In her new role, Kilström will have responsibility for Tur’s number games and lotteries, including brands such as Triss, Lotto, Eurojackpot and Keno.
Kilström joins Svenska Spel having most recently served as marketing and communications director for the Stockholmsmässan exhibition facility in Stockholm.
Prior to this, Kilström also previously had spells in senior roles with companies including Coca-Cola and Ebay.
“I really look forward to working with our talented employees to develop the gaming experience of the future in a sustainable way, not least now at a stage where the outside world and customer movement place demands on both our sales and marketing,” Kilström said.
Svenska Spel Tur business area manager Anna Romboli added: “Christina’s experience in customer experience, digital development, sales and brands from Coca-Cola, Ebay, Vattenfall and most recently the Stockholmsmässan will be a great asset.
“It is an exciting time where strong brands and the ability to adapt to a rapidly changing world and new customer habits are more important than ever.”
The appointment comes after Svenska Spel last week released its results for 2020, revealing that growth in digital revenues failed to offset losses suffered due to the closure of its land-based business as a result of Covid-19.
Net gaming revenue for the 12 months ended 31 December 2020 amounted to SEK7.67bn (£666.1m/€763.65/$926.3m), down 9% from the previous year.
As we look to the year ahead, industry experts give their views on the opportunities and challenges facing the industry.
In part one we hear from igaming operators and suppliers. In parts two to eight we will cover land-based operators and suppliers, finance, marketing, people, technology and innovation, regulation and social responsibility.
Interviewees
Anthony Evans, VP of product strategy, Playtech Ciara Nic Liam, commercial director – gaming, Betsson Stéphane Pallez, chairwoman and CEO, FDJ Group Joe Saumarez Smith, chairman, Eyas Gaming
Looking back at 2020, what – other than the Covid-19 pandemic – did you feel was transformational for the industry? And how much of a lasting effect do you think the Covid-19 pandemic will have going forward?
Anthony Evans (AE): I feel as though the pandemic has expedited the progress that was already being made in key areas, for example, the expansion and growth of retail to online. Many businesses that solely operated through retail outlets have looked to build and leverage an online presence during the pandemic, and those that were already online have expanded their product offerings. This trend is certainly here to stay and is a key part of Playtech’s strategy.
Anthony Evans
I see continued growth in the live casino vertical due to improvements in mobile networks, changing consumer habits and the birth of a new style of entertainment-based games. I see this trend continuing with more and more innovative concepts that blend the product portfolio and give greater focus to entertainment and community-based gaming.
In terms of what has been transformational, I would suggest the stringent regulatory landscape has changed things forever, for both B2C and B2B businesses. Our investment here is considerable and I believe this will help us create a more sustainable business, for both Playtech and our partners.
Ciara Nic Liam (CNL): Remote working has undoubtedly been transformational for the industry and has now become the new normal, at least for the time being. For a global industry, this has undoubtedly presented challenges, especially for organisations that have offices in multiple locations around the world.
But the industry has risen to these challenges and demonstrated that it can continue to thrive while also ensuring that players can be properly protected even in the most uncertain of times. I do believe that on some level, remote working is here to stay and that it will allow the hugely talented people that work in this industry to strike a better work/life balance and ultimately perform better as a result.
Stéphane Pallez (SP): The pandemic crisis has considerably sped up consumer adoption of new technology in all sectors of the economy, a shift we’ve also seen among our customers. Digital, as well as the increasing use of electronic payment methods, is now firmly established in consumer behaviour.
Our customers are increasingly connected, and digital stakes have grown in step with this trend on our website, particularly for lottery games, and also in our physical network with digital play slips, which users can set up on their mobile and validate at a point of sale. The decision made five years ago to steadily invest in digital, both in our online and offline distribution channels, has proven highly relevant. This trend was true before the crisis but has been considerably accelerated.
Joe Saumarez Smith (JSS): If you can set aside a global pandemic, I think the main thing 2020 will be remembered for is the huge valuations achieved by US gambling companies and the rise of the SPAC vehicle. There are some truly exceptional valuations being put on companies and the cash they have behind them allows some huge deals to be done.
In terms of Covid-19, I think the main factor will turn out to have been the speed it increased channel shift from land-based retail to online. A lot of people who would only use retail were forced to try online (in all aspects of their lives) and are not going to return to going to betting shops, casinos or lottery retail outlets with the same frequency.
What do you feel is going to be a game-changer for the industry in the coming year?
AE: I am not sure there is going to be one specific game-changer. The US will be a big opportunity for many and the rate of regulatory change will be key for everyone to adapt to. The live casino and streaming formats will lend themselves to truly innovative product offerings, encouraging more online community-based gaming, which has been overlooked historically. I also feel that truly real-time and predictive marketing and safer gambling techniques will improve the industry as a whole. Of course, there are product verticals like esports to consider, and as this matures, I am sure it will be a very interesting vertical, and I can see some very exciting gaming opportunities.
Ciara Nic Liam
CNL: Regulation and compliance will be the biggest game-changer for the industry this year, both in terms of new and emerging markets and established markets that are putting their regulations under review. Regulation should always be welcomed, especially when it comes to protecting players, but it does pose difficulties for operators. Take Germany, for example – the transition to temporary regulations has forced operators to quickly adapt to the rules or risk non-compliance. While the move to licensing is a positive, it must be done seamlessly and with a clear understanding of what it means for all stakeholders.
SP: Digitalisation everywhere, as illustrated by our omnichannel strategy, maximising players’ points of contact and use cases and building a real and new customer relationship based on customers’ knowledge. Diversification in adjacent activities will also undoubtedly be an asset to sustain growth and profitability. We have for our part already launched innovative new services in our points of sale. And generally speaking, consolidation and internationalisation will become a major theme for the sector.
JSS: If only I knew! Hopefully it will be the regulation of Germany and the Netherlands in a way that actually achieves significant channelisation and doesn’t leave a huge black market. I hope we see some interesting innovation through the integration of payment methods and social media channels – I know it is something that Facebook and WhatsApp are looking at – which could be very interesting for gambling operators.
On the other hand, what do you feel could disrupt the sector or slow progress?
AE: While I consider solid regulation 100% necessary, of course overregulation can slow everything down. Playtech is active in over 20 regulated markets and we can leverage our technology when entering new ones, but if the speed of change is high and continual, then the rate of innovation in other areas could potentially be impacted.
CNL: While regulation and licensing are a positive force, they can also slow the industry down if not rolled out correctly. In addition, if rules and requirements are too stringent, there is a risk that players will move away from the safety of playing with a licensed operator in favour of an unlicensed operator because they are able to offer a more comprehensive player experience.
This is obviously counterintuitive and that is why it is so important that regulations are balanced. Take gamification models as an example – for bigger operators live in multiple markets they present a huge challenge as the rules in each regulated market differ. The risk of running these loyalty and VIP schemes is increasing and means that some operators will simply remove them from their casinos. For the player, this means a more restricted offering which in turn could mean they switch to an unlicensed site.
SP: The evolution of the health situation and how we adapt to it will obviously be critical issues for this year. Operators in the gambling sector need customers to come back to points of sale, casinos, racecourses, etc. Traffic restrictions, such as a lockdown, curfews or a new halt to sports competitions would be real handicaps to growth in 2021.
Joe Saumarez smith
JSS: I hate to be a pessimist but there are some pretty ill regulatory winds blowing at the moment and I don’t feel that the markets have priced in quite how much the regulatory environments in markets like the UK, Spain and Germany are going to affect profitability.
In the US I think there will also be a crackdown on some of the more egregious behaviours in the market – some of the bonusing and marketing offers are eye-opening to those who have worked in regulated European markets for some time and I am surprised by some of the ways that those partnering with operators are allowed to boost the turnover levels of those operators by having huge bets with them.
Is the industry beginning 2021 in a stronger or weaker position than 2020?
AE: While the wider gambling industry has been impacted in terms of profitability in 2020, I do believe the learnings from the past 12 months will expedite online growth and gambling companies will have a renewed focus on building sustainable growth for the future. Most companies have dealt with the challenges of a global pandemic incredibly well and there will be many technological and operational advances as a consequence. With the further digitisation of betting and gaming companies, improved compliance and sustainability focus, and transitions into more mass market entertainment products, I think the industry is in a very strong position as we go into 2021.
CNL: I think the industry is in a stronger position. Last year showed that this industry is resilient and determined and that it is pandemic-proof as well as recession-proof. I think we have proved that we can put player safety first, and that even when the odds are very much stacked against us ensure that gambling remains safe and fun, while the most vulnerable are protected and supported. What’s more, we have adapted to the pandemic and can now move forwards this year with confidence.
Stephane Pallez Credit: Joel Saget, AFP
SP: Our industry has undoubtedly been hit by the health crisis and most operators have suffered from various negative effects. But it has also demonstrated at various degrees its potential resilience, i.e. its adaptability and capacity to bounce back. For our part, we saw a clear upturn in activity at the end of the first lockdown in France.
Starting from mid-June, stakes were back to levels comparable to 2019. While the crisis will weigh on our 2020 results, we’ve proven that our business model is solid and confirmed our strategic directions based on four essentials: resilience of the lottery, technological excellence, rigorous balance sheet management and growth in digital. This gives us a certain optimism for 2021 and its challenges.
JSS: If you just look at share prices then it would appear to be stronger. Land-based gambling businesses are clearly weaker and even when they reopen will frequently be doing so in the middle of a recession. Online businesses seem to be stronger but only if they have scale and geographic diversification. I think it’s hard to look at the industry as a whole and say whether it is weaker or stronger – some people are doing well and some are really struggling.
Check back tomorrow for part two, when a panel of land-based operators and suppliers discuss their expectations for the year ahead.
The data business will use its Opta database, alongside video performance analysis and a series of advanced models to assess performances for integrity purposes.
The service sees Stats use statistics such as expected goals as well as player tracking data to help with investigations. These, as well as video analysis, are used alongside its existing integrity tools based on suspicious bet reports to create a more complete picture.
“In one case two football matches were referred to Stats Perform for analysis which had been highlighted as high risk due to suspicions around a predetermined sporting fix between the two sides,” the data provider said.
“The analysis revealed a demonstrably low lack of attacking intent from one team in the first match, including an historically low Expected Goals total and among the lowest pressing statistics in the entire Opta database.
“Other investigations have shown changes in formation by teams in specific periods of matches, as well as individual errors aligned with suspicious moves in betting markets.”
Stats Perform said that performance analysis had previously only played a peripheral role in the sporting integrity conversation, owing to the fact that the data required had “lack[ed] the necessary robustness for disciplinary proceedings”.
However, it said that its use of the Opta database, as the largest performance analysis database in sport, combined with a transparent methodology, allow it to introduce these tools to integrity investigations for the first time.
Multiple football governing bodies have already employed the service for use in match-fixing cases.
“As with every element of sport integrity, success is built on a unified combination of measures across prevention, detection and investigation,” Jake Marsh, global head of integrity at Stats Perform, said. “Sport governing bodies have been calling for professional performance analysis to support the fight against match-fixing and we have answered that call.
“This is an additional tool and deterrent in the fight against sporting corruption, and a new front in maintaining the integrity of sport.”
Alex Rice, chief rights officer for Stats Perform, said Opta had long proved to be a valuable tool in assessing player performance and it made sense to put it to use for integrity reasons as well.
“Opta data is the most trusted, accurate and largest performance database in the industry,” Rice said. “We’ve been using it in the media and elite team performance space for years but by switching the perspective, we’re able to help answer questions about the integrity of a match using a professional approach and methodology.”
These standards were set out by the IBIA in October 2020 and include a requirement that all data collection be carried out by people aged 18 and above, whose identities have been verified. Data providers must also carry out a detailed risk assessment for all sporting events or competitions on which they collect data and must make clear how the data was collected.
Adjusted gross revenue for January totalled $29.3m (£21.2m/€24.2m), up 127.1% from the same month last year, while the amount was also 15.8% higher than the previous record of $25.3m set in November 2020.
Players wagered $348.2m on sports in January, more than double the $170.8m bet in the corresponding month in 2020, and also 11.2% more than December 2020’s previous record of $313.1m.
Operators paid a total of $2.8m in sports wagering tax during the month, up from $1.2m in January of last year.
Basketball was the sport of choice for many players in Indiana. Some $133.2m was wagered on basketball during the month, ahead of football on $77.6m and baseball with just $56,796. Parlay betting amounted to $86.1m, while other betting reached $50.3m in January.
Of that total, JPY61.79bn came from pachinko machine sales, up 19.7%.
Meanwhile JPY27.70bn came from the Okada Manila integrated resort, down 37.0%. A further JPY1.20bn was generated from other sources, including social and video gaming.
All of the Pachinko and other revenue came from Japan, where 139,152 machines were sold.
The drop in integrated resort revenue came as Okada Manila was closed from 15 March following an order from regulator Pagcor because of the novel coronavirus (Covid-19) pandemic. Operations resumed on 9 September, though the property remained subject to a 30% capacity limit.
After costs of sales of JPY40.78bn, Universal’s gross profit came to JPY50.01bn, down 22.7%.
However, Universal’s selling, general and administrative expenses declined to JPY47.54bn, leaving an operating profit of JPY2.56bn. After non-operating income of JPY1.85bn, Universal made an loss of JPY9.35bn, 16.5% higher than in 2019.
This was made up mostly of profits from businesses in which Universal has a non-controlling share, and non-operating expenses of JPY13.66bn, including JPY10.17bn in interest.
Universal then incurred a further JPY10.50bn in extraordinary expenses, of which JPY9.17bn was related to the closure of the Okada Manila resort due to the pandemic.
This meant Universal’s pre-tax loss came to 19.74bn, up 113.1% year-on-year.
After a net of JPY517m income taxes, Universal’s net loss totalled CPY19.22bn, 270.0% more than it lost in 2019.
Looking forward, Universal said the future of both segments of its business was uncertain due to the effects of the novel coronavirus (Covid-19) pandemic.
The business announced it is planning to spin off and list its integrated resorts business in the US, though a combination with a special purpose acquisition company (SPAC). Image: Tomas Cermak via Freeimages.com
Published in its Interim Performance Report, covering the six months to 30 June 2020, the figures showed that the MGA issued a total of 20 notices of regulation breaches in H1, as well as 11 warnings.
Some nine administrative fines were handed out to operators, while two licences were suspended by the regulator.
In terms of financial settlements, Blackrock Media agreed to pay a penalty of €2.3m (£2.0m/$2.8m) for operating a gaming service without the necessary authorisation.
The report also included online gambling figures for the period, with some 303 licences issued. A total of 196 were B2C gaming licences, while 111 were B2B critical supply licences.
The number of active player online accounts climbed 11.8% year-on-year to 17.2m, while new active player accounts also increased 12.3% to 7.6m.
Slots were the most popular form of online gambling for type 1 games, with 77.4% of gaming revenue generated via these games in H1, compared to 18.4% on table game and 4.2% other games.
Some 74.8% of online sports betting revenue came through football wagering in the period, while peer-to-peer poker was by far the most popular form of gaming in Type 3, accounting for 90.8% of revenue in this category.
The MGA collected €24.6m in online gambling tax during the half, the highest six-monthly total since the second half of 2018, when €24.9m was paid by licensees.
In terms of land-based gambling, casinos took a hit due to the temporary closure of facilities as a result of the novel coronavirus (Covid-19). Player visits slipped 54.6% year-on-year to 192,351, while new player registrations fell 64.1% to 26,176.
Land-based casinos paid a total of €3.9m in tax during the first half, less than half the €8.0m contributed in the same period in 2019.
Controlled gaming premises also took a hit in H1 due to Covid-19 measures, with player visits down 39.3% and tax contribution falling 42.0%. Commercial bingo player visits also decreased 54.1% to 38,190, with tax payment down 52.3% to €118,344.
In terms of Malta’s National Lottery, sales fell 36.5% year-on-year to €30.7m in H1, with operations again hampered by Covid-19 closures. A total of €4.0m was collected in gaming tax from National Lottery operations, down 34.4% on 2019.
Analysing the performance of the market as a whole, the MGA said a total of 313 companies were active by the end of H1, operating via 318 licences. Some 8,009 people were employed across the industry – 7,196 online and 813 in land-based gaming – and operators paid €33.7m in tax, down 16.3% year-on-year.
The operator said that in order to obtain the licence, it still needs to carry out a number of procedures required by the current legislation, including the payment of its licence fee to be completed within ten working days.
“Parimatch welcomes the decision of the commission to issue a licence,” said the operator’s chief communications officer, Daria Isakova.
Parimatch, which was founded in Ukraine, immediately announced its intention to pursue a licence in the jurisdiction.
Under the bill, online gambling, bookmaking, slot halls and land-based casinos would all be legalised, but casinos may only be located in hotels.
The country’s gambling laws include a clause to block any Russian-owned gaming businesses, or those with Russian directors, from participating in the market. However, Parimatch had previously confirmed to iGB that it was confident it met this requirement.
Figures published in the last version of the bill before it was passed suggested that a licence fee for online gaming would cost UAH39m (£1.0m/€1.2m/$1.4m), to be paid when a licence is renewed every five years.
The legislation stated however that all of these fees would be tripled until Ukraine’s Online Monitoring System comes into effect. This was expected within 30 months of the launch of the gambling market.
According to reports in Ukraine, Spaceiks LLC operates the Cosmolot brand, which was previously owned by the country’s National Lottery but was discontinued in 2019.
Universal Entertainment opened the Okada Manila property in the Philippines in December 2016, and has seen performance grow steadily since.
While the resort was shuttered as a result of novel coronavirus (Covid-19) pandemic between March and September 2020, Universal explained that it had implemented a number of measures to boost its earnings power.
This included reducing fixed expenses and ramping up marketing. These measures will now remain in place after ongoing restrictions, such as a 30% capacity limit, are eased to benefit future margins.
As a result, Universal will now explore a potential listing either on the Nasdaq or New York Stock Exchange, designed to further grow its IR business and increase the corporate group’s value.
To support these plans it has struck agreements with US and Japanese financial advisory firms in preparation of a potential listing.
As part of this process the operator is working to identify a SPAC through which it will list, investigating legal and tax ramifications, and whether a listing would require a change in its capital structure.
Universal did not give any indication as to when it may announce a combination and timescale for listing, though said it was likely to happen some time in its 2021.
The business also announced its financial results for 2020. While its pachinko machine sales business saw revenue increase, the closure of Okada Manila meant revenue dropped 27.3% year-on-year.
Revenue for the six months to 31 December 2020 is expected to come in around AU$72m. While this would represent a 71% improvement on the second half of its 2020 fiscal year – when operations were disrupted by the novel coronavirus (Covid-19) pandemic – it also represents a 33% year-on-year decline.
Over the reporting period Ainsworth saw its North American performance improve, with revenue from the region totalling AU$41m in H1, compared to AU$21m in the previous six month period. This again remained down year-on-year, however, with the supplier generating in AU$51m in H1 2020.
This was driven by improved revenue from leasing and rental of its machines, which grew 10% from the prior fiscal year, while its historical horse racing (HHR) products made a positive contribution.
Australian revenue, meanwhile, more than doubled to AU$19m, thanks to a strong performance from newly launched products.
However, Latin America continued to be adversely affected by high novel coronavirus (Covid-19) transmission rates, leading to more venue closures and restrictions.
“Given the uncertainties and deferrals of purchasing decisions caused by the pandemic within this region, further reductions in revenues are expected in the short term before a return to pre-pandemic activity levels, impacting timing of expected cash flows,” Ainsworth said.
As a result it expects to make a material non-cash impairment charge on its business in the region.
While the improvement in US and Australian revenue is expected to help underlying earnings before interest, tax, depreciation and amortisation reach $6m – excluding currency translations and one-off items – the business is set to post a loss for the period.
Ainsworth’s first half pre-tax loss is expected to come to approximately $14m, though this excludes a currency translation loss of $14m, due to the strengthening of the Australian Dollar against the US Dollar.
The unaudited result remains subject to further review before it is finalised, with a full breakdown of first half performance expected to be released on 25 February. Audited results will then follow in March
EPIC, the CSPPA and mental health bodies Kindbridge and Rise Above the Disorder will provide mental health support services and education for players potentially at risk, and will work internationally with Entain and the company’s non-profit charity, the Entain Foundation.
The operator said its strategy for sustainability and growth underscores its commitment to delivering the highest possible levels of player safety and protection across all its markets.
As part of its safer gambling strategy, the Entain Foundation supports customer protection through a mix of education and support projects, as well as research and data analysis.
Each of its new partner organisations seeks to bridge the gap between demand and availability of affordable professional, individual therapy and care, the operator said.
EPIC Risk Management is an international consultancy specialising in the prevention of gambling-related harm, and already works with Entain. Its partnership will now be expanded to address video gaming and esports.
The CSPPA is the worldwide association for professional players of the Counter-Strike: Global Offensive video game, which is among the world’s most popular esports titles.
The association aims to safeguard, protect and promote professional Counter-Strike players’ interests, working to secure the best possible working conditions for the players.
Kindbridge is the world’s first teletherapy company focused specifically on the treatment of gamblers and gamers struggling with their mental health. The US-based mental health services organisation provides access to online professional mental health counsellors and specialised support services.
Rise Above the Disorder (RAD) is a non-profit universal mental health care system, covering the cost of mental health care for tens of thousands of people around the world. RAD has been celebrated by the United Nations for having helped over 36,000 people receive free mental health support.
“We are committed to supporting initiatives that encourage responsible gambling and gaming in every way we can,” Martin Lycka, senior vice president for American regulatory affairs and responsible gambling, and trustee of the Entain Foundation US, said.
“The vast majority of people enjoy playing for fun and have no problems whatsoever, and we want to leverage our capabilities to offer them additional experiences whilst keeping all our customers safe.”
“These new partnerships are initial steps in this and other new directions as we both expand our offer to customers and the protections we put in place to protect the very small number who may be at risk.”
