Month: May 2021

Max Meltzer is Chief Commercial Officer at Kambi. Having joined the company in 2016 with responsibility for managing its global sales and partner management functions, he has played a key role in a period of significant commercial growth.

As land-based gaming begins to make a comeback in the US, the focus now shifts from recovery back to growth and on finding new ways to engage customers, increase ROI and enhance the customer experience.

The challenges of a post-Covid world for commercial and tribal casinos of course do not end there though, having to adopt a phased approach to re-opening their doors with the additional issue of social distancing restrictions to contend with.

Sportsbook provider Kambi’s omnichannel approach has however allowed it to continue to collect data around user trends during the shutdown and to help land-based stakeholders to innovate their offering and return to growth.

“Bringing a new product vertical to the casino floor, particularly one with dynamics across both margins and player engagement that separate it from traditional casino verticals like slots and table games is understandably not a light undertaking”, says the company’s CCO Max Meltzer.

However, Meltzer adds that sports betting should not be underestimated for its capacity to drive revenue across the entire casino ecosystem, referencing a partner success story to highlight its potential.

“Kambi partner Penn National Gaming has found that on-property customers who engage with both casino and sports betting generate five times more value than those who engage with casino only. Furthermore, it has seen revenues from table games rise significantly since the introduction of sports betting.”

Broader horizons

One of the most notable benefits of sports betting, according to Meltzer, is that it appeals to a broad range of demographics.

Appealing to different generations and bringing these into the casino also draws attention to other casino amenities and increases ROI across the board, with the potential to align engagement strategies with upcoming sports events.

“As we transition to a new normal the coming months promise to be particularly exciting ones for sport and sports betting, with several events such as the UEFA European Championships and the Olympics having been postponed to 2021. 

“In addition to this, the forthcoming NFL season will offer huge excitement for football fans, with the most recent Super Bowl driving the highest bet volumes in Kambi’s history.”

A stronger brand

Meltzer points out that tribal operators have two primary options when deploying sports betting. The first one being a partnership with a B2C brand and the second teaming up with a B2B provider.

While each operator has different needs which may be better met by either option, a B2B partnership allows operators to harness the strength of their own brand. With the B2C route, the day-to-day handling of the sportsbook would fall to the B2C operator, along with the brand and database building opportunities that go with this given that the sportsbook would not carry the casino’s own brand.

For those operators looking to increase brand awareness, the B2B route offers the chance to maximise the sports betting opportunity for customers and be actively involved in the process.

The other consideration is on the regulatory side, where B2B providers like Kambi – which recently launched four partners on day one of online regulation in Michigan -can ensure that this is being handled efficiently and with accuracy.

“Taking control of the sportsbook with a B2B partner empowers the casino with a full 360-degree view of casino and sportsbook customers – enabling them to see how they intersect and how to most effectively drive cross-sell between the two verticals.”

Meltzer explains how Kambi’sBYOD (Bring Your Own Device) technology has helped operators to conduct sports betting in a “safe and contactless manner” during the pandemic.  Although not originally intended as a Covid precaution, the technology allows a safe experience for players as they can view lines and buildbets from anywhere, before placing them at a counter or Kambi kiosk by simply scanning a QR code.”

Expanding on this, Meltzer outlines how a B2B partner can help tribal operators capture a greater share of wallet through mobile sports betting.

“A tribal casino’s customer-base will naturally find their way to mobile sports betting as regulation allows”, he says. “Developing a mobile and online offer consistent with the tribe’s established brand, in partnership with a B2B provider, is the best way to beat the competition to the punch and develop even greater brand loyalty, extending into a vertical that resonates with new and existing players.”

Richer insights

Another advantage for tribal casinos teaming up with a B2B supplier is the growing pool of data-driven insights it would be able to draw upon.

“The success Kambi delivers is anchored in our ability to leverage our network data from a global player base, creating network advantages that increase as each new partner is added and existing partners grow.”

“For example, a greater volume of data will lead to a more accurate understanding of player behavioural habits, aiding Kambi in providing a more frictionless and intuitive user experience.”

Meltzer also emphasises that Native American gaming operators would not be launching sports betting from a standing start with Kambi.

“They are not competing alone, but with the benefit of our 20 years of trading experience and actionable analytics from our deep network data behind them – a partnership with Kambi offering a platform on which they can thrive.”

Looking to the future, Kambi plans to continue providing partners with the combination of technical and regulatory expertise to succeed together with that crucial competitive edge.

Having introduced their system for remote launches during the pandemic, which sees land-based partners launch sports betting without the need for a member of the Kambi team on-site, there are a number of exciting opportunities for operators to gain commercial momentum. 

“While not necessarily our preference, remote launches have proved a crucial factor in helping us to maintain commercial momentum for both our business and our partners, while further underlining the adaptability of our technology.”

Bragg first named Carter as the new CEO in March.

Carter has taken the place of Bragg co-founder and former CEO Adam Arviv, who took on the role in September 2020. Arviv will continue to work as a strategic advisor to Bragg.

Prior to joining the Bragg board in October 2020, Carter served as the chief executive of sports betting platform SBTech for five years before its merger with DraftKings in April 2020.

Bragg also announced the appointments of Paul Godfrey as chair and Lara Falzon as audit committee chair.

“I’m excited to be leading Bragg in its next phase of growth and helping to shape the future of the company, as we continue to provide next generation premium content and tools to our B2B partners,” said Carter.

“I’m eager to leverage these strengths to expand Bragg in both our core European markets and in the rapidly growing North American iGaming market.”

As CEO, Carter will oversee Bragg’s plans to expand throughout the US and Canada. The plans include increasing Bragg’s regulatory compliance and launching a B2B igaming technology platform.

Also as part of the expansion plans, Bragg applied to list its shares on the Nasdaq Stock Market in March.

The agreement will see Playtech become Holland Casino’s strategic technology supplier across its IMS platform, sports betting, online casino, live casino, poker and bingo products.

In addition, Playtech will build a live casino facility in close proximity to one of Holland Casino’s existing locations.

Following the implementation of the Remote Gambling Act in the Netherlands on April 1, the Dutch online gaming market is expected to open in October with regulator Kansspelautoriteit (KSA) confirming that there have been 28 licence applications thus far.

Playtech CEO Mor Weizer said: “We are delighted to announce this strategic cooperation with Holland Casino. The brand strength and local presence of Holland Casino combined with Playtech’s 20 years of technology leadership in the industry will see us drive the online growth of the market in Holland.

“We look forward to working with Holland Casino to offer the highest quality, most comprehensive responsible gambling entertainment experience across retail and online in the Dutch market.”

This deal with Holland Casino is the latest step in Playtech’s expansion this year.

As well as launching Casinò Lugano’s online product in Switzerland, the company also opened its first US-based live casino studio in Michigan.

Playtech also signed a partnership agreement with ComeOn Group last month, similar to the deal just penned with Holland Casino.

Holland Casino also recently announced a partnership with regtech provider TruNarrative, which will see TruNarrative aim to enhance Holland Casino’s its land-based onboarding process in a safe way.

On the Playtech deal, Holland Casino CEO Erwin van Lambaart added: “This agreement will provide the technology and expertise required to ensure we will deliver the leading online offering in the Netherlands. Holland Casino has high ambitions for the new online market and at the same time we are determined to play a leading role when it comes to Responsible Gaming and Player Protection. Playtech has the track record and necessary scale to deliver industry leading software, marketing and responsible gambling tools to the number one brand in the Netherlands.

“We look forward to the online market launching in the Netherlands in October 2021 and to a long and successful cooperation with Playtech as we work together to capture this exciting opportunity.”

The unit said that all sectors, including remote gaming, saw an increase in suspicious transaction reports related to money laundering in recent years, in an enforcement factsheet covering 2019 and 2020.

Gaming, it noted, was listed alongside banking as the two “main contributors”. However, this increased reporting of suspicious activity was seen as a positive, rather than negative, development.

The total number of suspicious transaction reports across all sectors in 2020 was 5,090, up from 1,668 in 2018.

The report highlighted certain failings by some remote gaming operators related to anti-money laundering checks.

It said a number of investigations into gaming operators found that these operators often only gathered details that “add no value” in building a customer’s profile, such as simply stating that the customer is employed.

The FIAU also cited examples of gaming operators with inadequate checks, such as one that had not implemented “any form of enhanced due diligence”, despite having players from high-risk countries, including many who placed large bets at low odds.

Another operator was found to have had a “quite robust” AML procedures manual, but did not implement the policies in the manual, such as mandatory checks for players who spend €2,000 (£1,728/$2,399) or more.

In addition, the FIAU listed the most common types of breach of its AML rules in non-financial sectors, which include gaming.

This most common type of breach was an inadequate customer risk assessment making up 11.6% of breaches. The second most common breach was a lack of measures to check if a player is a politically exposed person, at 7.6%. However, it did not say how many of these breaches were gaming-related.

After the relaunch of the gambling market and issuance of several operating licences, Ukraine finally introduced the licensing conditions for service providers at the end of March.

The Commission for the Regulation of Gambling and Lotteries in Ukraine (KRAIL), the country’s regulator, is on the prowl for attractive businesses from a thriving local industry of software development, leveraging the country’s strong reputation as an international IT hub.

Low regulatory barriers, access to local talent and low-cost set-up fees are the weapon of choice for Ukraine.

B2B license scope

A B2B license allows Ukraine-based companies to provide gambling software -that is,  any product used to conduct games of chance – to resident and foreign gambling operators. 

Although the term is defined vaguely, it includes a wide range of software, including random number generators, live-streaming products, odds services and online systems for gambling operators, among other things.

A licensed B2B provider may supply its software to both Ukrainian gambling operators and non-resident entities holding gambling licenses in other jurisdictions. However, foreign B2B providers are not required to get Ukrainian licenses to supply their products to Ukrainian operators.

Requirements

In contrast to tough requirements imposed on gambling operators, potential B2B licensees are benefiting from the low regulatory barriers. 

Companies eligible for B2B licenses shall be legal entities registered in Ukraine and shall not: be controlled by Russian residents, have Russian residents as UBOs, have individual shareholders who are also considered to be Russian residents, hold any stake in a Russian business or have corporate shareholders registered in North Korea or Iran.

In addition, the regulator wishes to see an “impeccable business reputation” of the top management (CEO, CFO), shareholders, and UBOs, meaning that these people have clear files and are not subject to Ukrainian/international sanctions.

No particular requirements for share capital or number of employees exist, however.

The B2B licensing conditions do not limit the services providers in their business relations with clients. Different commercial models may be agreed, including revenue share. 

License terms and fees 

The license is granted for five years. The total license fees are about €54,000, payable annually in five equal tranches.

With a rather inexpensive license (with an annual fee of EUR 10,800) the government hopes to issue two dozen B2B licenses in 2021. 

Who may benefit from the new licensing regime?

International sportsbooks and online casinos operators

It is a common practice for international operators to engage qualified Ukrainian staff to develop new products and maintain existing operations. Due to the unclear regulation of these services, international operators had to rely on a complicated network of outsourcing and outstaffing agreements, combined with Ukrainian-based IT outsourcing companies. 

Now international operators may seek to establish a separate B2B provider in Ukraine to support their groups’ needs, cutting down their compliance risks and accessing local talents directly.

IT outsourcing businesses

These businesses have a chance to get a newly licensed jurisdiction in their portfolio, strengthening their compliance stands. It is a particularly appealing opportunity given a continuing exodus of international operators from unregulated markets and unlicensed providers. 

Independent development studios 

Content providers such as live-casino streaming services and games development studios may become a more interesting and reliable party for the clients buying their services by obtaining a local licence. Beyond that, foreign investment funds and private equity investors consider licensed studios as better targets for investment and strengthening their portfolios.

Currently, the state offers online sports betting and poker, but other forms of online gaming are not permitted.

The proposed amendments seek to remove provisions limiting interactive gaming to the game of poker, in addition to a number of related and other changes, such as creating definitions of ‘peer-to-peer’ and ‘non peer-to-peer’ gaming.

A significant change to be introduced is the creation of a state-wide list of individuals who have self-excluded from participating in igaming.

Read the full story on iGB North America.

Under the agreement, the length of which was not disclosed, 32Red branding will continue to feature on the front of players’ shirts. 

32Red will also continue its support of Team Talk, a men’s mental health initiative that aims to engage with male football supporters about their mental well-being.

The deal is one of the longest of its kind in British football, with 32Red having sponsored Rangers since 2014.

“Rangers and 32Red have been on a long journey together and I am delighted that our winning partnership is continuing,” Rangers manager Steven Gerrard said. “I was particularly heartened to hear that the vital Team Talk initiative will be continuing as part of the new agreement.”

Kindred Group UK general manager Neil Banbury added:  “We are thrilled to be continuing our longstanding partnership with SPFL Champions Rangers – it’s been quite a journey over the last decade and we’re proud to have played our part in that. 

“More widely, we remain committed to reinventing the sports sponsorship model, so that it benefits the wider community. That is why, as part of this extended agreement with the club we will be renewing our support for the vital men’s mental health initiative, Team Talk.”

Players in the US state will now have access to PointsBet’s selection of online casino games, after the operator secured approval from the Michigan Gaming Control Board (MGCB).

PointsBet already operates online sports betting in the state, via an approved partnership with the Lac Vieux Desert tribe.

“Over the past 18 months we have assembled a highly experienced igaming team, which has built our in-house proprietary igaming platform and administrative tools, and I am thrilled to announce our inaugural launch in Michigan,” PointsBet chief executive and managing director Sam Swanell said.

“The launch of igaming not only complements our existing sports wagering products, but also removes the disadvantage we have had with customer acquisition, retention and cross sell, compared to those operators with igaming.”

Read the full story on iGB North America.

Under the strategic partnership, the organisations will exchange information, documents and analysis relating to sporting integrity, in order to better tackle fraud, match-fixing and corruption.

The General Directorate National Police of Bulgaria and Sportradar will also explore other opportunities for joint projects they can collaborate and support each other on.

“The MoU between the General Directorate National Police and Sportradar will contribute to the improvement of cooperation in the field of protection and safeguarding of integrity in sport and sports betting. Bulgarian sport is in a safer position as a result of this cooperation,” General Directorate National Police chief commissioner Nikolay Hadzhiev said.

Sportradar’s managing director integrity services Andreas Krannich added: “Maintaining the integrity of global sport is our number one priority, and partnerships like this one will help us reduce the threat of betting related corruption.

“Our objective is to establish effective communication channels with the General Directorate National Police in order to swiftly identify and resolve integrity issues facing sport in Bulgaria.”

The deal comes after Sportradar last week announced details of a similar agreement with the West Asian Football Federation.

Revenue for the three months to 31 March 2021 came to €18.3m (£15.8m/$21.9m). 

This revenue figure included the full profit and loss from its white label agreement with SkyCity Malta, a subsidiary of the New Zealand land-based operator. If standard white label accounting principles were applied, giving GiG only a share of SkyCity Malta earnings, normalised group revenue for the period would have been €15.4m, a 43.9% year-on-year rise. 

The main contribution came from GiG’s media services division, which set a new revenue record of €10.0m – up 22.0% – in Q1, of which more than 60% (€6.9m) came from revenue share agreements. 

Paid media channels were launched in seven new territories, and revenue from paid media grew 72.2% to €3.1m.

Having secured a sports betting vendor registration from the Virginia Lottery, and an igaming registration from the West Virginia Lottery, it now has nine US state licences, and is active in 11 states. 

This helped it refer 43,712 first time depositors (FTDs) to operator clients in the quarter, a 55.7% jump from the prior year. This broke down to 27,653 from publishing (up 32.2%) and 16,059 from paid media (up 124.2%). 

Its platform services arm, meanwhile, saw revenue grow 88.4% to €8.1m, though if this is normalised, that figure dropped to €5.2m, still a 36.8% improvement on the prior year. 

Having signed 14 new partners to its solutions in 2020, GiG has added a further three in 2021 to date. This included PlayStar Casino, which is preparing to launch in New Jersey, an unnamed German-facing operator, and an agreement to launch a new online casino brand for an existing partner. 

It has 14 brands in its intregration pipeline, with clients ranging from current online partners to igaming brands being launched by brick-and-mortar businesses in new regulatory markets. 

As a result of “increasingly complex” licensing procedures and longer licensing processes, GiG admitted that it faces certain delays in its development work. It has completed projects for five new brands, with three live on its platform, one awaiting client sign-off for launch, and one converting from a white label to a Software-as-a-Service agreement. 

Its platform is now certified in ten regulated markets, with a further seven to be added through its development pipeline. 

Finally, GiG aims to revitalise its sports betting business through a partnership with Genius Sports Group that combines its platform with the sports data specialist’s live data, trading and risk management services. Genius is to manage day-to-day sportsbook operations through this deal. 

There are currently four brands live on the platform, with a further four in the development pipeline. The live brands’ turnover came to €21.4m for the first quarter, resulting in revenue of €0.2m. 

GiG’s costs of sales for the first quarter grew 94.1% to €825,000, though thanks to its increased revenue, gross profit was up 62.8% at €17.5m.

Marketing expenses grew significantly to €4.7m, as a result of the expansion of its media services division, though this was mitigated in part by a slight decline in other operating expenses, to €8.2m. As a result earnings before interest, tax, depreciation and amortisation (EBITDA) grew markedly, rising from €589,000 in the prior year to €4.6m. 

Once €2.1m in depreciation and amortisation charges, plus €1.1m in amortisation related to acquired affiliate assets, were factored in earnings before interest and tax came to €1.3m, compared to a €4.7m loss in the prior year. 

Once finance-related expenses were taken out, GiG’s pre-tax profit stood at €690,000, again a significant improvement on prior year losses of €4.3m. After a €1.5m income tax benefit, it swung from a loss to a profit of €2.2m from continuing operations. 
Its since-divested B2C arm incurred a loss of €67,000, for a profit of €2.1m. This was increased by a €129,000 foreign exchange gain, for a total profit of €2.4m. 

“The business and the team continue to work exceptionally hard to continue to deliver, and with a relentless dedication to improve the business, striving towards its future potential,” GiG chief executive Richard Brown commented. “We have a media business that is again starting to deliver exciting growth prospects and global igaming platform business that is beginning to scale forward.

“A strong start to the year, but this continues to be just the foundations of what is possible to achieve with this business over the coming years and what we as a group are targeting long term.”