GIQ - Gaming Intelligence Quarterly Jan-Mar 2020

G A M I N G

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

2020

Q4 REVIEW

Jan – Mar 2020

• JANUARY – MARCH 2020 • ISSUE 40

FEATURING

Q U A R T E R L Y

A GAMING INTELLIGENCE PUBLICATION

The Good News Issue Reasons to be cheerful in 2020

Innovation and good works from bet365, Evolution, Gamesys, GVC, Playtech, Scientific Games, The Stars Group, William Hill and many more

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CONTENTS

LEADER Q4 REVIEW

4 Snapshot

Top stories, top quotes and deals of the year

8 The Gaming Intelligence Awards 2020

Find out who won our operator and supplier awards

16 All hail the good news

As we enter a new decade, Gaming Intelligence looks at some of the good things the industry does

22 Thought leadership

2020

SG Lottery, SBTech, Sportradar, Sporting Solutions, BtoBet and BlueRibbon

34 The Gaming Intelligence Hot 50 2020

The most innovative and influential people working in the betting and gaming industry

49 People

New appointments at the BGC, Yggdrasil, News UK and elsewhere; plus a look at neurodiversity

54 Games

A look at the quarter’s best new games from Blueprint, NetEnt, Relax and more

56 Technology

New tech launches from Gamesys, GVC, White Hat and more

58 Lottery

Global lottery news; and how US lotteries are introducing a new model for sports betting

60 Legal & regulatory

The latest world legal developments; plus an exclusive interview with Swedish Gaming Authority director general Camilla Rosenberg

67 Marketing

An in-depth survey of listed affiliates; plus the latest marketing news

75 Finance

The GIQ 20 Q3 2019

86 And another thing….

Coulda, shoulda: a Hot 50 addendum

Steve Hoare

E D I TO R

LOOK ON THE BRIGHT SIDE HIS IS OUR good news issue. We celebrate the most talented, innovative and influential people working in betting and gaming, with the publication of the industry’s most anticipated feature of the year – The Gaming Intelligence Hot 50 – and we reward the year’s best performers in The Gaming Intelligence Awards.

There is no getting away from it.

The year 2019 was rubbish. Beyond the Brexit woes of those of us living in the UK, the regulated betting and gaming industry struggled under the glare of media scrutiny and the ensuing political and regulatory backlash that introduced new curbs on advertising, bonuses and more all over Europe.

If you turn to page 75, you will see revenue and profit dropping at industry leaders such as Betsson, GVC, Kindred and NetEnt. Flick this page over and you will see that 17 of 50 listed betting and gaming companies saw their share price fall in 2019. You can add the likes of LeoVegas and 888 to the companies mentioned previously (although GVC’s share price continues to fly).

But we are finding a route out of the darkness.

While some will undoubtedly look to grey and black markets for an easier ride, others have embraced the regulations and restrictions.

There has been a lot of moaning from the industry but the likes of Betsson, Kindred and LeoVegas have remained positive. There should be nothing wrong with protecting your customers.

As the Swedish regulator Camilla Rosenberg says clearly on page 62: “Considering that a high level of consumer protection is one of the main priorities of re-regulation, I think a drop in profits is of secondary importance.”

We can argue all day long about the means to achieve a high level of consumer protection while protecting our businesses – and we should.

Regulators are not immune to this quandary, but solving it is essential.

So, let’s celebrate the innovation at companies such as bet365, Betsson, Gamesys, GVC, Kindred, Playtech, Scientific Games and elsewhere, all aiming to make sure that responsible gambling is no longer seen as a tautology.

We talk a lot about competing with the likes of Spotify and Netflix for the entertainment dollar.

Let’s show potential customers that we’re worth it. sah@gamingintelligence.com

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T

EDITOR IN CHIEF Bobby Mamudi bmm@gamingintelligence.com

DEPUTY EDITOR Kio Dawson k.dawson@gamingintelligence.com

www.GamingIntelligence.com

EDITOR Steve Hoare sah@gamingintelligence.com

CONTRIBUTORS Christina Thakor-Rankin, Jon Harwood, Chris Tooley

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

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GIQ Q4 REVIEW

Published by Gaming Intelligence Services Ltd

Copyright © 2020 Gaming Intelligence.

All rights reserved.

3

GIQ Q4 2019

Snapshot

most popular stories of the year 2019 GamingIntelligence.com Blow for Gibraltar as bet365 confirms Malta expansion plans Flutter Entertainment and The Stars Group to merge NetEnt launches newest branded slot title, Narcos Global Gaming loses Swedish licence Netherlands regulator releases AML guide JPJ Group agrees £490m deal to acquire Gamesys UKGC issues £4.5m in penalties to four operators Novomatic sells UK gaming business to Inspired NetEnt swoops in on Red Tiger in £220m deal GVC exits Spanish retail sports betting market

Quote of the Quarter Considering the fact that a high level of consumer protection is one of the main priorities of re-regulation, I think a drop in profits is of secondary importance.”

Camilla Rosenberg, Spelinspektionen (page 62)

4

Regulation, regulation, regulation… and Narcos THE YEAR’S MOST popular stories (left) give a fairly accurate view of the industry’s concerns – and its love of Netflix TV show Narcos, by the looks of things. These concerns could fairly easily be summed up by paraphrasing Margaret Thatcher: regulation, regulation, regulation – and M&A, of course.

Malta had a great year. It was not just bet365 relocating from Gibraltar – William Hill also based its digital operations there after acquiring Mr Green. The Mediterranean island started the year under the microscope. The resignation of Prime Minister Joseph Muscat followed the murder of journalist Daphne Caruana Galizia.

Its banking practices were also under scrutiny.

Not even the Malta Gaming Authority could

escape the glare. New chief Heathcliff Farrugia rose to the challenge – and the opportunity offered by Brexit – to establish the MGA as the world’s leading offshore regulator.

The most dramatic regulatory action of the year was undoubtedly Swedish regulator Spelinspektionen’s withdrawal of Global Gaming’s licence to operate. It marked a dramatic fall from grace by last year’s Gaming Intelligence Casino Operator of the Year. Hopefully this year’s award winners (see page 8) will have a better reign than Global Gaming.

The operator of the innovative Ninja Casino has lost its first appeal in Sweden’s administrative court. Spelinspektionen director general Camilla Rosenberg explains all on page 62.

Stateside opportunities boost iGaming stocks in 2019 THE 50 PUBLICLY-LISTED operators and suppliers which make up the Gaming Intelligence Stock Index saw their combined share prices climb by more than 45 per cent Between Wednesday 2 January and Tuesday 31 December 2019, there were 30 public companies in the gambling sector that saw the value of their shares increase. The strong overall growth mirrored the improved performance of the wider global financial markets in 2019 compared to the previous year. But results were skewed by seven companies at the top of the chart, which saw the value of their shares more than double during the course of the year.

The biggest climber in 2019 was London-listed GAN, the Micro-Cap stock soared an impressive 285 per cent to close the year at 181.50p per share and led to thoughts of a Nasdaq listing in 2020. GAN came out ahead of Stockholm-listed Evolution Gaming, which enjoyed another successful year of growth, with shares up 172 per cent by the end of the year to SEK282.

GAN is one of a number of companies benefiting from the state-by-state sports betting and iGaming expansion in the US, alongside the likes of Score Media and

Gaming, PointsBet and Caesars Entertainment, which all saw their respective share prices more than double in 2019.

There were also notable share price gains from Gaming Realms (up 138 per cent after selling its B2C brands), Rank Group (up 102 per cent), Churchill Downs Incorporated (up 74 per cent), Aristocrat Leisure (up 59 per cent), and Flutter Entertainment (up 63 per cent), which is in the process of merging with The Stars Group (up 49 per cent) to create the biggest publiclylisted iGaming operator in the industry. This stock will definitely be one to watch in 2020.

At the other end of the table were 19 companies that saw their share prices decline during the course of 2019. The tightening of regulations in the UK market, coupled with the re-regulation of the Swedish market, had a major impact on several operators’ financial results during the period, and their share prices were affected.

Global Gaming was the worst-performing stock in 2019 after its much publicised troubles in Sweden, with shares falling 83 per cent to SEK6.30, hitting a low of SEK3.40 on 17 June following the revocation of its Swedish licence by gambling regulator Spelinspektionen.

GIQ Q4 2019

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GamingIntelligence.com OP. PRICE 03.01.19

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Score Media and Gaming

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AUD$2.13

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124.88%

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62.85%

Aristocrat Leisure

AUD$21.20

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58.82%

Eldorado Resorts

$38.28

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55.80%

CAD$22.69

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49.36%

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49.03% 45.60%

COMPANY GAN plc Evolution Gaming Group Gaming Realms

Caesars Entertainment Corporation Rank Group Churchill Downs Incorporated Flutter Entertainment

The Stars Group (TSX) Scientific Games Corporation OPAP SA

€ 7.96

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MGM Resorts International

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39.50%

Boyd Gaming Corporation

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39.00%

Enlabs

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38.95%

Better Collective A/S

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683.00p

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Inspired Entertainment GVC Holdings Penn National Gaming

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25.54%

William Hill

157.00p

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20.03%

634.00p

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11.51%

$7.93

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8.45%

bet-at-home.com

€ 48.78

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8.45%

Tabcorp Holding

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8.11%

La Française des Jeux SA (IPO on 21 Nov)

€ 23.00

€ 23.83

3.61%

Playtech

385.00p

397.00p

3.12% 0.54%

Gamesys Group (IPO on 27 Sep) 500.com

International Game Technology Zeal Network SE Pollard Banknote Limited 888 Holdings Ainsworth Game Technology Intralot SA Sportech AGTech Holdings Webis Holdings

$14.89

$14.97

€ 20.70

€ 20.75

0.24%

CAD$20.00

CAD$20.00

0.00% -0.96%

166.60p

165.00p

AUD$0.795

AUD$0.785

-1.26%

€ 0.43

€ 0.37

-13.95%

39.50p

32.75p

-17.09%

HK$0.48

HK$0.365

-23.96%

1.70p

1.25p

-26.47%

LeoVegas

SEK41.52

SEK29.51

-28.93%

Kindred Group

SEK82.32

SEK57.63

-29.99%

SEK37.61

SEK25.85

-31.27%

$18.00

$12.29

-31.72%

NetEnt Sciplay Corporation (IPO on 3 May) Kambi Group

SEK201.50

SEK132.70

-34.14%

Betsson

SEK74.08

SEK43.68

-41.04%

Aspire Global plc

SEK50.70

SEK29.60

-41.62%

$22.51

$12.13

-46.11%

Scout Gaming Group

SEK29.70

SEK13.00

-56.23%

Catena Media

SEK98.45

SEK39.52

-59.86%

Gaming Innovation Group

SEK22.99

SEK8.19

-64.38%

14.00p

2.75p

-80.36%

SEK36.46

SEK6.30

-82.72%

PlayAGS

Nektan Global Gaming 555

GIQ Q4 REVIEW

Deals of the year

2019

B2B

The Stars Group teams with FOX Sports to create FOX Bet The Stars Group launches FOX Bet on the US market after signing a joint venture with FOX Sports.

SciGames wins a ten-year sports deal in Turkey Scientific Games’ joint venture – Sans Girisim – usurps rival Intralot to win a ten-year deal to provide Turkey’s state-sponsored Spor Toto lottery with a sportsbook.

M&A

Eldorado acquires $17bn Caesars Eldorado steps in to wipe out Caesars’ debt and create the biggest land-based operator in the US. Flutter and Stars merge to create a $12bn megacorp Flutter Entertainment acquires The Stars Group to build an empire containing brands such as Betfair, Paddy Power, FanDuel, PokerStars and Sky Betting & Gaming.

JPJ acquires Gamesys for £490m JPJ Group buys itself out of existence after acquiring Gamesys and renaming itself Gamesys.

William Hill acquires Mr Green for £242m William Hill heads to Malta and asks Mr Green to overhaul its digital operations.

NetEnt acquires £220m Red Tiger The B2B acquisition of the year is undoubtedly NetEnt’s acquisition of Red Tiger Gaming.

5

The Gaming Intelligence Awards are the only betting and gaming industry awards that solely reward a company’s excellence.

You do not have to buy sponsorship, book a table or run an advertising campaign to qualify, you only have to demonstrate a record of achievement that convinces the judges you have had a fantastic year.

The competition was intense this year. There were more entries than ever before in the most hotly contested categories.

AND THE WINNERS ARE...

A special mention must go to The Stars Group, which has won three awards, and Evolution Gaming and Gamesys, which have won two. All three are extremely well managed businesses, with the passion and drive to continue pushing the boundaries.

Evolution, Gamesys and Stars embody much of what makes this industry great. In doing what they do, they do not just drive their companies on, they also drive the industry forwards.

Congratulations to all of our winners!

OPERATOR AWARDS

SUPPLIER AWARDS

Bingo Operator

Game Of The Year

GAMESYS GROUP

Sports Betting Operator

THE STARS GROUP Poker Operator

THE STARS GROUP Lottery Operator

SAZKA GROUP

Socially Responsible Operator

BETSSON GROUP

MONOPOLY LIVE

Casino Operator

Sports Betting Supplier

Management Team

Casino Supplier

888 HOLDINGS GAMESYS GROUP One To Watch

FOX BET

SBTECH

EVOLUTION GAMING Poker Supplier

RELAX GAMING

Supplier Innovation

SG VISION

Lottery Supplier

IWG

Bingo Supplier

PLAYTECH One To Watch

SKYWIND GROUP

OPERATOR AWARDS BINGO OPERATOR

LOTTERY OPERATOR

RUNNERS UP Buzz Bingo GVC Holdings Rank Group

RUNNERS UP Camelot FDJ The Pennsylvania Lottery

Put simply, nobody does it better than Gamesys when it comes to bingo. Jackpotjoy continues to fly the flag in the world’s most competitive bingo market of the UK. In 2019 it returned to growth after a year of regulatory upheaval that saw it implement new responsible gambling measures.

But Gamesys is about far more than Jackpotjoy. Heart Bingo has emerged as another leading UK brand with its excellent mobile product.

In Spain, Botemania is growing and accounts for 17 per cent of revenue. Following its reverse takeover of JPJ Group, it will take some stopping.

The European company’s continued focus on innovation and digital growth means they dominate the lottery category this year. On a strong shortlist, SAZKA Group stands out.

The company’s ever-expanding portfolio of operations across Austria, Cyprus, the Czech Republic, Greece and Italy marks SAZKA out as a trailblazer. Its revolutionary approach to lottery as entertainment runs through the portfolio and is being rewarded with high returns.

As regulators clamp down on commercial operators, lotteries are seeing a resurgence and SAZKA is making sure it benefits.

After turning around Greek lottery OPAP, SAZKA is sure to fight runner-up Camelot for the licence to operate the UK’s National Lottery.

The smart money must be on the incumbent but SAZKA is a powerhouse and will go from strength to strength regardless.

GAMESYS GROUP

Last year: Tombola

SPORTS BETTING OPERATOR

POKER OPERATOR

RUNNERS UP DraftKings FanDuel PointsBet

RUNNERS UP IDNPoker Kindred Group Winamax

The Stars Group emerges triumphant in this category, thanks to an increasingly global portfolio of brands.

UK-based Sky Betting & Gaming goes from strength-to-strength, shrugging off integration concerns with spiralling revenues.

It also provided the inspiration and the springboard into the US market, where Stars struck the deal of the year with FOX Sports to create FOX Bet. The new brand was launched with minimum fuss but maximum fanfare in New Jersey and Pennsylvania. Stars also increased revenue by more than a third in Australia, where it migrated William Hill’s customers to its BetEasy operation. Now, it enters a new era as part of Flutter Entertainment. The Stars Group goes out on a high.

It is difficult to dislodge PokerStars in this category. For all the innovation shown at Kindred Group as it goes it alone; the moves into new territories by Winamax; and the under-the-radar success of IDNPoker, PokerStars continues to dominate.

The poker vertical has endured slings and arrows, but PokerStars runs ahead of the pack, with operational excellence, customer care and cross-marketing of online with land-based tournaments across the world.

Poker is no longer The Stars Group’s biggest vertical and it will be an even smaller percentage when TSG is submerged into Flutter. But it will lead Flutter’s charge into new global territories. Flutter’s other products will have to go some to match PokerStars’ excellence.

Last year: bet365

Last year: The Stars Group

THE STARS GROUP

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THE STARS GROUP

SAZKA GROUP

Last year: Michigan Lottery

Betsson Group CEO Jesper Svensson and chief HR officer Lena Nordin

CASINO OPERATOR

888 HOLDINGS RUNNERS UP Gamesys Group Rank Group The Stars Group

SOCIALLY RESPONSIBLE OPERATOR

BETSSON GROUP RUNNERS UP 888 Holdings GVC Holdings Paf

In the current climate, this has become one of the most hotly contested and coveted of awards.

Betsson’s victory is just reward for a longstanding commitment to responsible gambling.

The Swedish operator has launched a number of RG initiatives, including a free online self-help tool based on cognitive behavioural

ONE TO WATCH

FOX BET

This was a no-brainer for the judges. The concept of migrating the Sky Bet model to the US was beautiful in its simplicity. The deal to engage FOX Sports was executed smartly, with the media company buying into the concept and supporting it dutifully in the subsequent launch in Pennsylvania and New Jersey. The new FOX Bet followed that up with a partnership with Penn National that enables market access across the nation.

It has achieved a remarkable amount of progress in the past year and you cannot see anything stopping it.

Last year: FanDuel

GIQ Q4 REVIEW

concepts, and it has invested in preventive RG technology with a behavioural monitoring tool built in-house.

But this award goes far beyond responsible gambling. It is about culture. During the past year, Betsson has relaunched its CSR strategy to ensure all its offices are engaged in projects to raise funds for the communities in which they operate. There are too many projects to name here but one can be sure that the people of Malta, Georgia, Estonia and beyond are very happy to have a Betsson office nearby.

888 Casino is perhaps the most established online casino in the world. As such, the transformation it achieved in 2019 and the subsequent boost in every KPI you can think of is remarkable.

During 2019, 888 rolled out its new Orbit platform and its AI-powered recommendation engine to eight regulated markets and was rewarded with a 23 per cent increase in Spanish first time depositors (FTDs), a 72 per cent rise in Denmark, a 76 per cent rise in the UK, and a stunning 114 per cent rise in Italy.

888 remodelled itself as a home for recreational players and put responsible gambling at the heart of everything it does. It was rewarded with phenomenal success.

The 888casino team is operating at the very top of its game.

Last year: Kindred Group

Last year: Global Gaming

MANAGEMENT TEAM

with founding shareholders Noel Hayden and Robin Tombs) and finance director Michael Mee have formed a tight-knit team that has played a long-term strategic game to perfection.

The team initially sold the Gamesys brands to (then) Intertain for £425m in 2015, while retaining the supply contract, before selling the whole company to them last year.

Lee In keeping an eye on the future Fenton by entering the US, operating the best-performing bingo brands in its home market, while being at the forefront of the industry’s responsible gambling efforts, the Gamesys management team has played a blinder.

GAMESYS GROUP RUNNERS UP Betsson Group 888 Holdings Flutter Entertainment The Gamesys management team enjoyed a transformational year with its £490m sale to JPJ Group and subsequent l i sting on the London Stock Exchange.

The installation of Lee Fenton and Robeson Reeves as CEO and COO of the enlarged company reflects the esteem in which this management team is held. The pair (together Robeson Reeves, Gamesys

Last year: GVC Holdings 11

SUPPLIER AWARDS

CASINO SUPPLIER

EVOLUTION GAMING RUNNERS UP Big Time Gaming EveryMatrix Red Tiger Gaming

GAME

MONOPOLY LIVE RUNNER UP Who Wants to be a Millionaire?

There was fierce competition in this category but our Casino Supplier of the Year ultimately triumphed by producing a game that has invented a whole new category.

Many have tried to reinvent gambling games with innovative ideas and concepts

to break from regular slots and table games.

Evolution Gaming has succeeded with a game that merges board game, table game and slot.

Furthermore, it has excited players so much it has smashed all Evolution’s previous records.

Evolution has taken one of the world’s most popular board games and turned it into a gambling game that is mindblowing in its creativity.

Utter genius.

Evolution Gaming wins the most hotly contested category in the Gaming Intelligence Awards.

Year after year, the competition gets hotter and in 2020 nobody can match Evolution.

During 2019, it boosted its share price a stunning 172 per cent on the back of a string of deals and a revenue rise of 32 per cent over the first three-quarters of the year. Few suppliers of a similar size come anywhere near that number.

Its other KPIs are even more impressive, with 50 per cent-plus rises the norm. A commitment to product excellence saw inspirational games such as Monopoly Live and a whole new category in the shape of Live Game Shows.

The company grew fastest in Asia and North America, where it secured a string of deals topped by entry into Pennsylvania with Penn National. If you add in deals with ATG, Svenska Spel, Scientific Games, BetVictor, Flutter and many more, nobody could match Evolution’s performance.

Last year: The Goonies by Blueprint Gaming

Last year: Red Tiger Gaming

POKER SUPPLIER

RELAX GAMING

SPORTS BETTING SUPPLIER

SBTECH

RUNNER UP Playtech

RUNNERS UP IGT Kambi Scientific Games SBTech follows up last year’s victory in this category with another win. It has had a fantastic year with a hat-trick of deals with three of the world’s most forward-thinking lotteries, in the shape of Oregon Lottery, Svenska Spel and Veikkaus.

None of its rivals could match that trio of contracts. It might have been enough to win this award alone, but SBTech also found time to win the contract to supply the hotly anticipated new Virgin Bet with its

12

sportsbook. Virgin Bet will be SBTech’s first customer to build a differentiated UI from its next generation APIs. In 2020, SBTech will be busy replacing rival Kambi after being acquired by DraftKings. That is the company’s future.

In its present form it is one of the most buoyant suppliers in the sector.

Last year: SBTech

Relax Gaming has one client but it has delivered that one exclusive client a product that has reinvigorated a vertical that was dead on its feet.

Against a backdrop of decline in the wider ma rket , Rel a x has delivered a platform that drives profit and has delivered consistent growth for the last 25 consecutive quarters. Kindred has been rewarded for committing itself to one of the most innova-

SUPPLIER INNOVATION

ONE TO WATCH

SG VISION Scientific Games wins the Supplier Innovation award because SG Vision is not just an innovative slot or an interesting new gamification technique, SG Vision is a breakthrough technology that can verify player age, support responsible gaming, enhance player loyalty programs and create personalised experiences for players – instantly.

Imagine that a player walks into a casino and sits down at a table game. The SG Vision enabled table would recognise the player and verify the player’s age. Next, SG Vision tracks the guests’ play to deliver real-time player ratings. The player moves onto a slot machine and SG Vision offers him a choice of games based on his previous preferences. SG Vision will even recognise when the player’s drink is running low, and cue a server to check on the guest.

However, the really important breakthrough could be SG Vision’s use to promote responsible gambling. If this technology is deployed across properties, it could alleviate concerns that a self-excluded player simply pops from William Hill to Paddy Power to continue gambling.That could be game-changing.

Last year: Playtech

tive young companies in the sector.

During 2019, Relax l au nched Poker 2 .0, which included a new, slick interface on mobile for an intuitive and accessible player experience across both portrait and landscape modes. It became the first supplier in years to launch poker in France and soared to the top.

Kindred loves it so much, it has asked Relax to r evolut ion i se it s bingo product.

Last year: Playtech GIQ Q4 REVIEW

During 2019, Skywind Group struck deals with the likes of 888, bwin-party, The Stars Group, Kindred, Snai, LadbrokesCoral, Gala, Superbet, Caliente, VideoSlots, Sportingbet, Eurobet, Hero Gaming, The Sun and more.

It released an impressive 70 new games and opened five studios around the world, as it looks to produce diverse art and maths, and unique content focusing on specific markets.

Launched in 2012 by Playtech founder Teddy Sagi, Skywind could be capable of challenging Sagi’s first vehicle as one of the industry’s favourite casino suppliers.

SKYWIND GROUP RUNNERS UP BlueRibbon Software 1X2 Network

Skywind Group rocketed into regulated markets in 2019, with a momentum rarely seen even in this industry.

The progress made during the past year is phenomenal. Skywind secured six licences in the UK, Malta, Spain, Romania, Alderney and Gibraltar. In addition, it has certified its games and entered Italy, Denmark, Belgium, Sweden and Portugal.

Skywind managing director Oren Cohen Schwartz

LOTTERY SUPPLIER

IWG

RUNNERS UP Intralot NeoPollard Interactive Scientific Games IWG breaks Scientific Games’ five-year winning streak in this category to become the Gaming Intelligence Lottery Supplier of the Year.

The company has doubled turnover without increasing costs, while securing a string of new clients to make it a challenger to IGT and SciGames as the leading internet lottery supplier.

BINGO SUPPLIER

PLAYTECH RUNNER UP Dragonfish

Playtech retains this award after a stunning 2019 which saw the company reproduce the simple formula of introducing fantastic new games, winning important new clients and increasing revenue.

Over the last year the company has developed a range of exclusive branded and original titles for operators such as Buzz Bingo, Gala, Mecca, Sky, Sun Bingo and William Hill, while continuing to churn out new games to the bingo network. New releases in 2019 included innovative gems such as Dynamite Digger

Last year: Big Time Gaming

During 2019 it won deals with Belgium’s Loterie Nationale and the UK’s National Lottery, while rolling out new products for the likes of the ALC, BCLC, Pennsylvania Lottery and Michigan Lottery. Its Love Island game for Camelot became the best-performing game in the National Lottery’s portfolio, while Jungle Payout set records for Michigan and Pennsylvania.

IWG has broken the stranglehold IGT, Intralot and SciGames have had on the lottery market. With NeoPollard Interactive hot on its heels, this category just got a lot more interesting.

Last year: Scientific Games

Jackpot, Best Odds Bingo, Hot House Bingo and Love Island Bingo. In addition, the company offered the sort of branded games that bingo players love. There cannot be many Gala customers that did not enjoy exclusive games based around popular TV shows such as Coronation Street, Emmerdale, The Chase and Tipping Point.

The headline deal was the relaunch of Gala as Buzz Bingo and Playtech was engaged to throw the full omnichannel works behind the new brand. Renewals with Rank and Sky Bet were the cherries on the top of Playtech’s splendidly baked cake.

Last year: Playtech 13

Allhail the goodnews 2019 will not be remembered fondly by many in the industry – or in the wider world beyond – but the betting and gaming industry moves into 2020 in a far healthier state. And it is helping others as well

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YOU MIGHT NOT have heard the news that problem gambling in the UK has declined from 0.7 per cent of the population to 0.5 per cent.

Such drops do not comply with the overwhelming media narrative of a nation of problem gamblers hooked on the crack cocaine of gambling (FOBTs) or betting their lives away on mobile phones.

The National Health Service’s biennial Health Survey for England revealed that 53.9 per cent of the adult population participated in some form of gambling in 2018, down from 56.2 per cent of the adult population in 2016.

Lotteries and related products continue to be the most popular forms of gambling, with gambling participation falling to 40.1 per cent when excluding National Lottery draws.

Online gaming and betting participation held at 9.4 per cent of the adult population, unchanged from 2016.

This hardly underlines the mainstream media’s stories of thousands of young men becoming addicted to gambling on their mobile phones. Online betting with a bookmaker posed a problem gambling risk for only 3.7 per cent of participants.

W hile the government’s draconian crackdown on FOBTs lacked evidence, the figures here suggest that it is the most risky GIQ Q4 REVIEW

form of gambling. Although, with just 12.7 per cent of players classified as problem gamblers, it hardly suggests a problem akin with crack cocaine.

Nearly 11 per cent of those betting on greyhounds are also classed as problem gamblers but nobody ever suggested that a trip to the dogs was as addictive as crack. Online gambling on slots, casino or bingo games was a problem for just 8.5 per cent of participants.

This marks a significant improvement versus 2016, when more than 11 per cent of online casino and bingo participants, and more than five per cent of online betting participants, were classified as problem gamblers.

The number of young people gambling in Britain has also improved in recent years, with 11 per cent of 11-16 year olds claiming to have spent their own money on gambling in the prior week in 2019, compared to 16 per cent in 2016. Most of this group had participated in legal gaming, such as lotteries or betting, with friends.

So let’s celebrate an industry that is doing some good things. You wouldn’t know it, of course. It has yet to master the art of media management – or lobbying politicians. But once it has, it could tell the world about some of the good things it is doing.

Finding a funding focus During the past year, GVC Holdings and William Hill relaunched their charitable projects under a ‘Foundation’ banner. The GVC Global Foundation and the William Hill Foundation have refocused their respective company’s charitable efforts.

While the William Hill Foundation was relaunched last year, it has been doing good things since 2011. Between 2012 and 2017 it raised £220,000 for a village in Kenya, building a school and a hospital.

“We wanted to do something within our own communities and clearly we don’t have a business in Africa,” says chief HR officer Karen Myers. “We wanted the Foundation to have more in common with the day-to-day experiences of our people.”

So the company focussed on three areas: colleague hardship, employability and improving mental wellbeing. The first prong of the new strategy involves helping colleagues or former colleagues who are enduring difficult times.

“We wanted to make sure that when things happen to our employees – whether that’s in the UK, the US or Manilla – they can request a grant from us,” explains Myers.

For example, the Foundation helped colleagues in Manilla rebuild their homes after ›› 17

F E AT U R E GOOD NEWS

they were hit by flooding and storms. In the US, the Foundation has funded health treatment for some employees. That is the core point of the Foundation,” says Myers. “Sometimes people just need a little extra support when they are going through tough times.”

The second pillar is about helping people into work. For example, the company utilised its partnership with Tottenham Hotspur to provide skills, training and support for people in its community who are looking for work. That might be ex-offenders, or homeless people, or those that have just endured a tough run. The Foundation has worked with Tottenham and other providers to offer apprenticeships for those seeking a fresh start.

“A lot of things people write about our sector focus on the harm our products may or may not do, and we’re passionate about being responsible and ethical, and ensuring player safety. We wanted to extend that to look at how we can support, improve and prevent mental health issues.”

Among other things, this has led to a threeyear partnership with the Alzheimer’s Society.

The aim is to raise £2m within the three-year period. “We want to be the most dementiafriendly employer in the sector,” says Myers.

“We also want to be the most dementia-friendly betting and gaming company, so that our customers feel supported and protected.”

It was launched with a quiz supported by celebrities, such as broadcaster and former footballer Robbie Savage, fellow broadcaster Kirsty Gallacher and former jockey AP McCoy. £85,000 was raised on the night.

“If you think about our retail business and our shop environment, our customer profile is of a slightly older generation, so we felt that working for the cure or prevention of Alzeimer’s was a really good thing to do, considering our customer base.”

William Hill contributes £600,000 a year to the Foundation, a figure that is rising to £1.2m a year over the next three years.

The bookmaker will also match any money that its employees raise through their charitable activities.

And its employees seem only too willing to indulge their silliest whims to raise money for charity. During December, employees dressed as elves for a day. Indeed, the senior executive team gathered for their regular meeting in the boardroom dressed as elves (see photo).

“It has been a tough year – especially for our retail colleagues – but our people love it. We have had colleagues running 5km races for the Alzheimer’s Society. Others did a 100km bike ride. We have had marathon runners. We are 18

unlocking and unleashing that passion on the Alzheimer’s Society, so I think they’re a bit worried,” jokes Myers.

Grass roots and globalisation The GVC Global Foundation was launched last year to internationalise the company’s CSR portfolio, which was mostly inherited from Ladbrokes Coral and therefore very UKcentric. It was also a means of bringing together all of GVC’s acquired companies’ activities and communicating them better.

“Our bread and butter is responsible gambling,” says communications chief Jay Dossetter, who is a trustee of the Global Foundation, together with director of regulatory affairs Martin Lycka.

All of the company’s responsible gambling efforts, from research to education to treatment, are brought together at the Foundation.

“Sports integrity is a natural add-on to that,” says Dossetter. “It is important everywhere, but very important in the US, where there is a degree of scepticism about sports betting and integrity.”

But it is not solely a US issue. During 2019, GVC launched the first German Sports Integrity Forum at the Borussia Dortmund football stadium. The aim is to turn this into a quarterly event. “Sport is integral to our business,” continues Dossetter. “So another key focus is to help support grass-roots sports – especially women in sport and disabled athletes.”

To this end, bwin has used its partnership with Italian football club Inter Milan to promote an innovative scheme that encourages female football players. Young female footballers are encouraged to film themselves playing and to send them to media partner Gazzetta Dello Sport. A judging panel will decide which ones are the best and they will get a chance to train with (and possibly even join) the women’s Inter Milan team.

GVC also has a partnership with UK charity SportsAid, which supports young British athletes. GVC is sponsoring 50 athletes for a period of three years.

The third focus for the Foundation is mental health – and particularly men’s mental health.

“A large proportion of our customers are men, and men are pretty poor at monitoring their own health – particularly their own mental health,” says Dossetter.

This new focus dovetails with Coral’s partnership with another UK charity, Prostate Cancer UK. For its part, Ladbrokes has its own charity – Children with Cancer UK. When the decision was made to give up all football shirt sponsorship and perimeter board spon-

William Hill executives, left to right: interim COO Phillip le Feuvre; Corporate Development and Strategy director Crispin Nieboer; CFO Ruth Prior; MD Retail Nicola Frampton; chief HR officer Karen Myers; MD UK Online Phil Walker; and CEO Ulrik Bengtsson

››

bwin has used its partnership with Italian football club Inter Milan to promote an innovative scheme that encourages female football players

bwin’s partnership with Inter Milan promotes an innovative scheme encouraging female football players

sorship last year, the company’s position on the shirts of Charlton Athletic and Sunderland were handed to the charity.

A pledge for the future Most of the mainstream media coverage around bet365 concerns the size of chief executive Denise Coates’ pay packet. Which is a shame, because the growth of bet365 is a remarkable homegrown success story. And while Coates’ salary might dwarf that of her counterparts at GVC and William Hill, so does her charitable work.

She increased the amount donated to the Denise Coates Foundation from £75m in 2018 to £85m in 2019. Around £10m has been distributed to a rich diversity of projects in each of the past two years, with a specific focus on education projects around the company’s hometown of Stoke-on-Trent.

B enef icia ries i nclude : Newc ast le under-Lyme School, which received £3m towards the construction of a new sports facility; Keele University, which received £2m towards the construction of a management school and bursaries for undergraduates from disadvantaged backgrounds; and the Douglas MacMillan Hospice, which has received a GIQ Q4 REVIEW

F E AT U R E GOOD NEWS

number of grants for the refurbishment of wards and for funding the psychological services and social work team.

The diversity is further revealed by grants to the Tate Modern to help buy artworks by suffragette Emmeline Pankhurst, London Zoo to fund its aviary, and CAFOD, to deliver water to Eritrea.

While the Foundation’s charity work is commendable, it is the company’s increasing commitment to responsible gambling that will have the longest lasting impact on the industry. The company is one of many that is exploring ways it can use artificial intelligence and machine learning to spot harmful play. bet365 has been a driving force behind the Remote Gambling Association (RGA) since its inception, and many of the industry’s most important innovations are starting to emerge through that route as it morphs into the Betting and Gaming Council (BGC).

Among them is a game design initiative originally helmed by Blueprint Gaming, Gamesys, Microgaming and Playtech to instil safer gambling techniques into the games design process.

The UK Gambling Commission jumped on this idea and challenged the industry to come up with an Industry Code for Game Design by March this year. Scientific Games and Playtech are heading up that effort.

“The biggest challenge the industry has is how to continue to grow in a sustainable manner, while also improving safety standards and reducing harm,” says Playtech’s BetBuddy CEO Simo Dragicevic. “One of the biggest elements of gambling harm is financial loss, which equates to revenue for the industry. This is the great paradox.”

Playtech has shown it is willing to invest heavily in this area. Others are contributing hugely as well. Last year, bet365, Flutter Entertainment, GVC Holdings, Sky Betting & Gaming, and William Hill committed £100m towards gambling addiction treatment services over the next four years. This is part of a wider package of safer gambling measures and support for people experiencing problems.

This includes a ten-fold increase in voluntary contributions to support safer gambling, from the current 0.1 per cent of gross gaming yield to 1.0 per cent by 2023. This is being done in coordination with government departments responsible for the industry and for health, with the key aim of quadrupling the number of people accessing treatment.

This is good stuff. It is also important stuff. The long-term future of the industry depends on it. n 19

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

How to keep responsible gaming entertaining Scientific Games chief product officer Tim Bucher has been working with regulators throughout the world to trial technology that makes gaming products safe for everyone THE ROLLOUT OF the Anonymous Player Awareness System (APAS) in the UK’s betting shops has the potential to be game-changing for an industry that has been hit hard by the government’s decision to drop the maximum bet on fixed-odds betting terminals (FOBTs) to £2.

As one of the chief suppliers of FOBTs, Scientific Games worked with the UK’s bookmakers to develop a technology that uses artificial intelligence algorithms to spot play that could be leading to dangerously addictive behaviour.

For example, this might be players chasing losses with increased bets to counter heavy losses.

Pop-up messages are triggered to suggest it might be time to take a break, while shop staff are also alerted to consider an intervention.

Importantly, the whole thing is done anony22

mously, saving the need for a player card.

“We think that it’s one of the many pieces in the puzzle to make responsible gambling a reality,” says Scientific Games chief product officer Tim Bucher.

Silicon Valley-based Bucher and other Scientific Games thought-leaders regularly participated in discussions during the past year with the UK Gambling Commission about the company’s responsible gaming technology. The UK regulator has been a trailblazer in driving the industry towards more responsible behaviour, and towards the protection of players.

Bucher continues: “The UK Gambling Commission does not want the responsible gambling element to suppress the entertainment. If you suppress the entertainment, you might

make gaming responsible but you will also defeat the industry and make the whole market non-existent.”

Scientific Games is developing other technologies that make gaming more responsible.

One of those is anonymous computer vision technology. “Computer vision technology, object detection technology, behaviour detection technology and emotion detection technology – it’s real now,” says Bucher. “Behind it all sits artificial intelligence and machine learning.”

However, the expertise needed to utilise these technologies is not widespread in the gaming industry. This has encouraged Scientific Games to look beyond its office walls for a partner at the cutting-edge of computer vision technology. The company has teamed up with

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

Amazon Web Services to develop custom versions of Amazon’s computer vision technology for the gaming industry.

The first product of this collaboration is SG Vision. This puts cameras in gaming machines, lottery terminals and games tables that will help identify players – albeit anonymously. This can be used to verify players’ ages but perhaps more excitingly, it could also be used in conjunction with APAS. SG Vision can generate a unique ID for every player that can be used across different locations and different companies. This means a player that has self-excluded or been warned about irresponsible behaviour cannot just leave William Hill and pop into Ladbrokes and carry on gambling.

GIQ Q4 REVIEW

SG Vision and APAS together can potentially provide the silver bullet that skewers many anti-gambling campaigners’ arguments against machine gaming in the UK. And it could, of course, be used in any jurisdiction.

“The UK Gambling Commission loved it,” says Bucher. “We are in trials and working very closely with all regulators.”

The third prong of Scientific Games’ responsible gambling innovations is PlayMyWay, which is a card-based tool that has been around for a bit longer than APAS and SG Vision. It was first adopted in Australia and New Zealand, and has

“If you suppress the entertainment, you might make gaming responsible but you will also defeat the industry” Tim Bucher, Scientific Games

since been used in the US and elsewhere. The technology allows players to set limits, view responsible gaming information and potentially self-exclude from games. It is a voluntary cardbased tool linked to Scientific Games’ CMS and potentially, to a lottery’s central system.

“We are working on a digital integration of this technology,” says Bucher. “We believe PlayMyWay technology should be everywhere.”

Together, the three products comprise a responsible gaming portfolio that should help keep gaming entertaining and safe. In an environment where media, politicians and regulators are increasingly demanding, Scientific Games is generating new technology that could provide a dream scenario of products that are fun to play and safe to play.

“It is our responsibility to work in conjunction with regulators to keep the entertainment content entertaining and also to underpin it with technology that protects players,” concludes Bucher. “I believe that if we do that, gaming has a bright, bright future.” n 23

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

Futureproofing innovation using open APIs SBTech chief product officer Gregory Karaolis believes open API technology could be gamechanging for operators

AFTER A DECADE of operating in this induselements of their own, in turn creating a unique try, we have seen more than our fair share of differentiated offering that stands out in comtechnology developments. It simply never stops petitive markets. moving and therefore nor can we.

We have built some of this industry’s bestCreate own destiny performing sportsbook and platform software The first customer to use our open API and products, winning some of the biggest approach is Virgin Bet, who signed with us iGaming and government deals of the last 12 last year in one of the biggest B2B gaming to 24 months as a result. While innovation has, deals of 2019. Using a partner-led approach they and always will be, central to everything we do, have combined the power of their brand with our focus today is to refine and finesse our core our powerful technology and the result is a sports engine, platform funcsportsbook that is exceeding tionality and product suite to expectations, despite tough both futureproof the business UK market conditions.

“The added unique and provide our customers Virgin Bet has ambitions flavour of individual to become a top five UK sportsand their players with the brands, products ultimate experience. book and quickly realised that and presentation Innovation does not have it had to take innovative steps to come in one fell swoop, to manage its own destiny. represents our as you will see below, with Our approach enables them immediate focus” our open API technology to do this by building their Gregory Karaolis, SBTech significantly changing entire sportsbook user interthe game for operators both in the short face, including elements such as betslip and bet term and over time, enabling them to flow, using our open APIs. This method entails use advanced tools to differentiate and some initial work up front. However, they are drive their own innovation at their then free to test, optimise and see the results of own pace, across an endless array their offering, all in real-time, unbeholden to set of areas. time frames or roadmaps.

So, how are we achieving that This is just the beginning of our work with and what will be the key technology Virgin Bet, with many more areas of its UI trends for us in 2020 and beyond? moving over to using the SBTech API solution, including registration, player account pages and Differentiation much more.

This is a word that is often discussed by suppliers, but the reality New customer types is that few truly deliver. To achieve Not only have we geared up product developthis, you must both work in close partment and invested across sportsbook and platnership with brands to understand their form to become the ultimate one-stop shop, but individual needs in finite detail, and opening our APIs has also given us the opporhave robust, best-performing and highly tunity to win new types of clients and firmly flexible technology. establish ourselves as the world’s ‘go to’ sportsWe saw this early on and have book platform provider. been gradually exposing more Speed to market and differentiation in of our sports and platform crowded, competitive regulated territories APIs to give operaare both delivered by our proven technology. tors the freedom But the added unique flavour of individual to use our awardbrands, products and presentation represents winning techour immediate focus. In fact, it will soon become nology to build the future focus of many global sportsbook and key feat u re gaming operators. n

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

From the platform up Sportradar managing director of betting and gaming Warren Murphy explains why the company acquired platform provider Optima

26

ONE OF THE key foundational tools for being OPTIMAMGS. Like all of Betradar’s solutions, successful in today’s increasingly crowded and the OPTIMAMGS platform was developed using competitive sports betting market is, arguably, proprietary-owned software and systems, and your platform. can be set-up in whichever way an operator With the US and other major regions opening requires. It is therefore fully complementary their doors to regulated sports betting, there is with all Betradar’s 360-degree betting services, growing pressure on sportsbook providers to which can be easily integrated and customised find new ways to gain an edge, as this is critical to, again, suit a range of sportsbooks. for success. Market fluctuation, cross-country The benefits of integrating an already-estabregulations, technological developments and lished platform like this are plentiful. It means user trends are just some of the variables that operators don’t need to invest in resources on can affect this success. developing something that is highly complex.

Many of these aspects, however, can be Instead they can rely on a tried-and-tested soluaddressed with the right platform. Deciding tion built by sports betting technology experts which platform to use can be both a crucial yet with in-depth knowledge of both the industry complex decision-making and software systems. It also process. Whether building a means operators can rely sportsbook from scratch, or on the fact that the platform “Operators can rely integrating a new platform will remain at the forefront on the fact that the to strengthen an existing of investment and ongoing platform will remain offering, selecting the right development. As such, it is at the forefront of option can mean the differcompletely adaptive to today’s ence between a highly sucever-changing technical enviinvestment and cessful sportsbook and one ronment and the different development” that struggles to gain any requirements of sportsbooks, Warren Murphy, Sportradar attention or engagement. allowing full customisation As many operators will concede, while retaining brand look and feel. when it comes to a platform, a one-sizeFrom a market perspective, this can assist fits-all approach is not the best solulocalisation efforts, allowing operators to suption. Again, given the different variply and license across regions worldwide. With ables, sportsbooks across the world a platform that is agnostic and can be easily intewill vary in terms of size and stage grated with an existing offering, or used with any of the business life-cycle. Like all of Betradar’s products and services, this can help businesses, operators will theresportsbooks move into newly emerging markets, fore have an increasingly different like the US, more seamlessly and quickly. range of needs and goals, dependOperators can’t afford to overlook the core ing on where they are operating technology that their sportsbook operates on, in the world. A betting platform, whether it’s in developing a new offering or together with the sportsbook enhancing an existing one. Unfortunately, there offering as a whole, needs to be are too many examples of providers not deliverable to address and suit various ing on their promises by not adapting or developelements. This includes processing their platform over time – either at all, or at ing requirements, product range speed – and prioritising larger customers at the and depth of offering, effective cusexpense of others. tomer management, target audience Operators should do their research into promarketing, preference management viders to see if they can and do deliver on their and regulatory requirements. promises. When it comes to the truly important When it comes to making choices components like stability, scalability, flexibility, about a platform then, having access feature development and innovation, relying on to the latest cutting-edge innovation reputable, well-established expertise across both and service flexibility cannot be underthe industry and technology is the only way to stated. As one of the leading sports betreally know if you are choosing the best platform ting providers in the world, this was to enable your sportsbook to continue to grow, a key part of our decision to acquire both now and in the future. n

2020

SAVE THE DATE EDUCATION OCTOBER 5-8 EXPO HALL OCTOBER 6-8 SANDS EXPO, LAS VEGAS

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

Taking inspiration from financial markets Sporting Group chief executive officer Simon Trim believes bookmakers should follow the example of the finance industry to boost trading margins IT IS OFTEN overlooked how much the world of equities and hedge funds has in common with the world of sports betting. While the underlying products are different, they both rely on liquidity being generated from a marketplace of buyers and sellers trading on often intangible assets.

Delve a little deeper into how risk is managed in finance versus sports betting, however, and you’ll see this is where the similarities end and the comparison falters. At a time when headwinds in regulated betting markets are stronger than ever, it is now time for sports betting operators to learn a few lessons from how the financial markets have automated human expertise to improve volume and margins.

We all know sports betting has exploded since the early 2000s, fuelled by the channel shift from retail to online and the advent of in-play.

Most operators rode this wave of new 24/7 betting opportunities by changing their business model to offer pricing as commoditised content rather than employing expensive experts to compile proprietary prices. As a result, differentiated pricing and effective risk management became obsolete – after all, you don’t need to worry about differentiation in a world of incremental revenue fuelled by low data costs and a high propensity to avoid tax.

For legal operators, those days are gone. Regulatory pressures, enhanced CSR requirements and spiralling content costs have all contributed to the decline of gross win as a percentage of GDP since 2015 in mature markets.

So, if what we are talking about is a business model that is now failing as a result of prevailing tougher market conditions, it should be a completely rational response for operators to fix what is broken. But herein lies the problem – if you no longer have access to in-house expertise and/or you’re constrained by a B2B supplier that views pricing as content and has never traded positions on its own book, how do you even begin to improve your trading strategy?

Lifting and shifting trading operations to providers who offer MTS solutions doesn’t

help – for ‘Managed Trading Services’ read ‘Manual Trading Services’ – often geared at limiting exposure being built up on sub-optimal pricing using aggressive player restrictions and bet referrals. Not a nice user experience for your valuable customers.

There is a way out, which comes back to looking at how the financial industry has evolved quantitative trading strategies to replace discretionary manual ones (or having no strategy at all). Fortunately, in certain pockets of the sports betting supplier landscape there has been long-term investment into trading and risk expertise. This means operators can now buy a carefully researched, automated and systematic Quantitative Trading Service (QTS) solution as an alternative to stealing IP and making manual decisions made through inability, emotion and indiscipline.

The value of machine-managed portfolios of risk in the financial market now exceeds those of human-managed portfolios and is measured in trillions of dollars. What we are talking about

“In our view, commoditised pricing, manual trading services and operators that rely on them are fast approaching the end of the road” Simon Trim, Sporting Group

here is not AI – it is the computerised, systematic implementation of expert quantitative trading strategies devised by humans, and it is a service that is now available to sports betting operators.

Adopting automated risk adjusted pricing for sports betting results in the same improved margins. The integration of established econometric techniques into sports risk algorithms ensures profitable decision-making and consistently enhanced returns. It is only through objective automation of the risk management function that this can be achieved.

In our view, commoditised pricing, manual trading services and operators that rely on them are fast approaching the end of the road.

But for those that embrace price differentiation driven by quantitative trading services specifically designed to increase volume, improve efficiency in pricing and optimise returns, the future is looking bright. With enhanced margins, a differentiated pricing strategy and stronger brand position, sportsbooks can still carve out a stable path to success. n

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

Opting for a player-centric betting approach BtoBet chief executive officer Alessandro Fried believes we need to look to our players before focussing on our products THE IGAMING INDUSTRY is a global marketplace that requires operators to have a multidimensional understanding of their players.

While other entertainment industries are well ahead in the field of hyper customer-centricity, the betting industry has been left lagging behind, with scarce differentiation characterising the competition.

This comes as a surprise, given the fact that demographic shifts, coupled with technological advances and players’ demands for a more seamless integration with new smart technologies are set to reshape the industry in the short term. It will create a landscape where the more agile and forward-looking companies, which respond and deliver a 360° betting ecosystem, will take hold of a significant market share.

The industry is still characterised by operators who are focused entirely on the product, and consequently market that product to their target players, rather than the other way round.

Customer-centricity flips this equation around.

Operators need to truly understand all their target players’ traits, gain knowledge about every stage that comprises their journey, mould their business strategy around them, and develop and use technology to address all their requirements in order to potentially increase revenue.

GIQ Q4 REVIEW

Operators must understand the true extent channels, mediums and communicative means. of their customers’ interactions with the digital Such an approach presents endless opportuniworld that constitutes their daily lives. They ties to uncover patterns to differing situations must be in a position to not only harness the data in customers’ behaviour. It puts bookmakers in trail created through these interactions, but also the advantageous position of evaluating different explore new approaches to develop a customerapproaches – even from a technological perspeccentric approach. This will provide players with tive – to personalise their propositions, and the the best possible entertainend experiences they offer to ment throughout their whole your customers. betting experience.

This is what BtoBet has “Neuron 3 is all The knowledge, data and envisioned with its new about empowering technological acumen that Neuron 3 betting platform. It operators with the operators need to have at their is all about empowering opermost appropriate disposal to succeed in such a ators with the most appropriconstantly evolving industry technology to make ate technology to make them is vast. Transaction data, stand out from the competithem stand out” social data, demonstrated tion. It is about creating a betAlessandro Fried, BtoBet behavioural data, geolocating ecosystem that makes a tion data, business and player management clear separation between the core platform techtools, APIs for a seamless content and channel nology and the UX, with the operators being in a integration… The list is substantial and one can position to focus entirely on, and develop in the argue that the data feed is almost incessant. way they deem best, the player journey for their But while real-time data analysing is pivtarget customers. otal, a player-centric approach also depends on This is what Neuron 3 encapsulates at its the operators having at their disposal the core core. The freedom, flexibility and technological technology to provide a seamless experience, dexterity for operators to develop their own bettearing down the barriers of the conventional ting experience, conveyed through the gadgets omni-channel approach, and incorporating and and channels that are trending at the moment, subsequently taking advantage of new disruptive in a simple and feasible way. n 31

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

BlueRibbon co-founders Dan Fischer and Amir Askarov

Gaming SaaS – is it achievable?

BlueRibbon Software chief executive officer Amir Askarov looks for a new way to tackle complex integration problems AS WE MOVE forward into a new decade of innovation, certain buzzwords continue to dominate the industry landscape. Words like ‘big data’, ‘artificial intelligence’, ‘deep learning’ and ‘machine learning’ – concepts we are all too familiar with, stand out as the hopeful saviours to our technological future.

However, on closer inspection, and with all the breakthroughs aside, the common challenge remains the same; integration processes are complex and time consuming, coupled with costly expenses, maintenance, upgrades and system diversity.

Business embarking on digital change and transformation face frustrating obstacles and long queues as standardised protocols remain nonexistent, together with APIs’ inability to effectively function without the implementation of complex integration projects.

How can it be that in the year 2020 we are still forced to prioritise according to integration complexities? Can it be that technology is the hindrance and not the solution we assume it to be?

We do acknowledge that great strides in technological processes have indeed been seen over the last few years, with content aggregators 32

space to focus on delivering value-added deliverables to different markets rather than just manage technological tasks, and so much more. stepping in with their intentions of simplifying At BlueRibbon, integration is top priority. processes for all parties concerned and making Addressing integration challenges and leveragconcerted efforts in integration. However, it has ing APIs, we are focused on building sustainable only moved the challenge from one junction to solutions, giving operators access to our unique another, without holistically solving the probofferings without the hassle of outdated prolem. The bottom line is that the queue still exists! cesses, saving them time and valuable resources.

What if a gaming prodWhat we offer is seamless uct could work as a Service integration, and once sub(SaaS), removing the hassle scribed to our service, opera“BlueRibbon of integration? tors can run various jackpot partners simply Imagine the possibility promotions almost immedisubscribe and start whereby an operator could ately, while capturing player building marketing simply subscribe, select the gaming transactions and condesired business model of his necting them to relevant camcampaigns using choice and following a few syspaigns, pre-configured by the agnostic jackpots” tem configurations, then be operator in advance, all based Amir Askarov, BlueRibbon ready to launch new products on business insights. on his website in a short amount of time, while, BlueRibbon is the first content agnostic behind the scenes processes would be automatijackpot platform, designed to enable operator cally managed and controlled. The prospect of partners to simply subscribe and start building such an endeavour could be the game changer marketing campaigns using agnostic jackpots we have all been so eagerly anticipating. across their B2C operations. BlueRibbon gives Implemented correctly, operators will have businesses the power to offer exceptional player the ability to launch more products, more freexperiences across all verticals, while removing quently. Suppliers will be able to bring products the hassle of complex integration processes. n to market faster and operators will have the To find out more, see www.bluerbn.com

T

he Gaming Intelligence Hot 50 is a celebration of the most innovative and inspiring people working in the betting and gaming industry.

It is an annual event acclaiming the people who have made a difference to their company or to the industry during the past year, or those who are in a key position to influence events in the coming year.

Every year the selection is refreshed to avoid churning out the same old names in a predictable list of ‘the most influential’ people in the industry. The Hot 50 is about celebrating both unsung heroes working behind the scenes and chief executives calling the shots.

That said, there are some high flyers who continue to soar year after year – often in very different roles or in companies that have evolved beyond recognition.

FOX Bet chief executive officer Robin Chhabra is the most celebrated name in this year’s Hot 50. His M&A feats landed him a spot in 2018, while business development chief for Stars Group, and in 2016, while assuming the same role at William Hill.

He had a massive influence on both, guiding them through transformative mergers, joint ventures and new markets before one of those JVs landed him his current role Stateside as CEO of one of the most exciting brands in the nascent sports betting market.

Gamesys Group chief commercial officer Irina Cornides is the only other name to feature more than once. Her career has continued to thrive, while her company has undergone a transformation from Mandalay to Intertain to Jackpotjoy to JPJ and finally to Gamesys. It is a career that reflects the changing face of the industry. Few have been as sustainable.

The past year was one of upheaval, the mergers that engulfed The Stars Group and Jackpot-

joy are just two factors – the other great theme was regulation. As the industry comes under closer scrutiny in more and more jurisdictions, the Hot 50 stars of regulation and responsible gambling will become more influential.

These are the two forces shaping the industry. We also feature more stars from the lottery industry than ever before. With the betting and gaming industry under such scrutiny, the trusted brands of former monopolies and existing monopolies become more and more influential. It is no coincidence that suppliers are clamouring to become members of the World Lottery Association.

Thank you to our judges for your assistance – many former Hot 50 winners among them. You have helped to compile a Hot 50 for 2020, which takes in more roles than ever before. From technologists, marketers, lawyers and accountants, to lobbyists, RG professionals, regulators and sales people. They are all stars. And our judges are too. Congratulations to all.

Judging panel Ivor Jones

Jeff Ifrah

Eric Hollreiser

Nik Robinson

Paul Peinado

Jim Kennedy

Equity analyst Peel Hunt

Founding partner Ifrah Law

Founder A.C.E. Hollreiser

CEO Big Time Gaming

Vice-Chairman Scientific Games

Andrew Bulloss

Leigh Nissim

Karolina Pelc

Gavin Hamilton

Senior operations manager World Lottery Association

Head of global gaming practice Odgers Berndtson

CEO Future Anthem

Founder Basic Strategy

CEO Red Tiger Gaming

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Christina Thakor Rankin Co-founder All-In Diversity Project

THE GAMING INTELLIGENCE

2020

HOT 50 2020

GIQ Q4 REVIEW

Johnny Aitken Pointsbet USA

Alberto Eljarrat Sportium

Robert Andersson Enlabs

Trude Felde The Norwegian Gaming and Foundation Authority

Amir Askarov BlueRibbon Software Neil Banbury Kindred Group Elena Barber Kindred Group Bryan Blake Hexopay Beth Breshnahan DC Lottery Tim Bucher Scientific Games

Lee Fenton Gamesys Group Eric Foote Pointsbet Christian Genetski FanDuel Ravi Haldahalli Atlantic Lottery

Jo Button Camelot

Todd Haushalter Evolution Gaming

Robin Chhabra FOXBET

Phil Horne SG Gaming

Robert Chvátal Sazka Group

Ian Ince Playtech

Andrew Clucas Microgaming

Peter Jackson Flutter

Oren Cohen Schwartz Skywind Group

Jon Kaplowitz Penn National

Irina Cornides Gamesys Group James Coxon SB Tech Stanton Dodge DraftKings Simo Dragicevic BetBuddy (Playtech) Michael Dugher Betting & Gaming Council

Carsten Koerl Sportradar Michael Leadbeater GVC Group Conor Leavey The Stars Group Jason Lisiecki IWG Chris Looney Red Tiger Gaming

Laura Nash The Stars Group John O’Reilly Rank Group Stéphane Pallez FDJ Jason Park DraftKings Kevin Reid 1X2 Network Israel Rosenthal MuchBetter Alex Sefton Bet365 Liz Siver NeoPollard Interactive Bjorn Sjoberg Evolution Gaming Darren Small Sportradar Jesper Søgaard Better Collective Drew Svitko Pennsylvania Lottery Keith Whyte National Council on Problem Gambling Damian Xuereb Kambi Bret Yunker Eldorado Resorts

Mikel López de Torre JDigital

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2020 Robert Andersson, Enlabs

Amir Askarov, BlueRibbon

Robert Andersson

Amir Askarov

Neil Banbury

Chief executive officer Enlabs

Co-founder & chief executive officer BlueRibbon Software

General manager UK Kindred Group

After several years in the doldrums, 2019 was a breakthrough year for Enlabs, the fast-growing iGaming operator previously known as Redbet and then Nordic Leisure. Andersson took over as CEO just over a year ago to lead the turnaround. So far the results have been impressive, with Enlabs enjoying its best ever quarter in Q3 2019 as revenue hit €10m for the first time.

The former Catena Media CEO will be hoping his passion and experience will drive Enlabs to further glory as one of the leading operators in the Nordic and Baltic regions.

BlueRibbon Software has quickly emerged as the leading jackpot marketing supplier in its short history, thanks to the vision and acumen of its co-founder and CEO Amir Askarov.

Askarov has landed a number of tier-one signings in 2019, including Mr Green, EveryMatrix and Scientific Games. He also oversaw the company securing its UK and Malta licences.

Having spent nine years at Playtech in key management roles, Askarov knows what it takes to drive a business forward and has positioned BlueRibbon for a spectacular 2020.

Johnny Aitken Chief executive officer PointsBet USA 2019 was a transformative year for the Australian-based sports betting operator, with a successful IPO in Sydney and entrance into the potentially lucrative US betting market. Aitken has been essential to this. He joined PointsBet as chief operating officer and was promoted to CEO of PointsBet USA just five months later. Under his charge, PointsBet has come out of nowhere to become one of the major operators in the fledgling US market, with market access deals in New Jersey, Colorado, Iowa, Illinois and Michigan. Aitken will be crucial to PointsBet’s further expansion Stateside.

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Neil Banbury is approaching the ten-year mark at Kindred Group and has impressively climbed the ranks to become general manager of one of the operator’s key markets. While the operator has struggled with headwinds in Sweden and the Netherlands, the UK has been a real plus point for Kindred recently. Banbury has been at the heart of all this, whether through unique sponsorship deals with the likes of record-breaking England soccer star Wayne Rooney or through Kindred’s responsible gambling commitments in the UK. He is the kind of understated superstar the Hot 50 was invented to celebrate.

Bryan Blake Chief executive officer and Founder Hexopay With over 15 years banking and payment industry experience behind him, few doubted that Bryan Blake would make a success of Hexopay, but few could have predicted the meteoric rise of the payments and risk management company.

Already profitable just two years after its inception, Blake has been at the forefront of attracting industry big-hitters like Kindred Group, Lottoland and William Hill. With plans to double its staff by early 2020 and the feel-good factor Blake has instilled in the company, expect its rise to keep continuing.

Elena Barber Chief marketing officer Kindred Group Elena Barber has risen through the ranks to assume her position on the executive management team at the beginning of last year. Having headed affiliates, digital advertising, performance marketing and central brand marketing, her experience is perfectly formed. She will now have to navigate a landscape where media and political pressure are forcing operators to rein in their advertising; and where bonusing is becoming more contentious. Barber has the versatility and nous to ensure Kindred is perfectly equipped to thrive in this changed landscape.

Tim Bucher Chief product officer Scientific Games

Elena Barber, Kindred

Tim Bucher is exactly the sort of product genius that Silicon Valley specialises in churning out. After spells at Microsoft, Apple, Dell and a string of successful startups, Bucher has turned his attention to gaming, where he is continuing to display the innovation that has served his career so well. Insiders say Bucher reimagined innovation at the company. He has launched products such as SG Connect, SG Game Service and, most excitingly, SG Vision.

The latter could revolutionise the industry with vision-recognition technology that could not only overhaul the player experience but also introduce a guarantee of responsible gambling that brings a smile to the face of any regulator.

Bucher’s impact could be monumental.

Jo Button Head of digital Camelot

Jo Button, Camelot

GIQ Q4 REVIEW

Digital sales at UK National Lottery operator Camelot soared past the £1bn mark during the first half of its 2019/20 financial year.

While Jo Button can’t take all the credit, she has led the team that has delivered growth of 40 per cent to Camelot’s online unit in the past year. Her phenomenal success rate is driven by a devotion to innovation that could see that figure repeated year after year. Every lottery could use a digital marketing superstar like Jo Button.

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2020 Robin Chhabra

Robert Chvátal

Chief executive officer FOX Bet

Chief executive officer SAZKA Group

Robin Chhabra has appeared in the Gaming Intelligence Hot 50 in both of his previous roles, as business development chief at Stars Group and at William Hill.

His M&A feats at both are legendary but he now has his biggest challenge as CEO of newly-launched US sports betting business FOX Bet. After acquiring Sky Betting & Gaming, Chhabra saw the potential to export the model to the US. In snaring FOX Sports to provide brand and other marketing assets, Chhabra almost guaranteed its success.

Now we will see how Chhabra copes as an operator. As one of the smartest and hardest-working men in the business, you can be sure he will make a success of FOX Bet.

In his seven years in charge, Robert Chvátal has transformed SAZKA Group into the fastest-growing lottery operator in Europe, with a wide-ranging portfolio of retail and online operations across Austria, Cyprus, the Czech Republic, Greece and Italy. Chvátal believes that teamwork, a focus on innovation, and speed are what is needed to succeed in the lottery and gaming sector. Sazka Group’s selection as the GIA Lottery Operator of the Year 2020 proves that he is doing things the right way.

Andrew Clucas Chief operating officer Microgaming Since taking charge of operations in 2018 Andrew Clucas has played a pivotal role in guiding the strategic direction of the innovative gaming supplier. He has overseen the launch of Microgaming’s independent studios strategy and quickly built up a roster of ten unique independent studios, which are creating content exclusively for Microgaming customers. They have delivered more than 40 exclusive games in the last 12 months.

Clucas has also overseen the launch of a new content team to develop and drive content strategy. The team is gathering ideas from across the company to ensure Microgaming remains at the cutting edge of game development.

With so many new ideas and initiatives, it would be easy to lose sight of the operation of the core business but Clucas has steered the casino vertical to double digit growth, through his unerring ability to retain focus and inspire others.

Irina Cornides Chief commercial officer Gamesys Group Irina Cornides has held numerous senior management roles as Intertain has transformed itself into Jackpotjoy G r oup a nd now Gamesys, where she has assumed the 38

role of chief commercial officer. She features in the Hot 50 for the second time (after making the list in 2016 when chief revenue officer of Intertain), Cornides is one of the few remaining survivors from those halcyon days. Amid all the asset yo-yoing between Gamesys and Intertain/Jackpotjoy/JPJ Group, Cornides has been honing her skills as CEO of the company’s largest division, Jackpotjoy, and has now become a formidable component of Gamesys Group’s new management team as the company undergoes a key period of integration and expansion.

James Coxon Vice president of commercial SBTech James Coxon has made a huge impact at SBTech since joining as business development director from Scientific Games in early 2019.

He was swiftly promoted to VP of commercial after just six months and given wider responsibility for all of SBTech’s 50-plus global partners and for the company’s main revenue line.

Bringing new ways of working and transforming the sales team, Coxon was instrumental in winning highvalue government contracts and secured a historic agreement with BetGenius that gives customers access to UK football rights.

Coxon has led a complete overhaul of the way SBTech executes its commercial strategy, culminating in one of its most sucJames Coxon, cessful years to date.

SBTech

ACQUISITIONS

Size matters Consolidation continues to be one of the driving factors for the betting and gaming industry. And the deal of the year in the online space was Flutter Entertainment’s acquisition of The Stars Group.

The deal creates a £10bn market cap company. It will have more than 13 million customers, revenue of £3.8bn and EBITDA of £1.14bn. It will bring together market leaders such as Paddy Power, Betfair, PokerStars, Adjarabet and FanDuel, with insurgents such as Sky Bet, FOX Bet and SportsBet.

Peter Jackson Chief executive officer Flutter

GIQ Q4 REVIEW

The audacious deal wins Flutter chief executive officer Peter Jackson a place in the Hot 50. Considering the fact that much of his tenure has been spent trying to fix the teething problems associated with Paddy Power’s combination with Betfair, the acquisition of Stars Group is something of a gamble. However, Jackson has proved himself a serial buyer of companies, with The Stars Group the cherry on the cake, following smaller acquisitions of FanDuel in the US and Adjarabet in Georgia.

The Stars Group is itself still trying to digest Sky Betting & Gaming, which it acquired last year for $4.7bn. But GVC Holdings has shown it can be done. Its acquisition of LadbrokesCoral – shortly after acquiring bwin and shortly after Ladbrokes merged with Coral – has set a precedent. Jackson will need an equally slick team in place to make it work.

The second most notable online gaming deal of the year belonged to Gamesys, which was acquired by JPJ Group for £490m, just four years after JPJ (in its previous guise as Intertain) bought the Jackpotjoy, Starspins and Botemania brands for £750m from... Gamesys!

Not only did Gamesys chief executive officer Lee Fenton help engineer these fantastic double deals but he also ended up scooping the top job at the

combined company, which was renamed... Gamesys!

It takes a special kind of genius to sell your company to the same buyer twice and to also win the contract to supply the acquirer in the time in between. But joking aside, Fenton and his team have proved themselves one of the most adept operational outfits of recent years. It celebrated the union in its first post-completion results announcement with a 23 per cent increase in revenue to £92.4m for the third quarter of 2019. Fenton is a canny operator and one can expect much more from him in the M&A market in the coming years.

While the Goliaths of UK online gaming have been busy, their land-based counterparts in the US have also been turning to M&A. Eldorado Resorts transformed itself from regional casino player to gaming royalty with its $8.58 billion acquisition of Caesars Entertainment.

Chief financial officer Bret Yunker joined Eldorado from JP Morgan in February and was immediately thrown into one of the most complex deals the industry has seen. Twenty years in the banking industry with clients working across the gaming, lottery and online sector allowed him to hit the ground running.

The Caesars acquisition did not come out of the blue. It followed the acquisitions of Isle of Capri and Tropicana. With William

Jason Park,

Chief financial officer, DraftKings

Lee Fenton Chief executive officer Gamesys

Stanton Dodge Chief legal officer DraftKings

Hill recently in talks with old Caesars, and chief executive officer Tom Reeg talking about spinning off the online gaming operation, you can expect Yunker to be as important a figure in 2019 as he was in 2020.

On the back of its daily fantasy sports operation, DraftKings has raced to the front of the fledgling sports betting market. Its speedy rollout and partnerships have been shaped in part by chief legal officer Stanton Dodge, who will also have had a major influence on the company’s acquisition of sports betting supplier SBTech.

Described as a “super strong general counsel” by

one of our judges, Dodge will have been pivotal in unpicking the company’s contract with Kambi to make way for SBTech.

DraftKings chief financial officer Jason Park also wins a place in the Hot 50. The former Bain Capital partner joined the company in June and set about structuring the deal to acquire SBTech and list on Nasdaq. The deal involved a merger with a special acquisition vehicle led by former MGM chief executive Harry Sloan, which then acquired SBTech. DraftKings’ ambition is almost limitless.

Park and Dodge will be major assets in fulfilling that ambition.

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2020 Alberto Eljarrat

Christian Genetski

Chief executive officer Sportium

Chief legal officer and chief commercial officer FanDuel

Alberto Eljarrat is one of the most prominent figures in the Spanish industry and his attitude towards innovation, responsibility and transparency has driven Sportium to continually operate as one of the leading sportsbooks in the country. Eljarrat will need to ensure a smooth transition after GVC Group sold its 50 per cent share in the business to joint venture partner Cirsa. GVC will continue to operate as a B2B supplier but the new relationship will need to be managed delicately. Eljarrat can be relied on to lead the business into a new era.

Eric Foote US chief commercial officer PointsBet Attracting someone of the calibre of Eric Foote was something of a coup for PointsBet. His 20 years’ experience in the US sports media landscape and expertise in building strategic partnerships will prove invaluable as the operator looks to reinforce its presence in the US market.

Having only just begun his new role, 2020 will be a very big year for Foote, and for PointsBet.

Christian Genetski is the exemplar for any aspiring lawyer seeking to double up as a business leader. Genetski is a fantastic lawyer and as chief commercial officer he has overseen the metamorphosis of his company from daily fantasy sports operator into sports betting and DFS market leader.

In New Jersey alone, FanDuel has raced to become market leader – way ahead of its nearest rival, DraftKings. It has also rolled out sports betting operations in Pennsylvania, Indiana and West Virginia. It will not be long before you see it elsewhere, after the company signed a deal with The Cordish Companies group, which has venues in Pennsylvania, Maryland, Washington DC and elsewhere. There could be nobody better to oversee this aggressive rollout than Christian Genetski.

Ravi Haldahalli Director of architecture and development Atlantic Lottery Corp In his eight years with the company, Ravi Haldahalli has led the effort to modernise Atlantic Lottery’s systems technology, with a focus on integrating the consumer’s retail and digital experience. He is the man responsible for architecting a complex, multi-stage evolution of the lottery’s technology systems to a fully-integrated ecosystem. Introducing new technology such as QR codes and mobile apps to the lottery, he continues to push forward changes in digital customer engagement, in retail, online and via mobile for one of North America’s most proactive lotteries.

Todd Haushalter Chief product officer Evolution Gaming Todd Haushalter has been described as a genius. While Evolution excels in almost everything it does, it would not be an understatement to declare that it would not be where it is without Haushalter’s product brain. Haushalter brings the innovation and

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eye for player-friendly solutions that guarantees success. His brilliance ensures Evolution stays ahead of competitors with deeper pockets.

Put simply, Haushalter is the superstar of live casino.

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E VOLV E YOUR BE T TING ENVIRONM ENT A ROUN D T H E P L AY ER THROUGH ALL CH ANNELS

2020 RESPONSIBLE GAMBLING

Growing up responsibly There are some among us who believe the industry’s future will be shaped by how it responds to the responsible gambling challenge. The Hot 50 reflects this trend, with lawyers, regulators and industry advocates featuring heavily.

The role of the in-house lawyer has changed enormously over the past few years, as the best of them respond proactively to the responsible gambling challenges set for them by regulators and the attendant PR pressures of media and politicians.

Nobody has responded better than GVC Group legal director Michael Leadbeater, who arrived from William Hill in September 2018 and has ushered his company through a period of unprecedented growth and change. Our judges singled Leadbeater out as one of the industry’s leading in-house counsels.

Performing a similar task for his company is Playtech’s head of regulatory affairs and compliance, Ian Ince. Ince is a spectacular advocate for his company and the wider industry. Not afraid to speak truth to power, Ince has been a strong voice in the industry’s response to a series of challenges laid down by the UK Gambling Commission.

In doing so, he has radically reformed Playtech’s approach to responsible gambling. The world’s leading gaming software supplier took a big plunge when it acquired responsible gambling tool BetBuddy two years ago. Its CEO Simo Dragicevic has blossomed at the larger company, joining up product teams, Ince’s compliance team and his contacts in academia to help make Playtech’s products safer for players.

Dragicevic and fellow Hot 50 winner Phil Horne, chief executive officer at SG Gaming, have led the industry’s response to the UK Gambling Commission’s challenge to create an Industry Code for Games Design. The pair have marshalled efforts from Blueprint Gaming, Gamesys, Microgaming and more, and are expected to deliver the code by the end of March. It is quite some challenge but Dragicevic and Horne have embraced the test with gusto – and have reportedly impressed the regulator with their zest and innovation.

The Industry Code was first mooted by the Remote Gambling Authority (RGA), which embraced its land-based brothers and became the Betting and Gaming Council (BGC) during the past 12 months.

The BGC has recruited its first chief executive in the form of Michael Dugher, who joins from UK Music, where he has been chief executive since stepping down as a Labour party MP in 2017. Dugher was shadow secretary of state for culture, media and sport (the government department responsible for gambling) and is a close associate of Labour’s most vociferous antigambling campaigner Tom Watson.

That relationship might well be tested. Watson left the House of Commons during 2019 but vowed to continue to fight for gambling reform.

Trude Felde, Senior Dugher will have to adviser, Norwegian Gaming recruit a team with the and Foundation Authority

wit and imagination to lift the industry’s representation to a whole new level, as the new UK government ponders how it will fulfil its election manifesto promise to revisit the Gambling Act. Dugher could take a leaf out of the book of Mikel López de Torre, chairman of Spanish industry group Jdigital. López de Torre has played a crucial role in uniting the industry in Spain. Sensing the political mood, he introduced a responsible gambling and betting advertisement code in the country before the authorities enforced one.

While the UK Gambling Commission has raised the bar with its approach to responsible gambling, it is not a UK-specific phenomenon. The National Council on Problem Gambling executive director Keith Whyte is an unsung hero, pushing the responsible gambling agenda in the US further than anybody has done in the past.

As the fervour around sports betting increases, his role is going to become more and more important.

Washington DC’s Office of Lottery and Gaming opened its sports betting licensing process in December with an innovative fast-track procedure for those already licensed in certain other jurisdictions. DC executive director Beth Bresnahan is one of the youngest and smartest regulators working in the US. The former executive director of the Massachusetts State Lottery also brings a wealth of experience from outside the industry. Her communications and media skills mean she is likely to become one of the industry’s most prominent figures.

Equally noteable is the current IAGR president and senior adviser of The Norwegian Gaming and Foundation Authority, Trude Felde, who will be an important figure as regulators increasingly look to cooperate across national boundaries.

Michael Leadbeater Legal director GVC Group

Simo Dragicevic Chief executive officer BetBuddy

Michael Dugher Chief executive officer BGC

Mikel López de Torre Chairman Jdigital

Beth Bresnahan Executive director DC Lottery

Carsten Koerl Chief executive officer Sportradar The fact that Carsten Koerl has not featured in the Hot 50 before is remarkable, but it speaks volumes about the understated brilliance of the Sportradar founder.

Since launching the company in 2001, he has driven a growth curve that is almost unrivalled – from tech-focused startup to global leader in sports data and audiovisual content, as well as sports integrity.

Few founder CEOs have remained in their post for so long and overseen such remarkable growth.

Jon Kaplowitz Head of Penn Interactive Ventures Penn National In the rush to market in the US, few have approached the terrain with the careful strategic planning applied by Jon Kaplowitz and his colleagues at Penn National.

They have devised a national strategy that takes in all of its 41 properties in 19 states. Furthermore, Kaplowitz has cut deals with a mixture of market leaders and insurgents that balance the present needs with a desire for future innovation.

While Kaplowitz’s strategic planning is second to none, the business has also managed to launch retail sportsbooks in ten locations in partnership with William Hill, while launching under its own name in Iowa.

Kaplowitz will ensure Penn continues to make smart decisions.

Conor Leavey Head of casino product The Stars Group The Stars Group has not been content with building the world’s biggest online casino in terms of revenue, it also wants to build the best.

It has been rebuilding its casino platform from the ground up and Conor Leavey has been working at the sharp end, reshaping the product to make it stand out from the crowd. Leavey is leading the team doing smart work around personalisation and building a differentiated product. It is early days but the intention is to move away from the standard grid of tiles, towards a casino experience that justifies the use of the word ‘experience’. Leavey’s own experience suggests he is exactly the right person to pull it off.

Jason Lisiecki VP North America IWG Jason Lisiecki’s impact on IWG since joining from William Hill in 2018 has been huge.

He has brought experience at Michigan Lottery to help clients launch schemes such as the Atlantic Lottery’s (ALC) Cash Buster ticket, which encourages cross-promotion between retail and online; a weekly game launched at Pennsylvania Lottery; and a new Lottery Instants tab at BCLC. He has launched a Strategic Insights unit, which has helped clients such as ALC expand iLottery sales by 52 per cent. Lisiecki is driving the expansion of iLottery in North America in a manner few can match.

GIQ Q4 REVIEW

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2020 Chris Looney Commercial director Red Tiger Gaming After nine years at Microgaming, Chris Looney joined the fastest-growing supplier in online gaming. Red Tiger Gaming has continued its extraordinary growth curve with Looney pulling in the deals that culminated in the supplier’s sale to NetEnt. His commercial nous is second to none.

His customer care is legendary. Red Tiger’s commercial fortunes lie in one of the safest hands in the industry.

Laura Nash

John O’Reilly

Stéphane Pallez

Director of performance marketing Stars Group

Chief executive officer Rank Group

Chairwoman and chief executive officer FDJ

Laura Nash is a ten-year veteran at Stars, where she worked in business intelligence before transitioning to marketing two years ago.

She brings strong analytics and expertise in maths and psychology to Stars’ performance marketing efforts across the verticals. The Flutter takeover of Stars makes any predictions fraught with difficulty, but if she continues her current trajectory, Nash is a CMO in the making.

John O’Reilly is one of the most experienced men on this list. He has a CV that takes in most of the UK’s leading operators and he continues to make management look like a simple exercise.

He has overseen a year that has witnessed the operator boost its share price by almost 90 per cent. This has been on the back of a transformation programme that has been implemented efficiently and has paid off quicker than might have been expected.

While costs have needed to be cut, he has handled that sensitively while implementing new technology with a focus on customer experience. He has shown a willingness to invest in new machines and property refurbishment. At Rank, O’Reilly has performed a tricky balancing act with some panache.

Since taking over as CEO in 2014, Stéphane Pallez has driven FDJ’s digital transformation as part of the company’s FDJ 2020 strategic plan. This culminated in the privatisation of the French lottery and sports betting operator last November, beginning a new page in the history of the company. Pallez has already proved she can drive change and inspire growth. Her next challenge will be to keep its new shareholders happy, and reinforce FDJ’s position in its home market, while driving its international expansion.

Kevin Reid Chief commercial officer 1X2 Network The past 12 months have seen 1X2 Network become one of the most in-demand game developers in the world, with its content now live across thousands of operator sites. Spearheading that rise is Kevin Reid. The executive has led 1X2 Network’s entry into core regulated markets and built a hugely talented commercial team during his seven-plus years with the company, fostering partnerships with the likes of bet365 and BetVictor.

Taking on more responsibilities than just CCO, Reid has also been responsible for bolstering 1X2Networks own aggregation

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Liz Siver Chief executive officer NeoPollard Interactive Liz Siver joined NeoPollard Interactive (NPi) more than two years ago after spending most of her career at Microsoft, leading a team which delivered IT services to state and local government customers across the US. As general manager of NPi, the iLottery joint venture between NeoGames and Pollard Banknote, she has used that experience to help the company expand its solutions to state lotteries in Michigan, New Hampshire and Virginia, among others. In the process, she has transformed NeoPollard into one of the leading North American iLottery suppliers.

platform. With Reid’s desire and commitment leading the way, 1X2 Network looks set to continue on its impressive growth trajectory.

Israel Rosenthal Chief executive officer MuchBetter Israel Rosenthal worked his way up from customer support to COO during his long period at former PokerStars owner Rational Group. His time at the helm of MuchBetter is evolving at a much faster rate.

Rosenthal can reasonably claim to have launched the fastest-growing payments company in iGaming. He might have expected to secure a deal with The Stars Group but integrations with 888, Pinnacle, Casumo, Lottoland and Interwetten have shown that was not purely down to old contacts. Rosenthal has developed an innovative solution that operators and customers love.

Alex Sefton Head of software product development – Gaming & Content bet365 Alex Sefton is one of bet365’s many unsung heroes. He is regarded by some as the guy who gets things done at bet365. Whether that is launching in new markets such as Estonia, Greece or Mexico, or updating products in Denmark and Spain, it is always accomplished with GIQ Q4 REVIEW

Oren Cohen Schwartz, Skywind

a skill that continues to drive revenue. On top of all that he has also been responsible for the development and deployment of an entirely new gaming platform. As such, he plays a key part in the strategic development of the world’s leading sportsbook operator.

Furthermore, he is a great advocate of collaboration across the whole industry and was the driving force behind solutions for the updated Apple App Store regulations. Sefton is the kind of dynamic and collaborative force that every team needs.

Oren Cohen Shwartz Managing director Skywind Group In the space of just 18 months, Oren Cohen Shwartz has revolutionised Skywind Group and transformed the company into a supplier of premium content to tier-one operators in regulated markets.

During 2019, Skywind Group secured six licences – in the UK, Malta, Spain, Romania, Alderney and Gibraltar. It had its games certified and launched in Italy, Denmark, Belgium, Sweden and Portugal. It has struck deals with the likes of bwin.party, The Stars Group, Kindred, Snai, Ladbrokes, Coral, Gala, Superbet, Caliente, VideoSlots, Sportingbet, Eurobet, Hero Gaming, The Sun and more.

Shwartz inspired his team to develop 70 games during 2019. He is travelling at a phenomenal pace that few – if any – can match.

Björn Sjöberg Head of key accounts Evolution Gaming Since being promoted to head of key accounts 18 months ago, Björn Sjöberg has excelled.

He handles most of Evolution Gaming’s tier-one customers and is simply amazing at it. He knows the businesses of his customers inside out and is always equipped with new ideas and data to back up his r e c om mend at ion s .

Whether he is addi ng more t ables or changing limits, his advice is invariably spot on.

Clients love him and so do his bosses.

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2020 Jesper Søgaard Chief executive officer Better Collective Better Collective was founded more than 15 years ago, but its meteoric growth in the last few years has seen the company emerge as the leading publicly-listed iGaming affiliate. Co-founder Jesper Søgaard has been there every step of the way as CEO. He led the company through the acquisition of seven companies in 2017, managed its Stockholm IPO the following year, and helmed its entrance into the US market in 2019. While other listed affiliates have floundered, Better Collective has thrived and, for that, Søgaard deserves immense credit.

Drew Svitko Executive director Pennsylvania Lottery

Darren Small MD Trading Services Sportradar Darren Small manages Sportradar’s 400person team of trading staff across four continents and eight countries. He has been instrumental in establishing and managing Sportradar’s bespoke, market-leading risk management and trading solution, Managed Trading Services (MTS) since it launched in 2014 and in 2019 added 45 new clients to a list that now numbers over 150. He has managed the product’s growth in tandem with demands from the mushrooming client base, adding pre-match, live and premium cricket during the last year. He is renowned for his commitment to his team across the world and is a key player in Sportradar’s continuing success story.

Drew Svitko began his career in the lottery industry nearly 20 years ago and is now leading one of the most innovative and top-performing lotteries in the US. He is a visionary leader, launching one of the country’s best performing iLotteries in May 2018. It has since gone on to generate $642m in sales.

Svitko has positioned the Pennsylvania Lottery as an innovation leader. It has launched a series of new products and new categories and pioneered digital technologies, many of which were firsts for the US lottery industry. Pennsylvania can expect to stay ahead of the pack with the inspirational Svitko in charge.

Damian Xuereb Global sales director Kambi Damian Xuereb has ensured that Kambi has had a far bigger impact on the US market than many would have expected. His masterstroke was signing a deal with DraftKings but he has followed that with a potentially huge deal with Penn National and others with the likes of Ohiobased casino operator Jack Entertainment and New York-based Seneca Gaming Corporation.

He will hope the latter deals pay off after DraftKings acquired rival supplier SBTech and promised to unwind the Kambi deal. Xuereb will not let that hitch get in his way. With Xuereb at the helm, you can expect Kambi to be operating in every US jurisdiction that matters. n

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World World Gaming Executive Summit 2020

PEOPLE FIVE IN THE NEWS Executives on the moves and issues in their inboxes Björn Krantz joins Yggdrasil

UK industry association gets new CEO

FORMER NETENT CHIEF operating officer Björn Krantz has been appointed to lead Yggdrasil’s newly formed B2B publishing business, which is expected to become a key growth driver for the supplier as it expands its global footprint to become a content enabler for multiple global partners, including operators, suppliers and studios. Yggdrasil has spent months carefully planning its new strategy, basing it on the solid foundations the supplier has built up over several years, and adding several highly innovative layers that will enable partners around the world to expand their B2B operations. In Krantz, the company has a proven executive who spent more than ten years with NetEnt, most recently as chief operating officer and prior to that as managing director of NetEnt Americas.

Michael Dugher doesn’t begin his new role as CEO of the Betting and Gaming Council (BGC) until spring, but it is clear he will have his hands full, as operators and suppliers face up to a UK market which has become burdened by regulations and increased costs. He will be the first chief executive of the new UK gambling industry association, which replaces the Remote Gambling Association and Association of British Bookmakers. As a former Labour Party MP and close associate of anti-gambling crusader Tom Watson, his relationships with both will come under the microscope.

GIQ Q4 REVIEW

News UK brings in Simon Collins A S T H E N E W LY app oi nte d m a n a g i n g director of betting and gaming, Simon Collins will bring a wealth of experience as News UK embarks on the next phase of growth around its gaming brands, including Dream Team fantasy football league, Sun Bingo and Sun Racing. There aren’t many people in the online gaming market more experienced than Collins, who co-founded online bingo business Cashcade (now part of GVC) and Gaming Realms.

The company’s gaming portfolio has endured a rocky period, with Sun Bingo moving from Gamesys to Playtech, and Sun Bets closing down just 18 months after launching. Rupert Murdoch’s UK operation clearly still has ambitions for the sector but the appointment of such an experienced bingo executive might suggest it has washed its hands of sports betting. But don’t bet against Collins springing a surprise.

CFO exodus highlights brain drain

GiG names permanent CEO RICHARD BROWN HAS served as acting CEO of Gaming Innovation Group (GiG) since September, when the board decided to replace former CEO and co-founder Robin Reed. Having previously served as chief operating officer, Brown impressed the board so much that he has now been given the keys to the chief executive office on a permanent basis. GiG has come a long way in a short period of time.

IN THIS ISSUE 49 Yggdrasil, News UK, GiG and more 50 Embracing neurodiversity 52 A headhunter’s view

Brown’s appointment was accompanied by the announcement of a strategic review to “identify value-creating opportunities, reduce complexity and improve efficiency within the business”. That normally means a sale.

IN JUST ONE week, the industry lost two CFOs. The longest-serving CFO in the sector, Aviad Kobrine, will bring down the curtain on 15 years at 888 Holdings, having shepherded the business through several periods of tumultuous change. The announcement of Kobrine’s departure came the day after William Hill CFO Ruth Prior resigned from the bookmaker to become CFO of materials testing service Elements Materials Technology.

Kindred Group is also on the hunt for a new CFO after Albin de Beauregard resigned to pursue new challenges outside of the industry. That is a lot of talent lost. Are executives seeking an easier life away from the pressures of r e g u l a tion? T he on ly wi nners here are headhunters.

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P EO P L E

NEURODIVERSITY

Embracing the

Spectrum The betting and gaming industry should take inspiration from the financial trading world and foster neurodiversity to bolster its recruitment strategies OPINION Christina Thakor-Rankin FOR AN INDUSTRY that prides itself on being an early adopter of trends and technology in the constant search for the ‘next big thing’, the betting and gambling sector can be surprisingly stuck in its ways. While it is happy to ‘think differently’ and challenge established perceptions and practices when considering products and players, it seems oddly resistant to taking the same approach to people.

Take the example of sports betting and trading. Technology and internationalisation has seen the traditional sportsbook transformed. Once, it could be considered a battle of wits between bookie and punter (or in the case of exchanges ‘would-be bookie’ and punter) on local events, where both sides considered themselves to be expert. Now, it is something closer to a game of cat and mouse, with each side racing to identify pockets of value or vulnerability before the other. They get to choose from a wealth of global betting opportunities powered by data and price feed providers, monitored increasingly by automated 50

trading systems. This has led to a change in the traditional role of the trader.

Traditionally, one of the more glamorous and soughtafter jobs in sports betting, the trader is a confident and strongly opinionated individual (usually male) – a master of their craft, using information and intuition to manage markets and the company’s fortunes – often able to distil the day’s performance down to a few individual bets or bettors.

This is no longer the case. With so many markets, the definition of bettor has now extended to include – among the genuine punters – arbitrages, insider traders, problem gamblers, money launderers, match-fixers and those looking to exploit technology and circumstances, such as time lags. The role of the trader today is something closer to that of data analyst, with the hands-on attention of old replaced by identifying patterns, trends, anomalies and exceptions – liability is increasingly managed at a higher level in accordance with global thresholds.

This has been the case for a while now, yet for some reason, so many companies still hang on to the traditional image of the trader when recruiting. In doing so they not only limit themselves to a dwindling pool of pos-

Perhaps now would be a good time for the industry to apply the same level of diversity of thought to its people as it has to its products

P EO P L E

NEURODIVERSITY

sible candidates, but as the sector continues to grow (to the US, Latin America, Africa and Asia), supply and demand means that they invariably find themselves paying over the odds for a role that could easily be done just as well – perhaps even better and possibly at a lower rate – by others more suited to today’s trading challenges.

This is not limited to trading. Driven by a combination of technology, transaction volumes, regulation and greater customer awareness, the job descriptions and skills requirements for roles relating to responsible play, payments, fraud and security have also GIQ Q4 REVIEW

changed, with an emphasis on monitoring and identification of issues much earlier on in the process. In the case of fraud and security, the need for proactivity will become even more urgent as the European Union’s sixth antimoney laundering directive brings in new offences, accountabilities, penalties and crimes, which apply to the whole of the organisation.

With this in mind, perhaps now would be a good time for the industry to apply the same level of diversity of thought to its people as it has to its products. A good place to start might be to take a leaf out of the book of its near cousin, the financial trading sector. It is a sector facing exactly the same challenges of a limited talent pool and increased demand.

Faced with similar challenges of volume, regulation and integrity issues, as a result of operating in an international marketplace with a shortage of traders, big names such as JPMorgan Chase have found that one of the solutions lies in redefining their traditional perception of a trader.

It all started in February 2019 when a chap called Bill Gross, nicknamed the ‘Bond King’ for his success as co-founder and portfolio manager at PIMCO, revealed he had been diagnosed with autism spectrum disorder. The subsequent suggestion was that the characteristics commonly associated with high-functioning autism, such as Asperger’s syndrome, may have been an advantage in his chosen career. In fact, anecdotal reports suggest that some of Silicon Valley’s most successful professionals, Bill Gates included, may have a high proportion of tendencies that lie within the Asperger’s range.

These traits include: higher than average levels of intelligence; obsessive collection and categorisation of facts; logic-based (objective) reasoning; identifying and finding comfort in patterns (and often being discomfited by exceptions and anomalies); and an acute, (obsessive) focus and attention to detail, driven by fear of missing something. It seems a no-brainer. Individuals that fall within the spectrum are natural data analytic engines and perfect candidates for roles such as trader, fraud analyst or responsible play specialist – so why is the industry not reaching out to them?

Normally, it goes back to the perception of what the ideal candidate looks like. Alongside the core skills, most companies are looking for a personality ‘fit’, i.e. individuals who are sociable and able to work with others, communicate effectively and work under pressure.

Unfortunately, individuals who fall within the Asperger’s range tend to be the exact opposite of this. Socially awkward by nature, many have poor social skills and struggle with ‘normal’ things like casual chit-chat, making eye contact, relating to others or changes to routine. As such, they are unlikely to make friends, engage in office banter, or help out colleagues. They are unlikely to ‘fit in’. But in a world with greater awareness and acceptance of individuality and different dimensions of intelligence, not to mention increasing levels of hot desking and flexi/working from home, just how relevant is the traditional office environment and attendant personality fit?

This industry has always prided itself on its ability to adopt and adapt to new trends. In choosing to tap into neurodiversity and updating its perceptions of the ‘ideal’ candidate, the industry could reinforce its commitment to social responsibility and sustainability, while opening itself up to a whole new world of talent – and that surely is just good old-fashioned commercial common sense. n Christina Thakor-Rankin is co-founder of the All-In Diversity Project 51

P EO P L E

RECRUITMENT

Odgers Berndtson head of global gaming Andrew Bulloss looks at the impact of private equity, regulation and Brexit on salaries and the recruitment market

A headhunter’s TWO YEARS AGO, Gaming Intelligence and our global gaming practice here at Odgers Berndtson teamed up to produce the industry’s first comprehensive salary survey for executive and C-level roles. Some of the results are in the box opposite. You can read the entire survey here: tinyurl.com/GISalaries We were planning on repeating the exercise two years on, but the headline would have been much the same – which we didn’t think would be much of a headline. Salaries and bonuses for senior level roles across the industry are broadly the same as they were two years ago.

On average, gaming execs, in comparison with their peers in other industries (perhaps with the exception of the technology sector), are still paid better than most.

The private equity factor What has changed is the industry’s attitude towards long-term incentive plans (LTIPs), which are now seen as the norm for leadership positions and not just reserved for C-level appointments. This has almost always been the case in public companies but it is becoming the norm in private businesses too, where you can expect to be offered some form of profit share, or share scheme from director level and above.

During the past two years, private businesses have realised that they will be sig52

nificantly disadvantaged in the recruitment market if they do not offer potential employees an LTIP. The senior talent market in global gaming remains hugely competitive, particularly as new markets open (think US and Central/Eastern Europe) and the demand for talent rises as a consequence.

This trend will undoubtedly have been influenced by the massive expansion of private equity into the sector. Private equity houses such as Blackstone Partners (which took a stake in Superbet), Clairvest Group (FSB Technology) and Apax Partners (Betgenius) are driving change in the sector. While they may be demanding employers in terms of the results they expect, the rewards for executives who achieve growth in PE-backed companies are significant. Private enterprises need to be aware that compensation schemes for senior hires must be competitive – this doesn’t mean overpaying on basic salary and bonus, but ensuring that solid long-term incentives are in place to attract the best talent.

Indeed, the two most in-demand roles (based on our roster of assignments from the last six months) are senior commercial/ business development executives at B2B suppliers and chief commercial officers for B2C operators. The basic salary of the former would likely be around £125-£180k, with a 70

per cent bonus, while the latter earns around £140-£190k, with a 50 per cent bonus. There has also been a notable increase in new CEO searches in the last year, many driven by the private equity houses.

On the commercial front, you can look at this year’s Hot 50 (page 34) for successful moves from the likes of Chris Looney, who left Microgaming for Red Tiger, and James Coxon, who has been pulling up trees since leaving Scientific Games for SBTech. In the US, another recent example is the appointment of Eric Foote as CCO, who joined Australian and US sportsbook operator PointsBet from CBS Sports Digital

Malta benefits from Brexit In the short-term, these are areas of the talent market that are booming (and the types of hires we are being asked to make). From a territory perspective, the UK market and, in turn, Gibraltar have been quiet for a while, certainly for senior level hires. Malta has benefited from Brexit and is seeing far more activity on the hiring front, as is Central Europe.

Sweden is experiencing similar difficulties to the UK, where increased regulation and a saturated market is leading to stagnation in the recruitment market and, worse, a brain drain from the industry.

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RECRUITMENT

“I’m hoping that the rebirth of the industry Stateside will see an increase in product and customer innovation that might reinvigorate the industry back in Europe” Andrew Bulloss, Odgers Berndtson

Gaming IntelligenceOdgers Berndtson salary survey results 2018 Chief executive officer

view Given restrictions on work visas, the US talent market tends to operate in isolation when it comes to senior hiring, with most of the moves restricted to US citizens (or Green Card holders). We have certainly not seen the volume of people shifting from roles in European gaming to take advantage of the new regulation in the US that we expected. There have been a few exceptions to this rule but this has largely been internal transfers of talent from Europe to the US, rather than brand new hires of Europeans into US-based entities.

It is worth noting there have also been a number of high-profile departures from the industry. Increased regulation, competition and a difficult political environment means that it is more difficult for gaming firms to make a profit and satisfy shareholders than ever before. When M&A activity provides a route out, many executives are taking it.

This means the companies operating in this industry – certainly when looking for experienced industry leaders – need to be very clear of their USP to attract talent. While one USP will be a competitive compensation package, it is not the only reason. There are too many to list here, but perhaps one of the critical attraction factors for senior candidates right now is the company’s approach to customers. Which markets do they operGIQ Q4 REVIEW

£515,000 153% Basic salary

Average cash bonus

Chief financial officer ate in? How do they treat customers in those markets? And what is the business doing to ensure that an amazing user experience is balanced with a robust customer protection plan?

The moral obligations of gaming employers to their customers (as well as their employees) are being exposed, more than ever before.

So many of the European operators continue to push regulators to the limits, testing the boundaries of what they can get away with. Instead, while remaining commercial, they also need to put the customer first. As the US market grows with fierce competition and strong regulations, it might spur a few to look at new commercial models, new products and new tech – and that can only be a good thing.

I am hoping that the rebirth of the industry Stateside will see an increase in product and customer innovation that might reinvigorate the industry back in Europe. Most industry commentators suggest that innovation in the industry, certainly in the UK, has been at its lowest ebb for a number of years. This is in part due to the technological burden of regulatory compliance, leaving little time and resource for new ideas. While this adherence to regulation and compliance is of course important, those organisations with an eye on the future, carving out time to launch new products, will win out in the long-term. n

£371,220 128% Basic salary

Average cash bonus

Chief operating officer

£204,200 60% Basic salary

Average cash bonus

Chief information/ technology officer

£202,300 73% Basic salary

Average cash bonus

Chief commercial officer

£176,250 46% Basic salary

Average cash bonus

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GAMES NEW RELEASES Q4 GIQ casts its eye over the quarter’s brightest new games

QUICKSPIN LAUNCHES GOLDEN GLYPH SKYWIND GOES NATIVE AMERICAN WITH BIG BUFFALO

RELAX GAMING LAUNCHES WILDCHEMY

Skywind Group released its latest slot, Big Buffalo, a Native American-themed slot featuring buffalos, bald eagles and the beauty of the desert. The 4x6 high volatility slot offers 4,096 ways to win, and up to 100 free games with wild multipliers. The game features scatters that can grant up to 100 free games, with random wild multipliers that can be triggered again and again.

“We promised big games, big names and big brands, and we are delivering,” said Skywind vice president of operation and content Uri Cohen. “Big Buffalo is packed with potential multipliers and opportunities. This really is a big game with big potential for large prizes, and we are proud to be bringing it to our growing audiences.”

Relax Gaming’s latest release is a 5x5 medium volatility slot which sees players transported to a post-medieval era laboratory. When symbols in the two Magical Portals situated in the top left and bottom right corners match, all appearances of the symbol on the reels turn into wilds, before potentially transforming into exploding symbols to boost chances of winning by up to 697 times the bet.

“Wildchemy is a prime example of Relax Gaming’s distinctive visuals and action-packed gameplay that puts players right at the heart of the game,” said chief product officer Simon Hammon. “The result is an immersive experience that appeals to a wide audience, ranging from experienced slot fans to casual players.”

BLUEPRINT TAKES TO THE SKIES WITH DRAGONFALL Blueprint Gaming expanded its portfolio with the release of Dragonfall, a new highly volatile slot featuring cluster pays and tumbling reels that activate wins again and again. In the 8x8 grid game, four mystical modifiers turn the game on its head, including the Mystery Flame, Mega Drop, Fire Burst and Dragon Rage modifiers.

“This enchanting title brings a new dimension to our portfolio, with tumbling reels dropping red-hot prizes for players,” said Blueprint Gaming director of marketing Jo Purvis. “Dragonfall’s strong aesthetic appeal and innovative features are sure to tempt brave players into the dragon’s magical layer.”

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Playtech-owned Quickspin launched a new Ancient Egypt-themed game Golden Glyph, the supplier’s first reactor type game which boasts a 7x7 grid. The slot features Tumble Mechanics, a Power Wild feature, and a Power-Up featu re wit h fou r magica l Power-Ups: Golden Scarab, Eye of Horus, Blaze of Fire, and a Free Spins Bonus.

“Golden Glyph is a stunning and featurerich slot, and the team has done a fantastic job with it,” said Quickspin CEO Daniel Lindberg. “The new 7x7 grid makes it perfect for our new and improved UX design, which is optimised for all devices, whether you use landscape or portrait mode. We always develop all our games and engagement tools with a ‘mobile first’ approach, and with an even better UX in portrait mode it means that we can continue to offer players the best gaming experience possible.”

G A M ES

Q4 RELEASES

YGGDRASIL GOES FOR GOLD IN ALDO’S JOURNEY

ISOFTBET LAUNCHES FIRST MEGAWAYS TITLE

SG DIGITAL DEBUTS MEGA DROP QUEST FEATURE…

Yggdrasil is inviting players to join an epic global quest for gold and riches in its new adventure-themed slot Aldo’s Journey. The game sees players accompany travelling merchant Aldo on the voyage of a lifetime across four faraway cities and cultures, in a 5x5 video slot with 65 paylines. Each country contains its own unique treasures, giving slot fans the chance to discover higher multipliers, symbol removal, sticky wilds and random wild lines.

“While travelling through the game as they hunt for gold, players will find themselves in wonderous lands, from Italy and China to Persia and Mongolia,” said Yggdrasil product owner slots Natalya Ovchinnikova. “Aldo’s Journey has fantastic graphics and is packed with fun features to keep players entertained and engaged, including Free Spin Symbols, bonus combinations and Journey Wilds.”

iSoftBet rolled out Aztec Gold Megaways, its first title to feature the popular mechanic under licence from Big Time Gaming. The six-reel slot is set deep in the rainforests of Central America and features classic Megaways action, with cascading wins, where all winning symbols explode to allow more symbols to drop onto the reels, and a maximum of seven symbols possible on each reel, resulting in up to 117,649 ways to win.

“The hugely popular Megaways mechanic has been one of the most important innovations in our industry, and we are thrilled to be bringing our own title to this market with the release of Aztec Gold Megaways,” said iSoftBet chief commercial officer Michael Probert. “Essentially, we wanted to stay true to the genre, with cascading wins and up to seven symbols per reel, but have added a Cash Spins bonus, which we feel gives the game a unique edge.”

Nessie’s Treasure Mega Drop Quest is the first release from SG Digital to feature its new syndicated gaming product, providing players the opportunity to team up with other players and ‘win together’. Through community gaming, large jackpots become more accessible as participants join up to collectively win a percentage of a larger jackpot. Nessie’s Treasure is the first title to launch with the innovation and also offers a rich selection of features, including a multiplier bonus wheel, added wilds and free games delivered through a double reel mechanic, all triggered by Nessie, the famous Loch Ness Monster.

NETENT ROLLS OUT LATEST BRANDED SLOT NetEnt added another big-name branded game to its NetEnt Rocks line-up, through a collaboration with Black Sabbath lead singer Ozzy Osbourne. The Prince of Darkness is centre stage in the high-volatility slot, which is brought to life with illustrations of the performer and licensed music from his back catalogue as a solo artist.

“Ozzy is the archetypal rock star, whose name transcends the music industry,” said NetEnt director of games Bryan Upton. “He’s had an incredibly colourful career and we are ecstatic to have worked with him for his latest gig.

With its great ga mepl ay a nd exciting theme, Ozzy Osbourne Video Slots will appeal to his fans as well as a wide cross-section of slots players.”

GIQ Q4 REVIEW

… AND LAUNCHES TETRIS EXTREME SLOT

GOLDEN ROCK STUDIOS LAUNCHES FIRST SLOT With more than 15 new games in the pipeline, Golden Rock Studios released Volatile Slot as the first game to launch under an exclusive supply deal with Microgaming. The game is a five-by-three reel, ten-payline slot that pays left to right and includes a number of dynamic features, including two different game modes and a free spins bonus.

“Our first release, Volatile Slot, delivers an exhilarating, high-volatility gameplay experience and is filled with stimulating game mechanics and visuals,” said Golden Rock Studios CEO James Curwen. “This slot is volatile, and if the volcano erupts, the level of extremity is taken to a whole new level for the player, with the maximum win at 25,600 times stake.”

Tetris Extreme reimagines the globally recognised video game, remaining true to the timeless Tetris look and feel, with the added win potential and anticipation of a slot game. Colourful Tetriminos and Line Clears remain at the core of the game, along with increasing multipliers and the addition of a Free Falls Bonus. Available via the Open Gaming System, Tetris Extreme is compatible with the Mega Drop Jackpots system, a multi-level jackpot system designed to supply more games with quicker guaranteed jackpot drops, encouraging more active players than a traditional jackpot system. When an individual jackpot drops, it immediately starts over, allowing for multiple drops in a shorter time span, giving players the ability to strategically strive for the next big drop.

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TECHNOLOGY 5 BIG LAUNCHES

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

What’s the big idea?

Playtech has been investing in its live casino technology and facilities over the past few years, and its deal with GVC marks its first major agreement in the sector. The dedicated live casino studio will initially offer GVC’s brands a range of live dealer games, including five blackjack tables and a roulette wheel studio.

“Significant investment has gone into delivering the first stage of the Elevation studio and we’re delighted with the results,” said GVC chief operating officer Shay Segev. “Playtech’s track record and experience in delivering innovative live casino technology and content is unsurpassed. We’re looking forward to continuing our partnership and delivering a world-class player experience.”

What’s the big idea?

White Hat Gaming has been around for a few years but came out of nowhere to win a tender to provide its player account management platform to Penn National, which operates HollywoodCasino.com in Pennsylvania and is expected to expand across the US in 2020.

“In Penn National, we have found a partner who shares our passion for the consumer gaming experience and is committed to the highest standard of regulation,” said White Hat Gaming chief executive Phil Gelvan. “We look forward to building one of the leading businesses in American sports betting and online casino.”

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Gamesys Group and Scientific Games entered into a deal to launch a new UK-facing B2C online casino dedicated to the popular Rainbow Riches brand.

Powered by Scientific Games’ OpenGaming platform, RainbowRichesCasino.com features games from the supplier’s Rainbow Riches slot franchise, which was first released across retail and online in 2006, including new titles such as Daily Rainbows and Leprechaun’s Harvest. The site becomes the latest addition to Gamesys’ portfolio of UK-facing brands, which includes Jackpotjoy, Virgin Games, Heart Bingo and Monopoly Casino.

“Through our years of partnership with the Gamesys Group, including the launch of the successful Monopoly Casino, we have sought to transform player experiences,” said SG Digital senior vice president gaming Dylan Slaney. “With their latest move to the Open Gaming System platform, we are delighted to bring this new casino offering to the market in partnership with Gamesys Group.”

Playtech has launched a live casino studio in partnership with operator GVC Holdings.

White Hat Gaming will make its first move into the burgeoning US iGaming market through a new long-term deal with leading operator Penn National Gaming.

Gamesys and SG ready Rainbow Riches launch

What’s the big idea?

Playtech and GVC develop new live casino studio

White Hat Gaming heads Stateside

IN THIS ISSUE 56 Playtech, Gamesys, Scientific Games and more

Scientific Games seals VLT deal in Norway

Inspired inks global distribution deal with Novomatic Inspired Entertainment has expanded the reach of its virtual sports titles through a global distribution agreement with Austrian gaming giant Novomatic.

What’s the big idea?

The deal with Novomatic provides Inspired with significant potential to expand its games to new geographies, customer verticals and distribution channels. Inspired’s games will be integrated with the NovoPrime Sports platform, which was developed by Novomatic in collaboration with Sportradar and operates across self-service betting terminals, desktop and mobile devices. Games include virtual horse racing, greyhounds, motor racing, trotting and basketball, with virtual hockey and football games in the pipeline.

Scientific Games secured a landmark agreement to supply video lottery terminals (VLTs) to Norwegian state-owned gaming operator Norsk Tipping.

What’s the big idea?

Scientific Games already provides a range of services to Norsk Tipping, including iGaming, eInstant games, instant lottery games, lottery gaming systems and retail technology. The new deal will see the supplier’s Global Draw subsidiary supply up to 4,500 video lottery terminals in 1,000 venues across Norway, including convenience stores and bingo halls. The roll out is expected to begin in late 2020.

“Scientific Games has a wealth of gaming and lottery expertise,” said SG Gaming UK CEO and 2020 Hot 50 winner Phil Horne.

“Using a collaborative approach and bringing in the best resources from across the company was key to securing this deal, demonstrating that we will meet all customer needs and deliver a specific, tailored gaming solution.”

LOTTERY FIVE BIG STORIES News from the lottery world, from Brazil to New Hampshire Tipp24 returns to German lottery brokerage model

NeoPollard repurposes iLottery game for retail play

ZEAL NETWORK’S TIPP24 brand returned to the German lottery brokerage market in October after the company changed its business model from a secondary lottery business to an online lottery broker. Ten years after relaunching its secondary lottery business from the UK, following the ban on lottery brokerage in Germany at the time, Tipp24 is once again an official partner of the German Association of State Lottery Companies. It is generating income without any bookmaking risk of its own, with customer winnings guaranteed and paid out by state lotteries.

“We are convinced we can lead the German lottery safely into the digital future as a partner of the state lottery companies,” said Zeal Network CEO Dr Helmut Becker.

NEOPOLLARD INTERACTIVE (NPI) launched its first omni-channel game for the New Hampshire Lottery, with Holiday Cheer released as a retail scratch card following its debut in the state as an online game last year.

The launch marks the first time one of the supplier’s iLottery titles has been repurposed for the retail sector.

“As an omni-channel company ourselves, coming from both the retail and online worlds, NPi commends the New Hampshire Lottery on its commitment to creating player experiences that promote the retail network, while also offering players the added value of entertaining digital games available through the iLottery program,” said NeoPollard Interactive general manager and 2020 Hot 50 winner Liz Siver.

IN THIS ISSUE 58 Tipp24, NeoPollard, IWG and more 59 US sports betting

Scientific Games and IGT JV wins Lotex tender in Brazil THE BRAZILIAN GOVERNMENT awarded a 15-year licence to operate the Lotex instant lottery to a joint venture between rival suppliers International Game Technology and Scientific Games. Having previously been operated by Brazilian bank Caixa Econômica Federal from 1960 to 2015, the new consortium will begin operating in Brazil from mid-2020, through physical retailers, via the internet and through mobile.

“The award of the Brazilian Lotex concession represents an important step towards the privatisation of lottery instant games in Brazil, the world’s eighth-largest economy,” said Walter Bugno, CEO IGT International and Pat McHugh, Scientific Games executive vice president and group CEO of lottery. “This business partnership will benefit the people and government of Brazil, and brings together the vast experience and market leadership of global leaders in the instant game market to help position Lotex for success.”

IWG partners third US lottery for online instant-win games IWG secured a deal to roll out its portfolio of over 100 online instant-win games with the Georgia Lottery Corporation, including flagship title Super Cash Buster.

The partnership further enhances IWG’s footprint in North America, where its games are live with Canada’s Atlantic Lottery Corporation, BCLC and LotoQuébec, as well as the Michigan Lottery and Pennsylvania Lottery in the US. “Partnering with one of the biggest lotteries in North America is a fantastic move for us and further demonstrates our position as a premium provider of instantwin games,” said IWG chief executive Rhydian Fisher. “Players will now have access to a wide range of entertaining games, featuring a mix of themes and mechanics that will appeal to a wide target audience. We’re looking forward to working alongside our latest lottery, driving greater online revenues alongside their existing and successful retail operations, as well as helping raise funds for good causes.”

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Scientific Games extends iLottery deal in Pennsylvania SCIENTIFIC GAMES WAS awarded a new long-term contract to continue supplying its iLottery platform to the Pennsylvania Lottery, including online and mobile games and services. Scientific Games took the lottery online in May 2018, with total digital sales topping $342m in the first year. Scientific Games also provides Pennsylvania Lottery’s instant games, as well as systems and retail technology.

“Our iLottery games have proven a fun new way to play the Pennsylvania Lottery,” said Pennsylvania Lottery executive director Drew Svitko.

“Selling lottery online is a big part of our effort to modernise the lottery, appeal to new customers and meet our players where they already are, which is online, while generating new funds to benefit older Pennsylvanians.”

LOT T E RY

US SPORTS BETTING

This year’s

model Lotteries provide a different template for sports betting in the US NEW HAMPSHIRE WILL become the third US lottery after Delaware and Oregon to roll out its own sports betting operation when it launches in the early part of this year. That puts lotteries in the driving seat in one in four US states with a regulated sports betting market.

The majority, thus far, have opted to reserve sports betting licences for their land-based casino operators. Other jurisdictions, such as Michigan and Washington DC, are emerging with legislative innovations that suggest there will be something for everyone in the US market, as long as they are an incumbent operator.

Emerging models

Oregon and New Hampshire are the only lottery states to have legislated for sports betting that do not operate land-based casinos. Delaware’s casinos are operated under the supervision of the lottery, as are those in Rhode Island and West Virginia. Unlike the latter two, where sports betting is restricted to the casinos, the Delaware Lottery’s retail outlets are also allowed to accept bets. Mobile sports betting is also legal in Delaware but has not launched.

Oregon was the first lottery to launch an online sports betting operation, when it launched its Scoreboard product last October.

Lottery laws Supplied by SBTech, players can wager via the The New Hampshire law creates a Division Oregon Lottery Sports website and Scoreboard of Sports Wagering within the state lottery to app, with land-based sports betting kiosks set oversee sports betting. Five out to be rolled out this year. of nine New Hampshire cities Geolocation services are have voted to allow retail sports- Five out of nine used to ensure Scoreboard play book locations within their com- New Hampshire occurs within state boundaries, munities, while several towns cities have voted and not on the tribal lands that will vote on the same proposal house Oregon’s ten tribal casito allow physical in March and April. It is yet to nos. sportsbook retail be determined what form these Like Delaware, Montana and locations within retail locations will take.

Nevada, Oregon was exempt When it comes to the mobile their communities from PASPA because of an product, there is no requireexisting sports lottery game, ment for in-person registration, as there is in which ran between 1979 and 2005. So the state Nevada, where it has limited growth. That did not need to pass any new legislation when means anyone within the state can download PASPA was repealed. In most states, legislators an app and bet as soon as their identity is verihave passed laws designed to protect incumbent fied. In-play betting is limited to online. gaming operators (either commercial casinos New Hampshire has chosen DraftKings to or the lottery). provide sports betting on a mobile app and in While this has tended to mean granting the retail locations, while Intralot has been choexclusive licences to casinos or lotteries, other sen to provide it through the lottery itself. How models are emerging. A bill introduced in these operations will be branded (e.g. whether Kansas would authorise the Kansas Lottery to it’s a New Hampshire Lottery app powered by offer sports betting through authorised lottery DraftKings or just a DraftKings app) is to be gaming and racetrack gaming facilities, both decided. online and in-person. The lottery would serve GIQ Q4 REVIEW

as the licensee for sports betting but would be prohibited from operating its own gaming or sports betting platform until 1 July 2032.

Michigan has progressed further. Its lawmakers have approved a package of bills that would regulate sports betting and online gaming – primarily through land-based casinos already operating in Michigan, including Detroit’s three casinos and tribal casinos across the state. In an interesting twist, it includes a provision to ensure online games offered by casinos do not directly compete with games offered by the Michigan Lottery.

How this will work in practice is not clear.

Does it preclude the lottery from expanding its iLottery portfolio or merely stop the casinos from imitating the lottery’s existing products?

The ensuing regulations will make that clear.

With Washington DC’s Office of Lottery and Gaming opening its sports betting licensing process with a fast-track procedure for those already licensed in other jurisdictions, there are a number of models emerging, and the nation’s lotteries are not being excluded. n 59

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World regulatory update

GIQ rounds up the major global legal developments

Australia The Australian Communications and Media Authority (ACMA) began to fight back against unlicensed online offshore gambling websites targeting the country’s players, with Emu Casino and Fair Go Casino gaining the ignominious title of becoming the first two online casino sites to be blocked in Australia. The ACMA has also requested that Australian internet service providers (ISPs) block nine other illegal iGaming sites, and urged Australian users of those sites to withdraw their money immediately. Meanwhile, Australian lawmakers voted in favour of legislation to establish a national self-exclusion register to allow people to ban themselves from all online betting sites and apps in one go. Administered by the ACMA, the register is designed to provide greater protection to online gambling consumers and is a key measure within the first National Consumer Protection Framework for online wagering in Australia, which aims to reduce gambling-related harm.

Austria The Austrian Association for Betting and Gambling (OVWG) has renewed its call for the government to end the “unjustifiable” online gambling monopoly held by Austrian Lotteries. The association argues that the single online gaming licence awarded to Austrian Lotteries by the Ministry of Finance does not provide greater protection to consumers than a well-regulated market where all operators fall under state supervision.

It has also questioned the validity of the iGaming monopoly under EU law, as well as the triple role of the Ministry of Finance as licensor, regulator 60

and Austrian Lotteries shareholder. The association highlighted Denmark as an example of how a transparent and secure gaming environment can be achieved, through the introduction of a licensing system in which licences are not limited in quantity but are subject to compliance with high player protection standards.

Denmark Licensed online casino and sports betting operators in Denmark will pay significantly higher taxes from 2021. After lengthy negotiations, Denmark’s Social Democrat-led government secured the backing of the Red-Green Alliance, Socialist People’s Party, Danish Social Liberal Party and Alternative Party to increase the tax paid by licensed sports betting and online casino operators, from 20 per cent to 28 per cent of GGR from 2021. This increase is expected to generate an additional DKK150m (approx. €20m) in taxes in the first year. Meanwhile, Denmark’s gambling regulator Spillemyndigheden ordered 888 to amend its anti-money laundering procedures to comply with the country’s Money Laundering Act, after finding that a Danish player had deposited more than DKK1m (approx. €133,827) with the operator over a three-month period without providing any documentation to prove their income. 888 had allowed the player to continue playing for a further month before the account was closed.

Finland Finland’s Competition and Consumer Authority concluded that the Finnish gambling monopoly does not provide effective industry supervision

or protection to problem gamblers, although it stopped short of recommending a liberalised gambling market. In a report on the Finnish gambling market, the authority noted that Norway was the only other European nation with a gambling monopoly, with its research finding that the current monopoly system was hard to justify, given that “the regulation of the Finnish gambling system does not meet the [EU] requirement of effective supervision”. The report examined the regulatory systems in Sweden and Denmark, and recommended the establishment of a single gambling regulator in Finland with powers to ensure the lawful operation of the gambling market. A final report is due out this year.

Germany The Interior Ministry of the German state of Hesse has warned of a major crackdown against unlicensed online sports betting operators this year. The state is responsible for licensing sports betting nationally under the third amended State Treaty on Gambling, which came into force on 1 January. The regional council of Darmstadt, which is responsible for licensing, wrote to sports betting operators to warn them that no unlicensed operations will be tolerated from 2020. The regional council of Darmstadt has expanded its human resources in anticipation of the licensing process, making it the largest gambling regulator in Germany, with this team now ready to also ensure compliance with the law. This will see them take legal action against any online sports betting provider active in Germany without authorisation, and work with the competent authority in the state of Lower Saxony to prevent financial transactions with illegal 60

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operators. Advertising unlicensed sports betting will also be prohibited.

Greece Rules to govern the regulated Greek online gaming market were notified to the European Commission at the end of 2019, following the adoption of new online gaming legislation in October, which will see operators fully licensed and regulated in Greece for the first time. Sevenyear licences will be available for online betting (Type 1 Licence) and online casino games (Type 2 Licence) at a cost of €3m and €2m respectively, although operators that have appeared on the Hellenic Gaming Commission’s (HGC) blacklist of illegal operators in the year prior to application will be ineligible for licensure. European operators in the Greek iGaming market are not currently locally licensed but are allowed to operate under a transitional scheme from 2011 that sees them pay local taxes.

Netherlands The opening of the Netherlands’ regulated iGaming market has been pushed back by six months in order to give lawmakers more time to establish secondary regulations. The country’s new Remote Gambling Act was expected to come into force on 1 July, with the launch of licensed operations planned for 1 January 2021. The delay will mean that the Act won’t come into force until 1 January 2021, followed by a six-month period to consider licence applications ahead of the market opening on 1 July 2021. Legislation continues to be debated in parliament, with a number of gambling-related motions adopted GIQ Q4 REVIEW

by the Netherlands House of Representatives, including a proposal to prohibit gambling advertising during the day, as well as a motion directing the government to develop additional measures to prevent minors from being exposed to advertising for high-risk gambling products on television and social media.

Northern Ireland The Northern Irish government has launched a public consultation on gambling regulations as it considers future legislation. The consultation seeks to assess the appropriateness of current legislation and to identify gambling products which should be included in any future legislation. The Department for Communities noted that the current legislation was outdated, having failed to keep pace with industry and technological developments. The consultation considers two particular issues, the regulation of remote gambling and consumer protection, and seeks input on any additional, Northern Ireland-specific licensing and regulatory measures that should apply to remote gambling operators. It also asks for views on whether the current level of consumer protection available to Northern Ireland consumers is sufficient.

Switzerland Swiss authorities have blocked access to a host of online gambling websites that targeted customers in Switzerland without a local licence.

The move follows the implementation of new regulations last year which limit online gambling licences to Swiss land-based casino operators and prohibit unlicensed online gaming. The

latest blacklist compiled by the Swiss Lottery and Betting Board and Federal Gaming Commission adds 100 new domains for site blocking – 28 sports betting and lottery domains and 72 online casino domains. It marks the first update to the blacklists since their introduction in September, with a total of 88 sports and lottery and 110 iGaming domains now blocked. There are currently six casinos licensed to operate online in Switzerland; Grand Casino Baden, Casino Davos, Grand Casino Lucerne and Casino Pfäffikon, as well as recently approved Grand Casino Kursaal Bern and Interlaken Casino.

UK British customers will no longer be allowed to gamble using credit cards from 14 April, following a public consultation carried out last year by the UK government and the Gambling Commission (UKGC). The ban applies to all forms of gambling except retail lottery sales. It will affect around 800,000 of the 24 million adult gamblers in Britain and is aimed at reducing the risk of harm, with UKGC research showing that 22 per cent of online gamblers using credit cards are classified as problem gamblers. A new licence condition will also come into force at the end of March, requiring all gambling operators to provide their customers with access to the GAMSTOP self-exclusion system. n 61

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Courting Controversy Spelinspektionen director general Camilla Rosenberg tells Gaming Intelligence she welcomes being taken to court, as the market seeks clarity on Sweden’s new laws MOST PEOPLE DON’T like being taken to court. For many people, the thought of it fills them with dread. Others are more aggressive and up for the fight. “I’ll see you in court!” they scream as they slam down the phone.

The head of the Swedish regulator, Spelinspektionen, Camilla Rosenberg has a completely different stance. She is facing 21 court cases, but welcomes each and every one of them in a quiet, stoical manner. “We are the authority and the court interprets the law. If the operators appeal our decisions then we need to find out through the courts what the correct interpretation of the law will be,” says Rosenberg, matter-of-factly.

She even permits herself a small giggle, when I suggest that some people would be quite anxious at the prospect of appearing in court. It’s clearly no big deal.

Seeking clarity One year after launching a re-regulated market, which includes non-governmental operators for the first time, the Swedish market is in flux. Of the 68 licensed online operators, 25 have had to endure some sort of investigation that has resulted in a sanction. For most, that has taken the form of a fine. These have ranged from the SEK19m ($2m) handed to Betsson for bonus violations, to the SEK0.5m ($52,000), which was demanded of Aspire Global – again for offering bonuses to customers.

Only four of the 25 operators fined have accepted the regulator’s decision. Every other case has ended up in court.

“If you look at the court cases, operators believe the rules are unclear. They struggle with the interpretation of bonuses, betting on minors 62

and betting on lotteries,” says Rosenberg.

Ninja Casino operator Global Gaming suffered the ultimate sanction. It had its licence revoked for serious failures in its anti-money laundering and consumer protection policies.

Global Gaming CEO Tobias Fagerlund was particularly vociferous in his defence of the company, branding the regulator’s decision as “odd”, stating that he believes the company is in compliance with the laws and threatening to take legal action to recover damages. However, the Administrative Court agreed with Rosenberg and her colleagues. Global Gaming will take the case to a higher court.

“We need to get a decision from the court to decide what is acceptable and what is not, and whether we have enough to revoke a licence,” comments Rosenberg. “It was a very serious breaking of the regulation, in our view.”

Betsson and others are using the courts to appeal the fines handed to them for bonus violations. These cases cover everything from the definition of a bonus and whether other offers constitute a bonus, to the number of bonuses you can offer to a player (one, says the regulation) and how you i nt e r p r e t that.

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“A high level of consumer protection is one of the main priorities of re-regulation, I think a drop in profits is of secondary importance” Camilla Rosenberg, Spelinspektionen

“You might think it is clear to everyone, but it is not,” states Rosenberg. She is aware how important it is to clarify the rules on bonuses, and also believes there might be changes to the current ban on betting on lotteries, which Lottoland and others have appealed to the courts.

There have also been cases regarding the length of licence awarded, which can vary between two and five years. LeoVegas, for example, won a case that extended its licence to five years. This has been about clarifying the criteria for the different length of licence.

Despite her calm exterior, Rosenberg admits: “It has been a very hectic and extremely intense year for us – and for operators and suppliers, of course”

Teething problems Rosenberg’s hectic period dates back way beyond 1 January last year. Her team had to handle a flood of licence applications in the second half of 2018.

“We didn’t know what to expect,” says Rosenberg. “But we were delighted that so many did apply and that we managed to process them in time for launch day on 1 January.”

At the time of going to press, 94 companies were licensed, with 68 commercial operators granted a licence for online gambling and/or betting. Twenty-two have a licence for landbased gambling, two for maritime gambling and two licences are reserved for the state.

It did not take long for problems to arise. On 11 January, the regulator announced that some operators had failed to link their systems with Spelpaus, the national self-exclusion programme.

“In certain cases, operators had teething problems,” admits Rosenberg.

“I was not surprised by GIQ Q4 REVIEW

the number of operators that struggled to connect to Spelpaus. But I was surprised by the number of operators who opened their websites [to the public], even though they were not connected to Spelpaus. They hadn’t even tried to connect to Spelpaus before opening their websites.”

One year on, and everybody is connected to Spelpaus. She believes the system has been a success, with 50,000 people signing up to take a break from gambling.

Taking the hit All of these issues have impacted heavily on the results of operators and suppliers. NetEnt chief executive officer Therese Hillman told Gaming Intelligence as early as February that the new regulations for responsible gambling were working “too efficiently”.

Rosenberg notes the tax regime and cost of compliance will be significant factors in any drop in profit but also backs up Hillman’s claim that a number of people who signed up to Spelpaus would have spent a considerable amount on gambling previously. Of course, Hillman noted this fact with some regret, while Rosenberg suggests it is a sign of the system’s success.

“Considering that a high level of consumer protection is one of the main priorities of reregulation, I think a drop in profits is of secondary importance,” says the regulator. “Unless the politicians decide to change the regulations with regards to measures of responsible gambling or the tax rate, I think this is the new normal.”

Along with all these challenges there was plenty of negative media coverage of the television-advertising blitz that operators used in an attempt to grab market share, when the new market opened. It was largely self-defeating – failing to raise revenue, and enraging media and politicians alike.

Notably, Kindred Group blamed the marketing costs and new taxes for falling profit in its home market, rather than regulation.

As Betsson’s struggles continued into the final quarter of the year, chairman Pontus Lindwall was relatively upbeat about the future, but warned: “The regulated markets now also face major challenges regarding the degree of channelisation, which is one of the most important prerequisites for high consumer protection.”

Last month, Spelinspektionen released the results of a survey revealing that four per cent of respondents were aware they gambled with unlicensed operators. That figure could be misleading – and operators have questioned it – if respondents don’t know whether they are playing with a licensed operator or not. But Rosenberg says 80 per cent of respondents claimed to be sure they were playing with licensed operators.

“We hope that figure will decrease further but it is unlikely to drop to zero,” says Rosenberg. “It suggests that people are aware of the difference between licensed and unlicensed operators and of the dangers of gambling with unlicensed operators.”

While some suppliers have delivered a very gloomy outlook, the likes of Betsson, Kindred and LeoVegas have refused to view the shortterm hit to profitability negatively. They are uniformly optimistic about the future of the regulated market. Rosenberg is also looking to the long-term.

“This is the beginning of the new regulated market. If you look at other markets in Sweden, for example the energy market, it took three years to get it in place.”

There is an ongoing evaluation that will come to an end in March 2021, when the Swedish Agency for Public Management delivers its verdict on the re-regulated gambling market.

There is also a government enquiry into gambling advertising running in the background.

Rosenberg is confident the market will be running smoothly by then. The courts will have delivered their verdicts. Only then will we know what constitutes “the new normal”. n 63

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MARKETING FIVE BIG STORIES This quarter’s biggest marketing news

PartyCasino partners eSports team GVC’s recently launched play-for-fun offering PartyCasino.fun has agreed a partnership with Canadian eSports franchise Luminosity Gaming.

Enthusiast Gaming’s eSports division Luminosity Gaming comprises seven professional eSports teams under ownership and management, including the Vancouver Titans Overwatch team and the Seattle Call of Duty League. The agreement will see PartyCasino. fun’s logo appear on Luminosity Gaming jer-

seys visible during live streams and broadcast events, as well as in the online store. Additionally, PartyCasino.fun will sponsor the gaming lounge at the Enthusiast Gaming Live Expo (EGLX), Canada’s largest gaming expo.

Enthusiast Gaming president Menashe Kestenbaum said: “We used the sales and marketing expertise of our newly formed direct sales team to create a unique, customised marketing strategy for PartyCasino.fun to reach its media and sponsorship goals.”

Sweden threatens Mr Green and Karl Casino

ASA bans Casumo Google ad

THE SWEDISH CONSUMER Protection Agency threatened Mr Green (William Hill) and Karl Casino (L&L Europe) with SEK2m (€186,000) fines after they sent marketing materials to self-excluded players.

Sweden’s Spelpaus system went live at the start of 2019 with the opening of the re-regulated online gaming market. It allows players to exclude themselves from real-money gambling for a specific or indefinite period of time. It is also meant to prevent self-excluded players from receiving any direct marketing.

“The law is clear on this point,” said Konsumentverket counsel Johanna Nyblom.

“The purpose [of Spelpaus] is that players who want to pause or stop gambling should be protected from direct calls to play and from receiving advertising directly on mobile or via email.”

GIQ Q4 REVIEW

T H E U K A DV ERT ISI NG Standards Authority ruled against a Google advertisement by online gaming operator Casumo, which inadvertently targeted potentially vulnerable consumers. The ad for the Casumo app appeared as a sponsored search result on Google to people who searched the term “how to unsubscribe from all gambling”, offering them a 100 per cent welcome bonus and 20 free spins.

Casumo said that the combination of terms had not been anticipated when creating the list of excluded search terms. It added that due to the dynamic nature of Google searches and the way individuals searched the internet, it was impossible to cover every possibility. Nonetheless, it has reviewed its list of excluded search terms.

The ASA acknowledged Casumo’s actions but concluded that the ad had not been responsibly targeted.

IN THIS ISSUE 67 Fast Track, Mr Green, Casumo and more 68 Special Report: Listed affiliates

Fast Track enters Africa with Parimatch MALTA-BASED SOFTWARE PROVIDER Fast Track has secured its first partnership in Africa to provide its customer relationship management (CRM) solution to operator Parimatch Africa. Fast Track will supply a bespoke solution for the operator’s online launch, which will tie individual ‘moments’ into a player’s unique life-cycle and allow Parimatch to coordinate all aspects of player engagement from one place, using real-time data.

Parimatch Africa chief executive Lasha Gogiberidze said: “With Africa being the fastest-growing region for sports betting, now is our moment to bring something new and exciting to this market. As part of our expansion plans, we know that we have to be able to engage with players in a way that others are not currently achieving in Africa, and Fast Track CRM is the tool we need to be able to do this.”

Fast Track CEO Simon Lidzén commented: “Our discussions have exposed some interesting opportunities for engagement that are unique to the African market. We are looking forward to working on a solution for the team.”

Parimatch Africa operates retail sports betting in Tanzania and is planning the roll-out of venues in cities across Tanzania and other African countries including Rwanda, Uganda, Nigeria and Democratic Republic of Congo.

Unibet and William Hill partner NBA Unibet and William Hill have been named official sports betting partners of the National Basketball Association (NBA).

The companies will have access to official NBA betting data and league marks across its online and mobile platforms in the US, throughout the NBA season. Having launched online in Pennsylvania and New Jersey, Unibet and William Hill become the latest operators to partner the NBA, following the likes of DraftKings, The Stars Group, FanDuel and MGM Resorts.

The betting companies have also vowed to work closely with the NBA to ensure the integrity of basketball games.

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MARKETING AFFILIATES

BRAVE NEW WORLD In the first in a series of quarterly updates on listed affiliates, Jon Harwood finds affiliates are expanding across the globe.

But they are having to adapt to stricter regulations – with bonusing and advertising coming under greater scrutiny

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MARKETING AFFILIATES

2019 WILL BE remembered as a challenging year for affiliate marketers, with stricter regulation biting in European markets, the impact of consolidation being felt across the industry and with new horizons opening up in the US and other areas.

The results of the major listed affiliate companies reflect that turbulence. Some have prospered while others have struggled to build on previous successes.

The likes of Denmark-based Better Collective have enjoyed a period of expansion – with revenue growth of 69 per cent in the first nine months of the year, and organic revenue growth of 27 per cent – but others have been hit by the changing landscape. Industry behemoth Catena Media has been one of those to suffer and has admitted it took its eye off the ball after a series of acquisitions.

Revenues for XLMedia in the first half of 2019 was ten per cent down on the same period in 2018, and operating profit fell by 20 per cent.

In a December update it said revenue for the year was likely to be down by a third on 2018, at £59.5m. It has now initiated an internal review of the company’s structure and business model, led by new chief executive Stuart Simms, who took over in October.

Meanwhile, Raketech CEO Michael Holberg went as far as to describe his firm’s Q3 results as “unsatisfactory”, with profit down and revenue falling by 15 per cent year on year.

New depositing customer numbers are widely seen as a guide to the health of the industry. But once again the picture is confusing.

Better Collective has enjoyed stellar numbers, with NDCs up 74 per cent in the first nine months of 2019, thanks to new acquisi-

GIQ Q4 REVIEW

tions. Gambling.com Group also saw a jump, with a growth of 31 per cent from January to December 2019. Raketech saw a slight fall in NDCs in Q3 2019, but numbers were up by a quarter (26.4 per cent) in the first nine months of the year compared to 2018. Growth also declined year-on-year for Net Gaming Europe, although NDCs grew from Q2 to Q3. The biggest player, Catena Media, attracted 323,423 NDCs in the first nine months of 2019, compared to 411,670 in 2018.

So how to explain these differences and how is the industry adapting to the new landscape?

REGULATION The biggest story of the year has surely been the impact of regulation in Europe. Sweden, home of many of the listed affiliates, stole the headlines, but Italy and the UK have also tightened up the rules on advertising, which has had an impact on how affiliates operate. Other markets, including Germany, are on the path to regulation, so more changes are afoot.

“No one predicted how Sweden would play out,” says Per Hellberg, CEO of Catena Media. “The European gambling market is going through tremendous changes, but they are good because they are for the benefit of the customer. But while you are in that change, of course it has an impact.”

Jesper Søgaard, co-founder and CEO of Better Collective, agrees. The first year of regulation in Sweden has been “rough”, he says. But there is also a widespread belief that things will settle down in time, although the more strictly regulated markets will no longer be the cash cow they once were.

“It’s not a big surprise,” says Søgaard, talking about the Swedish experience. “It is similar

to what happened in Denmark in 2012, but the Swedish market is much, much bigger, so the numbers look bigger. But when we look back in a few years, I expect there will be a stable growing market.

“There has been some negativity in Europe because of issues of advertising and negativity about Sweden, but we think it will come good in 2020.”

Charles Gillespie, chief executive of Gambling.com Group, says: “People thought the market would increase, but we were cautious

“The European gambling market is going through changes, but they are for the benefit of the customer. But while you are in that change, of course it has an impact” Per Hellberg, Catena Media about that. We’ve never seen a market as mature as Sweden regulate. The taxes went up and the rules changed and now the market is a lot smaller.” But, he adds, regulation has its benefits. “Investors like sustainable businesses and black market revenue is not sustainable,” he explains.

Sweden is not the only market to have pulled down the shutters. Marcus Teilman, president and CEO of Net Gaming Europe, admits: “Our top line and bottom line have both been impacted by regulation effects in many European markets, such as Sweden, the UK, Netherlands and Italy, who all have contributed negatively to our numbers.”

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MARKETING AFFILIATES

In Italy, where Catena Media has finalised adds: “As regulation brings restrictions the acquisition of ASAP Italia, the future of on operations, affiliates need to be creative affiliates is under something of a cloud, thanks and dynamic.” to strict new advertising guidelines.

And there could be unexpected benefits The rules in Italy are still open to interfrom regulation – particularly on advertising. pretation and Catena remains confident that It is ultimately the operators who are the ones affiliate sites will not be overly affected, as affected by these new restrictions and, as their long as they “comply with the principles of marketing options narrow, many refocus their self-restraint, truthfulness and transparency”. effort on driving traffic through affiliates.

But as Scott Collins, head of corporate “The authorities may close the advertising responsibility and communications at Raketchannels, but the operators still have the same ech, puts it, the new landscape in strictly reguadvertising budgets and we think that’s a posilated markets like Italy can tive for the affiliate chanreduce affiliates to “basinels,” explains Gillespie of cally comparison sites”.

Gambling.com Group.

“Regulated markets But despite the hit, the Regulation may mean are more secure and big players are unified there are fewer bonus in their belief that there more appealing longoffers available to drive are benefits from operat- term. In the future customers, but affiliates ing in properly regulated I expect to see a may benefit from increased markets. Even Raketech, shift towards more CPA and revenue payments which operates in both regulated markets” instead. Then there are regulated and grey marissues of trust and compliScott Collins, Raketech kets, believes there are posiance, which can end up tives to be taken from the pointing operators in the new landscape. direction of the bigger affiliate players.

“We will continue to operate in both reguIn an environment where a bookmaker lated and unregulated markets,” says Collins. can fall foul of the advertising watchdog sim“But where it is unregulated, we will make ply by tweeting Spurs’ starting line-up for a sure that we are being responsible, and if it football match – as happened to William Hill does become regulated we’ll make sure we have in the UK last year, because two of the players products that can follow the rules. were under 25 – it is clear gambling brands are “Regulated markets are more secure treading on eggshells. In that situation, operaand are appealing as a long-term strattors will be anxious that the external partners egy. In the future I expect to see a shift they work with are responsible, and undertowards more regulated markets.” But he stand and play by the rules.

Better Collective Listed: Nasdaq Stockholm HQ: Copenhagen Things are looking bright for the ambitious Better Collective, who in 2019 made acquisitions in the US, the UK and Sweden. Elsewhere, they signed a partnership with the Daily Telegraph, and invested in AI and responsible gaming company Mindway.

All this helped drive growth, and chief executive Jesper Søgaard said: “Q3 saw the

“There has been negativity in Europe because of issues of advertising and negativity about Sweden, but we think it will come good in 2020” Jesper Søgaard, Better Collective

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highest revenue ever in a quarter – even though it was low season with no World Cup and no major football competition.”

New depositing customers: Exceeded 85,000 in Q3 (up 27 per cent year-on-year).

Jan-Sept saw 313,000 NDCs, up 74 per cent on 2018.

Revenue: Q3 revenue grew 54 per cent to €17.1m (2018: €11.1m). Jan-Sept revenue grew by 69 per cent to €47.9m (2018: €283m).

Profit: Q3 €3.3m (2018: €2.5m). JanSept profits rose 354 per cent to €10.6m.

“Operators prefer to work with affiliates who can deliver high volumes and also deliver on compliance – affiliates hold the operator’s brand in our hands,” says Søgaard of Better Collective.

Hellberg of Catena Media agrees. “When regulation happens, operators want to work with people who understand it,” he says.

CONTINUED CONSOLIDATION? So, could one outcome of the increased levels of regulation be another round of M&A activity?

The desire of the big players to pick up smaller operators has not exactly dwindled this year. Catena, for example, has made 37 acquisitions and Better Collective has picked up brands in the US including VegasInsider and RotoGrinders.

Jonas Warrer, managing director of media at Gaming Innovation Group, says that although his company is not currently looking to buy, plenty of others are – and he does not rule out the possibility of making an offer

MARKETING AFFILIATES

Catena Media Listed: Nasdaq Stockholm HQ: Malta “One should never be happy,” says CEO Per Hellberg, and the Malta-based company’s Q3 results were mixed. The company has gone through a period of “self-healing” but is getting back on an even keel, with growth in the US, expansion into Japan and strong performances from its core AskGamblers product improving profits.

New depositing customers: 99,435 NDCs in Q3, a decrease of 28 per cent on 2018.

Jan-Sept NDCs totalled 323,423, a decrease of 21 per cent on 2018 (411,670).

Revenue: Decreased by five per cent and totalled €26.4m in Q3 (2018: €27.7m). JanSept decreased by two per cent to €76.3m (2018: €77.6m).

Profits: Rose to €11.9m in Q3 (2018: €8.1m).

Jan-Sept profit was €20.6m, up 12 per cent on the previous year (€18.4m).

if the right opportunity comes along. “I expect consolidation to continue in the affiliate space – although at a slower rate than in previous years,” he says.

Teilman of Net Gaming Europe adds: “I am convinced that in the long run, regulation will lead to consolidation in the market. M&A multiples have come down a little bit, I would say, mainly because the larger affiliate companies tend to be more selective today, compared with previous years. I believe that by having a proper post-merger integration plan from the acquisition date, the transaction risk will decrease and increase the probability of successful acquisitions.”

That is a lesson that Catena Media has learned this year. CEO Hellberg freely admits that the company took its eye off the ball after a purchasing spree.

“When you buy something, it’s typically a small company that’s run by a few people with their own systems,” he explains. “And when you take them over you need to integrate them. But for the synergy to work they need to become part of a big system and you need to make sure the thing you buy is refitted.”

That can be a complex process and as staff worked to incorporate their latest sites, Catena let its focus drift away from its core sites, including AskGambers.com.

That might help explain the company’s recent mixed performance. “We’ve been going through a self-repair process, which happened at the same time as regulatory GIQ Q4 REVIEW

change, so it’s been a double-edged sword,” says Hellberg.

It’s a lesson that others can learn from, but it is unlikely to dampen the thirst for new blood at Better Collective, which admits that much of its recent growth has come from acquisitions, particularly in the US. RotoGrinders was bought in May 2019, with Better Collective initially paying $21m for a controlling stake, and the company sees it as a key weapon in the assault on the US market. “It’s a substantial business from which we can grow and target the American states as they grant sports betting licences,” says CEO Søgaard.

VegasInsider is another US brand it has acquired, and which does require some work.

It is set to relaunch in the second quarter of 2020. However, the company is not buying for the sake of it. “We don’t feel we have a dire need to make an acquisition, but if we see the right one for the right price we will,” explains Søgaard.

Collins of Raketech, which acquired Casumba – which gives it a foothold in the important Japanese market – among others this year, says the key to a good deal is not to buy from people who are simply looking to sell and move on. “What we like to do when we make an acquisition is make sure that the people are there for at least a couple of years,” he says. That way the company culture can come through, and brands, which are becoming more important for affiliates, can be developed.

“We’ve been going through a self-repair process, which happened at the same time as regulatory change, so it’s been a double-edged sword” Per Hellberg, Catena Media

Net Gaming Europe Listed: Nasdaq Stockholm HQ: Malta President and CEO Marcus Teilman blamed the regulatory pressures in European markets for a weak quarter, and said that the change in revenue model towards revenue share had also had an impact. The company also acquired MaxFreeBets.co.uk during the quarter.

New depositing customers: NDC numbers declined by 14 per cent in Q3 compared to 2018. Jan-Sept NDCs were down 19 per cent compared to 2018.

Revenue: Q3 amounted to €3.5m, down 29.5 per cent on 2018 (€4.9m). Jan-Sept revenue was €11m, down 20.5 per cent on 2018 (€13.8m).

Profit: Q3 profit was €1.14m, down 44 per cent on 2018 (€2.03m). Jan-Sept profit was €4.32m, down 31 per cent on 2018 (€6.26m).

71

MARKETING AFFILIATES

Gambling.com Group Listed: Nasdaq Stockholm HQ: Malta Chief executive Charles Gillespie was bullish about the Q3 results, despite the lack of major sporting events and headwinds in markets, including the UK and Sweden.

There were licences granted in the US and an injection of $15.5m from Edison Partners.

Gillespie said: “KPI data continued to show very strong growth trends, and we remain extremely positive for future development in these markets.”

New depositing customers: NDCs totalled 18,411 in Q3, up four per cent on 2018 (17,703). Jan-Sept NDCs totalled 65,163, an increase of 31 per cent on 2018 (49,707).

Revenue: Up two per cent in Q3, at €4.16m (2018: €4.07m). Jan-Sept revenue was €13.83m, an increase of 22 per cent on 2018 (€11.30).

Profit: The group reported a loss of €57,000 in Q3, having made a profit of €438,000 in 2018. This was put down to a spike in operational costs. Jan-Sept profit was €1.1m, more than 80 per cent down on the 2018 figure of €5.9m.

“Investors like sustainable businesses and black market revenue is not sustainable” Charles Gillespie, Gambling.com Group

72

REVENUE STREAMS Another key factor in the differing fortunes of the main affiliates this year has been the type of revenue they chase. It’s perhaps telling that Catena, Net Gaming Europe and Raketech focus on casino gamers, who have been hit by European regulation, while Better Collective gets 80 per cent of its revenue from sports betting.

Søgaard of Better Collective says there is a good reason for focusing on sports in the new landscape: “The fact that sports betting is viewed more favourably by regulators is one of the reasons that sports betting is what we focus on.”

But Warrer at GiG says: “Revenue is revenue, so the short answer is that we focus on where we can make the highest return on investment. Casino customer lifetime values are much higher than in sports, so I would favour being big in casino over sport. Operating both within sports and casino, it is very evident to see that sports betting players have much lower churn rates, meaning that revenue will come for a longer period.”

The different types of revenue available to affiliates also play a part. Most affiliates prefer revenue share, where they get a percentage of the deposits made by any player they introduce to an operator, as it guarantees a long-term income and can help build relationships. However, in the US, operators tend to prefer a CPA model, paying for leads, which offers a short-term hit but has little long-term value.

Net Gaming Europe chief Teilman says his company has moved to increase revenue share income. “We have made a strategic decision to make a shift in our revenue model, where we reached 60 per cent of our revenues in Q3 from a revenue share model, compared with 12 per cent in Q2 2017, so it’s a pretty big move. That has of course had quite an impact as well, short-term. Over time this will benefit us, though.”

Warrer of GiG says : “ T he mi x between CPA and revenue sha re a l l comes down to the kind of

deal we can strike with our partners. All deals have to be made with a long-term perspective.

We need to make deals where both we and our partners are happy, where we support them offering valuable insights to their consumers, otherwise business is not sustainable in the long-term.”

A lot rests on what is on offer, adds Hellberg. For example, he says, “US operators don’t want revenue share and they are paying much higher CPA – but if you are in a market that is about to open up, then revenue share is much better.”

As Søgaard of Better Collective adds: “With a new partner we will want some form of secure payment, otherwise we’re not interested. Revenue share is a question of trust. We have partners we have been with for more than ten years and we know we can trust them.”

LOOKING AHEAD So, after the travails of 2019, what will 2020 have in store for the affiliate industry? Of course, the elephant in the room is the emergence of markets in the US – but there are other opportunities opening up as well and other challenges to face in the new regulatory landscape.

“Companies in the affiliate space will look to expand into new markets. In general, I would say the consensus in the affiliate space is that future growth will probably be generated from markets such as the US, Latin America and Asia,” says Warrer.

“All actors will have to adjust to a marketplace with fiercer competition and where low performance has a much higher impact. In a setting like this, I believe the importance of human resources, marketing technology and strong execution will become more and more apparent to all, so maybe this is something we will talk about more and more in 2020.”

“It is difficult not to talk about the US,” adds Warrer. “We are investing in the US through our website wsn.com, pursuing a longterm strategy where we will use one site to target all the regulated states.”

But Hellberg thinks a local approach in the States wi l l pay d ividend s.

“When people bet they want to bet on local teams.

When you search on Google you want to get local odds,” he says.

Catena’s PlayUSA brand is developing state-branded versions for different states but will also develop a national site. It is also

MARKETING AFFILIATES

pushing its European brands into the new market, in what amounts to a belt and braces approach. Hellberg is also confident that when the US market matures the casino industry will emerge out of the shadows and offer rich rewards.

But the way US states are rolling out sports betting on a state-by-state basis could be an issue. It “makes things a little harder”, admits Teilman, as affiliates must apply for separate licences. “But on the other hand, the US is a very big market with fantastic potential long-term. I think the main driver in the US is sports betting. However, I am also convinced that casino will add substantial growth as well.”

Gi l lespie of Gambling.com ag rees that each state will be its own market.

And while the group has not rushed to make acquisitions in the US, he is confident the company will prosper there. “We are the only one of these businesses that is founded by and is managed by Americans – we don’t necessarily need a US acquisition because we are American,” he says. It already has a “foothold” there through a casino site and Bookies.com, he adds.

Raketech is also resisting the urge to rush headlong across the Atlantic. “You’d be silly not to think about the US but there is going to be a lot of competition there from major companies, local startups and tech firms, so we are trying to be cautious about it,” says Collins.

“We want to enter at the right time with the right products and make sure that there are enough states open for business.” The company already has a CPA licence for New Jersey, he

Gaming Innovation Group Listed: Oslo HQ: Malta The gaming operator and B2B supplier appointed Richard Brown as CEO in November and underwent some strategic changes, including divesting B2C brand Highroller and closing its proprietary game studio. Overall Q3 revenue for the group was €30.2m, down from €37.3m a year earlier.

Media services revenue: €8m in Q3, down

says, and other states could follow. “We have done analysis and we have domains that are dormant and ready to go – it may mean changing domain focus from UK to US.” Better Collective’s acquisition of US sites RotoGrinders and VegasInsider, plus its focus on sports betting, is a clear indication of its ambitions in the West. “It will be exciting to see which states progress,” says CEO Søgaard. “We have a good platform for growth in the US and we need to develop that.”

As for XLMedia, which finds itself in a state of flux, it remains to be seen whether the new management decides to double down on the previous regime’s decision to pivot towards the US. Its North American revenue increased 20 per cent in the first six months of 2019.

The company says it is “encouraged” by the opportunities in the US and said it had “already built a number of websites, engaged with US users across multiple states and is in the process of expanding its local presence”. It added that it was “actively looking

Raketech Listed: Nasdaq Stockholm HQ: Malta Raketech acquired Casumba in Q3 and established a foothold in the Japanese market, which it believes will offer opportunities and could prove to be more attractive than the US. It, like other affiliates, also suffered

GIQ Q4 REVIEW

from €8.4m in 2018. Revenue for the entire B2B segment, which includes media services, was down 15.3 per cent in the first nine months of 2019, at €39.2m compared to €46.3m in 2018.

First Time Depositors: Media services referred 26,896 FTDs to operators in Q3. Down eight per cent on 2018, when the figure was 29,288.

Earnings: EBITDA for media services in Q3 was €4.2m, marginally down on the 2018 figure of €4.3m.

for acquisition opportunities to accelerate its expansion”.

Of course, the US is not the only option for affiliates. Eastern European markets are also opening up, and possibilities in Japan are exciting, as its commercial casino market prepares for lift-off. And as frontiers expand, the market consolidates and the new-look European market develops, the issue of branding will come to the fore.

Net Gaming Europe has appointed brand managers for its main sites, says Teilman, with the aim of “improving our conversion rates and value of our traffic through a more intensified focus”.

Collins of Raketech says: “With bonuses under pressure, affiliates will use brands to create traffic to their sites rather than focus on SEO.” Strongly branded affiliate sites also open up other conversion routes, such as social media.

For the big players, another year of challenges and opportunities beckons. n

XLMedia from regulation in Europe and changes to the Google search algorithm.

New depositing customers: NDC numbers were similar to Q3 2018. It attracted 26,782 in 2019, marginally down on the Q3 2018 figure of 26,837. Jan-Sept NDCs were up by 26.4 per cent at 80,364, compared to 63,599 in 2018.

Revenue: Q3 revenue was down 15.1 per cent on 2018, at €5.95m, compared to €7m in 2018. But Jan-Sept revenue was slightly up, at €18.06m, up 0.7 per cent on 2018 (€17.94m).

Profit: Q3 profit was down 59.4 per cent, at €1.49m (2018: €3.67m). Jan-Sept profit was €6.22m, down 16.1 per cent on 2018 (€7.41m).

Listed: London HQ: Jersey XLMedia, which declares its results half yearly, has appointed a new CEO, Stuart Simms, and undertaken an internal review of its business model. But in its December trading update it forecast that revenue was likely to be a third down on 2018, at $78m (2018: $117.9m). It estimated that its adjusted EBITDA would be £32m, down more than a quarter on 2018 ($43.9m).

Revenue: In the first half of 2019 it reported revenues of $42.46m, down ten per cent on 2018’s half yearly figures ($47.18m).

Profit: Operating profit for the first half of the year was $14.32m, down 20.6 per cent on 2018 ($18.04m).

73

Reimagine Next

©© 2020 Scientific Games Corporation.

All Rights Reserved.

2020 Scientific Games Corporation.

All Rights Reserved.

2020 isn’t just a new year – it’s a new decade, a new beginning.

And Scientific Games has a bold new look to kick it off.

So look for us as we work with our lottery partners to reimagine the future.

FINANCE

The GIQ Q3 2019 BETSSON SPIN-OFF ANGLER Gaming came out on top of the GIQ20 chart as revenue more than doubled during the third quarter of 2019. With the company enjoying a breakthrough year in 2019, Angler Gaming’s strong Q3 performance took the company ahead of Penn National Gaming, one of the early leaders in the nascent US sports betting market, and live casino provider Evolution Gaming at the top of the chart.

Other strong performers in the GIQ20 chart of the fastest-growing companies included Churchill Downs Inc, Enlabs and Gamesys Group, which began a new era following JPJ Group’s reverse takeover of Gamesys and yet another name change. Aspire Global continues to reap the benefits of its increased B2B focus, while the Stateside sports betting boom across the Atlantic boosted results for the likes of Kambi, Flutter Entertainment and The Stars Group.

The bigger story during Q3, however, was the record number of companies that missed out on a place in the chart. Hampered by recent regulatory changes in the UK and Sweden, some of the industry’s leading operators were unable to post revenue gains during Q3. Betsson and Kindred Group both slipped off the GIQ20 chart, while UK retail troubles pushed GVC out, and the likes of Codere, Intralot and bet-at-home.com also failed to see revenue growth. Let’s hope this isn’t a sign of things to come. n GIQ Q4 REVIEW

IN THIS ISSUE 84 GIQ20 fastest growing companies

The GIQ20 Q3 2019 fastest growing listed gaming companies COMPANY

Q3 2019

Q3 2018

CHANGE

€7.6m

€3.8m

102%

$1,354.5m

$789.7m

72%

€94.7m

€64.3m

47%

$306.3m

$221.3m

38%

1

ANGLER GAMING

2

PENN NATIONAL GAMING

3

EVOLUTION GAMING

4

CHURCHILL DOWNS INCORPORATED

5

ENLABS

€10.0m

€7.6m

32%

6

GAMESYS GROUP

£92.4m

£75.2m

23%

7

ASPIRE GLOBAL

€33.2m

€28.6m

16%

8

KAMBI GROUP

€23.0m

€20.5m

12%

9

LEOVEGAS

€88.2m

€78.6m

12%

10

SCIPLAY CORPORATION

$116.4m

$105.3m

11%

11

RANK GROUP

n/a

n/a

10%

12

FLUTTER ENTERTAINMENT

£533m

£483m

10%

13

POLLARD BANKNOTE

CAD$103.2m

CAD$94.5m

9%

14

THE STARS GROUP

$622.5m

$572.0m

9%

15

MGM RESORTS INTERNATIONAL

$3,314.4m

$3,029.3m

9%

16

OPAP

€393.6m

€368.9m

7%

17

AGS

$79.4m

$75.5m

5%

18

SCIENTIFIC GAMES

$855m

$821m

4%

19

CAESARS ENTERTAINMENT

$2,236m

$2,185m

2%

20

WILLIAM HILL (UP TO 29 OCTOBER)

n/a

n/a

1%

75

F I NA NC E GIQ20 Q3 2019

Betsson spin-off shoots to the top Angler Gaming soars to the top of the GIQ20 chart with the biggest revenue growth during Q3 2019, as a record number of operators and suppliers miss out, writes Kio Dawson

76

ANGLER GAMING 102% Net revenue (€)

TOTAL

Q3 2019

Q3 2018

Change

7.6m

3.8m

102%

Stockholm-listed operator Angler Gaming topped the GIQ20 chart after enjoying a stellar performance during the third quarter, as revenue and profit more than doubled compared to last year. Angler Gaming, which was spun off from Betsson in 2012, saw revenue soar 102 per cent to €7.6m, benefiting from growth in its Premiergaming subsidiary, operator of the ProntoCasino brand that generates 27 per cent of group revenue. After launching a new casino brand in Sweden during Q4, the operator will add a sportsbook to its Premiergaming brands in H1 2020.

“In summary, we have a good momentum and we are satisfied with the all-time highs in revenues and profits so far in 2019,” said CEO Thomas Kalita. “Considering that we have all-time high in customer bets in Q3 and a higher customer payout than usual, we feel extra pleased with the result in Q3 and the start of Q4.”

“Considering that we have all-time high in customer bets in Q3 and a higher customer payout than usual, we feel extra pleased with the result in Q3 and the start of Q4” Thomas Kalita, Angler Gaming

FINANCE

GIQ20 Q3 2019

PENN NATIONAL GAMING 72% Net revenue (US$)

said CEO Timothy Wilmott. “The combination of our greater than five million active mychoice player database and our industry leading regional casino footprint positions us well to capitalise on the rapidly expanding sports betting and iGaming markets in a way that maximises shareholder value.”

Q3 2019

Q3 2018

Change

Northeast segment

628.9m

441.4m

42%

South segment

276.6m

60.4m

358%

West segment

161.5m

92.6m

74%

EVOLUTION GAMING GROUP

Midwest segment

275.8m

185.4m

49%

47%

Other

12.4m

9.9m

25%

Net revenue (€)

Intersegment eliminations

(0.7m)

n/a

n/a

1,354.5m

789.7m

72%

TOTAL

There was a strong performance too from New York-listed Penn National Gaming, as results were boosted by the recent acquisition of Pinnacle Entertainment and increasing contributions from sports betting and iGaming. The bulk of the company’s revenue is derived from its land-based casino operations, with nearly half of the Q3 total generated by the Northeast US region, while there was also strong growth across all other US regions. Other revenue increased by 25 per cent to $12.4m, comprising results from racing, social gaming, retail sportsbooks, iGaming and the Heartland Poker Tour live poker tournament series.

“We are very encouraged by early market share results from these operations and are excited about the new growth opportunity,” GIQ Q4 REVIEW

TOTAL

Q3 2019

Q3 2018

Change

94.7m

64.3m

47%

Stockholm-listed Evolution Gaming reported a 47 per cent increase in revenue to €94.7m for the third quarter, with profit for the period nearly doubling to €39.8m. The supplier said that demand for live casino games continued to grow, partly as a result of several successful games launched earlier in 2019, with the total number of bet spots from end users increasing by 49 per cent to 5.8bn during Q3. For the first time, Evolution provided a breakdown of revenue per region, with the biggest growth coming from Asia as revenue climbed 115 per cent to €13.9m, while North American revenue more than doubled to €6.1m.

“Our investments in new games and studios are having an increasingly strong impact, which is reflected in both the high growth as 77

F I NA NC E GIQ20 Q3 2019

“Our investments in new games and studios are having a strong impact, which is reflected in the high growth as well as stronger margins” Martin Carlesund, Evolution Gaming Group

well as stronger margins,” said CEO Martin Carlesund. “Through our expansion and construction of studio capacity, together with the ten new games launched during the first half of 2019, we are also favourably positioned to take advantage of the growing general demand for Live.”

CHURCHILL DOWNS 38% Net revenue (US$)

Churchill Downs Online wagering Gaming Other TOTAL

Q3 2019

Q3 2018

Change

31.4m

10.8m

191%

70.2m

71.8m

-2%

GAMESYS GROUP

178.3m

110.4m

62%

23%

26.4m

28.3m

-7%

306.3m

221.3m

38%

New York-listed Churchill Downs Incorporated enjoyed strong performances from its Churchill Downs racing segment and landbased gaming operations during Q3, which offset a decline in revenue from online wagering. CDI’s gaming segment generated the bulk of the Q3 total, as revenue grew by 62 per cent to $178.3m, driven by the acquisition of Pennsylvania’s Presque Isle Downs & Casino, the consolidation of Ocean Downs Casino and Race78

track in Maryland, and increased revenue at Mississippi properties, following the opening of the retail BetAmerica Sportsbooks.

Revenue from Churchill Downs soared 191 per cent to $31.4m due to the opening of Derby City Gaming in Kentucky last September, while revenue from online wagering fell by two per cent to $70.2m, primarily due to the exit of existing high-volume and low-margin customers in the Velocity group within TwinSpires.

The new online sports betting and iGaming business generated negative revenue of €0.1m, as sign-up bonus incentives in New Jersey outpaced gross revenue of €0.6m.

Net revenue (£) Q3 2019

Q3 2018

Jackpotjoy

52.2m

49.5m

Change 5%

Vera&John

40.2m

25.7m

56%

TOTAL

92.4m

75.2m

23%

London-listed Gamesys Group reported a 23 per cent increase in revenue to £92.4m for the third quarter, benefiting from continued growth from Vera&John in international markets and the first contributions from the newly acquired Gamesys brands. Revenue from Vera&John rose 57 per cent to £40.2m, while Jackpotjoy revenue increased by five per cent

FINANCE

GIQ20 Q3 2019

ENLABS 32% Net revenue (€) Q3 2019 TOTAL

10.0m

Q3 2018 Change 7.6m

32%

Stockholm-listed Enlabs recorded its best ever quarter in Q3 as revenue increased 32 per cent to €10m following growth from its Optibet in Estonia, Latvia and Lithuania. Gaming revenue increased by 39 per cent to €9.2m, while media revenue fell by 12 per cent to €0.6m and other solutions contributed €0.3m in revenue. Casino represented 62 per cent of gaming revenue at €5.7m, while betting revenue climbed seven per cent to €2.9m, of which 20 per cent related to revenue from retail betting shops in Latvia and Lithuania. Poker contributed a further €0.6m in revenue.

“The quarter showed overall strong performance, but September stands out as a record-breaking month on all fronts – so I have

great confidence going into Q4,” said president and CEO Robert Andersson. “October has been off to an even better start as we launched a lot of new content, with Evolution Gaming in Latvia being a key driver going forward. We are also in the final stage of migrating Optibet.com to our new platform, which operates on our Maltese licence. This means we will have a highly competitive offering, enabling us to go after markets beyond the Baltics.”

“We will have a highly competitive offering, enabling us to go after markets beyond the Baltics” Robert Andersson, Enlabs

ing a decline in its B2C business, due mainly to a lower contribution from sports betting following strong comparables in the prior year period, which included the World Cup. Revenue from B2B grew 32 per cent to €22.5m, representing nearly two-thirds of the quarterly total, with six new brands launched during the quarter, while B2C revenue fell by 12 per cent to €11.5m.

“Despite the ongoing transformation of the iGaming industry and the various regulatory changes that tend to affect activity in the short-term, for instance in the UK, Aspire Global continues to sustain a strong and profitable growth,” said CEO Tsachi Maimon.

“We are able to do so thanks to a wide market presence, a differentiated partner portfolio and a broad offering – most recently through the acquisition of Pariplay, the integration of which will help us to capitalise further on our game assets.”

LEOVEGAS 12%

to £52.2m following a return to growth from Jackpotjoy UK and double-digit growth from Botemania in Spain. This offset a decline in Jackpotjoy’s Swedish revenue following regulatory changes in Sweden. The newly acquired Gamesys brands contributed a further £2.3m from just four days of trading during Q3.

“It is a very exciting time for all involved at Gamesys Group,” said CEO Lee Fenton.

“The successful combination of two leading and complementary businesses with a unique technology offering, a strong pool of talent and an enhanced portfolio of brands, ensures the group is in a strong position to take advantage of future growth possibilities and we are already reaping the benefits in terms of operating performance.”

ASPIRE GLOBAL 16% Net revenue (€) Q3 2019

Q3 2018

Change

B2B

22.5m

17.1m

32%

B2C

11.5m

13.0m

-12%

Elimination

(1.8m)

(2.0m)

-10%

TOTAL

33.2m

28.6m

16%

Stockholm-listed Aspire Global reported a 16 per cent increase in revenue to €33.2m for the third quarter of 2019, despite seeGIQ Q4 REVIEW

Net revenue (€)

TOTAL

Q3 2019

Q3 2018

Change

88.2m

78.6m

12%

Stockholm-listed LeoVegas reported a 12 per cent increase in third quarter revenue to €88.2m, benefiting from growth in Sweden, Finland, Denmark and Italy. The operator said the British market remained challenging and that its Royal Panda brand in particular recorded a weaker performance during the quarter, while revenue from the Nordic region climbed 14 per cent as Sweden continued to develop “in a positive direction” following market re-regulation in January.

“We continued to show prog ress during the third quarter in a difficult-to-navigate environment and generated double - dig it g row t h i n bot h sales and operating profit,” said CEO Gustaf Hagman. “Greater regulatory complexity in several of our main markets has given rise to certain short-term challenges but is also raising the barriers to succeed in the sector which benefit established companies.”

79

F I NA NC E GIQ20 Q3 2019

“We have a number of updates that will lead to growth in our evergreen franchises as we explore opportunities in new geographies, new games and new genres” Josh Wilson, SciPlay

80

SCIPLAY CORPORATION

RANK GROUP

11%

10%

Net revenue (US$)

Net revenue (£)

TOTAL

Q3 2019

Q3 2018

Change

116.4m

105.3m

11%

New York-listed SciPlay has reported an 11 per cent increase in social gaming revenue to $116.4m for the third quarter, buoyed by the ongoing popularity of its Jackpot Party Casino, Bingo Showdown, 88 Fortunes and Monopoly Slots apps. Mobile continued to grow and accounted for 84 per cent of Q3 revenue, up from a 79 per cent share a year ago.

Average daily active users remained at the same level as last year at 2.7 million, with average monthly active users down marginally by 0.6 per cent to 7.8 million.

“I’m pleased with the team’s hard work and passion that led to above market revenue growth of 11 per cent in the third quarter,” said CEO Josh Wilson. “We have a number of exciting game updates that will lead to continued growth in our evergreen franchises as we explore opportunities in new geographies, new games and new genres. These will enable us to execute on our mission to become the number one casual mobile gaming company in the world.”

Q3 2019

Q3 2018

Change

Digital

n/a

n/a

16%

Grosvenor venues

n/a

n/a

15%

Mecca venues

n/a

n/a

0%

International venues

n/a

n/a

4%

TOTAL

n/a

n/a

10%

London-listed Rank Group posted a ten per cent increase in revenue for its first quarter ending 30 September. The digital division recorded the strongest growth, as revenue increased by 16 per cent compared to the same period last year. Within this, Rank’s Grosvenor brand grew revenue by 27 per cent, while Mecca digital’s revenue rose by 14 per cent, and YoBingo’s performance remained in line with last year. Following the completion of its acquisition of Stride Gaming, Rank revealed that the business generated revenue of £16.3m during Q3, a decline of 15 per cent compared to last year, driven by lower customer acquisition volumes and reduced margins.

“We are pleased with the growth achieved across our businesses in this key part of our

financial year, as well as with the ongoing progress we are making with our transformation programme,” said CEO John O’Reilly. “The acquisition of Stride marks a pivotal moment in the development of our digital offering and having completed on 4 October 2019, we are now starting the execution of all our plans for integration and delivery of synergy benefits.”

FLUTTER ENTERTAINMENT 10% Net revenue (£) Q3 2019

Q3 2018

Change

Online

247m

248m

-1%

Australia

119m

101m

18%

75m

82m

-9%

91m

52m

75%

533m

483m

10%

Retail US TOTAL

London-listed Flutter Entertainment grew Q3 revenue by ten per cent to £533m, as strong performances in the US and Australia offset falling revenue in the online and retail segments. Sports betting accounted for £417m, an increase of ten per cent year-on-year, with gaming contributing £116m, an increase of seven per cent versus the prior year period.

GIQ Q4 REVIEW

“Q3 was an important quarter for the group, with revenues up ten per cent and the announcement of our combination with The Stars Group,” said CEO Peter Jackson. “We believe that this deal will accelerate delivery of all of our core strategic objectives and we are very excited about the international growth prospects for the combined group.

“Within PPB, both the Paddy Power and Betfair brands continued to make good progress in building more recreational customer bases through enhanced responsible gambling measures. While revenues in the quarter were impacted by this ongoing work, we remain confident that the changes being made will improve the sustainability of future growth and lead to a more diversified customer base for both brands.”

“Q3 was an important quarter, with revenues up ten per cent and the announcement of our combination with The Stars Group” Peter Jackson, Flutter Entertainment 81

FINANCE

GIQ20 Q3 2019

MGM RESORTS INTERNATIONAL 9% Net revenue (US$) Q3 2019

Q3 2018

1,507.4m

1,454.4m

4%

935.0m

777.1m

20%

MGM China

737.8m

606.0m

22%

Management and other operations

134.2m

191.8m

-30%

3,314.4m

3,029.3m

9%

Las Vegas Strip resorts Regional operations

TOTAL

New York-listed MGM Resorts reported a nine per cent increase in revenue to $3.31bn for the third quarter, with nearly half of the total generated from Las Vegas Strip casinos. There was also strong growth from the company’s regional operations, with revenue up 20 per cent to $935m, while revenue from MGM China grew 22 per cent to $737.8m.

Meanwhile, MGM Resorts continues to make good progress with its Roar Digital

21% Net revenue (CAD$) Q3 2019

Q3 2018

Change

Lottery

74.9m

62.7m

19%

Charitable

15.9m

11.3m

41%

6.8m

6.3m

8%

97.5m

80.3m

21%

TOTAL

joint venture with GVC Holdings, securing a landmark deal in October to launch sports betting within the Yahoo Sports app in the US, with all transactions taking place on the BetMGM platform.

“Integrating Yahoo’s fantasy sports operations and content with BetMGM’s world-class sports betting and interactive platform positions us to drive market share and large-scale adoption among sports fans,” said CEO Jim Murren.

THE STARS GROUP

POLLARD BANKNOTE

Gaming systems

“NeoPollard continues to win a significant share of iLottery opportunities and is seen as the clear market leader in this important growth area” John Pollard, Pollard Banknote

9% Net revenue (US$) Q3 2019

Q3 2018

Change

Poker

192.6m

215.7m

-11%

Gaming

194.6m

180.9m

8%

Betting

218.2m

158.4m

38%

Other

Toronto-listed Pollard Banknote hit a record quarterly high in Q3 as revenue increased by 21 per cent to CAD$97.5m, buoyed by strong growth from its lottery and charitable gaming businesses. The supplier also benefited from its growing iLottery division, with the North Carolina Education Lottery becoming Pollard’s fourth iLottery customer at the end of October.

“Pollard has achieved strong results in our third quarter, reaching a new revenue record driven by increased instant ticket sales and supported by sales of our expanding ancillary products,” said co-CEO John Pollard.

“Continued consumer demand among our existing contract portfolio and success in growing market share from lotteries that have multiple suppliers has been the key in increasing demand for our tickets. Pollard’s iLottery joint venture, NeoPollard, continues to win a significant share of iLottery opportunities and is seen as the clear market leader in this important growth area.”

GIQ Q4 REVIEW

Change

TOTAL

17.2m

17.0m

1%

622.5m

572.0m

9%

Toronto-listed The Stars Group reported a nine per cent increase in revenue to $622.5m for the third quarter, driven by strong performances in the UK and Australia, which offset a decline in revenue from the International segment. Sports betting was The Stars Group’s largest product vertical during Q3 with a 35 per cent share of revenue, while online casino and poker each accounted for 31 per cent of revenue. Of the Q3 total, 77 per cent of revenue was derived from locally regulated or taxed markets, compared to 72 per cent last year.

“Our Q3 results were robust and in line with our expectations, supported by strong revenue growth in our United Kingdom and Australia segments, which helped offset both the ongoing disruption in certain of our lowerpriority international markets and continued foreign exchange headwinds across the business,” said CEO Rafi Ashkenazi. “We have also 83

FINANCE GIQ20 Q3 2019

SCIENTIFIC GAMES 4% Net revenue (US$) Q3 2019

Q3 2018

Change

Gaming

454m

448m

1%

Lottery

220m

207m

6%

SciPlay

116m

105m

11%

Digital

65m

61m

7%

TOTAL

855m

821m

4%

New York-listed Scientific Games grew Q3 revenue by four per cent to $855m, following growth across all business segments. This helped the company post net income of $15m for the quarter, compared to a loss of $352m a year ago. The SciPlay social gaming business and digital segments posted the strongest growth, with revenue climbing 11 per cent and seven per cent respectively, while the lottery segment grew revenue by six per cent and gaming by one per cent. Within the digital segment, sports and platform revenue increased by 38 per cent, which offset a ten per cent decrease in gaming and other revenue to $36m. made rapid progress in the US following our landmark FOX Sports deal in May, with the launch of our FOX Bet products at the start of the professional football season in New Jersey and Pennsylvania, and some very encouraging early signs from our FOX Sports Super six nationwide free-to-play games.”

said chief executive Damian Cope. “With revenues and profitability again showing good growth over 2018, OPAP continues to demonstrate the sustained benefits of the company’s ongoing transformation.”

AGS

Q3 2019

Net revenue (US$)

7% Net revenue (€) Q3 2019 TOTAL

393.6m

Q3 2018 368.9m

Change 4%

Athens-listed OPAP posted a seven per cent increase in net gaming revenue to €393.6m for the third quarter of 2019, benefiting from a strong performance from its growing video lottery terminal (VLT) business. OPAP recorded its ninth consecutive quarter of growth in Q3, with lottery revenue increasing by four per cent to €197.4m, offsetting a six per cent decline in sports betting revenue to €91.9m. Revenue from VLTs grew 43 per cent to a record €72.8m from 20,932 machines now installed across the country, while revenue from instant and passive games rose two per cent to €31.6m.

“Our results in Q3 provide further evidence of the growth being delivered by the OPAP team, thanks to the investments made, and hard work put in, over the last few years,” 84

2% Net revenue (US$)

5%

OPAP

CAESARS ENTERTAINMENT CORPORATION

Electronic gaming machines Table products Interactive TOTAL

Q3 2019

Q3 2018

Change

75.3m

71.8m

5%

2.9m

2.1m

39%

1.2m

1.7m

-28%

79.4m

75.5m

5%

New York-listed AGS saw revenue increase by five per cent during the third quarter to $79.4m, with electronic gaming machines (EGMs) representing the bulk of the total after recording growth of five per cent to $75.3m.

Revenue from table games grew 39 per cent to $2.9m, offsetting a 28 per cent drop in interactive revenue to $1.2m, which was impacted by a 51 per cent decline in social gaming revenue.

AGS’s growing real-money iGaming business saw revenue more than double to $0.5m, driven by the continued placement of its landbased EGM content in the European iGaming market, as well as its recent launch in New Jersey where it has more than 28 suppliers

Q3 2018

Change

Las Vegas

973m

910m

7%

Other US

1,119m

1,125m

-0.5%

144m

150m

-4%

2,236m

2,185m

2%

Other TOTAL

New York-listed Caesars Entertainment reported a two per cent increase in revenue to $2.24bn for Q3 2019, as the company remains on course to merge with rival Eldorado Resorts next year.

Revenue growth was driven by Caesars’ Las Vegas properties, which increased seven per cent $973m. This offset a marginal decline in revenue from other US regions to $1,119m, due to competition in Atlantic City and Southern Indiana. Other revenue also declined, down four per cent to $144m, primarily as a result of lower gaming volumes in the UK. “We are pleased to have delivered solid financial results in Q3, with net revenue growth across all business verticals,” said CEO Tony Rodio. “Revenue performance was driven by our Las Vegas region, with particular strength in the hotel business which continues to outpace prior years across properties.”

FINANCE

GIQ20 Q3 2019

WILLIAM HILL

Going down in Q3 2019

1% Net revenue (£) Q3 2019

Q3 2018

Change

Retail

n/a

n/a

-23%

Online

n/a

n/a

26%

US existing

n/a

n/a

27%

US expansion

n/a

n/a

200%

TOTAL

n/a

n/a

1%

London-listed William Hill sneaked into the GIQ20 as revenue grew by one per cent for the four-month period ending 29 October, with falling retail revenue once again offset by growth in the US and online. Retail revenue was down 23 per cent due to the lower £2 maximum stake limit introduced to FOBTs in April, which led to 700 shop closures during the period. William Hill US saw revenue climb by 60 per cent, with its existing Nevada business growing revenue by 27 per cent, while US expansion revenue tripled, driven by new launches in a number of states, including Indiana and Iowa. William Hill’s Online segment grew revenue by 26 per cent, driven by gaming revenue growth of 51 per cent and sportsbook growth of one per cent.

International Game Technology (IGT) narrowly missed out on a place in the GIQ20 chart as revenue declined marginally by 0.3 per cent to $1,153m during Q3 2019, with growth in its North America-facing businesses offset by lower revenue in Italy and other international markets.

GVC Holdings posted a one per cent decline in Q3 revenue as solid growth in online gaming and sports betting was offset by falling revenue in retail. NetEnt continued to struggle with

the weak developments of the Swedish market as revenue fell by one per cent to SEK443.4m, though results were boosted by the first contributions from newly acquired Red Tiger.

Kindred Group was another to be impacted by the difficult market conditions in Sweden, with a lower than usual sportsbook margin in September pushing overall revenue down two per cent to £226m. Despite a growing contribution from online, Codere saw revenue decline by four per cent to €356.2m in Q3 following struggles in its core Argentina, Mexico and Spain markets.

Intralot’s Q3 revenue was down five per cent year-onyear to €177.5m, following a decline in revenue from licensed operations and game management services, partially offset by growth in technology contracts.

Revenue from bet-at-home. com fell by six per cent to €29.2m as both sports betting and online gaming declined, down seven per cent and four per cent

respectively to €12.4m and €16.8m.

Betsson saw revenue fall 11 per cent to SEK1,275.2m as a result of the continued weak trends in Sweden and the Netherlands, though the operator did reveal plans to enter the B2B sports betting space in 2020 and offer its in-house developed sportsbook to external customers.

Revenue from Gaming Innovation Group declined by 19 per cent to €30.2m, as results were impacted by the Swedish market and termination of a customer at the end of 2018. Inspired Entertainment’s revenue fell by 25 per cent to $26.6m, mostly due to the impact of reduced maximum staking limits on gaming machines in the UK. Zeal Network was another to struggle in Q3 as revenue fell by 44 per cent to €21.9m following a large jackpot win of €26.3m in August, while Global Gaming continued to suffer from its regulatory issues in Sweden, with revenue falling 76 per cent to SEK60.3m.

Net revenue Company

Q3 2019

Q3 2018

% Change

IGT

$1,153m

$1,156m

-0.3%

n/a

n/a

-1%

SEK443.4m

SEK449.3m

-1%

Kindred Group

£226.0m

£230.7m

-2%

Codere

€356.2m

€343.4m

-4%

Intralot

€177.5m

€187.6m

-5%

bet-at-home.com

€29.2m

€31.0m

-6%

GVC Holdings NetEnt

Betsson

SEK1,275.2m

SEK1,426.8m

-11%

Gaming Innovation Group

€30.2m

€37.3m

-19%

Inspired Entertainment

$26.6m

$35.6m

-25%

Zeal Network

€21.9m

€39.2m

-44%

SEK60.3m

SEK253.1m

-76%

Global Gaming 555

GIQ Q4 REVIEW

85

C O LU M N AND ANOTHER THING...

The Hot 50 addendum Beyond betting

B2C brands, Wynn Resorts’ 22.5 per cent stake in As regulatory constraints squeeze profits, BetBull, and mkodo’s sale to Pollard Banknote. there are a few companies looking to find easier Daniel Burns and Sandford Loudon at pickings in emerging (read grey or black) marOakvale Capital are consistently involved in kets. However, most of these will slowly regua string of mergers and acquisitions. Last year late, with politicians being the most influential was no exception, with the firm working on 888’s Steve Hoare figures in coming years. £15m acquisition of BetBright, among many China is the world’s biggest gambling marothers. Burns, Loudon and Shapton might well ket and one can expect the state lotteries to claim to work full-time in the industry but dominate for some time yet. But there there are others, such as Goldman are other angles. eSports is hugely Sachs rainmaker Anthony Gutpopular in China. While matchman, who certainly would not. he Gaming Intelligence Hot 50 (page fixing also remains hugely But as one of the key advisers 34) celebrates the most innovative popular in China, it is unlikely on Flutter’s takeover of Stars and influential people working in the to have a huge influence on the Group, he still made his presbetting and gaming industry today. It is our betting industry, but AliBaba’s ence felt in 2019. most anticipated feature every year. People love subsidiary AliSports will be Stateside, Kyle Bender and it because it is an opportunity to celebrate the working to export it. As such, David Berman form a pretty achievements of the unsung heroes who make global head of eSports Jason formidable partnership at Macthe industry tick. It is not a list of the most Fung could be hugely imporquarie Capital, which is advisimportant or influential people working in the tant, especially with pres- Most countries will ing on the Eldorado acquisition industry – that would be a staid list of CEOs and sure growing for eSports in slowly regulate, of Caesars. And of course, bilwith politicians regulators that would remain virtually the Olympics. lionnaire investor Carl Icahn unchanged from one year to the next.

Meanwhile, a special men- being the most has been the most influential Of course, CEOs and regulators are not tion should be made here for Ian influential figures figure in that space for quite excluded, but we do have an unwritten rule Smith, the integrity commissome time. in coming years that you cannot be in the Hot 50 two years in a sioner of the Esports Integrity row – unless your job has changed, or you have Coalition (ESIC), who will be Trusted advisers an inarguable record of achievement in the massively important if eSports is to be accepted And so to the lawyers. As regulation and M&A previous year that demands inclusion. While as an event worth betting on. become more important, the influence of the Hot 50 is all about achievement, it is also In a similar potential position of influence trusted advisers cannot be underestimated. about influence. We want to celebrate people is Harsh Jain, the chief executive officer of The likes of David Zeffman and Rob Willis at who are in a position to influence their company India’s daily fantasy sports company Dream11, CMS; Gil White at HFN in Israel; Jeff Ifrah at or the industry in the coming year. The Hot 50 is which has reasonable claims to be the world’s Washington DC’s Ifrah Law; Morten Ronde about looking forward, as well as looking back biggest fantasy platform. As pressure grows at Nordic Gambling; Jason Chess, Stephen over the previous year’s achievements. to regulate sports betting in India, Jain’s conKetteley and David McLeish at Wiggin; and However, there are a lot of people we leave tinued opposition would be a massive obstacle.

Ola Wiklund at Wiklund Law in Sweden. The out of the Hot 50 each year because they do not But don’t be surprised if you see a Damascene list could go on and on. There is a superstar betfulfil the basic requirement of working full-time conversion along the lines of that experienced ting and gaming lawyer in every jurisdiction. in the betting and gaming industry. by his peers at DraftKings.

In the past five years, the most influential These might include politicians, person for the UK industry has arguably been journalists and those working in Deal makers former Labour MP Tom Watson, who has affiliated sectors, who couldn’t Less obliquely related to the betting driven an agenda that has been taken up by the give a hoot about appearing in the and gaming industry are the legions media and ultimately by the government. WatHot 50, but might also include of lawyers and bankers working for son resigned from the Labour party last year lawyers, bankers, PRs and othclients in the sector. but vowed to maintain his mission to reform the ers, who might. Some of the latAkur Capital co-founder David industry. Whether he can be as effective from ter might argue that they do work Shapton had a great 2019, with outside Westminster remains to be seen. full-time in the betting and gaming involvement in a string of deals, The state-by-state dimension of the US marindustry. Although, the way profesincluding Clairinvest’s £23m investket stops any politician from having too much sional services firms work, I’d be ment in FSB Technology, William Hill’s clout. But populists across the globe will continsurprised if any are completely €270m takeover of Mr Green, Gaming ue to take swipes at the sector, when looking for devoted to betting and Realms’ sale of its gaming plata quick fillip. There are enough of them around Dealmaker Daniel Burns, gaming. form business and UK nowadays.n

The influential people who do not qualify for the Hot 50

2020

T

Oakvale Capital

86

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