In this video, Pala Interactive chief executive Jim Ryan explains how the tribe has built its expertise and generated thriving B2B and B2C businesses.
He talks over what drove Pala’s ambition to invest in digital, and how the evolving regulatory map in California and beyond prompted its focus to evolve from online poker to social casino, igamingand now sports betting.
Ryan also discusses how the business has fared, especially in the wake of Covid-19, and the revenue this has delivered to the tribe at a time when venues are closed and capacity limits are reduced.
This webinar, which went out live on 13 April, takes a closer look at the key themes and trends shaping up the present and the future of tribal gaming.
The discussion is led by Victor Rocha of Pechanga.net, and features a panel comprising some of the leading names in tribal gaming:
James Siva, Vice Chairman, Morongo Band of Mission Indians, Chairperson, California Nations Indian Gaming Association,
Matthew Morgan, Chairman, Oklahoma Indian Gaming Association, Director of Gaming Affairs, Chickasaw Nation Division of Commerce,
Erica M. Pinto, Chairwoman, Jamul Indian Village
In this webinar, the panel discusses…
How the political and regulatory priorities have evolved in Indian country and how the arrival of the new administration changed the conversation and relationship
Ensuring that gaming continues to be the means of cultural preservation (listen to one California tribe fight for 6 acres to be added to their reservation to expand housing and facilities as gaming now takes most of its reservation’s space)
The desire to protect sovereignty – not just the right to preserve, but the right to make own choices by the tribes, against the backdrop of efforts to corrode tribal sovereignty
Possibility of pushing the vote on sports wagering in California from 2022 to 2021
How state-tribal relationship are evolving and differ across the states, with examples of Connecticut, California and Oklahoma, as represented by the expert panel
What to expect in the key tribal states in 2021 and beyond with the drive towards sports betting and digital and as the result of states that have already launched
To truly understand the impact of exclusivity, it requires going back to the initial thoughts in the compacting process. Nowhere was there a ‘Tribal Gaming 101’ handbook setting out how to negotiate with the state, and what, pray tell, the future would hold that you needed to contemplate in the many decisions that were in front of you.
What will the number of locations, number of machines, scope of games, problem gambling, internet use, all matter in years ahead? And most importantly, how does one protect their interests for the future?
Valerie Spicer
Exclusivity, in the main, was a means of protecting the incredible financial investment a tribe was going to make for the economic future of their community. It was a way to secure the tribe’s place competitively, along with the many jobs and benefits that were going to be realised through the sharing of revenue dollars. Exclusivity was by definition an exclusion of the ability for competition to share in what the tribes had fought for and invested in.
Fierce defence
As both commercial and state gaming segments of the industry at large continue to grow adding new states and the scope of games offered, the encroachment on the position of exclusive tribal gaming compacts increases.
Year-over-year and countless Dollars spent, the protection of the exclusive right to conduct gaming has come under attack. Yet, the narrative to protect tribal government gaming never changes. The economic benefit from gaming is in many cases the only revenue source that allows the tribe to be self-reliant, rather than dependent on government dollars to operate social programs for their communities.
The revenue sharing contributions, like the facilities, have grown and with them a reliance on the programs they serve. Yet, time and time again, defending exclusivity typically comes around with every legislative session and every new expansion.
The conundrum
The inclusion of exclusivity was necessary and valuable to the infancy and potential for growth of tribal gaming and protection of a tribe’s investment.
The language, in many cases of the compacts, could never have anticipated the continual shift and growth of the gaming industry – new states offering gaming, internet gaming, sports betting, racino, or fantasy sports.
How could one have predicted the future and protected for it in the compacts?
The playing field
Since the repeal of the Professional and Amateur Sports Protection Act (PASPA) in 2018, the spread of sports betting has been viral.
In state after state, legislation is being introduced and passed. Along with it comes the challenge to tribal-state compacts where exclusivity exists.
In this scenario, the stakeholders are many and the influence, politically and financially, is profound. Never before has there been a movement of expansion quite like this one; the landscape that included sports betting was small and limited for decades.
Fantasy sports grew in acceptance and circulation and with it the desire to wager on sports. An industry such as gaming can produce new and various machines, but this was a completely new offering for many, and now everyone wants it and everyone wants their piece of the pie.
Timing could not have been more impactful, somewhat like the perfect storm: new offerings, Covid-19 shut-downs, depleted budgets and sports betting.
For tribes, sports betting is a new offering in the form of a widely popular amenity, whose revenues initially were hard to determine as beneficial. Especially if the trade-off to get it meant potentially negotiating against oneself and the prize possession of exclusivity.
Additionally, tribes have garnered and grown fruitful and reciprocal relationships with teams, leagues, the sporting venues near to them. Sponsorships have been feverishly fought for and won.
There is a true sense of pride to see the naming rights on a venue, or a glimpse on television of one’s logo on the infield, not to mention back in the community, support for youth sports.
Now, there is a new facet to consider and that is that all want to engage in, and benefit from sports betting.
Tribal gaming is tribal government gaming. Tribes are in the industry and know what it takes to operate, market, regulate and protect a gaming entity. Sport leagues are in sports and know how to manage their game play, its players, and to market their sport and operate their venues. Two sides of the shiny new penny.
Trade-offs
Have exclusivity clauses been pushed to the brink? Is it feasible to retain and grow with the expansion that continues and hold that line? Is there a point where the constant cost of defenve outweighs its benefits overtime, either financially or politically?
The language of exclusivity is tenuous to protect from the constant onslaught of competitive advances, perhaps there is a place in time that negotiations will encompass working to control the narrative of expansion beyond exclusivity.
Many ask why tribes were not quick to jump into the fast lane towards sports betting, but those who have been on those front lines for years understand it all too well.
It will be the wisdom of the leadership that determines the right path forward, especially in the face of potentially shaving a piece of exclusivity as a result. Creative crafting of advancement that protects years of investment, and secures a place for the years yet to come.
Valerie Spicer leads Trilogy Group with more than 35 years of gaming experience, working in a collaborative fashion on B2B opportunities for Tribes and businesses alike. The work Valerie does with Trilogy encompasses representing an array of companies from Tribally owned enterprises to national, and international corporations. In addition to the B2B efforts Valerie drives, she works in concert with national and regional gaming associations, and holds a position as an advisory board member to the National Council on Problem Gambling.
Prior to Trilogy Group Valerie was the Executive Director of the Arizona Indian Gaming Association (AIGA) where she worked extensively in the Tribal, private and public sectors of the growing industry.
Spicer is proud of her Mescalero Apache and Hispanic heritage, as well as her Degree in Business Management. Spicer was named by the Arizona Business Magazine as one of the “50 Most Influential Business Women” in Arizona. In 2011, Spicer was named a “Great Woman of Gaming”, Proven Leader, by Casino Enterprise Management Magazine. In 2004, she was named one of the “Top 25 People to Watch” by Global Gaming Magazine.
The dashboard reveals that in 2020, tribal gaming revenue surpassed that of commercial gaming.
Aided by operators being able to determine when they reopened, rather than relying on state orders, the industry was able to get back to business quicker than corporate operators.
This will have a knock-on effect in the years to 2025; while commercial casino revenue will not return to 2019 levels until 2022, tribal operators will surpass that total this year, and continue to grow from there.
By 2025, H2 believes tribal revenue will reach $40.52bn, compared to $37.61bn for their corporate counterparts. This represents a 17.2% increase from 2019, and a 55.4% jump from 2020, when the industry was shuttered by the novel coronavirus (Covid-19) pandemic.
This means that from 2020 onwards, tribal gaming will account for the majority of US casino gross win. Its market share is expected to peak at 55.3% this year, before falling to 50.6% as the commercial sector recovers in 2022.
However H2 believes that it will continue to be the dominant force through to 2025, at which point its market share will have increased slightly, to 51.9%.
Scroll down for the full dashboard, an exclusive extract from the Tribal Gaming Report, which will be available from Wednesday (21 April). Compiled by PKC Gaming & Leisure Consultancy, this offers the most comprehensive picture of Native American gaming available.
H2 Gambling Capital is the gambling industry’s leading consulting, market intelligence and data team. The company has a track record of 15 years focused on the global gambling industry, its projections have been influential in shaping legislators’ and investors’ views of the gambling sector across the globe.
Cnattingius takes on the role with over 20 years of industry experience behind him, holding siginificant roles at the likes of Play’n Go, Copacabana Gaming and QTech.
He is now tasked with overseeing EveryMatrix’s expansion, managing the supplier’s commercial business as part of its global sales team.
Erik Nyman, president for the Americas at EveryMatrix, said: “I am excited to have Staffan joining our Americas team. He comes with unique experience, in-depth product knowledge, relationships and not least an impressive track record of success in Latin America.
“His professional experience will enable EveryMatrix’s goal of becoming the leading turnkey provider in the region. Staffan is the right man for the job, and I wish him welcome aboard.”
Cnattingius added: “I’m delighted to be joining EveryMatrix during such an exciting phase of growth in regions I know so well. The company has a remarkable content suite and great coverage in both casino and sports, all delivered via a stellar platform built on amazing technology.
“But more importantly, EveryMatrix has a fantastic team and great organisational culture, which I’m looking forward to being a part of.”
AGA vice President of Government Relations and Gaming Policy Counsel Jessica Feil said the report was in response to a rapid growth in the amount of unregulated gaming machines that had been operating.
“Unfortunately, there’s been a rapid increase of unregulated gaming machines that exist in the shadows, taking advantage of loopholes and flouting the law, with little to no oversight,” she said.
Bigley has led marketing at Bloomberg since 2014, with responsibility for designing and launching the corporation’s first global marketing department and building marketing strategies for all of its business units.
Prior to joining Bloomberg in 2009 as global leader of marketing communications, Bigley held a number of leadership positions at IBM, including vice president of brand and vice president of worldwide advertising and interactive.
“This is an exciting time to join Sportradar as it continues to demonstrate its leading sports data capabilities and drive innovation that changes the way the world experiences sport,” Bigley said.
Sportradar chairman Jeff Yabuki added: “Deirdre brings strong knowledge of building brands and working with businesses focused on complex data. She has been instrumental in driving the Bloomberg brand globally, establishing a digital first marketing department, and recognizing the intrinsic value that technology and innovation brings to customers through its products and services.
“We are pleased to add an experienced director who understands both the opportunities within a high growth business, as well as the scale needed to further extend our industry leadership by delivering long-term growth and value for our stakeholders.”
The KSA this month launched the licencing process after the new national Remote Gambling Act came into effect on 1 April, with the market set to launch on 1 October.
According to the KSA, all 28 applicants have paid the required €48,000 (£41,578/$57,787) fee as part of their submission.
If successful with their applications, these operators will be permitted to offer online games of chance via approved websites when the market opens in October.
“The intention of the law is to channel players from illegal providers to legally reliable providers,” KSA chairman René Jansen said. “With this number of applications, I am confident that there will soon be a sufficiently attractive and varied offer to achieve this objective.”
The Remote Gambling Act was originally supposed to come into effect on 1 July 2020, but was delayed three times prior to finally moving into place this month.
Operators applying for Dutch licences are required to have in place an effective responsible gambling strategy and agree to connect with the country’s Central Register of Exclusion of Gambling (Cruks).
In addition, operators must provide the Control Database (CDB) with their own data captured from games, allowing the KSA to carry out remote monitoring of game systems.
Agreed through the operator’s Betsson Perch Investments subsidiary, the acquisition deal is worth €8.8m (£7.6m/$10.6m), with Betsson to settle this in shares.
Betsson said the purchase will secure customer payment flows for its continued expansion efforts in Latin America.
The deal marks Betsson’s latest acquisition in Latin America, having also purchased a 75% stake in Brazil-facing Suaposta in late 2019, as well as 70% of Colombian operator Colbet in the third quarter of last year, granting it market access in the country.
In addition, Betsson is in the process of obtaining a licence for both the Province and City of Buenos Aires.
“LatAm is a strategically important region for Betsson and we see great future potential for the company there,” Betsson chief executive Pontus Lindwall said. “With this strategic investment Betsson is well positioned to further expand our business in the LatAm igaming market.”
Crown said the funds would be used to buy back some or all of its shares from investment holding business Consolidated Press Holdings (CPH), which currently holds approximately 37% of all shares in the operator.
According to Crown, the proposal is unsolicited, preliminary, non-binding and indicative proposal, and would be subject to shareholder approval, with no votes needing to be cast in favour by CPH or its associates.
Crown added that it is yet to form a view on the merits of the proposal, with its board now set to commence a process to assess the offer, while the operator also said there is no certainty the offer will result in a transaction.
The proposal was submitted from a company on behalf of funds managed and advised by Oaktree Capital Management.
The offer comes at a time when Crown is thetarget of a takeover bid from private equity giant Blackstone. Last month, Blackstone offered AUS$8.02bn to acquire the remaining 90.1% of shares in Crown, having already acquired 9.99% of the business in April 2020.
Last week, it was revealed that Blackstone had altered its bid to acquire Crown, so that the deal would not go ahead if either of Crown’s existing licences are suspended or its New South Wales licence is not granted.
In its new bid conditions, Blackstone made clear that suspension, revocation or failure to receive a licence in its New South Wales, Victoria or Western Australia would be grounds to cancel the deal. The operator was the subject of an inquiry in New South Wales found that Crown was “unsuitable” to operate a casino in the Barangaroo district of Sydney, though it may still receive a license if it undergoes some changes. This report then prompted inquiries in Victoria and Western Australia, where Crown already operates.
Blackstone may also withdraw its bid if “any of the gaming regulatory authorities imposes terms or conditions on Crown or any of its current or foreshadowed casino licences or framework agreements which, when combined, constitute a material adverse change” to Crown’s business, or if the regulators signal that such conditions are likely.
However, if none of these conditions to cancel the deal arise, the acquisition is expected to close in the third quarter of 2021.
