employees: chief executive Mor Weizer, COO Shay Segev, Videobet CEO Shmuel Weiss, GTS and Virtue Fusion CEO Aaron Johnston and Mobenga CTO Lars Widmark. Only one of that quintet is still with the company. No prizes for guessing who (it’s the CEO Mor Weizer). However, the company has gone on to acquire other Hot 50 luminaries from that first gathering. Quickspin and its canny CEO Daniel Lindberg was acquired in 2016, while AAMS head of remote gaming Francesco Rodano later joined as chief policy officer. Losing four out of five Hot 50 stars might seem a lot, but consider that this was seven years ago and that year’s list also contains names such as Isai Scheinberg, David Loveday, Breon Corcoran and Jenny Williams. All have since departed our industry. Only 18 people on that initial list are still with the same organisation they were back then. Indeed, Weizer’s longevity is striking. Only eight of the 20 chief executives on the 2012 list are still in their posts. Most of those are chief executive founders. Since then, William Hill has had three CEOs. PokerStars, in its various guises, has had four. Weizer joined Playtech from Oracle in 2005. He ran customer relations, marketing, the Techplay subsidiary and the company’s Israel office, before being appointed CEO in mid-2007. On becoming CEO, he was very much Playtech’s face in the City of London. Weizer took over from Avigur Zmora, who led the company into its IPO on the London Stock Exchange’s Alternative Investment Market in March 2006. Total revenue for 2006 was $90m. At

the end of Weizer’s 10th year in charge it stood at €807m. Interestingly, while revenue has grown around 800 per cent, employee numbers have grown around 1000 per cent during Weizer’s reign. Weizer has grown into the role as Playtech has evolved. Back in 2012, this was still very much Teddy Sagi’s company. The Playtech founder has been reducing his stake in the company since 2015 and finally exited at the end of 2018, but back in 2006 he was still the main man. Sagi took a step back after the IPO. Officially, he provided mere “advisory services to the Group for a total annual consideration of €1”, but as the company’s largest shareholder his influence was felt. “He was the founder and had the guts to make some brave decisions. He got involved in the big things,” says a source. Sagi was the driving force behind the $75m acquisition of poker network Tribeca Tables in November 2006, for example, and would sign off other mergers and acquisitions.

The old guard The core management team was quite entrenched when Weizer arrived. Shuki Barak was the influential chief financial officer and quite a dominant voice within the organisation. Rafi Ashkenazi was chief operating officer, working out of the Isle of Man and would later go on to the same position at Rational Group, before becoming CEO of Amaya and then The Stars Group.

F E AT U R E

PLAYTECH

Andrew Smith

Shimon Akad

CFO Relative newbie approaching four years at Playtech.

COO Vitally important COO responsible for coordinating Playtech’s many moving parts.

Armin Sageder

Fabio Schiavolin

CEO, Playtech BGT Sports Charismatic sports chief bringing sports centre-stage.

Mor Weizer CEO At Playtech since 2005 and CEO since 2007. One of the industry’s most enduring CEOs. GIQ Q4 REVIEW

CEO, Snaitech The boss of Playtech’s largest acquisition. Responsible for Italian growth engine.

Edo Haitin

Peter Mares

CEO, Euro Live Technologies Young, energetic boss of live casino operations. Has a big future.

CTO, Playtech Games Innovation Labs Tech brain responsible for keeping Playtech ahead of the chasing pack. 53

F E AT U R E PLAYTECH

Playtech alumni JOACHIM TIMMERMANS 2016-2019 Now: On holiday Then: Chief product officer, Quickspin Timmermans left the Playtech Group in January, seven years after founding software house Quickspin with Daniel Lindberg and Mats Westerlund, and two years after it was acquired by Playtech. VALERY GELFMAN 2009-2018 Now: Deputy chief operating officer, GVC Holdings Then: COO Playtech Retail During his nine years at Playtech Gelfman was the go-to expert for any retail software queries and questions – so much so that he ended up leading the entire retail operation. As Playtech’s strategy focused increasingly on its omnichannel capabilities, Gelfman’s expertise became more and more important. He took the lead on many RFPs. DAN PHILLIPS 2012-2018 Now: Consultant Then: VP UK operations Industry veterans do not come much more experienced than Dan Phillips. He started his career as a dealer at Gala Casino, before being promoted into the online gaming world as director of Gala Coral’s fledgling eCommerce efforts. After spells at Chartwell and Fertitta, he re-emerged at Playtech as head of bingo and ultimately was put in charge of some 500 employees as head of the company’s flagship UK operations. 54

SIMON BERNHOLT 2012-2018 Now: Partner, Wiggin Then: UK head of Legal Simon Bernholt worked in the legal department at Playtech for six and a half years before joining old boss David McLeish at law firm Wiggin. STEVE SCHRIER 2013-2017 Now: Chief commercial officer, SG Digital Then: VP, sales and customer relations Steve Schrier arrived at Playtech in December 2011 after it acquired Ash Gaming, where he was business development chief. He rose to the same position in Playtech before leaving in late 2017. BRYAN HURWITZ 2015-2017 Now: Head of product, Endorsed Group Then: Mobile product manager Bryan Hurwitz made his name at mobile technology provider Mfuse. After brief spells at Bodog and Gamesys, he moved on to Bonza Gaming, before assuming responsibility for mobile products at Playtech. DAMIAN SOKOL 2013-2017 Now: Founder, blockchain company Then: CEO, PokerStrategy PokerStrategy was acquired by Playtech in mid-2013 for $50m. The acquisition was a key plank of Playtech’s strategy to resuscitate its iPoker network. Sokol’s expertise was seen as key to that and he stuck around for almost five years.

The position of chief operating officer is an important one at Playtech. There was a time during Sagi’s heyday, when it seemed like every talented executive would get a spell as COO before being moved on when he became too influential. Former COOs include Shay Segev (now joint COO at GVC), Shmuel Weiss (now chairman at Skywind) and, of course, Ashkenazi. The current incumbent is Shimon Akad. He has been at Playtech since 2011 and has been COO since 2015. He is a vital member of the executive team. The all-important IMS back office system sits in his team. And, much as the IMS brings together different Playtech technologies, Akad’s operational expertise

When the company floated in 2006 it employed 450 people. Today it has 5,500 employees. That takes some managing is vital in bringing together licensees and all the teams working across different verticals. Akad is credited with bringing order to the operation. He is quite a tough character and sources say he has a knack of ‘doing the right things’. Playtech is a much bigger organisation than it once was. When the company floated in 2006 it employed just 450 people. Even as recently as 2012, when the first Hot 50 was revealed, it had around 2,800 staff. Today it has around 5,500 employees. That takes some managing and Akad’s role in central management is crucial in bringing all Playtech’s different divisions together. The rest of the central management team comprises Weizer, CFO Andrew Smith and business

development chief Uri Levy. Weizer and Levy have been the constants since the former became CEO in 2007. At one Hot 50 judges’ meeting it was joked that Levy should be in the Hot 50 every year. Certainly, his role in the growth of Playtech has been immense. As business development chief, Levy’s key responsibility has been M&A and new joint ventures. The list of Playtech acquisitions keeps growing. From the foundational purchases of Tribeca, GTS and Virtue Fusion, through leading games studios such as Ash Gaming and Quickspin, to the slightly less obviously successful financials companies, through to the recent transformative acquisitions of BGT Sports and Snaitech. Mention of the financials division – now dubbed TradeTech Group – brings to mind another Playtech veteran Ron Hoffman, the former CFO who is now CEO of TradeTech. Hoffman is very close to Weizer, having been his CFO for almost half a decade. While he reports to Weizer and the Playtech Board, he has more autonomy than other parts of the organisation, which are necessarily more integrated. Hoffman has been at Playtech for over 15 years, so can be considered a trusted general. And while TradeTech endured a tricky post-acquisition regulatory storm, all its key performance indicators are now heading in a healthy direction. While TradeTech can now be considered a worthy semi-standalone business, the recent acquisitions of BGT and Snaitech are so important that the entrepreneur founders have been rewarded with special deals aimed at tying them to the company for the long-term. BGT founder Armin Sageder is the charismatic and energetic leader of the sports division, who is currently spending a great deal of time in the US with Levy trying to secure the foundational deals that

F E AT U R E

PLAYTECH

will see Playtech enter the US for the first time. The recent US experience is testimony to the important role sports betting performs in opening regulated markets. Increasingly, Playtech views retail (and its natural development into omni-channel) as an essential channel in newly regulating markets. One only needs to look at the quick speed to market of the likes of Caesars and MGM to see that the brands best placed to lead are often the ones with an existing retail presence. If BGT’s self-service betting terminals are the most obvious example of Playtech’s retail s t r en g t h , t he FOBTs of Videobet, the bingo terminals recently rolled out with Gala and the IGS retail

casino management system reveal a retail portfolio of some depth. “We can digitise the retail offering, put it on the ONE platform and drive effective cross-sell to online. We did it in the UK with Hills, Ladbrokes and Coral, being the best examples, and we are looking to do it with Snaitech in Italy, Caliente in Mexico and Fortuna in the Czech Republic,” says an internal source. Snaitech is Playtech’s biggest acquisition and its experienced CEO Fabio Schiavolin is acknowledged as a key player in delivering continued growth for Playtech. Italy’s gambling market is the biggest in Europe – even bigger than the UK, where Playtech has been so successful. However, most analysts believe the market is in relative infancy. Online penetration is nowhere near the level of the UK, so Playtech will utilise Snai’s retail network to grab market share. As online penetration increases, so will the size of the online gambling market. It is a long-term strategy and Playtech expects Schiavolin will stick around to lead it.

The next generation Playtech has not always ret ai ne d it s acqui re d founder CEOs for the longterm. Quickspin chief product officer Joachim Timmermans and chief creative officer Mats Westerlund are the latest to leave, although cofounder Daniel Lindberg remains. While GTS founder Steven Matsell, Mobenga founder Christian Rajter and Virtue Fusion CEO Bob McCullough left almost as soon as they could, Rajter and Matsell’s technical co-founders Jerry Bowskill and Lars Widmark stayed a little longer. The expertise of Ash Gaming founder Chris Ash was GIQ Q4 REVIEW

Playtech alumni LIRON SNIR 2007-2016 Now: Chief product officer, GVC Then: VP product strategy Liron Snir was recruited by his old boss Shay Segev to head up the product offering at GVC Holdings following the acquisition of bwin. party. DAN WIEGENFELD 2013-2016 Now: Senior VP GSN Casino Then: Head of social gaming Recruited from diwip to helm Playtech’s foray into social gaming. He spent nearly three years managing the product before the company decided to throw in the towel and abandon social. DAVID MCLEISH 2013-2016 Now: Partner, Wiggin Then: General counsel David McLeish spent almost four years at Playtech before departing in January 2016 for law firm Wiggin, where he joined Stephen Ketteley, who was a colleague at the law firm he worked at before joining Playtech. Playtech later tapped up that firm – BLP – for its new general counsel, Alex Latner, a year after McLeish’s departure. AMIR ASKAROV 2007-2016 Now: CEO, Blue Ribbon Technologies Then: CEO, Techplay Amir Askarov is another Playtech veteran, who assumed a series of senior management roles including head of casino, product director and CEO of Techplay. He left at a similar time to Segev and Nankin, all of them serving for nine years in a variety of roles.

CHRIS ASH 2011-2015 Now: Founder, Ash Capital Then: Head of open platform Chris Ash sold his Ash Gaming software house to Playtech in December 2011. After the acquisition he assumed a senior management role with a major role in group content strategy and responsibility for the previously acquired GTS platform. He was also involved in the company’s M&A efforts. He left in March 2015 and went on to launch his own advisory firm for software start-ups in 2017. SHAY SEGEV 2006-2015 Now: COO, GVC Holdings Then: COO Shay Segev was one of Videobet’s co-founders before going on to become COO of the Playtech group. He was an important figure in the Gala Coral deal and left Playtech for the UK gambling company, before joining GVC as COO. He then became joint COO of the GVC-Ladbrokes Coral group. AARON JOHNSTON 2005-2013 Now: CEO and co-founder, Voidbridge Then: Various New Zealander Aaron Johnston first hooked up with Playtech in Asia in 2003, while working for Bayview Technologies, before moving to Europe and joining Playtech in 2005 as commercial director. He became a trusted lieutenant of Teddy Sagi, leaving the company for a period to work directly with Sagi on M&A. He returned as chief of Virtue Fusion and GTS before leaving for William Hill. He founded Asian-based Voidbridge with former Playtech CEO Tom Hall in 2014. 55

F E AT U R E PLAYTECH

Playtech alumni AVIV NANKIN 2006-2015 Now: Various Then: VP products Aviv Nankin was an old-school Playtech veteran, who assumed various senior roles within the organisation over the course of nearly a decade at the company. He was CEO of S-tech and Euro Live Technologies, before taking charge of live games and then all products. Since leaving he has been involved with a number of new ventures, including live casino rival Ezugi. SHMUEL WEISS 2005-2014 Now: Chairman, Skywind Group Then: COO Shmuel Weiss and Videobet co-founder Shay Segev followed parallel careers at Playtech, both helming the VLT business and following it with a spell as group COO. Weiss has gone on to chair Teddy Sagi’s Skywind Group and is CEO of eCommerce technology provider MarketGroup. ADELE LAWTON 2013 Now: Head of bingo, GVC Holdings Then: Commercial director Former Gamesys marketing director Adele Lawton worked at Playtech for less than a year before leaving for an even shorter stint at Betfred. She has been head of bingo at GVC for over two years. RAFI ASHKENAZI 2006-2013 Now: CEO, The Stars Group Then: COO Rafi Ashkenazi was recruited out of Playtech as Rational Group COO. He survived the Scheinbergs’ sale and the Amaya years to emerge as CEO of The Stars Group. 56

JERRY BOWSKILL 2009-2012 Now: CTO, The Stars Group Then: Technology and solutions director Jerry Bowskill arrived at Playtech after it bought GTS, the platform provider that he co-founded with Steven Matsell. After a spell as CTO of Scientific Games, Bowskill now helms the technology efforts of The Stars Group. LARS WIDMARK 2011-2015 Now: CEO, Menmo Then: CTO, Mobenga Lars Widmark was the CTO of mobile betting company Mobenga, which Playtech acquired in 2011. He was responsible for making sure the technology side of the business actually worked. He left after his three-year earn out period ended and returned to Menmo, the incubator that gave birth to Mobenga. STEVEN MATSELL 2009-2012 Now: CEO, Leander Games Then: Director Steven Matsell co-founded GTS with Jerry Bowskill, which was bought by Playtech in 2009. He served his earn-out period and soon re-emerged as CEO of Leander Games. TOM HALL Playtech 2002-2009 Now: Chairman, various Then: CEO The AsianLogic co-founder joined the Playtech board in 2002 and was subsequently appointed CEO. He became chief business development director before the company’s flotation in 2006 and remained an executive director until 2008 and a non-exec until 2009.

utilised for a more prolonged period. Ash directed Playtech’s content strategy for a time and became an influential voice on M&A matters, leading on one acquisition and helping out on several others. While several of these businesses were crucial building blocks for the modern Playtech group, none were the size of BGT or Snaitech at the time of acquisition. That is the chief reason Sageder and Schiavolin have been granted long-term incentives and why they have immediately been integrated into Playtech’s next generation of leaders. Others include current head of content Eran Gilboa, who has been one of the driving forces behind some of the company’s most successful games, including Age of the Gods. Former Odobo chief technology officer Peter Mares joined Playtech when the supplier picked up the technology assets and core team from Odobo, after it closed down in 2016. Mares has assumed the role of CTO of Playtech’s Games Innovation Labs, a crack squad of 21 technicians, product managers and designers working on all sorts of platform and games projects. Mares’ team has created the Playtech Open Platform (POP), a new aggregation platform, which allows licensees to access any content in an App Store-type environment. Furthermore, the team has also developed the GPAS suite of technology processes and tools, which helps internal teams and – in future – external developers to develop their own content. This builds on the acceleration tools developed by a company called Corosin, which Playtech acquired in 2015 for a maths design tool that reduces development time from months to days. “Playtech is reinventing itself,” says Mares. “We’re opening ourselves up and bringing simplicity to different parts of the supply chain.” For a company that has been a market leader for a long time – and has often been criticized for doing just the opposite – that is no small thing. Further evidence of the next

generation of Playtech management and the new style of Playtech thinking comes from Edo Haitin, the CEO of Euro Live Technologies. Haitin heads a team of some 1,000 employees, running Playtech’s live casino studios in Riga, Latvia. The company has invested a lot of money in Playtech Live and has been rewarded with 15-20 per cent growth rates. Haitin is a dynamic and ebullient character, who prides himself on creating “an atmosphere that will let the dealers smile naturally”. That combined with the technology, broadcasting and gambling expertise has helped Euro Live flourish, but Haitin believes the Playtech culture allows them to thrive.

“Playtech is unique. There is no other company with so many products, verticals and technologies” Edo Haitin, Playtech

“Playtech is unique,” says Haitin. “There is no other company with so many products, verticals and technologies. It is a flat structure and can be a challenge. It is not for everyone but I always go back to the passion. And people with passion will find opportunities here.” In many ways 2018 was a challenging year for Playtech, with a downgrade based on competition concerns in Asia and a slow start in the US as others stole a march. But tracing the history of Playtech one can start to see a process of permanent revolution. Many have left – including the founder Sagi – but the new era will be in safe hands with the likes of Haitin and Mares, Sageder and Schiavolin, plus others such as BetBuddy CEO Simo Dragicevic, product strategy VP Anthony Evans, innovation strategy manager Boaz Shlevin and many more. n

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This was the most fiercely contested Gaming Intelligence Awards yet, as operators and suppliers scaled new heights during the past year. Congratulations to one and all

THE GAMING INTELLIGENCE

OPERATOR A

MANAGEMENT TEAM OF THE YEAR

GVC HOLDINGS AT THE TOP of the tree, GVC has an inspirational chief executive in the shape of Kenneth Alexander. But that would not be enough alone to secure this prize. Alexander has surrounded himself with key lieutenants such as Andy Hornby and Shay Segev, who get things done. The motto of the GVC management team could be “nothing is impossible”. Nowhere is this more evident than in its approach to M&A, where it has refused to let competitors, market conditions or regulators get in its way. There is always a solution for this incredibly focussed team. Furthermore, the management’s no-nonsense style is reflected throughout the organisation. Any one of the operators on the shortlist for this award would have made a worthy winner, but GVC has managed to grow at an incredible speed. It has pulled off the tricky task of integrating huge businesses, while continuing to pay attention to the bottom line and, crucially, continuing to improve its products. That is some feat. Now it looks set to conquer the US. This is a juggernaut that will take some stopping.

SOCIALLY RESPONSIBLE OPERATOR OF THE YEAR

KINDRED GROUP

IT COULD BE argued that this is our most important award, and Kindred is an extremely worthy winner. It continues to push the boundaries of excellence when it comes to corporate and social responsibility in the iGaming sector. Kindred has been a key driver and educator on the topic of adopting best practices in responsible gambling across the industry. As Sweden prepared to open to regulation this January, Kindred held its third Sustainable Gambling Conference in Stockholm. Kindred also sponsored the development GIQ Q4 REVIEW

and translation of a free Gambling Therapy app for the Nordic Region and collaborated with Betfilter to develop AdBlocker, a new online social responsibility tool to stop under-aged people from being exposed to gambling ads. However, the real reason it is a winner is because its actions reveal a philosophy that runs to the core of the business. Kindred has led the way for years and others should follow.

Runners up Bet365 / Kindred Group / The Stars Group

Runners up Betsson / GVC Holdings / Mr Green 16

THE GAMING INTELLIGENCE

OPERATOR A

POKER OPERATOR OF THE YEAR

POKERSTARS

“WITH SUCH DOMINANCE, there can be no other winner,” said one of our judges. But PokerStars wins this award for more than the weight of its numbers. The world’s leading

poker site continues to innovate and push the boundaries of online poker. This sustained focus on product improvement drove revenue up 19 per cent in the first half of 2018 and despite a blip in Q3, it continues to power on. Products such as Spin & Go, The Deal and its virtual-reality PokerStars VR offering continue a drive to bring casino-style mechanics to the poker table. Its Stars Rewards programme has played a major role and significantly contributed to this growth, while the shared player liquidity arrangement between the markets of Italy, France and Spain, has re-energised the sector and been maximised by the company. “You can’t beat Stars when it comes to poker,” said one judge. Amen to that.

Runners up PartyPoker / Winamax

ONE TO WATCH OPERATOR

FANDUEL

OF THE MANY new entrants to the US sports betting market, FanDuel is the one that our judges are most excited about. Its entry as a US sportsbook happened almost by stealth – and not without bumps – but amid all the fanfare of the PASPA repeal and the legislation landslide, FanDuel has been going about its business at some speed. It is the second largest sportsbook in New Jersey, with digital revenues of US$4.4m during November and the brand has been able to leverage the marketing and financial firepower of its parent company Paddy Power Betfair, which acquired it during the summer of 2018. FanDuel has a canny management team that has agreed tech partnerships with GAN and IGT, while cutting a strategic partnership with US gambling heavyweight Boyd Gaming and a string of agreements with sports leagues and teams. FanDuel means business.

Runners up DraftKings / Global Gaming (Ninja) / Omnia

SPORTS BETTING OPERATOR OF THE YEAR

BET365

BET365 CONTINUES TO deliver the most astonishing figures. It was an excellent year for its challengers, too. GVC, Kindred and the Stars-Sky axis pushed hard but it was impossible to argue with bet365’s weight of numbers. Total revenue for the Stoke-based giant were up 25 per cent to £2.8bn to the end of March 2018 while operating profits rose 33 per cent to £660m. Continuing to deliver this level of growth year after year, despite the operator’s size is simply phenomenal. 62

Its continuing dominance as the world’s most popular sports betting website owes everything to an attention to detail. It owed its growth to product improvement. For example, live content was increased to 160,000 events, streaming everything from football to tennis matches to darts and racing events around the world. “The growth bet365 is able to deliver from its already market-leading position is nothing short of astounding,” said one judge. “bet365 is the clear winner when it comes to sports betting.”

Runners up GVC Holdings / Kindred Group / The Stars Group

SOCIAL CASINO OPERATOR OF THE YEAR

ARISTOCRAT

YOU COULD NOT look past Aristocrat in this category. While others have shunned or sold their social casinos, Aristocrat has continued to invest. It has made social casino the cornerstone of its digital strategy since acquiring Product Madness in 2012, but it was in 2018 that it really began to motor. The acquisitions of Big Fish Games and Plarium Global towards the end of 2017 have strapped on the rocket boosters, with digital revenue growing 220 per cent to nearly

THE GAMING INTELLIGENCE

OPERATOR A

CASINO OPERATOR OF THE YEAR

GLOBAL GAMING (NINJA CASINO) GLOBAL GAMING’S NINJA Casino has transformed the online casino world with its innovative use of technology and trailblazing approach to marketing and product development. Ninja Casino offers super-fast access to an outstanding gaming experience, with no registration, and a streamlined cashout process that is easy and painless. This high-level onboarding enabled Global Gaming to grow 2018 revenues 181 per cent to €40m on the previous 12 months, with Q1 net gaming revenues up 64 per cent to €19.6m. Although Ninja is not a global player it impressed the judges with its ability to enter a competitive market with a limited product offering and grab a large market share within a very short space of time. And it did it so purely through innovation.

Runners up Golden Nugget / Betsson / The Stars Group

AUD$553m and digital profits shooting up to AUD$84m. Aristocrat launched the hugely popular Cashman Casino and Asian-themed FaFa Gold, and its online daily active users have increased almost sixfold to 8 . 3 m i l l i o n , c o m p a r e d w it h 1.4 million last year. The worrying thing for its competitors is that it plans to keep on buying. 2018 was an incredible year. 2019 might be even better.

Runner up Scientific Games GIQ Q4 REVIEW

BINGO OPERATOR OF THE YEAR

TOMBOLA

THE BINGO GROUP headed by Phil Cronin continues its growth in the highly competitive online bingo field, building on its market leadership in the UK to assume similar leadership in Italy and Spain. It achieved this growth thanks to an original games portfolio and sponsorship campaigns of high-profile UK TV shows such as I’m a Celebrity Get Me Out of Here. Tombola puts the emphasis on fun, community and friendliness, with many of its users

playing as much for the social features it offers as for the prospect of any financial gain. The group’s focus on technical expertise, recruitment and excellence in customer service is all part of its 2020 strategy, which aims to establish it as the leading tech hub in the north east of England. Its investment in a new £7m state-of-the-art office complex suggests a winner that is building foundations for a fantastic future.

Runners up Gala Leisure / GVC Holdings / JackpotJoy Group

LOTTERY OPERATOR OF THE YEAR

MICHIGAN LOTTERY THE MICHIGAN LOTTERY has been one of the pioneering state lottery operators in the US. It has reaped the rewards of launching new, tech-led online products that combine the instant win gratification elements beloved of players with technically strong solutions and platforms. In doing so, it recorded the sort of figures rarely seen in the lottery world, with online revenue shooting up 66 per cent to US$80m. The operator has continually improved its product. It was the first US state lottery to launch an online affiliate programme in the country, thus being an early adopter of online marketing and

onboarding techniques that provide it with efficient and stat-rich customer insights to drive home its lead in the online space. Its adoption of virtual sports also means an expanded retail-online integration that can drive traffic from physical to online channels and back. The group’s target of US$826m in online wagers for 2018 is proof of its ambition and drive.

Runners up Loto Quebec / Ontario Lottery & Gaming Corporation / Sazka Group 63

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THE GAMING INTELLIGENCE

SUPPLIER A

POKER SUPPLIER OF THE YEAR

PLAYTECH

PLAYTECH’S BIGGEST ACHIEVEMENT of the year was the merger of its French and Spanish regulated market networks – a vital task in preparation for the introduction of shared liquidity between these countries. Playtech is partnered with six major operators – Betclic and Unibet in France, and Bet365, Betfair, Casino Barcelona and Sportium in Spain – to create the largest B2B poker network across the two countries. With Portugal and Italy also ready to go, you can expect more operators to join the network in 2019. This was the single biggest differentiator from its competitors, but one other is that it remains the single biggest poker network in the industry. It continues to invest in a vertical that has struggled in recent years and its latest innovation is to bring casino-style gambling to the poker room. Whether this is through the hybrid missions based on events in its side games or its introduction of the hugely popular Age of Gods brand to poker. Playtech will not stand still and iPoker will benefit.

Runner up Microgaming 66

CASINO SUPPLIER OF THE YEAR

RED TIGER GAMING 2018 WAS A breakthrough year for Red Tiger Gaming. It rode the success of its daily jackpots – a truly inspiring innovation – and ploughed through an impressive 30 integrations, with another 50 signed and waiting for delivery. It should not be a long wait. Inspired by the large SAAS businesses from outside our industry, Red Tiger invested heavily in automating its integration process. In theory, any operator should be able to take Red Tiger content out of the box without the need for Red Tiger’s

involvement. The direct result is an increase in the number of integrations from two to six each month. However, it is not just weight of deals, it is the quality of the deals with Betsson, GVC, Kindred and Paddy Power Betfair all carving out exclusive real estate for Red Tiger content. And it was not just the daily jackpots or the deals that inspired the judges. They praised Red Tiger’s in-game branding and other engagement tools. And, of course, it continues to churn out inspiring games. A truly world-class casino supplier has arrived.

Runners up Blueprint Gaming / Playtech / Yggdrasil

LOTTERY SUPPLIER OF THE YEAR

SG LOTTERY

ONE TO WATCH SUPPLIER AWARD

BIG TIME GAMING

THIS WAS A fiercely contested category, with a number of smaller suppliers on the verge of a big breakthrough. However, Big Time Gaming scooped top prize after an outstanding year, when it could quite easily have made it onto the Casino Supplier of the Year shortlist. Bonanza has truly usurped Starburst as the biggest game in the industry – showing no sign of slowing down almost two years on from launch. But there is no way chief executive Nik Robinson will allow his team to rest on its laurels, with

content continuing to evolve with each new release. Don’t be surprised if Who Wants To Be A Millionaire, released in late-2018, becomes the biggest game of 2019. Furthermore Big Time Gaming has embraced Twitch and YouTube live streaming, creating an event out of its game launches. And its MegaWays mechanic is so good that competitors like Blueprint Gaming and Red Tiger have licensed it. Big Time is now setting its sights on the US market and it will not limit itself to the fledgling online market. It plans to deliver its slots into land-based casinos via server-based games while leaving the RTP unscathed. Truly one to watch.

SCIENTIFIC GAMES HAS had a stellar year, with growing European dominance complementing its market leadership in North America. This year it launched the first full-scale sports betting platform in the US with the Delaware Lottery, and also rolled out complete lottery solutions for Swisslos in Switzerland and Szerencsejáték in Hungary. SG’s expertise allows it to develop highly innovative digital lottery products such as the Pennsylvania Lottery’s first online/mobile games in May 2018, which recorded sales revenue of over $100m by October and is considered the most commercially successful iLottery launch in the US. IWG and NeoPollard Interactive ran SG close this year but the supplier’s sheer weight of numbers and innovations like its new SciQ retail system keep it ahead of the competition.

Runners up Booming Games / Relax Gaming / QTech

Runners up IWG / NeoPollard Interactive

BINGO SUPPLIER OF THE YEAR

PLAYTECH

P L AY T EC H H A S C ON T I N U E D to produce the best original and branded content titles for bingo operators. It provides brands like Gala, Mecca and William Hill with a range of fresh and compelling titles available across the Playtech Bingo network. The company has also added to its side games roster, with its awardwinning Age of the Gods casino brand now expanded to bingo, complete with themed lobby and slots, while its Dynamite Digger jackpot game GIQ Q4 REVIEW

brings an innovative new jackpot to the world of bingo slots. Playtech has added to its tech capacities with the acquisition of Australian software house Eyecon, which has significantly strengthened its games selection and provides licensees with a portfolio of 70-plus cutting-edge games, including the popular Fluffy Favourites. The group has also developed specific product ties with brands such as Gala, Sun Bingo and Mecca and continues to lead the way when it comes to tech excellence and product innovation.

Runner up Microgaming 67

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SUPPLIER A

SUPPLIER INNOVATION AWARD

PLAYTECH

GAME OF THE YEAR

THE GOONIES BY BLUEPRINT GAMING Blueprint Gaming could have won this with any number of games – Buffalo Rising was another classic. But The Goonies scoops the coveted Game of the Year award for being an object lesson in how to create a winning branded game. Oh, and its numbers are pretty good, too! The Goonies was the number one game for 85 per cent of UK operators in the first three weeks after launch. In that initial 21-day period, it was also the number one bonus game in terms

of plays, turnover, GGR and users across all operators. The Goonies has become a record-breaker for Blueprint, with the highest ever number of plays in one day across all partner operators and was the best performing launch ever with the UK’s number one operator. Blueprint deserves recognition for years of success, and with The Goonies it absolutely smashed it.

Runners up Dragon’s Fire by Red Tiger Gaming / Sporting Legends by Playtech / Vikings go to Hell by Yggdrasil

Playtech wins this award for its new Playtech Open Platform (POP), GPAS and Market Place suite. In combination, these features are looking to open Playtech up and ease the supply chain – allowing operators to pick and choose, and integrate any games they want with minimal fuss. POP aims to be the ultimate in content aggregation technology, while GPAS (the Gaming Platform as a Service) puts incredible creative power in the hands of developers. Marketplace is a groundbreaking tool that acts as a single point of discovery for all the latest content. Taken as a whole, they should bring an end to the walled garden approach that critics have often levelled at Playtech. This suite of tools is Playtech saying: “We listened and we acted.” If this really is a revolution for Playtech, then it could be a revolution for the entire industry.

Runners up Bet Builder from Betgenius / PulseBet by SBTech / SCiQ by Scientific Games

VIRTUAL SPORTS SUPPLIER OF THE YEAR

INSPIRED ENTERTAINMENT

The judges were almost entirely unanimous in picking Inspired for this category. The virtual sports betting vertical has grown massively in recent years and Inspired Entertainment has led the way. Thanks to its virtual channel, Inspired generates 15-20 per cent incremental revenues for operators and starting from the UK it has expanded its footprint into 30 markets worldwide, including Italy, Greece, China, Latin America, Eastern and Central Europe. Inspired is Italy’s largest virtual sports supplier and generates €1bn revenue per year and around 25 per cent of in-shop revenue for operators there. It is live across 6,000 venues in China and nearly 68

4,000 OPAP venues in Greece. Inspired hasn’t stopped there, it signed major agreements with leading operators such as Paddy Power, Betstars and the Pennsylvania State Lottery, where its ‘1st Down’ virtual American football product has given a strong foothold

in the US market. Its commercial growth a nd produc t i n novation ma ke it a clear winner.

Runners up Betradar / Leap Gaming

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SPONSORS Thank you to our 2019 Gaming Intelligence Awards presenting partners for their invaluable support.

SPORTS BETTING SUPPLIER OF THE YEAR

SBTECH

SBTech made great strides during the past year with its arrival in the US market and a string of contracts in Europe. Furthermore, it has continued to innovate, building out its product with innovations such as its PulseBet feature, and has continued to build its team. The US market was where it was at for sports betting suppliers in 2018, and SBTech was one of the first out of the blocks, when it announced an agreement with Churchill Downs. The pair teamed up in Mississippi and New Jersey, and SBTech followed that up by agreeing a deal

with New Jerseyâ&#x20AC;&#x2122;s iGaming market leader Golden Nugget. If Stateside progress grabbed the attention, SBTech had already reinforced its reputation in the European lottery market. In early 2018, Danish state lottery Danske Spil selected SBTech as the full turnkey platform solution supplier for its new Youbet.dk brand. Deals with the likes of Mansion and Bethard showed that SBTech will not lose focus on its core markets. To top it all off, SBTech closed the year with an extension to its deal with Czech lottery operator Sazka Group. Nobody made progress like SBTech in 2018.

Runners up BetGenius / Playtech / SG Digital

THE JUDGES We would like to thank our judges for sparing their time and sharing their wisdom. This would not be possible without them.

GIQ Q4 REVIEW

Andrew Bulloss

Daniel Eskola

Steve Hoare

David Oâ&#x20AC;&#x2122;Reilly

head of gaming Odgers Berndtson

CEO Relax Gaming

editor Gaming Intelligence Quarterly

COO Bet Colossus

Charles Cohen

Richard Flint

Daniel Lindberg

David Sargeant

SVP sportsbook IGT

chairman Sky Betting & Gaming

CEO Quickspin

founder iGaming Ideas

John Coleman

Itai Frieberger

Bobby Mamudi

Shay Segev

CEO Microgaming

CEO 888 Holdings

managing editor Gaming Intelligence

joint COO GVC Holdings

Matt Davey

Gustaf Hagman

Steven Matsell

Dan Waugh

former CEO SG Digital

CEO LeoVegas

CEO Leander Games

partner Regulus Partners

ople who Here we celebrate the pe to outstanding helped their companies ose in a position success in 2018, and th ahead. of influence for the year chief executive From the outstanding all work behind to the techie making it e innovators, the scenes, these are th om whom we motivators and those fr ngratulations expect great things. Co to all!

9 1 0 2 GIQ Q4 REVIEW

2019 ANTONIA ANDERSSON

Chief global markets officer Yggdrasil

RAFI ASHKENAZI

Chief executive officer The Stars Group

Antonia Andersson has had a huge influence on Yggdrasil’s success during its short lifetime. As chief sales manager, she has pulled in clients such as Big Bola in Mexico, Tipsport in the Czech Republic, Intralot and Lottomatica in Italy, GVC in the UK, plus global deals with the likes of 888 and Betsson. She has also played a key role in signing deals with Veikkaus, Paf, and with Swedish re-regulation approaching she helped to secure the biggest players in the market – ATG and Svenska Spel. She has not just signed the deals, she has developed a reputation for getting customers up and running as quickly as possible. Speedy integrations have been a key to Yggdrasil’s burgeoning success, and Andersson has the energy, enthusiasm and brains to make sure they happen.

The Stars Group CEO unleashed the full strength of the company’s M&A power during 2018. The $4.7bn acquisition of Sky Betting & Gaming was the deal that showed Ashkenazi really meant business but two earlier deals also transformed the company’s operations in Australia. At the same time, Ashkenazi has overhauled the Stars management team and entered the US market. Now, he just needs to integrate everything. Current form suggests he will take it in his stride.

JOE ASHER

LUCY BUCKLEY

Joe Asher has spearheaded William Hill’s commercial development in the United States with outstanding speed since the repeal of PASPA. The company was first to market in New Jersey and then tied up deals in Mississippi, West Virginia and Rhode Island. The deals avalanche culminated with the an all-encompassing partnership with Eldorado Resorts to supply its digital and retail sportsbooks, plus online gaming. The sports betting bandwagon rolls on and Asher is arguably driving it on.

Lucy Buckley can thank the Nektan board for convincing the Hot 50 judges to bend their rule prohibiting successive entries. Following three years in charge of Inspired Gaming’s interactive division, Buckley was handed the reins of Nektan in October as the company’s new CEO. Nobody should doubt her drive. Nektan is an ambitious organisation and it has seen an inspiring leader in Buckley. Her new colleagues have given her the foundations via a successful 2018. This year should be one to remember.

Chief executive officer William Hill US

ULRIK BENGTSSON Chief digital officer William Hill

The former Betsson chief executive joined William Hill when it was going through an uncharacteristic slump in its digital fortunes. Tasked with reviving its fortunes Ulrik Bengtsson has enjoyed some early successes. Bengtsson is a steely character. Few would doubt his determination to fulfil shareholders’ high expectations for the listed Goliath. 72

Chief executive officer Nektan

SIMON BUCKNALL

Co-founder and chief operating officer IWG It has been a remarkable year for IWG, which has taken the instant win game vertical to the next level and secured distribution deals across different continents, with US lotteries in Michigan and Pennsylvania, in Canada with Atlantic Lottery Corporation and BCLC, as well as in New Zealand with Lotto NZ. Simon Bucknall has been pivotal to this growth, ensuring a wide range of successful launches in record time. In addition to this, he has also managed a game studio that has delivered 170 games to IWG’s growing customer base over the last 12 months.

ANDREW COCHRANE Chief commercial officer SBTech

Andrew Cochrane might have been at SBTech for only 18 months, but he has already made a huge impression as a key member of the supplier’s executive team. Cochrane and SBTech have had an astronomical year, with the company becoming the platform provider of choice for a rapidly growing portfolio of top-tier operators in 21 regulated markets. The executive has led SBTech’s commercial charge, overseeing its international expansion and spearheading entry into newly regulated markets, most significantly in the US with Churchill Downs – a huge coup for the company which also set the tone for a string of further US successes.

Daniel Eskola, Relax Gaming

BARRY COTTLE

Chief executive officer Scientific Games The SciGames chief executive’s chair has been something of a hot seat in recent years. The board is demanding but the early signs suggest Barry Cottle can cope with the pressure. He has an unassuming demeanor but he has been a hit with colleagues since assuming the top job at SciGames. He is praised for his no-nonsense style and ability to get the team buying into his ideas. Perhaps Cottle is the CEO that SciGames always needed.

NIALL CONNELL

PHIL CRONIN

Niall Connell’s experience at Paddy Power and then at TVG Betfair in the US prepare him beautifully for his market-shaping role at FanDuel. They are all part of the Paddy Power Betfair group now, of course. Connell’s personal evolution has matched that of his company and he now takes on what could be the company’s biggest driver of growth. FanDuel has the brand. Connell will need to make sure it has the product to match. The company has placed its trust in him. Watch Connell repay it.

Phil Cronin has continued to develop his company without much fanfare but with such efficiency that Tombola could be dubbed the Bet365 of the online bingo sector. Perhaps that is little over-the-top for a company that faces challenges from the likes of Jackpotjoy and The Sun, but the group is the market leader in the UK, Italy and Spain. Cronin is playing an important role in the local community, building a £7m state-of-theart office complex as he aims to build a worldbeating tech hub in the north east of England. For that alone he is worth his place in the Hot 50.

General manager and SVP Sportsbook FanDuel

JOHN COLEMAN

Chief executive officer Microgaming John Coleman’s elevation to the top job at Microgaming in June last year is testament to the excellent work he has carried out as chief financial officer since 2004. During that time he has played a central role in the operation of the business, consolidating its leadership position across international markets and maintaining its growth in regulated markets thanks to its involvement with high profile UK brands such as Betway. Coleman is a people person, who should make a great CEO at a time when Microgaming is facing more challengers than ever before.

GIQ Q4 REVIEW

Chief executive officer Tombola

DANIEL ESKOLA

Chief executive officer Relax Gaming During his time at Kindred Group ,Daniel Eskola had no small part in giving the start-up Relax Gaming a few early breaks. He joins Relax with its roots firmly planted and ready to blossom. Eskola is a class act and has surrounded himself with a talented team that is aiming to take Relax to the next level. Relax can now boast of some 70 direct integrations with companies servicing over 300 brands. Eskola’s ultimate aim is to become the industry’s number one aggregator. He has fierce competition but Eskola and his tight-knit team look set to deliver. 73

2019 CAMERON GARRETT

Vice president of insights and analytics Scientific Games In more than a decade at Scientific Games, VP of insights and analytics Cameron Garrett has overhauled the company’s analytics platforms, tools and products while redefining the way lottery insights are gathered and actioned. Garrett has expanded his team’s portfolio from traditional lottery analysis to encompass new fields such as predictive analytics. As one of the company’s youngest VPs, his impressive rise is only just beginning.

EDO HAITIN

Chief executive officer Eurolive Technologies (Playtech) Edo Haitin is the kind of boss that everybody would want. He is passionate, enthusiastic and energetic. Haitin was new to live casino, when the Playtech executive entrusted him with the

fast-growing Eurolive Technologies vertical two-and-a-half years ago. He has taken to it like a duck to water and grown the Latvian live dealer operation to 1,000 staff in no time at all. Such has been his success that it has been whispered he could be a future Playtech Group CEO. This publication has little doubt he would make a great one.

ADAM GREENBLATT Chief executive officer MGM GVC Interactive

Adam Greenblatt has been an outstanding strategy chief for Ladbrokes Coral and he will bring crystal-clear thinking and no-nonsense communication to his new role as CEO of MGM GVC Interactive. US casino execs should love him. GVC and MGM intend to be the big beast of US sports betting and iGaming, and will invest $200m to make it happen. One suspects Greenblatt will spend it wisely.

GAVIN HAMILTON

Chief executive officer Red Tiger Gaming Gavin Hamilton took charge of the industry’s most exciting casino supplier in mid2017 and has guided it through a breakthrough year in 2018. The former Paddy Power Betfair

executive has proved himself an inspiring leader overseeing an unprecedented period of growth. The supplier integrated an outstanding 30 new clients last year and has another 50 in the pipeline. Hamilton’s task will be managing that growth curve, while ensuring clients’ expectations are met and making sure the technological innovation continues. No biggie, then.

2019

DANIELA JOHANSSON

Chief responsibility officer and deputy CEO Paf Daniela Johansson was promoted to deputy CEO in mid-2017. It was a recognition of how important her work has been as chief responsibility officer but also a just reward for being an inspirational leader. In the current climate it could be argued that every operator should have an executive with Johansson’s skillset at the top of the tree. Unfortunately, very few have it. Paf has been way ahead of the curve on responsibility and Johansson will no doubt keep it there.

SIMON HAMMON

SARAH HITCHCOCK

Simon Hammon featured in the Hot 50 during his time at NetEnt. At his previous employer, he was largely responsible for delivering smash hit slots, such as Starburst. He joins Relax as it embarks on its journey into slots. We know he can deliver a good product, but can he repeat the success he enjoyed at NetEnt? Relax. Hammon’s got it under control.

2018 was a transformative year for Bede Gaming, which landed its biggest commercial deal to date with the Ontario Lottery and Gaming Corporation. Bede has always backed itself on its tech, safe in the knowledge its platform is in good hands with product director Sarah Hitchcock at the helm. Hitchcock has been instrumental in defining Bede’s product roadmap during her six years at the company – and has been rewarded with Bede’s emergence as a major player in platform provision.

Chief product officer Relax Gaming

Product director Bede Gaming

THERESE HILLMAN Chief executive officer NetEnt

From the outside, NetEnt looks to have made inexorable progress over the past decade but it was not enough to save Theresa Hillman’s predecessor the axe when profit momentarily dipped. Hillman’s elevation to the chief executive’s office following nearly two years as chief financial officer will test her ability to merge commercial smarts with an attention to the bottom line demanded by the board. She joins as the US opens up and Sweden’s re-regulated market gives NetEnt access to the countries’ former monopolies. Asia presents another challenge but Hillman has shown she is up for the fight.

SAM HOBCRAFT,

Chief executive officer Omnia Casino Sam Hobcraft has a good track record with Betfair and The Stars Group. Now that he has ventured out on his own, we will see what he is truly made of. He has some innovative ideas to engage players and make sure they recommend Omnia to their friends. He is well backed by influential shareholders, who fully expect Hobcraft to succeed in his ambition of “putting the compliance back into casino”. The reason is simple: Hobcraft delivers.

MARC LANGE AND SIMON MATTHEWS

Integration director and group CTO GVC Holdings Marc Lange and Simon Matthews have the almighty task of ensuring that GVC’s acquisition of Ladbrokes Coral is a success. Lange is in charge of the integration of the businesses, while Matthews must ensure the

PETER MARES

Chief technology officer Playtech Games Innovation Labs Peter Mares arrived with a team from Odobo, and backed by Playtech’s financial power he looks likely to fulfil the promise that many Odobo supporters expected. Furthermore, Mares has taken the innovation baton and run with it. The launch of the Playtech Open Platform (POP) is the next phase of this innovation. Combined with the company’s powerful IMS, GPAS and M arketplace technologies, Mares is aiming to open Playtech up and simplify the supply chain. If he succeeds in doing it, then he will have truly proved himself a game changer.

MATÍAS LANUSSE

President Buenos Aires Provincial Institute of Lottery and Casino technical integration. Lange has been through this process before after joining GVC via the bwin.party deal, but for Matthew, who joined from Sky in late-2017 this will be a first. He has a passion for technology that should see him through a period of great change for Ladbrokes Coral. The pair will have to work together in harmony. GVC’s reputation for pulling off remarkable integrations lies in their hands.

MATT KING

Chief executive officer FanDuel Taking over from a founder CEO is never an easy task but former CFO Matt King seems to have negotiated the transition with aplomb. His timing has been impeccable, with a short bedding-in period coming before the repeal of PASPA and subsequent acquisition by Paddy Power Betfair. When King took over there was a very real danger that FanDuel might sink behind DraftKings’ shadow but it has grabbed the Post-PASPA bull by the horns and looks likely to be one of the nation’s great sports betting brands. GIQ Q4 REVIEW

Should Latin America begin to finally deliver on its clear iGaming potential in 2019, it will be in no small part due to the work of Matías Lanusse. The president of the Buenos Aires Provincial Institute of Lottery and Casino was instrumental in the legislation which passed in December to regulate online gambling in Argentina’s most populated province. With other provinces looking to follow suit, Argentina now looks set to follow Colombia’s example and become a viable regulated market.

ROBERT LEE

Commercial director Realistic Games In two years at Realistic Games, the former Gala Bingo, Ladbrokes, and IGT executive has shown how crucial he has been to the supplier’s growth. Robert Lee has expanded the company’s commercial, account management and marketing teams, and worked on the company’s expansion with certification granted in Denmark, Estonia, Spain and Sweden, and Italy next on the roadmap. Under Lee’s guidance, Realistic has experienced a 150 per cent increase in the number of new sites going live, including a record number during the past year. His tenure also heralded a ground-breaking deal with Playtech, as well as two new significant operator deals expected to be announced early in 2019. Realistic has

always produced good content. Lee is making sure it is being distributed as widely as it deserves.

DAVID LOPEZ

Chief executive officer PlayAGS PlayAGS CEO David Lopez led the New Yorklisted supplier through a transformative 2018, kicking off with a successful IPO in January and ending with the $49m acquisition of slot route operator Integrity Gaming Corp in December. In between, Lopez also had time to oversee a major expansion into the online sector, including deals with PokerStars, GVC and Rank. With more opportunities opening up closer to home as well, we can expect much more from Lopez during 2019.

MOTI MALUL

Chief executive officer NeoGames Moti Malul has bided his time as head of sales and business development for many years before ascending to the top job during 2018. His promotion came at an opportune moment. With the US opening up its sports betting markets and with William Hill relying on the supplier to anchor its digital operations, Malul cannot have hoped for better timing. Malul will not rely on William Hill alone though. He fully expects that the faith shown in his company by the UK bookmaker will be matched by others. 2019 will be a big year for NeoGames. 77

2019

MATT PRIMEAUX

SVP strategy & operations, USA The Stars Group That The Stars Group is even operating in the US is almost miraculous given the tortuous path it has taken to get there. Matt Primeaux is the man who will oversee its entry into the market as a multi-vertical operator. Given the States’ initial favouring of sports betting over poker, success is not guaranteed for Stars. However, Primeaux has the entrepreneurial smarts to succeed.

JO PURVIS

FREDERIK NIEHUSEN

Director of marketing and relationships Blueprint Gaming

Chief commercial officer Booming Games

Slots developer Booming Games has long been successful in Asia, but 2018 has seen it transition into a major player in Europe’s regulated markets as well. At the heart of its impressive growth has been chief commercial officer Frederik Niehusen, a former Ernst & Young consultant who oversaw a number of landmark deals in 2018, including a major expansion into Italy. With a Malta licence recently acquired, Niehusen will focus on maintaining the supplier’s exponential growth across Europe.

ASAF NOIFELD Director of product, innovation and operations The Stars Group

Praise for Asaf Noifeld is long overdue. He has had a massive influence on the outstanding launch and success of the company’s casino. The gregarious Stars director is one of the industry’s most driven individuals and he never stints on quality. An operator of The Stars Group’s standing demands it and Noifeld will not be found wanting. 78

Blueprint would not function without Jo Purvis. She has worked alongside founder Matt Cole for the entirety of Blueprint’s decade-long history. It is now one of the industry’s most successful suppliers, with revenues of around £30m, a portfolio of world-beating games and a long list of market-leading clients. Purvis will make sure Blueprint stays ahead of the curve.

MICHAEL PROBERT

Chief commercial officer iSoftBet iSoftBet’s emergence as a leading gaming supplier and content aggregator over the last five years has been in no small part down to the acumen of chief commercial officer Michael Probert. Probert landed a number of tier-one operator signings in 2018, including William Hill, GVC, Betsson and Snai. He also oversaw the provider’s entry into a host of regulated markets, from Lithuania and Latvia to Spain and Denmark. The result has been an 80 per cent year-on-year revenue boost, with the promise of more to come in 2019. Probert has held key roles at the likes of IGT, Bally and Ainsworth, but rarely will he have overseen such a phenomenal period of growth.

IAN PROCTOR Chief executive officer Sky Betting & Gaming

Richard Flint is a tough act to follow as Sky CEO. While it’s not quite like succeeding Sir Alex Ferguson at Manchester United, Flint guided Sky from start-up to acquisition with an eye for doing things right. Of course, Ian Proctor has accompanied Flint on that journey as his finance director and had no little influence on the operator’s success himself. He will now assume responsibility for ushering it into a new era as part of The Stars Group. His strategic moves to maintain Sky’s success while integrating with Stars will be closely watched.

CAMILLA ROSENBERG Director general Spelinspektionen

The spotlight is shining on Camilla Rosenberg after she opened Sweden’s re-regulated gambling market on 1 January. Her team has ploughed through the licence applications in an efficient manner but the real interest will be how she handles the new market’s responsible gambling agenda. With two former monopolies claiming the moral high ground and the likes of Betsson and Kindred innovating responsible gambling programmes, she has a chance to build on the work of the UK Gambling Commission and set the industry on a path to a sustainable future.

FABIO SCHIAVOLIN

Chief executive officer Snaitech (a Playtech company) One of the first things Playtech did after making its biggest investment was to tie Snaitech chief Fabio Schiavolin to a longterm deal. After founding Cogetech and then driving it through mergers with Snai and then Playtech, he is the key to making the business tick. Playtech has high expectations for the Italian operation. Schiavolin will be the dynamo that ensures the company becomes an inexorable force in Europe’s largest gambling market.

ROBIN REED

Chief executive officer Gaming Innovation Group Gaming Innovation Group (GiG) has been bubbling under for some time but founder Robin Reed’s commitment to innovation has never wavered. 2018 was the year when GiG stood up and said “Look at me!” The headline deal was with Hard Rock International, which chose GiG as the core of its new digital operations, but new clients are beginning to flow. Reed has been unafraid to invest and his commitment to filling out the company’s portfolio with innovative products is starting to reap dividends. Watch GiG fly during 2019.

GIQ Q4 REVIEW

NIK ROBINSON

Chief executive officer Big Time Gaming Nik Robinson has previous, of course. As the founder of NT Media, which became Orbis and then OpenBet, he has seen exactly what it takes to launch a successful business in this industry. Since leaving OpenBet post earn-out he has focussed on revolutionising the slots space. Building on the world-beating success of Bonanza in 2017, the company continued to power on with each new release and its groundbreaking MegaWays mechanic is changing the slots landscape. The US is the next target for Robinson and his appetite shows no sign of fading. The bricks and mortar casino industry is in his sights. He recently told Gaming Intelligence he aims to “bring the big wins back and make casino floors thrive once again”.

JANE RYAN

Chief operating officer of B2B Nektan Heading up Nektan’s thriving B2B business, Jane Ryan has driven international e x p a n sio n a c r o s s Europe, the US and Asia while delivering double digit growth. Most eye-catchingly, Ryan was behind the provider’s largest win to date – a landmark global platform partnership with BetVictor. There has also been a successful roll-out in Asia via Tyche Digital. Having nurtured a strong following in more than six years at Nektan, Ryan’s focus on organisational speed and efficiency has the provider well-positioned for further growth in 2019. 79

2019

MELISSA SUMMERFIELD Chief commercial officer Pragmatic Play

Melissa Summerfield has been a successful gaming executive for some time now, previously heading up gaming operations at bwin.party and CRM at BetVictor. But nothing could have prepared us for the outstanding success she has enjoyed since joining Pragmatic Play as chief commercial officer in January last year. She has delivered enviable growth in Spain, Italy, Portugal and beyond. Roll-outs with tier one operators including GVC, Kindred Group, Casumo, Lottoland and GIG have secured Pragmatic’s place at the top table. Summerfield is a star.

DYLAN SLANEY Head of gaming SG Digital

Dylan Slaney’s two-year tenure with Scientific Games and its legacy companies has led to the growth of SG Digital’s gaming group, which now processes 1.2bn game rounds per month across 20 regulated jurisdictions. Following SG’s purchase of NYX Gaming Group last January, Slaney led the charge in combining the two companies’ product offerings, creating a powerhouse provider of content and platform support to global customers. He also reshaped SG Digital’s gaming strategy to focus heavily on the customer and the product, with the supplier’s Open Gaming System (OGS) and Open Platform System (OPS) growing from fragmented product offerings to end-to-end casino integrations. Few people have the keys to 1,800 titles at their fingertips. Slaney does.

ANNE-JAAP SNIJDERS Head of Western Europe Kindred Group

Anne-Jaap Snijders is one of Kindred Group’s unsung heroes. He has continually smashed targets in his markets over the past few years and will continue to have a huge influence over the company’s regulated markets in the coming years. Taking the UK as just one example: a target market for some time, the acquisitions and successful integration of Stan James Online and 32Red have made the UK one of Kindred’s top markets. With Sweden’s re-regulated market kicking off 2019, Snijders’ influence in the company’s home market will be truly tested. He will not be found wanting. 80

KRESIMIR SPAJIC

SVP of online gaming Hard Rock International Kresimir Spajic flew into the US with the ambition of differentiating the Seminole Tribe’s digital operations from the rest of the market. He has responsibility for one of the biggest brands in the world – let alone the US gaming market. As such, maybe we shouldn’t have been surprised when he cut a deal with the world’s leading sports betting brand bet365. But we were. However, that was just a market access agreement. Spajic chose the lower profile Gaming Innovation Group to anchor its fledgling iGaming efforts. Spajic was impressed by GiG’s technology-focussed commitment to innovation. It is exactly what he needs to fulfil his ambition to make Hard Rock a global leader in online gaming. His ambition is sky high. Watch him soar.

MANUEL STAN SVP USA Kindred Group

The operator has been a cautious entrant to the US market, choosing its moment to finally take the plunge. Now that it has, responsibility lies on Manuel Stan’s shoulders to make it a success. Stan is a Kindred veteran, who has been responsible for much of the operator’s marketing activity for many years. He is regarded internally as one of the best in the business and nobody doubts his ability to get the company’s US adventure off to a flying start.

FREDRIK WASTENSON

Managing director Svenska Spel Sport and Casino Fredrik Wastenson has a big job on his hands. He takes charge of the former monopoly’s sports and iGaming company just as the Swedish market opens up to competition. He has done his research and has not put a foot wrong in preparation. Unlike his competitors, Wastenson launches from a standing start – but he does so with the backing of an almighty local brand. Few doubt his ability to deliver an outstanding growth curve.

CHRISTIAN STUART

Executive VP gaming and Interactive Entertainment Caesars Christian Stuart has the weight of one of the industry’s biggest names on his shoulders as he takes responsibility for Caesars’ expansion in sports betting and iGaming. The company has had mixed fortunes with iGaming to date. It made a fortune with Playtika but has not taken New Jersey by storm. Stuart will want to correct that blip and rival MGM as the biggest multi-state operator in US sports betting.

JULIO CÉSAR TAMAYO Chief executive officer Wplay.co

Wplay.co, the sports betting brand of Aquila Global, has quickly emerged as the leader of Colombia’s booming igaming market under the leadership of Julio César Tamayo. The first to gain a licence when Colombia rolled out its regulated framework in June 2017, Tamayo has overseen the construction of a world-class product built via a series of major deals with

GIQ Q4 REVIEW

the likes of Microgaming and others. With forward-thinking deals such as a sponsorship agreement with the Colombian Olympic Committee, Tamayo looks set to ensure Wplay stays ahead of the chasing pack in a vibrant, competitive and fast-growing market.

TOM WATERS

Head of PartyPoker and Cashcade GVC Holdings PartyPoker was an embarrassment. When GVC bought bwin.party it was ready to pull the plug but Tom Waters convinced CEO Kenny Alexander he had a plan. Since then, he has overseen six consecutive quarters of 30-something or often 40-something percentage point rises in net gaming revenue. Together with his colleagues he has reinvigorated the product and Party’s live events. Waters has the drive, vision and personality to bring his colleagues along with him on a journey that has some way left to run.

THOMAS WINTER

Senior vice president and general manager, online gaming Golden Nugget/Landry’s Atlantic City’s Golden Nugget casino is easily the biggest iGaming operator in New Jersey right now and has seen unrivalled growth since launching (later than everyone else) at the tail end of 2013. Winter has been there every step of the way, having started the online gaming business from scratch. The former Betclic and Expekt CEO has established Golden Nugget as the biggest regulated online casino in the US. With sports betting also added to the operator’s product portfolio through a de a l w it h SBTech, the Golden Nugget juggernaut shows no signs of slowing down, and for that Winter can take much of the credit. 81

F I NA NC E GI STOCK INDEX 2018

GAMING INTELLIGENCE STOCK INDEX 2018

Kambi and Cherry lift the gloom in tough year for iGaming stocks

Only 13 out of 50 listed gaming companies managed to record a growth in their share price during 2018, writes Kio Dawson MIRRORING THE STRUGGLES in the wider global financial markets, with Britain’s FTSE 100 and America’s S&P 500 suffering their largest annual declines since 2008, the 50 publiclylisted operators and suppliers which make up the Gaming Intelligence Stock Index 2018 saw their combined share prices decline by 27 per cent during 2018 – a marked contrast to the previous year’s 12 per cent share price gains. Between Tuesday 2 January and Friday 31 December 2018, there were 37 public companies in the iGaming sector that saw the value of their shares decline. Of these, 13 companies lost over half of their value during the course of the year, most notably William Hill, LeoVegas, Playtech, Gaming Innovation Group, Intralot and Ainsworth Game Technology. Despite these losses, there were still some gains to be made, with shareholders of Stockholm-listed Kambi Group and Cherry among the biggest winners. Just 13 companies saw the value of their shares increase over the course of the year, three of which – Cherry, Mr Green & Co and Lotto24 – will be delisted during 2019 as a result of respective M&A action. Kambi is one of a number of companies riding a wave of opportunity as the state-regulated US sports betting rush gathers pace, alongside the likes of GAN and Webis Holdings, which both saw their shares soar after the Supreme Court issued its reversal of PASPA in May. GIQ Q4 REVIEW

Reaching a new high of SEK256 in November, Another strong performing stock was Kambi’s shares finished the year up 98 per cent at Cherry, although this will likely be the last time SEK190, nearly double its SEK96 share price at the the Stockholm-listed operator appears in our turn of the year. Meanwhile, Webis Holdings and stock list after it received a SEK9.2bn (€805m) GAN, both listed on London’s junior AIM market, takeover bid in December from a consortium saw their shares climb 50 per cent and 45 per cent consisting of private equity firm Bridgepoint respectively to 1.85p and 46p. Advisers and a number of Cherry shareholdWebis shares enjoyed significant gains ers, including Betsson CEO Pontus Lindin November after receivwall and Cherry chairman ing a licence extension Morten Klein. from the California Horse The news helped CherThe 50 operators Racing Board for its Watch ry’s shares close the year at and suppliers which andWager.com advanced deposSEK86.80, an increase of 76 make up the Gaming per cent compared to the start it wagering platform, allowing Intelligence Stock the operator to continue to of the year and just below the Index 2018 saw their SEK87 bid received by Cherry accept wagers from California residents on horse racing. shareholders. The offer was a combined share With the company also 20 per cent premium on the prices decline by 27 operating a physical racetrack per cent during 2018 closing price of Cherry’s at Cal Expo, the California shares on 17 December. licence places WatchandWager Scientific Games Corin a strong position to offer sports betting in the poration has undergone a big transformation. state when legislation allows. The gaming and lottery behemoth made sports GAN also benefited Stateside, launching its betting a key strategic focus through its acquisecond New Jersey client, Ocean Resort Casisitions of NYX Gaming Group and Don Best no, at the start of Q3. This was followed by the Sports, but there wasn’t much to cheer about for launch of online sports betting for Paddy Power shareholders as shares nosedived by 65 per cent Betfair’s FanDuel, a new social casino offering during 2018. for Mississippi’s Pearl River Resort, and a distriIts shares fell from $51 on 2 January to $17.88 bution deal to take games from Czech land-based on 31 December, including a 52-week low of $14.79 supplier SYNOT online in the US. on 21 December. Continuing to be weighed down 83

F I NA NC E GI STOCK INDEX 2018

For UK bookmakers, the excitement of opportunities Stateside was tempered by the British government’s decision to slash the stakes on FOBTs

COMPANY

OP. PRICE 02.01.18

CL. PRICE 31.12.18

Kambi Group*

SEK96.00

SEK190.00

97.92%

Cherry*

SEK49.30

SEK86.60

75.66%

Webis Holdings

1.23p

1.85p

50.41%

31.80p

46.00p

44.65%

SEK36.50

SEK49.80

36.44%

$17.00

$23.00

35.29%

Mr Green & Co*

SEK54.60

SEK69.02

26.41%

Betsson*

SEK60.50

SEK73.00

20.66%

GAN Aspire Global* PlayAGS (Jan 26 IPO)

Lotto24* Global Gaming 555* Pollard Banknote Churchill Downs Bettor Collective* (Jun 8 IPO) Zynga

€ 10.56

€ 12.60

19.32%

SEK30.60

SEK36.22

18.37%

CAD$17.40

CAD$20.55

18.10%

$232.85

$243.94

4.76%

SEK60.00

SEK62.05

3.42% -0.25%

$3.94

$3.93

Zeal Network*

€ 21.30

€ 20.80

-2.35%

Catena Media*

SEK104.30

SEK98.15

-5.90%

Aristocrat Leisure**

AUD$23.55

AUD$21.84

-7.26%

Evolution Gaming Group*

SEK580.50

SEK509.50

-12.23% -20.88%

Safecharge International Group

297.00p

235.00p

JPJ Group

825.00p

638.00p

-22.67%

AUD$5.56

AUD$4.29

-22.84%

CAD$29.25

CAD$22.54

-22.94%

SEK40.00

SEK30.70

-23.25%

$32.99

$24.26

-26.46%

8,805.00p

6,400.00p

-27.31%

942.00p

674.00p

-28.45%

€ 10.65

€ 7.60

-28.64%

$10.85

$7.58

-30.14%

Kindred Group*

SEK117.40

SEK81.60

-30.49%

NetEnt*

SEK56.65

SEK36.55

-35.48%

277.00p

175.00p

-36.82%

Tabcorp Holding** The Stars Group Scout Gaming Group* MGM Resorts International

on FOBT stake levels. This has saved GVC approximately £676m on the acquisition. GVC’s shares recovered from a 52-week low of 623.50p on 11 December to close the year down 28 per cent at 674p, giving the company a market capitalisation of around £4.1bn. This was just behind Paddy Power Betfair’s £5.3bn valuation, but ahead of The Stars Group’s CAD$6.2bn (£3.6bn), which grew significantly during the year following its landmark acquisitions of Sky Betting & Gaming in July, as well as CrownBet and William Hill Australia earlier in the year. Shares in Toronto-listed The Stars Group hit a 52-week low of CAD$20.44 on 20 December, but were boosted by a Kentucky Court of Appeals ruling just days later, which reversed the $870m judgment issued against the company three years ago. As a result the company’s shares ended the year at $22.54, although this was still down by 23 per cent over the year. Playtech entered a new era at the end of 2018 following the sale of the last remaining shares held by founder Teddy Sagi. The Israeli entrepreneur sold his remaining 4.79 per cent stake in the business in November, ending his shareholding in the company he formed in 1999. Playtech’s shares ended the year down 55 per cent at 385p, slightly above the 52-week low of 357.10p set on 24 December.

% CHANGE

Paddy Power Betfair GVC Holdings OPAP 500.com**

888 Holdings Penn National Gaming

$31.46

$18.83

-40.15%

Boyd Gaming Corporation

$35.16

$20.78

-40.90%

247.00p

137.80p

-44.21%

$26.50

$14.63

-44.79%

Rank Group International Game Technology Caesars Entertainment Corporation

$12.65

$6.79

-46.32%

Stride Gaming

247.00p

124.00p

-49.80%

Sportech

80.00p

39.75p

-50.31%

$9.90

$4.80

-51.52%

William Hill

323.20p

155.00p

-52.04%

LeoVegas*

SEK84.20

SEK39.76

-52.78%

9.14p

4.24p

-53.61%

Playtech

858.20p

385.00p

-55.14%

bet-at-home.com*

€ 103.60

€ 46.06

-55.54%

Inspired Entertainment

Gaming Realms

Nektan

31.75p

14.00p

-55.91%

Gaming Innovation Group*

NOK52.20

NOK22.90

-56.13%

AGTech Holdings

HK$1.220

HK$0.485

-60.25%

€ 1.12

€ 0.43

-61.61%

AUD$2.12

AUD$0.80

-62.26%

$51.00

$17.88

-64.94%

Intralot*** Ainsworth Game Technology** Scientific Games Corporation

*28 Dec. closing price ** 03 Jan. opening price *** 30 Dec. closing price

by long-term debt of $8.7bn, Scientific Games posted a net loss of $559.2m for the first nine months of 2018, after suffering its 26th consecutive quarterly net loss during Q3. This run of losses now stretches back to Q1 2011. Scientific Games was the worst performing stock in our 2018 chart, and a big contrast to the previous year when the value of the company’s shares soared by more than 260 per cent. For the big UK bookmakers, the excitement of new opportunities following the US Supreme Court ruling, was tempered by the British government’s decision to slash the maximum stakes on fixed-odds betting terminals (FOBTs). In the end this proved to be a boon for shareholders of GVC Holdings, with its £3.9bn acquisition of Ladbrokes Coral Group including a contingent value right which took into account the UK’s Triennial Review and its potential impact

F I NA NC E

GIQ20 H1 2017

ON THE FOLLOWING PAGES

87 GIQ20 Q3 2018 results and analysis

The GIQ Q3 2018 WHILE GLOBAL GAMING came out on top of the GIQ20 chart, The Stars Group was the biggest mover in the third quarter of 2018 as it revealed results from its newly acquired Sky Betting & Gaming (SBG) and BetEasy businesses for the first time. Global Gaming’s growth through its flagship Ninja Casino brand has seen the operator top the chart throughout 2018 but it remains one of the smaller publicly-listed companies. By contrast, The Stars Group has grown into an online behemoth, with revenue topping $572m (approx. £454m) in the third quarter, just behind Paddy Power Betfair’s £483m, although PPB’s total includes £82m from retail operations. The Stars Group was the only non-Stockholm-listed company to break into the top half of this edition of the GIQ20, with significant growth recorded in Q3 by the likes of Catena Media, Cherry, MRG Group, Aspire Global and Evolution Gaming. There were also solid performances from Kambi, Betsson, Gaming Innovation Group, and Kindred Group. GVC did not provide revenue figures (just percentage rises) for Q3 but also lays claim to being one of the biggest listed companies in the industry. Revenue growth of 14 per cent was behind The Stars Group but ahead of long-time rivals Paddy Power Betfair and William Hill, which failed to make the chart as Q3 revenue fell four per cent. Other notable absentees from the GIQ20 were International Game Technology and Intralot, which both posted revenue declines compared to the same period last year. n GIQ Q4 REVIEW

The GIQ20 Q3 2018 revenue COMPANY 1

GLOBAL GAMING 555

THE STARS GROUP

CATENA MEDIA

Q3 2018

Q3 2017 CHANGE

SEK253.1m

SEK131.4m

93%

$572.0m

$329.4m

74%

€27.7m

€17.3m

60%

CHERRY

SEK898.5m

SEK567.3m

58%

MRG GROUP (FORMERLY MR GREEN & CO)

SEK445.2m

SEK295.1m

51%

ASPIRE GLOBAL

€28.6m

€19.3m

48%

EVOLUTION GAMING

€64.3m

€45.7m

41%

LEOVEGAS

€78.6m

€55.6m

41%

KAMBI GROUP

€20.5m

€14.8m

39%

BETSSON

SEK1,426.8m

SEK1,180.6m

21%

GAMING INNOVATION GROUP

€37.3m

€30.8m

21%

KINDRED GROUP

£230.7m

£193.6m

19%

ZEAL NETWORK

€38.2m

€31.5m

19%

BET-AT-HOME.COM

€37.6m

€31.9m

18%

GVC HOLDINGS

N/A

14%

NETENT

SEK449.3m

SEK404.8m

11%

PADDY POWER BETFAIR

£483m

£440m

10%

JPJ GROUP (PREVIOUSLY JACKPOTJOY)

£77.8m

£71.8m

SCIENTIFIC GAMES

$821.0m

$768.9m

OPAP

€247.6m

€239.0m

F I NA NC E GIQ20 Q3 2018

Stars Group soars into the Sky Global Gaming tops the chart but The Stars Group stakes claim as biggest online operator in Q3 2018, writes Kio Dawson

GLOBAL GAMING 555 93% Net revenue (SEK)

Own gaming activities Own brands on another platform B2B TOTAL

Q3 2018

Q3 2017

Change

242.6m

117.4m

107%

10.0m

9.7m

0.5m

4.3m

-88%

253.1m

131.4m

93%

Stockholm-listed Global Gaming continues to lead the way at the top of the GIQ20 chart as the third quarter represented another period of significant growth for the Ninja Casino operator. Revenue grew by 93 per cent compared to the same period last year to SEK253.1m, with the company’s flagship brand generating 91 per cent of the Q3 total. Having decided to shut down its B2B division, Global Gaming is focussing its resources entirely on the more profitable B2C business, which has seen the Ninja Casino brand rolled out in Estonia and approved to launch in Sweden’s re-regulated market. “This autumn, work has progressed well with the new platform and it will be used to launch Ninja Casino in Estonia,” said chief executive Joacim Möller, who took over as permanent CEO in August. “We look forward to working with our successful concept in a regulated market where we see good potential. Our new front-end platform will also keep us at the technical forefront for a considerable amount of time to come.”

F I NA NC E

GIQ20 Q3 2018

THE STARS GROUP 74% Net revenue (US$) Q3 2018

Q3 2017

Change

Poker

215.7m

221.4m

-3%

Gaming

180.9m

83.5m

117%

Betting

158.4m

11.7m

1255%

17.0m

12.9m

32%

572.0m

329.4m

74%

Other TOTAL

Toronto-listed Stars Group soared up the GIQ20 chart as the company’s Q3 results benefited from the first contributions from its acquisitions of Sky Betting & Gaming (SBG) and BetEasy. Revenue was up 74 per cent to $572m, with SBG contributing $168.4m during the period and Australia’s BetEasy a further $52.2m. The operator also enjoyed organic growth of seven per cent from its International segment to $352.4m, although poker revenue was down four per cent to $212.8m. Revenue from gaming increased by 29 per cent to $107.6m following product and content improvements to PokerStars Casino, while betting revenue rose 80 per cent to $21m. “This was a landmark quarter in a transformative year for the company as we begin to deliver on our vision to become the world’s favorite iGaming destination,” said chief executive Rafi Ashkenazi. “We are pleased with our quarterly results, which reflect both continued organic growth from our International business and contributions from both BetEasy and Sky Betting & Gaming, despite unfavorable sporting results during the period.”

CATENA MEDIA 65% Net revenue (€) Q3 2018

Q3 2017

Change

42.7m

22.5m

90%

Subscriptions revenue

0.1m

n/a

Paid revenue

7.2m

6.8m

Search revenue

Other TOTAL

n/a

1.1m

n/a

50.0m

30.3m

65%

There was a strong performance from Stockholm-listed Catena Media in Q3, as revenue rose by 60 per cent to €27.7m, helping the digital marketing specialist post a 50 per cent increase in net profit to €8.1m. With organic growth of 17 per cent, the company also benefited from its sports betting investment in the US, which GIQ Q4 REVIEW

“The company is now able to use more of its time and energy to establish even stronger positions in existing and new markets” Gunnar Lind, Cherry

CHERRY 58% Net revenue (SEK) Q3 2018

Q3 2017

Change

731.7m

448.5m

63%

Game development

71.6m

44.1m

62%

Online marketing

68.7m

44.6m

54%

7.4m

10.4m

-29%

Online gaming

Gaming technology Restaurant casino

35.8m

40.9m

-12%

Eliminations

(16.8m)

(21.2m)

-21%

Total

898.5m

567.3m

58%

It was a strong quarter too for Stockholmlisted operator and B2B supplier Cherry, which saw revenue increase 58 per cent to SEK898.5m and profit soar 352 per cent to SEK188m, mostly due to SEK57m from the revaluation of its stake in Highlight Games.

began generating revenue in September following operator launches in New Jersey. “While some of our competitors are still searching for their first recruits, we have an 18-person strong team in the US market,” said chief executive Per Hellberg. “This is sufficient for us to be able to grow in New Jersey, and prepares us for the launches that are imminent in Pennsylvania and West Virginia. It is my belief that Catena Media’s business, through being in the sweet spot of the value chain, has substantial growth opportunities ahead.”

The company’s Online Gaming B2C division, including its leading ComeOn brand, generated the bulk of Cherry’s Q3 total, having grown revenue by 63 per cent compared to Q3. There were also strong performances from the Game Development (Yggdrasil and Highlight Games) and Online Marketing (Game Lounge) segments, which offset declines in Gaming Technology (XCaliber) and the land-based Restaurant Casino business. “ComeOn has succeeded very well with the broad plan of action that was brought into effect just over a year ago,” said acting chief executive Gunnar Lind. “All employees are making a tremendous effort and the company is now able to use more of its time and energy to establish even stronger positions in existing and new markets like in Poland, as well as with new brands such as Blitzino and PZBuk.”

F I NA NC E GIQ20 Q3 2018

MRG GROUP (MR GREEN & CO) 51% Net revenue (SEK)

TOTAL

Q3 2018

Q3 2017

Change

445.2m

295.1m

51%

In what is likely to be its final appearance in the GIQ20 chart following William Hill’s approved acquisition of the business, Stockholm-listed operator MRG Group posted a 51 per cent increase in revenue to SEK445.2m in Q3. Customer deposits for the period increased by 72 per cent to SEK1.48bn, as the number of depositing customers climbed by 47 per cent to 193,273. During the quarter, MRG launched a sportsbook for Redbet in Ireland and obtained a sportsbook licence for Mr Green in Denmark. The company was also granted licences for its Mr Green and Evoke Gaming subsidiaries to operate in Sweden’s newly regulated market from 1 January. “We have now reported strong growth for a couple of years, which is proof that MRG has strong brands, an attractive product offering and effective customer communication,” said chief executive Per Norman. “We continued to deliver on our strategy of expanding geographically during the quarter.”

ASPIRE GLOBAL 48% Net revenue (€) Q3 2018

Q3 2017

Change

B2B

15.2m

10.1m

50%

B2C

13.4m

9.3m

44%

TOTAL

28.6m

19.3m

48%

Stockholm-listed Aspire Global benefited from strong growth across both its B2B and B2C operations as revenue increased by 48 per cent to a record €28.6m, with net profit growing 41 per cent to €4.8m. B2B revenue rose by 50.5 per cent to €15.3m, with a total of 38 partners operating on the company’s platform at the end of Q3, while revenue from B2C grew by 44 per cent to €13.4m. “Aspire Global developed strongly in the third quarter, as we have been doing consistently during the past year as a result of our growth strategy,” said chief executive Tsachi Maimon. “We see that revenues continue to reach record levels, but more importantly – profitability keeps up with the high pace.” Aspire has revised its mid-term financial targets in line with the company’s ambition 88

for the upcoming three-year period, setting a new revenue target of €200m for 2021. It expects to reach its previous mid-term financial targets in 2019, one year ahead of schedule as revenue approaches the €120m mark set out for 2020.

EVOLUTION GAMING GROUP 41% Net revenue (€)

TOTAL

Q3 2018

Q3 2017

Change

64.3m

45.7m

41%

It is now 20 consecutive quarters of yearon-year revenue growth for Stockholmlisted Evolution Gaming, the industry’s leading live dealer provider which has just got even bigger after snapping up its closest rival Ezugi. Q3 revenue increased by

“The development of the offering has exceeded our expectations during the initial phase, which provides confidence for the future” Martin Carlesund, Evolution Gaming

41 per cent to €64.3m, with net profit climbing 26 per cent to €21.2m. The supplier said that a major milestone was achieved in Q3 with the launch of Evolution’s st ate - of-t he - a r t st ud io i n Atlantic City, New Jersey, its 10th studio globally. “Already from start, the studio serves several strong brands in the market with a broad portfolio of games and services,” said chief executive Martin Carlesund. “The response has been positive throughout, and the development of the offering has exceeded our expectations during the initial phase, which provides confidence for the future.” Carlesund also explained that fol lowing the launch of new studios in New Jersey, Canada and the Republic of Georgia, the company’s focus in 2019 will be on expanding its presence in Malta, which may include the opening of a new studio

F I NA NC E

GIQ20 Q3 2018

KAMBI GROUP

LEOVEGAS

39%

41%

Net revenue (€)

TOTAL

Q3 2018

Q3 2017

Change

78.6m

55.6m

41%

Stockholm-listed operator LeoVegas suffered a slump in revenue from the UK market, but still posted a 41 per cent improvement in revenue to €78.6m in Q3. The company reported organic growth in local currency of 7.5 per cent compared to Q3 2017, with the slower growth attributable to a 32 per cent decline in UK revenue from LeoVegas, as well as declines from its Royal Panda and Rocket X brands, which now represent 14 per cent and 13 per cent of revenue. Regulated markets accounted for 35 per cent of the quarterly total, up from a 25 per cent share in the prior year period. From 2019 onwards, when the Swedish market is regulated, LeoVegas expects around 60 per cent of its revenue to be derived from regulated markets. LeoVegas was one of the first wave of operators to be granted licence approval in Sweden in early December.

GIQ Q4 REVIEW

TOTAL

Q3 2018

Q3 2017

Change

20.5m

14.8m

39%

Stockholm-listed Kambi Group has been making inroads into the US of late, and with its share price soaring over the past year, shareholders were further boosted by a record Q3. Revenue increased by 39 per cent to €20.5m, with growth attributed to the underlying performance of existing customers and contributions from new customers and the FIFA World Cup. Q3 saw Kambi go live in New Jersey, processing the state’s first legal online wager in the post-PASPA era for DraftKings. The supplier is also live in New Jersey with SugarHouse and 888sport, with Kindred Group’s Unibet also signed up to launch. A deal was also struck in Pennsylvania with Parx Casino. “Last year I described Q3 2017 as a ‘springboard’ quarter for Kambi, and what’s followed has been a period of sustained growth, leading to a historic Q3 2018 for the company,” said chief executive Kristian Nylén. “Overall, the business has never been in better shape, illustrated by a record quarterly performance.” 89

F I NA NC E GIQ20 Q3 2018

BETSSON

GAMING INNOVATION GROUP

21%

21% Net revenue (€)

Net revenue (SEK)

Casino Sportsbook Other TOTAL

Q3 2018

Q3 2017

Change

1,066.3m

871.1m

22%

B2C

338.9m

275.1m

23%

B2B

21.6m

34.4m

-37%

Eliminations

1,426.8m

1,180.6m

21%

Continuing its recent turnaround, Stockholmlisted Betsson said that its focus on product improvements and operational efficiencies helped Q3 revenue increase 21 per cent to SEK1.43bn and net income climb 63 per cent to SEK305.1m. Casino revenue accounted for 75 per cent of total Q3 revenue at SEK1.07bn, a rise of 22 per cent year-on-year, while sportsbook revenue grew 23 per cent to SEK338.9m, offsetting a 37 per cent decline in other products. The 2018 FIFA World Cup accounted for 1.8 per cent of sportsbook revenue in the quarter, with currency fluctuations also benefiting revenue to the tune of SEK54m. Mobile accounted for 64 per cent of casino revenue in the quarter and 78 per cent of sportsbook revenue. Betsson was another operator to be granted a Swedish licence in early December for three of its leading brands (Betsson, Sverigeautomaten and Nordicbet). Having offered gaming to Swedish players since 1963, the company said that the new licence finally enabled competition on equal terms. 90

TOTAL

Q3 2018

Q3 2017

Change

24.4m

21.9m

11% 33%

15.4m

11.6m

(2.6m)

(2.7m)

-4%

37.3m

30.8m

21%

Oslo-listed Gaming Innovation Group (GiG) continues to make significant progress on becoming one of the industry’s leading iGaming solutions providers and enjoyed another strong period of growth during the third quarter of 2018. Revenue was up 21 per cent to €37.3m, with B2B revenue climbing 33 per cent to €15.4m and B2C revenue increasing 11 per cent to €24.4m (with overall results including €2.6m in eliminations). “In the third quarter, we have delivered the last building blocks to our ecosystem, our own games and omni-channel solution, to cover all verticals in iGaming,” said chief executive Robin Reed. “We have created a base from where now, with full force, we can drive forward as the full service provider which every company serious about iGaming must be part of.” GiG signed its first external poker and sportsbook deals in Q3 with OneTimePoker and MRG majority-owned Latvian operator 11.lv. Since then, GiG Games launched its first in-house developed game (Wild Reels) and

“We have created a base from where now, with full force, we can drive forward as the full service provider which every company serious about iGaming must be part of” Robin Reed, Gaming Innovation Group

F I NA NC E

GIQ20 Q3 2018

signed its first deals with a game studio (Jade Rabbit) and game aggregator (Join Games). GiG also signed a sportsbook agreement with Metal Casino and was granted a B2B sports betting licence in the UK.

KINDRED GROUP

£4.4m came from poker and £5.3m from bingo and other products. Kindred has partnered Hard Rock in New Jersey to launch its Unibet brand using SG Digital and Kambi platforms, and has secured licences in Sweden for five brands (unibet.se, mariacasino.se, storspelare. se, bingo.se, igame.se).

19%

ZEAL NETWORK

Net revenue (£)

Sports betting Casino and games Poker Other TOTAL

19% Q3 2018

Q3 2017

Change

111.1m

85.7m

30%

109.9m

99.3m

11%

4.4m

3.0m

47%

5.3m

5.6m

-5%

230.7m

193.6m

19%

Preparing to enter the New Jersey market and Sweden this year, Stockholm-listed operator Kindred Group saw gross winnings revenue increase 19 per cent to £230.7m in the third quarter. Sports betting accounted for £111.1m of the total, up from £85.7m a year ago, with the current year period including the closing stages of the World Cup. Live betting contributed 64 per cent of turnover and 55 per cent of sports betting revenue, with gross margin after free bets climbing to 8.5 per cent compared to 7.7 per cent a year ago. Gross winnings from other products – comprised of casino, poker and bingo – climbed 11 per cent year-on-year to £119.6m, of which GIQ Q4 REVIEW

Net revenue (€)

TOTAL

Q3 2018

Q3 2017

Change

38.2m

31.5m

19%

Frankfurt-listed Zeal Network posted a 19 per cent increase in revenue to €38.2m for the third quarter, helping net profit more than double to €20.1m. Billings for the quarter climbed eight per cent to €70.5m, with lottery betting accounting for 64 per cent of the total. While the company is withdrawing its Spanish brokerage business Ventura24 following a legal dispute with the country’s regulator DGOJ, Zeal is

“In our core business, customer numbers, billings and revenues are all significantly up, while our acquisition costs per customer have halved” Helmut Becker, Zeal Network

targeting further growth in Germany with a takeover offer for lottery broker Lotto24, a company which was spun off from Zeal (then Tipp24) back in 2012. “We continue to deliver strong profitable growth, focusing firmly on controlling costs while also improving customer acquisition and activity,” said chief executive Helmut Becker. “In our core business, customer numbers, billings and revenues are all significantly up, while our acquisition costs per customer have halved. This is the result of the optimisations and investments we have continued to make. With positive performance also coming through from our start-ups in Norway and the UK, Zeal is excellently positioned to capitalise on the global lottery sector’s growth potential.”

F I NA NC E

GIQ20 Q3 2018

BET-AT-HOME.COM

NETENT

18%

11%

Net revenue (€)

Net revenue (SEK)

TOTAL

Q3 2018

Q3 2017

Change

37.6m

31.9m

18%

Frankfurt-listed bet-at-home.com reported record EBITDA of €13.0m for the third quarter, benefiting from increased marketing activity ahead of the World Cup. Gross betting and gaming revenue rose by 18 per cent to €37.6m in Q3, with the operator attributing the growth to increased marketing activity in Q2. This led to the successful acquisition of new customers before and during the World Cup and helped bet-at-home.com post its highest ever quarterly EBITDA of €13.0m, and earnings before taxes of €12.6m. At the end of September, the operator had nearly five million registered customers, up from 4.8 million a year ago, following a successful advertising campaign during the World Cup, comprising TV spots, posters and online media.

TOTAL

Q3 2018

Q3 2017

Change

449.3m

404.8m

11%

It was a solid third quarter for Stockholmlisted NetEnt which grew revenue by 11 per cent to SEK449.0m (€43m) and saw net profit climb 10 per cent to SEK155.4m. The number of game transactions rose seven per cent to 10.9bn in the third quarter, with the company attributing the different growth rates for rev-

GVC HOLDINGS 14% Net revenue (US$) Q3 2018

Q3 2017

Change

Online

n/a

28%

UK retail

n/a

-2%

European retail

n/a

24%

Other

n/a

TOTAL

n/a

14%

A strong performance from its online and European retail businesses helped London-listed GVC Holdings post a 14 per cent increase in revenue for the third quarter of 2018. Online was the star performer in Q3 as revenue increased 28 per cent, while the European retail business saw revenue climb 24 per cent, offsetting a two per cent decline in UK retail revenue. 92

enue and game transactions to lower average bet values per transaction. NetEnt signed nine new customer agreements in Q3 and launched online casinos for 14 new customers, including British Columbia Lottery Corporation in Canada and Norsk Tipping in Norway. “The third quarter was marked by a strong start thanks to the successful release of the game Jumanji,” said chief executive Therese Hillman. “We have remained focused on strengthening our customer offering, cutting lead times, and freeing up resources for new commercial activities.”

“The group’s performance in the quarter was very pleasing, with momentum continuing across the online and European retail divisions,” said chief executive Kenneth Alexander. “As highlighted in our H1 results, we will look to consolidate our position in markets where we are taking market share through the reinvestment of excess returns, and the board is confident in its full year expectations.”

“The group’s performance in the quarter was very pleasing, with momentum continuing across the online and European retail divisions” Kenneth Alexander, GVC Holdings

F I NA NC E

GIQ20 Q3 2018

PADDY POWER BETFAIR 10% Net revenue (£)

Online

Q3 2018

Q3 2017

Change

248m

216m

15%

Australia

101m

111m

-9%

Retail

82m

85m

-4%

52m

28m

82%

483m

440m

10%

US TOTAL

London-listed Paddy Power Betfair grew third revenue by 10 per cent to £483m, benefiting from the FanDuel acquisition in July, which contributed £2m to the company’s revenue, and the conclusion of the World Cup which contributed £22m. Results were adversely affected by foreign exchange translation and customer friendly sports results, primarily in Australia. “Q3 was a good quarter for the group,” said chief executive Peter Jackson. “In Europe, the encouraging momentum that we saw in Q2 accelerated further, with online revenue up 15 per cent. This momentum, which was evident in both Paddy Power and Betfair, is driven by enhancements in product and good execution in promotions and marketing.” Following the merger of Betfair US with FanDuel and subsequent sport betting launch, the company’s US business now comprises revenue from; FanDuel fantasy sports across 41 states; TVG horseracing across 33 states; the FanDuel sportsbook currently operating in New Jersey and West Virginia; and the Betfair Casino and Exchange in New Jersey.

“The growth at Vera&John highlights our strategy of international diversification, with 44 per cent of group revenue generated outside the UK in Q3,” said executive chairman Neil Goulden.

11 per cent to $105.1m in Q3, reflecting the ongoing popularity of Bingo Showdown and Jackpot Party Social Casino, as well as the recently launched Monopoly-themed casino app.

OPAP SCIENTIFIC GAMES

Net revenue (US$)

Net revenue (US$) Q3 2018

Q3 2017

Change

Gaming

447.9m

454.6m

-1%

Lottery

206.8m

202.9m

Social gaming

105.1m

95.1m

11%

Digital

61.2m

16.3m

275%

TOTAL

821.0m

768.9m

New York-listed Scientific Games posted its 12th consecutive quarter of year-on-year growth as revenue rose seven per cent to $821m during the third quarter, comprising growth across its Lottery, Digital and Social segments which offset a decline from its core Gaming division. “We are very pleased with the growth we are seeing across our businesses as we continue to lead our industry into the future,” said chief executive Barry Cottle. “Our investments in digital, sports betting, and new games are producing the most innovative and engaging products in the market. We are excited about the customer response here in the US and around the world.” The company also confirmed that it was considering a 2019 initial public offering (IPO) for its social gaming business, which grew revenue by

TOTAL

Q3 2018

Q3 2017

Change

247.6m

239.0m

A significant contribution from the roll-out of its video lottery terminals helped Athens-listed OPAP post its fifth consecutive quarter of yearon-year growth as revenue rose four per cent to €247.6m in Q3. This was despite declines across the company’s lottery, betting, and instant and passive games segments. At the end of the quarter OPAP had 16,043 VLTs installed across Greece, hosted by 320 Play Gaming halls and 1,762 agencies, with the company aiming for a target of approximately 19,000 VLTs by year end. In Q3, OPAP also launched its new Pamestoixima.gr online betting platform, and introduced new features on key games including Kino side bets and new virtual sports content. “Our Q3 performance confirms OPAP’s progress in the delivery of our 2020 Vision,” said chief executive Damian Cope. “Despite some unfavourable sports results, including the World Cup final match itself, and the ongoing macroeconomic challenges, the OPAP team delivered strong EBITDA growth, plus year-onyear revenue growth.”

JPJ GROUP 8% Net revenue (£) Q3 2018

Q3 2017

Change

Jackpotjoy

52.1m

53.5m

-3%

Vera&John

25.7m

18.4m

40%

TOTAL

77.8m

71.8m

London-listed JPJ Group said that its third quarter performance was in line with expectations as revenue increased by eight per cent to £77.8m. This was despite a three per cent fall in revenue from the company’s core Jackpotjoy segment to £52.1m, mainly due to a decline in the Mandalay brands and a lower contribution from Jackpotjoy UK following the closure of a number of high value accounts due to responsible gambling measures. Vera&John revenue increased by 40 per cent however to £25.7m and accounted for a third of JPJ’s overall revenue during the quarter. GIQ Q4 REVIEW

C O LU M N AND ANOTHER THING...

HE SAID WHAT?!

QUOTES OF 2018

“It was like catching a falling knife. Nobody wanted to go anywhere near it” PartyPoker chief Tom Waters remembers the bad old days (November)

“We are solidifying our leadership team” Scientific Games chief executive Kevin Sheehan (January)… ...SciGames chairman Ron Perelman moves Kevin on (May)

“I want to thank him for his strong leadership” “The only winner in the Pennsylvania market up until now is Microsoft Excel.” Yaniv Sherman of 888 does the math (October)

“Collectively, our industry’s number one competitor is going to be the black market books” Rush Street Interactive chief Richard Schwartz gets serious (October) 94

“It’s no longer enough to throw a few bells and cherries at them and expect player loyalty” Red Tiger Gaming chief commercial officer Chris Looney (October)

“I could say that I’m going on a stag weekend to Vegas this weekend and the share price would go up two per cent, such is the frenzy around the US” GVC Holdings chief executive Kenneth Alexander surveys the post-PASPA landscape (June)…

s his partner. …and choose ws (July) ediction follo A modest pr

at the JV will th t b u o d o n “There is er in the US” d a le t e rk a m be the

“America just celebrated its 242nd anniversary of telling Britain what it could go do to itself, yet now the country seems to be in a hurry to surrender to King William (Hill, that is)” SportAd CEO Joe Brennan observes the post-PASPA landscape (June)

“This bill is the epitome of a solution in search of a problem” AGA senior vice president of public affairs Sara Slane on the federal sports betting oversight bill (December)

“Are there any bookmakers out there who manage risk without throwing customers out?” @spankysports is not impressed with Europe’s approach to sports betting in New Jersey (September)

“For three or four years there were no customers” Caliente Interactive CEO Emilio Hank recalls the operator’s first moves on the internet (January)

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