Month: November 2021

Total revenue for the three months through to the end of September amounted to $168.3m (£123.2m/€145.2m), up from $112.4m in the third quarter of 2020, during which Everi said it was significantly impacted by the novel coronavirus (Covid-19) pandemic.

Breaking down this performance, Everi said its gaming business was the primary source of revenue in Q3, with revenue from this segment climbing 67.5% year-on-year to a record $95.8m.

Breaking down the gaming revenue further, game operations revenue was 52.3% higher at $71.6m, while game equipment and systems revenue also increased by 137.3% year-on-year to $24.2m.

Read the full story on iGB North America.

Reputation Matters, after a Covid-enforced year off, returned with the future of the British gambling industry facing significant uncertainty. The key takeaway was a need for the sector to invest in its messaging, stop apologising and talk about its successes. 

There is a small but vocal group of MPs campaigning for a significant overhaul of regulations, a focused group of campaigners taking the fight outside of Westminster, and bipartisan media efforts supporting this push. 

So it was quite surprising when the event’s keynote, Rank Group chief executive John O’Reilly, got up and pointed out it wasn’t a debate involving the general public. He said politicians don’t see gambling reform as a vote-winner, and the vast majority of parliamentarians do not have a strong view on the industry. 

Having said that, O’Reilly believes the review to be “long overdue”. There are valid concerns to be addressed, and some regulations are archaic. 

There were even elements of the 2005 Gambling Act that he admitted to having fought against at the time, such as the lifting of all restrictions on gambling advertising. He also felt the proliferation of B3 machines would lead to clusters of betting shops on the high street. Casino legislation, he added, was also barely addressed, with the main regulations governing the sector dating back to the 1960s. 

Yet O’Reilly does not accept the claim that the 2005 Act is “analogue legislation for a digital age”. In recent years, he explained, there has been significant legislative change, under difficult circumstances. Much of this came down to the regulator, he said. The sector experts in the Gambling Commission had been swept away, with the focus on tightening controls.

Operators, for their part, had baked safer gambling into their strategy, yet despite this positive change the vehemence and rhetoric directed at the sector “has clearly not followed the data”. To read the press, it would be easy to assume problem gambling rates are spiking, rather than declining as recent Commission data suggests. 

Even William Hill offering a sausage and egg muffin was condemned in the Guardian as some sort of fiendish plot to keep customers in betting shops for longer, he pointed out. “I don’t know about you, but I can eat a sausage and egg McMuffin in under 45 seconds.”

Clause IV moment

Ultimately, he hopes the review doesn’t “turn back the clock” and gives the industry – and Commission – a break from the uncertainty of recent years. “It’s vital the industry and regulator gets clear air for five to ten years, to refocus on its purpose of delivering entertainment,” he said. 

But as YouGov polling revealed in the following panel, the public perception of the industry is relatively low. It was ever thus, YouGov global sector head for leisure and entertainment Oliver Rowe pointed out. If the poll was done ten, even 20 years ago, the stats would have been very similar. 

The panel agreed that the industry does need to put out a more positive message. There was too much apologising, and not enough talk about the positive changes that have been made in recent years. 

Camilla Wright of Red Knot Communications argued that the sector needs a ‘Clause IV moment’, an equivalent to the Labour Party amending its constitution to remove its commitment to common ownership of industry. This was not seen as a pressing issue when it was announced, Wright pointed out, but served as a clear break from the past that proved to the public the party was changing. 

What that is, she and her other panellists admitted, was unclear. 

Regulatory failings 

This was exacerbated by the industry and the Gambling Commission moving at different paces when it comes to reform. This has contributed to an increasingly hostile climate between operators and regulators, panellists agreed. 

Kirsty Caldwell of Betsmart Consulting said this was partially a consequence of the gambling sector not being braver in highlighting the challenges it faces. She highlighted the Information Commissioner’s Office’s guarded endorsement of work to create a single customer view – which said that while this should be the ultimate goal, more investigation was needed on the legal practicalities. 
The Gambling Commission enthusiastically jumped on this announcement, and the industry failed to highlight the difficulties this could cause. Ultimately, Charles Cohen of the Department of Trust said, “the industry is not capable of standing up for itself”. 

Stephen Ketteley of Wiggin said there was a need for operators and suppliers to educate regulators and politicians exactly how their business works. The Commission had its part to play as well, by supporting on education and training, especially when it comes to best practice – currently failings are publicly identified, but successes are rarely talked about. This has created a “climate of fear” between the operators and regulator, Caldwell added. 

Ketteley added that the best the industry could hope for was accuracy from its critics, as it won’t get positivity whatever it does to improve. 

The day concluded with a discussion on environmental, social and corporate governance (ESG). Some quarters have raised concerns about ESG limiting capital market investment in the industry, though the panel pointed out that being seen as a ‘sindustry’ was not always detrimental to a business’ ESG credentials. British American Tobacco was often the highest rated business in ESG indices, while oil and gas giants such as Shell and BP also ranked highly. 

These indices were relatively embryonic, panellists noted, meaning it was hard to make judgement calls on how accurate the ratings are. These rating agencies were too disparate to offer a clear picture of what companies where the most socially responsible, they said. 

Ultimately Reputation Matters lived up to its name. The key takeaway was the gambling industry has worked hard and fast to raise standards, yet struggles to communicate this effectively. As one delegate raised forcefully from the floor, “Why are we always apologising?”

At a time when the key safer gambling message has evolved from “When the fun stops, stop” to “Take time to think”, a wider change in messaging is long-overdue. 

Revenue for the three months to 30 September was €58.6m (£49.7m/$67.8m), up 46.0% from €40.1m in the corresponding period last year and a record quarterly total for the supplier.

B2B revenue increased 45.0% year-on-year to €42.6m, or 39.6% to €38.7m when excluding inter-segment revenue. Aspire put this rise down to continued good business momentum in all B2B segments and the acquisition of BtoBet in Q4 2020.

Key developments in Q3 that helped drive B2B growth included new platform deals with JNS Gaming, which will launch a new casino and sports brand later this year, and also Esports Technologies, which will migrate its Gogawi.com brand Gogawi.com to Aspire’s platform, with the aim of launching another brand in the future.

Aspire also noted growth within its Aspire Core sub-segment, with revenue here up 24.8% to €32.0m and 21.8% to €29.0m excluding inter-segment revenues from Q3 2020, while revenue in the Pariplay sub-segment increased by 66.5% to €7.8m. 

Looking at B2C and revenue here climbed 60.4% year-on-year to an all-time high of €19.8m. Aspire said this growth was driven by good performances across all brands and helped by the launch of new sports betting brand BetTarget launched on BtoBet’s platform, as well as the roll-out of a new Hopa native app and affiliate program platform.

Shortly after the end of the quarter, Aspire announced an agreement to sell its B2C segment to US-based Esports Technologies following a review of the business that was announced in March. 

Announced on 1 October, the deal is worth $75.9m is expected to close by the end of this month.

“With the sale of the B2C segment, Aspire Global will become a clearly focused B2B company and even stronger and more profitable,” Aspire chief executive Tsachi Maimon said. “The sale will also give us additional resources to further develop and enhance our B2B offering as well as the opportunity to explore new M&A activities.

“The sale of the B2C segment will have a significant positive impact on Aspire Global’s position as a focused B2B company and profitability.”

In terms of geographical performance, the UK and Ireland was Aspire’s leading market with €22.7m in revenue, up 151.0% year-on-year. Rest of Europe revenue dipped 8.3% to €22.5m, but rest of World revenue rocketed 206.8% to €8.1m and Nordics revenue climbed 34.5% to €5.2m.

Turning to spending and operating expenses for Q3 reached €49.4m, up 52.5% year-on-year, while amortisation and depreciation costs climbed 37.5% to €2.2m and finance expenses 18.2% to €1.3m.

However, the significant increase in revenue meant pre-tax profit jumped 79.5% to €7.0m, while earnings before interest, tax, depreciation and amortisation (EBITDA) was 37.9% higher at €9.1m.

Aspire paid €593,000 in tax and after also accounting for €428,000 in losses from its share in associated companies, this left a net profit of €6.0m, up 71.4% year-on-year.

Looking at Aspire’s performance in the nine months to the end of September, total revenue was 38.2% up to €162.4m.B2B revenue was 36.2% higher at €118.9m and B2C revenue jumped 49.9% to €55.0m.

Group operating expenses were up 39.0% to €131.9m, while amortisation and depreciation costs hiked 41.9% to €6.1m, but finance expenses were reduced by 24.4% to €3.4m.

Pre-tax profit was 84.4% higher at €21.2m, while EBITDA increased 46.3% year-on-year to €27.5m.

After accounting for €1.8m in tax payments, a €1.0m loss from Aspire’s share in associated companies, this left a net profit of €18.3m, an increase of 81.2% on last year.

“Aspire Global has consistently demonstrated its ability to execute its growth strategy, reaching its financial targets and create value,” Maimon said. “We see great growth opportunities by expanding with existing partners, gaining new partners and entering new markets. 

“With the divestment of the B2C segment we will further enhance investments in our technology and product offering as well as geographic presence with focus on Brazil and the US. We will also put even more energy on increasing the M&A pipeline. 

“We clearly execute our growth strategy to become a world leading igaming supplier.”

Consumers in Iowa can place wagers on thousands of professional and collegiate sporting events using the Fubo Sportsbook mobile app, which has been integrated with FuboTV’s live TV streaming platform.

The Fubo Sportsbook also features a ‘Watching Now’ function, which leverages FuboTV’s first-party user data to allow users to instantly view wagering content based on what they are streaming.

Fubo Gaming secured approval to launch in Iowa in September after the Iowa Racing and Gaming Commission cleared Fubo to offer advance deposit online sports wagering via its market access agreement with Casino Queen.

Read the full story on iGB North America.

Bayes said that the deal will give it exclusive worldwide distribution rights for “virtually all League of Legends competitions”, including in-game data, fixture lists and audiovisual rights for betting operators.

Bayes Esports chief operating officer Amir Mirzaee said the partnership “is an essential component to strengthen the esports ecosystem and contribute to the sport’s sustainability. 

“Riot and Bayes launched the first official data offering of any game publisher back in 2019. We jointly laid the groundwork for data integrity and sustainability, and we’re beyond excited to take the partnership to the next level”.

Since the deal began in 2019, it has been expanded to add new “tailored solutions”, including a team data portal and the addition of extra regional leagues.

“The forefront of our partnership was initially focused on the distribution and commercialisation of data to third parties,” John Knauss, technical product manager at Riot Games, said. “But through great conversations with Bayes Esports, the community and the teams, we have learned that together we can achieve so much more to support the continuous growth and success of LoL Esports.”

Mirzaee added that the partnership has become about much more than simply distributing data.

“The complex ecosystems emerging across industries are creating a need for a collaborative and community approach where partners can co-create innovation and co-sell together,” he said. “Over the years, our partnership with Riot Games has evolved from distributing data to engaging with the betting and media industry, to collaboratively innovating the game data tech stack from the ground up.

“On both sides, there was a joint understanding that this cooperation would play a critical role in shaping the future of the LoL esports ecosystem and its community. To this end, our tech teams have worked together to establish a League of Legends community data portal that allows various types of community members to access a variety of historic data, from game replays to scrimmage data— securely and privately. 

“This is an absolute breakthrough in the professionalisation of esports, especially for pro teams that need this data to improve their game.”

Within the gambling industry, much attention is rightfully paid to responsible gambling measures. These include identifying excessive gambling behaviours and implementing provisions to promote responsible play. However, in examining excess gambling, conduct emerges that is also prevalent in video game play- such as extensive play time and obsession, which can lead to addictive behaviours.

Amidst the initial novel coronavirus (Covid-19) lockdowns, video gaming rose sharply in popularity. In June 2020, gaming giant Nintendo reported a 427.7% rise in profits in its first quarter of the year, compared to the same period in 2019. Microsoft, which manufactures the Xbox console, reported a revenue rise of 13% to $38bn in its 2020 first quarter results.

UKIE, the Association for UK Interactive Entertainment, reported that the UK video gaming market had reached £7bn in value in 2020, up by 29.9% from 2019.

The lockdowns gave people more time to spend at home. With normal social stimulation halted, many sought solace within the gaming world- some to excess.

In some cases, increased play has led to excessive behavior. Gaming addiction was classed by the World Health Organisation (WHO) as a mental health condition in 2019, after 18 months of deliberation by its 194 members. Gaming addiction is set to be added to the 11th edition of the WHO International Classification of Diseases, beginning on 1 January 2022.

”The inclusion of gaming disorder in ICD-11 follows the development of treatment programmes for people with health conditions identical to those characteristic of gaming disorder in many parts of the world, and will result in the increased attention of health professionals to the risks of development of this disorder and, accordingly, to relevant prevention and treatment measures,” read a statement from the WHO in 2018.

Although accelerated in the past 18 months, excess video game play has been part of the landscape for quite some time, as the first generation of “gamers” grow up.

As a result, charities are beginning to pay more attention to gaming addiction as an issue.

Game Quitters provides supportive resources for struggling gamers and those around them, such as partners and spouses, through educational content aimed at stemming or preventing video game addiction.

“The key is the difference between a passion for gaming, and a problem,” says Cam Adair, entrepreneur and founder of Game Quitters.

“For some individuals, gaming might be a function that helps them cope with real-life stress or discomfort. But if they don’t stop gaming and actually deal with those issues, then the gaming can cause other issues.”

Addressing the issue

As video gaming becomes more commercialised through avenues such as esports, features perceived as using gambling mechanics in games are hotly debated.

Defined as an in-game item that can be redeemed for other items, loot boxes have been at the centre of the video gaming-gambling affiliation for some time.

Belgium banned loot boxes in 2018, a decision spearheaded by controversy surrounding the practice in video game Star Wars Battlefront II, released in 2017.

In the Netherlands, the Hague District Court ruled loot boxes as a violation of the country’s Betting and Gaming Act last year.

Also last year, the Department of Digital, Culture, Media and Sport announced a call for testimonies in an investigation into loot boxes, titled the Select Committee Immersive and Addictive Technologies Inquiry. The investigation was meant to determine whether loot boxes perpetuated or encouraged problem gambling behaviours.

In addition, loot boxes are already being considered as part of the review into the 2005 Gambling Act.

“Loot boxes have also been something that research has consistently found between someone who spends on loot boxes and their problem gambling severity,” says Adair. However, Adair emphasises that loot boxes do not necessarily instigate gambling behaviours.

“That doesn’t mean that loot boxes are creating a generation of problem gamblers. It could mean that gamblers are more likely to engage in loot box mechanics.”

Nonetheless, comparisons are still drawn between video game and gambling mechanics. Martin Lycka, senior vice president for American regulatory affairs and responsible gambling at Entain, outlines what the video game industry could learn from the gambling industry in terms of addiction prevention.

“The likes of self-exclusion limits and other tools, including educational tools, that the gambling industry has introduced has catered towards the needs of individual players,” says Lycka.

“The video gaming industry is on the right track, but we would be more than happy to help them learn how to implement responsible gambling programmes.”

The conversation around shrewd gambling mechanisms and the increased perceptibility of problem gaming led to the inception of Mind Your Game. The campaign involves educational content addressing esports as a commonality in the video gaming-gambling sphere.

“We agreed that the Entain Foundation would sponsor a set of educational videos that Game Quitters would produce,” says Lycka.

“It’s a set of videos that start from the basics, which I believe is quite important- like, what esports are, how they work, who are the key players in that space. Then they move on to the more in-depth discussions – like sports integrity and prevention of metrics, responsible gambling, and even beyond that, player welfare.”

For Adair, the initiative takes the next step from education to protection tactics.

“Mind Your Game is a campaign that’s focused on building educational content to raise awareness on these kinds of things, and how people can protect themselves from these kinds of activities,” he says.

“For me, it’s very important that we get more of this info out there, and if we’re able to partner with the industry to help facilitate that, then it’s a worthy cause.”

Esports and young people

In 2019, when asked to explain the ethics of loot boxes by SNP MP Brendan O’Hara, vice president of legal and government affairs at Electronic Arts Kerry Hopkins compared loot boxes to Kinder Eggs. This suggests that video game publishers are not accustomed to dealing with the controversy loot boxes have attracted over the years – particularly in relation to young people.

In respect to young people and esports, Lycka sees the scope of education that Mind Your Game perpetuates as crucial.

“This is the way to go to educate. Not only the players – the minors – but also their parents, to potentially help them and their loved ones to potentially detect [concerning] behaviour.”

This worry is well-meaning, but Lycka emphasises the closeness of the esports community as a potential obstruction.

“One of the biggest questions for government authorities is, how esports is meant to be regulated without trying to demolish that community spirit?” asks Lycka.

“Views from the esports community say that they should be left alone, and should not be regulated. That’s another key point to make.”

With Game Quitters, Adair sees first-hand the effects of video games appealing to young people.

“There’s items that you win in the game, often that you use real money to buy, which has been converted into virtual currency,” he says.

“Some of these games allow you to sell or trade or bet so you win. Some of these games, and these websites, provide opportunities to withdraw that for real money […] Often, these features are being used by kids.”

The industry landscape

A study published in the Australian and New Zealand Journal of Psychiatry found that the worldwide prevalence of gaming addiction was 3.05%. With gaming addiction rearing its head, what can gambling industry offer?

“The gambling industry has had a longstanding relationship with gambling addiction issues,” says Lycka.

“It’s an extremely heavily regulated industry, and throughout the years we have put together a large portfolio of tools that help us help our customers, and also help our customers help themselves.”

Nonetheless, Lycka praises the efforts of video game publishers to raise standards.

“The video gaming industry is on the right track, but we would be more than happy to help them learn how to implement responsible gambling programmes.”

As gaming addiction and its related harms prevail, people are advocating for tighter regulations – seen in developments such as age categorisation changes in recent years. And in making its products safer, while still offering an entertaining experience to consumers, the video games industry could learn a lot from the gambling industry.

In addition to the land-based slot machine license, Aristocrat also received a non-exclusive license for virtual sports games. This is the first virtual sports deal of its kind for the NFL.

“The world of casino gaming is transforming, and the NFL is thrilled to be teaming up with industry leader, Aristocrat Gaming, with their proven track record in slot machine innovation and commitment to responsible gaming,” said Rachel Hoagland, vice president, gaming and partnership management at the NFL.

read the full story on iGB North America

Players who said they had self-excluded from Sky Bet or from online gambling altogether – as well as customers who had opted out of receiving marketing materials – said on social media that they had been offered free spins via email from SkyBet’s online casino platform SkyVegas.

A spokesperson for the Gambling Commission told iGB the regulator has been made aware of the incident and is looking into how it occurred.

A Commission statement said: “We’ve been made aware by members of the public that SkyBet have sent promotional emails to self-excluded customers yesterday. We do not expect this of our operators and we will be looking into how this has happened.”

Some of the recipients said they had signed up with self-exclusion tool Gamstop, which recently reported a 25% increase in registrations for the first half of 2021.

Lee Drabwell is a retail sports betting expert who brings a wealth of experience to his current role of Regional Director for Playtech Sports where he is responsible for UK, Irish, Belgium and Latam territories. Before joining Playtech, Lee was a key leader in the retail sports betting market in his roles of Managing Director at Ladbrokes and Operations Director in the merged Ladbrokes Coral business.

Figures unveiled by Playtech show just how the retail betting sector has been transformed by the impact of lockdowns, with customers now expecting the same breadth of services available online when they visit bricks-and-mortar establishments.

While the temporary closure of betting shops and casinos across major global markets accelerated the switch towards digital play, changes in customer trends have impacted land-based facilities on their reopening.

Lee Drabwell, the industry veteran who is now Regional Director for Playtech Sports, says that in-play betting – that bastion of mobile play – now accounts for 40% of football and sports business.

Approximately 80% of football betting revenues and nearly 100% of sports betting revenues are now generated through Self-Service Betting Terminals (SSBTs) in retail outlets. Even in horse racing, betting through terminals has risen significantly to nearly 10% of a shop’s total racing business.

Customers increasingly wish to avoid dwell time in shops or using paper tickets to place their bets, and terminals offer the kind of comprehensive service they have become used to online. For example, Playtech’s SSBTs include some 170,000 individual markets across 30 different sports every week.

Drabwell says: “The days of the restrictive betting opportunities on paper football coupons are now numbered and I am confident these will soon disappear from betting shops as they no longer satisfy customer demand.”

Digital-driven growth
Drabwell, whose experience prior to Playtech includes stints as Managing Director of Retail for Ladbrokes and Retail Operations Director for UK and Ireland for Ladbrokes Coral, says the switch to terminals is illustrative of retail trends seen across sectors. In supermarkets, for instance, customers increasingly want to be in charge of how they transact, and there has been a clear shift towards automated checkouts that remove human interaction.

While retail betting levels are between 80% and 90% of pre-Covid volumes, terminal betting has bucked this trend and performed positively. The first few weekends of the current Premier League season saw business levels almost 30% higher than the same period in 2019.

“Customers in all retail and entertainment environments now demand a new way of transacting and being served,” Drabwell says.

“Betting shops have been no different, with customers expecting and demanding sports betting on terminals. Delivering the right quality of terminals and content to facilitate this is a key challenge facing all operators. Playtech sports betting terminals have provided the obvious way to facilitate this new way of transacting by allowing customers to bet quickly and safely in the one-stop-shop for sports and racing betting that terminals provide.

“The digital experience and range of markets provided by terminals is now what customers demand in every shop, and in turn, these technological developments are helping operators address the significant impacts they have seen to over-the-counter turnover and customer numbers due to the pandemic.”

Increased density
Terminals have been growing in demand and prominence for many years prior to the pandemic, but the shift over the past year has been “significant”, according to Drabwell.

“The technology and scale behind the Playtech terminals are key in supporting the growth of Playtech’s omnichannel offering and a joined-up digital experience for the customer,” Drabwell says.

“Our Remote Mobile App (RMA) with cash out ‘Build a Bet’ functionality, where a customer can make their selections at their own leisure and then transfer direct to a terminal, has been fundamental in bridging that gap. With our licensees having the option to integrate this functionality into their own loyalty card or as a standalone app, the RMA has been widely adopted by shop customers for a more flexible way of betting, and is here to stay.”

 More markets
Looking ahead, Drabwell expects some rationalisation as smaller shops and operators struggle with costs and pressures of reducing over-the-counter business and in some cases an inability to invest in the technology that the new retail sports bettor demands.

 “We expect to see changes in the retail product being offered to traditional customers whilst attracting different demographics of bettors to the retail environment,” he said.

“Terminals and digital technology will become even more important to meet customer betting demand where cash still has a key role to play.”

 In short, there is an appetite for more markets and new ways of betting.

“Look at the way football has evolved with the match result not now the focus, but player, corner or goals markets taking prominence,” Drabwell adds. “These can only really be delivered through technology and terminals and will further remove the need for over-the-counter betting.

“We have seen increases in density and investment in new hardware that further shows how important technology and terminals are.

“All major operators have increased terminal numbers significantly and at Playtech we have signed 40 new contracts and extensions in the last six months. Terminals are quickly becoming the key to success in retail betting.” 

This was a rise of 40% compared to August, and a significant increase of 350% compared to October 2020.

Rivalry also experienced an increase in monthly active bettors, which were 80% more than September and were up by 200% year-on-year.

Read the full story on iGB North America.