Month: July 2022

Hervé Schlosser has been working in the sports betting industry over the last 15 years. He founded and launched Sportnco and was its CEO and main shareholder from 2008 to 2022.

The Company started as a B2C business in sports betting in the newly regulated French market as it got one of the first sports betting license in 2010. He has since launched a B2B business under Sportnco, in France, Europe and South America.

Schlosser negotiated the sale of Sportnco to Gaming Innovation Group (GiG), which was signed in December 2021 and closed on the 1st of April 2022. He now works as Managing Director of Sportnco.

Gaming Innovation Group (GiG) closed the acquisition of highly-regarded sportsbook and platform provider Sportnco for €51.3m in April this year.

However, Hervé Schlosser, CEO at Sportnco, says it wasn’t a natural step in their evolution to join forces with GiG – in fact, Sportnco was not originally for sale. 

It quickly became apparent that the combination of geographical areas, product portfolio and PAM product made for a very strong united force, Schlosser says, meaning the combination made strategic sense. 

Meanwhile, each company brought a strong presence in a different group of regulated markets, with only one overlap: Argentina. Sportnco was very prominent in France, Spain, Greece, Belgium, Portugal and South America while GiG had a significant presence across Northern Europe, Eastern Europe and North America.

Schlosser says this is what made the companies “a perfect match – with almost no overlaps.”

From 2010, Sportnco launched its B2B offering for regulated markets across Europe first and then South America. After combining with GiG, the pair now delivers sportsbook and PAM solutions to 36 different jurisdictions, operating with more than 610 employees out of headquarters in Malta, Denmark, Latvia, France, and other offices in Barcelona and Madrid, Spain.

Jumping in the deep end

Everything started 13 years ago for Schlosser, when the French gaming market opened to competition. Schlosser credits his business’s current success to starting in such a complex and highly taxed jurisdiction. 

High taxes necessitated high margins in the country, with a turnover tax of 9.3% meaning operators had to work to a margin of between 15% and 20% to remain profitable. 

“We started as a B2C company and were among the first eight to get their sports betting licence in 2010, when the French market became regulated. Very quickly, we had opportunities to do B2B business, because we had been building our software for the sportsbook platform in France.”

Having started as an operator under the France Pari brand, the success of its B2B operation ultimately saw the supply side generate similar levels of revenue, then surpass the customer-facing business. 

“Two or three years after the start of our B2C activity, we made a clear decision in terms of strategy,” Schlosser explains. “My feeling was that the world was getting regulated, and so we focused on our B2B operations”

Going forward, starting in such a heavily taxed market has helped make Sportnco adept at entering similar highly regulated territories, such as Portugal, where it already has three clients signed, including migrating Betway’s local operations in the second half of this year. 

While creating strong foundations across Europe, Sportnco and GiG’s expansion efforts in North America further reflect the company’s focus on taking strategic positions in high-potential markets. The lessons learnt early on have set them up to succeed going forward.

“Our understanding of regulated territories is where we are able to bring value to North America – we have a strong competitive advantage in our ability to offer attractive odds and good margins – which seems to be impossible to mix the two, but this is part of our know-how.”

Common ground

GiG and Sportnco both started out in Europe, and at the time of the acquisition had grown to B2B businesses of similar types: software in SaaS mode for regulated markets, something Schlosser believes has aided the integration in its early stages. “In terms of culture, our ability to mix internally has made for a very strong team – it is all going very well.”

This undertaking, he says, is focused around combining the solutions of the two entities, and developing unified processes for the enlarged company. 

“As a business, we have had our first deal with [Full Games in] Angola, where we were able to put together Sportnco’s books and platform and combine that with GiG’s managed services,” he explains.

“GiG can offer clients that have their own license but no operational experience the ability to launch into the market and quickly find success, supplying them with the marketing, CRM and Business Operations to do so seamlessly. We can support this through our KYC processes and pavement management.”

Sportnco and GiG followed this by striking a head of terms agreement with Crab Sports in early June. The deal – which will focus on the state of Maryland – marked the first US-facing deal struck since GiG acquired Sportnco in April. Under the agreement, Sportnco and GiG are able to provide their full solution, which includes their technical platform, CMS and sportsbook. 

“It’s been amazing to see how quickly we have been able to finalise this deal in the US – it’s been really impressive.”

When it comes to processes, Schlosser sees this as a combination of learning and teaching. “Being with GiG we have been able to strengthen our processes in terms of dealing quickly with new regulations” he says. “[This enables] us to move quickly when expanding into new markets. Both companies are learning a lot from one another.”

Company dynamics 

Moving ahead, Schlosser picks out three priority areas for a successful integration, and to ensure the enlarged business can thrive. The people, the clients, and the financials.

“In terms of people, we are getting along well. We had a seminar in Madrid two weeks ago which was a tremendous success. There are so many rationales behind the merger of the companies that everyone feels comfortable in its success.”

Schlosser credited GiG’s team for preparing for the merger in advance, with preparatory work carried out ahead of the deal closing ensuring everything was scheduled and prepared before the deal was completed.

When it comes to clients, the expansive new network and addition of products have only increased and got stronger – as evidenced by the Full Games and Crab Sports deals being struck in quick succession since the acquisition closed.  “We now benefit from a sportsbook that has the tools to accelerate the acquisition of players, and our clients benefit from better products, developed tools and more access to different regulations.”

And in terms of financial performance, he adds, there has been signs that growth has accelerated “I think our new deals are a testimony that we are already performing well”

“So far, the integration is a success, and we really want to continue to have this good dynamic between Sportnco and GiG.”

And that sets up the business for a strong push into North America. “We expect to continue to grow our existing client base with the help of GiG, enabling our clients to recruit more and more players and compete in multiple markets,” Schlosser says. “We also want to bring in existing clients to new countries.

“We have Europe, we have added LatAm, and now we’ll add North America and Africa”

With the Fifa World Cup coming up, the success of this year is only set to continue for GiG and Sportnco, with an extensive roadmap set out in the leadup to November. 

“Our sports calendar drives our business – we’re incredibly excited about all the upcoming opportunities of 2022.”

Following a series of investigation, the ACMA found Pokie Island, Rich Palms, Lucky Tiger Casino, Megaslot, Bitkingz, Parimatchwin, Casino Rocket, Montecryptos, Cabarino, Robin Roo and Jackpot Jill VIP were all operating in breach of the Interactive Gambling Act 2001.

As such, the ACMA said the sites were illegally offering online gambling in the country and called for ISPs to block access.

Since the ACMA made its first blocking request in November 2019, a total of 555 illegal gambling websites have been blocked, while more than 170 websites have pulled out of the country since the ACMA began enforcing new illegal offshore gambling rules in 2017.

“Website blocking provides a valuable opportunity to alert the public to illegal gambling services through the messaging that appears when there is an attempt to access the site,” the body said.

“The ACMA is reminding consumers that even if a service looks legitimate, its unlikely to have important customer protections. This means Australians who use illegal gambling services risk losing their money.”

The latest round of blocking requests comes after the ACMA last month also called for the blocking of thepokies.net, describing it as one of its most “significant” blocking requests to date.

Given that payments to the site are estimated to run into tens of millions of dollars, while data from Similarweb showed there are around 30,000 Australian visitors to the site each month, ACMA said the blocking would be one of the highest profile since it began using this regulatory tool in November 2019.

Also last month, the ACMA announced it is to launch a new national self-exclusion register in 2022-23.

Levon Hambardzumyan, senior product manager and engineer behind CreedRoomz’s first-of-its-kind live casino automation project Roba, explains the logistics of letting machines do the dealing.

Land-based casinos took a big hit during the pandemic, paving the way for the online gambling sector to thrive. This upwards trend is still growing, with everything from ewallets to artificial intelligence being implemented online casinos. 

Gaming companies have proven time and time again how agile they can be in uncertain times. And with online adopting and adapting to technologies, the attention turns to land-based to see how it can innovate in order to continue to compete.

Leading the way in the latest advancements is CreedRoomz, whose senior product manager, Levon Hambardzumyan, believes artificial intelligence and robots are the next step in the digital transformation of the casino floor.

Introducing Roba

Roba is a robot croupier that “performs all the actions and responsibilities of a dealer”, Hambardzumyan says. It launched late last year, and is trained in dealing cards, collecting cards from the table, loading them into the shuffler for the next round and demonstrating the outcomes of games.

Currently, CreedRoomz has launched Roba across its Baccarat and Dragon Tiger games, with plans to launch for Blackjack later this year.

“The robot does everything clearly – visibly and transparently for the player.” Hambardzumyan explains. “This is an innovative tool that optimises the work in a live casino studio by excluding human errors, increasing accuracy in dealing, helping operators reduce expenses on hiring staff for a private hall, and providing an automated 24/7 gaming experience.”

During the pandemic, the human factor of every industry was challenged, and many businesses turned to automation in order to streamline operations and reduce costs. 

Hambardzumyan recognised that there was a gap in the gambling vertical for an automated, robotic croupier, and that “In this era of innovation, the casino needed to innovate, too”

AI tech has become a hot topic across most industries over the past 10 years, with lucrative advantages.

Questions around the rising costs of employing casino dealers and the introduction of robotic ones in the gambling market were raised during a panel at Global Gaming Expo (G2E) Asia back in 2017. Since, AI technology has been trialled throughout Asian casinos – particularly in the industry hubs of Singapore and Macau. 

With this in mind, Creedroomz conducted an initial launch in the continent, as Hambardzumyan regarded this as “the region that enjoys innovation the most”.

“We have plans to integrate more existing games while being open to custom game requests,” he continues. “One of the main features, however, is that for any game a dealing time can be fixed. Unlike a human dealer, Roba will perform the dealing depending on the time set by a partner.”

“As this was a unique concept, there was no experience we could rely on. It was a difficult, binding, and at the same time inspiring challenge. After understanding the problems, we managed to find solutions and implement this innovative idea in 14 months.”

Is human communication replaceable? 

Despite the obvious operational advantages of using robots in the gaming sphere, human-to-player communication that comes with an in-person dealer in a casino setting is arguably one of the main pulls for guests into land-based casinos. 

Creedroomz, acknowledges this, and stresses that Roba is not a replacement for human interaction. 

“While robots can enhance the level and quality of players’ entertainment and provide a unique player experience, they can never replace the impact and role of the human factor in a live casino.”

“However, robotic technology has already taken its place, creating a very attractive market based solely on automated games. In other words, Roba has already assumed a special place and role, but in no way will exclude the possibility of a human factor.”

Hambardzumyan says Creedroomz is committed to exceeding the initial novelty factor of Roba through constant innovation and updating of the processes. It forms part of the business’ continued efforts to enhance player experience.

“On the other hand, playing with a robot croupier is an absolute innovation and revolution in the world of online casinos,” he says. “Playing with a robot croupier can be a new, very natural next step in our reality, and at the same time a very “exotic” experience.”

“Imagine how many people will be attracted by the fact that instead of the dealer there will be a robot sitting in front of them performing all the actions of the dealer with clear and beautiful movements?”

The future for Roba

It may have just launched a potentially huge innovation for land-based casinos, but  Creedroomz isn’t resting on its laurels.

“The automated dealer will stay in CreedRoomz’s casino and we have already thought of ways to enhance it,” Hambardzumyan says. “Our next step will be the addition of a camera to Roba. This will take the video streaming to another level, which again will be an interesting point of interaction with our players.”

Roba was on display at iGB Live!, which Hambardzumyan saw as the perfect opportunity for its European debut. 

“iGB Live! was a good platform for us to run Roba live for the first time. Here, all the participants and current and future partners were able to see Roba in all his charm and power,” he says. 

Industry commentators Earnings + More reported a number of details this morning related to the content of the Gambling Act White Paper.

Industry sources confirmed to iGB it matched up with their understanding of the document.

Perhaps the most significant detail in the report was detail of the affordability checks that operators may be required to perform. Players would be allowed to have a net loss of up to £125 per month or £500 per year before “passive” checks – to see if players have obvious signs of financial difficulties such as county court judgements – kick in.

Those who lose more than £1,000 in 24 hours or £2,000 within 90 days will face “more detailed” checks.

New accounts will face lower thresholds.

Sources raised questions, however, of what the differences between the two levels of checks will mean in practice, and whether the performance of checks would have an impact on customer credit scores.

Elsewhere, further details of the previously reported cap on slot stakes were revealed. These will take the form of “smart stake limits”, with customers initially subject to a cap between £2 and £5, but those who have gone through affordability checks able to stake up to a figure between £10 and £25.

Other products, including other online casino games, will not have stakes capped.

Online VIP schemes will also be banned. Free bets – contrary to prior reports – would not be completely banned, but may not be “targeted” based on spend.

In response to the news, most share prices across the industry initially declined before a sharp rebound. 888 – which recently acquired William Hill, giving it a particularly large exposure to Great Britain – experienced the sharpest rise, up from £1.46 per share at 10:00 am before the report to £1.50 at noon.

 Entain’s share price sat at £10.74 at 10:00 am but was up by 1.6% at the time of writing.

Flutter’s share price initially dropped to £75.14 after the news, before rising to £75.86.

The white paper has faced a number of delays since the Gambling Act review started in 2020. Most recently, the resignation of the minister responsible for the review – Chris Philp – and Prime minister Boris Johnson disrupted the process.

Philp was replaced by Damian Collins, who may himself push for late changes to the white paper.

Player spending on betting in June amounted to $256.3m (£215.4m/€255.4m), up 4.1% from $246.3m in June 2021 but 16.9% lower than $308.4m in May of this year.

Baseball drew the most bets during the month, with consumers wagering $84.6m, while a further $36.4m was spent on basketball betting and $886,991 on soccer. Some $64.4m was attributed to parlay betting and $68.9m other sports.

In terms of taxable adjusted gross revenue from sports betting, this reached $15.8m in June, down 37,8% from $25.4m in June last year and also 48.5% lower than $30.7m in May this year.

FanDuel partner Blue Chip Casino remained the market leaders with $5.5m in revenue from $79.7m in bets, ahead of DraftKings-partnered Ameristar Casino with $3.5m in revenue and a handle of $72.6m.

Belterra Casino and its FanDuel-operated sportsbook followed with revenue of $3.2m off a handle of $33.9m.

The IGC also said the state was able to collect $1.5m in sports betting tax during the month.

Confirming the news in a LinkedIn post, Grounsell said he was “excited” to be starting the new role, having been with the group since August 2019.

Grounsell was most recently deputy managing director for digital at Entain, serving in the role since January this year, prior to which he was its managing director of UK and Ireland digital for five months.

He also spent two-and-a-half years as managing director for Entain’s UK and Irish sports brands, as well as five months as chief marketing officer for Ladbrokes and Coral.

Before his time at Entain, Grounsell was managing director of Neilson Financial Services and he spent time as global marketing director for Travelex.

Grounsell also spent time working in marketing and sales roles for insurance business RSA, while he was marketing director for Capital One and head of broadband acquisition at BT.

In addition, during a four-year spell with Unilever, he was brand manager for the Dove and Lux brands.

The appointment comes after Entain last week reported an 18% year-on-year increase in net gaming revenue for the first half of its 2022 financial year, driven by the reopening of its retail betting shops following the easing of novel coronavirus (Covid-19) restrictions.

In a trading update, Entain said retail revenue was up 243% year-on-year for the six months to 30 June – above expectations – after the removal of many Covid-19 measures meant retail operations were able to return to near normal.

However, online revenue was down.

As an official partner of MLB Players, MGM Resorts will be able to use players’ branding and group marketing rights across a range of print and digital promotions, advertisements and sweepstakes in the US, China and Japan

MGM Resorts will become a participating partner of MLB Players’ Players House hospitality space at each season’s MLB All-Star Game, as well as an official offseason destination of MLB Players through programs that provide benefits for staying at MGM Resorts properties.

In addition, players represented by MLB Players will have opportunities to enter individual ambassador agreements to promote MGM Resorts through appearances, social media posts, autographed memorabilia and advertisements.

“This new partnership strengthens our commitment to the sport of baseball in the US and around the globe,” MGM Resorts’ senior vice president of sports and sponsorships, Lance Evans, said. “We welcome the opportunity to host MLB Players at our world-class resorts and create unique player experiences for our valued MGM Rewards members.”

MLB Players managing director Evan Kaplan added: “This agreement puts Major League Baseball players in partnership with a company that is synonymous with best-in-class hotels and entertainment.

“MGM Resorts’ global presence will also help strengthen the allegiance between baseball’s international fan base and our players.”

As a non-executive director, Farahi will serve on the provider’s nominating and governance, compensation and audit committees.

Farahi is currently executive chairman of Quick Custom Intelligence, having previously been an advisory board member, while he served as chief operating officer for Monarch Casino and Resort in Denver, Colorado, in the US between 2012 and 2021.

Having started his gambling industry career with Monarch in 1998, he also held a number of other roles with the business, including director of investor relations and financial planning and analysis analyst.

Farahi also served four terms as president of the Colorado Gaming Association, from 2015 to 2021, where he spearheaded the industry’s legislative agenda. 

In addition, he held a series of finance industry roles with HSBC Bank in London, Geneva and New York between 2004 and 2007.

“Since its inception, AGS has uniquely approached operators as a true partner, developing products from slots to table games and beyond that delight players,” Farahi said. “I’m honored to be joining their board at such an exciting time for the business.

AGS president and chief executive David Lopez added: “David is a seasoned industry executive with extensive experience in both the gaming operator and gaming regulator space. 

“He has a proven track record of leading teams to operational improvements, integrating and scaling a substantial acquisition, and effectively communicating with the investment community. 

“We believe his strong industry experience will be extremely valuable as we continue to grow, improve our operational efficiency, and strengthen our relationships with our casino operator partners.”

Football was responsible for 32 alerts during Q2, ahead of tennis with 27, horse racing on 12 and eight for table tennis. A further four alerts were related to esports, three for basketball and one each for handball and greyhound racing.

The total number of suspicious betting alerts was up significantly from 38 in Q2 of last year.

In terms of location, events in Europe generated the highest number of alerts with a total of 46, with 18 of these for football and 12 for tennis.

The highest number of alerts were registered in Poland, with six alerts being reported in the quarter, all of which were related to table tennis. Denmark placed second with five alerts, all for tennis.

Elsewhere, 18 alerts were raised in Asia, all of which were related to suspicious betting on football. Mongolia topped the list here with four alerts, ahead of Georgia on three.

Some 13 alerts were reported in North America, all in the US, with 10 for horse racing and three for tennis. Four of the five alerts in Africa were over football betting in Ghana and one tennis case in Algeria, while there two alerts in South America, one for football in Brazil and one for tennis in Chile.

The IBIA noted that not a single alert was raised over suspicious betting in Australasia. 

Meanwhile, the IBIA referenced Ontario in particular as an area of focus, with the Canadian province having launched its legal betting market at the start of the quarter.

According to data from H2 Gambling Capital, Ontario’s handle, including horse racing, is expected to increase considerably in the coming years, driven by the increased availability of sports betting.

Handle for 2021 was calculated at CAN$1.14bn (£736m/€872m/US$876m), with this expected to reach $1.56bn in 2022 and $8.02bn in 2023, reaching $12.28bn by the year 2027.

Services included in the deal include data collection; a fraud detection system, and the installation of motion-based AI video capture camera technology.

This will be distributed across a number of TBF leagues in 27 venues in the country; betting video content and data will be distributed both domestically and internationally by Sportradar.  

The agreement comprises the first-tier Turkish Basketball Super League (BSL), second-tier Turkish Basketball First League (TBL), as well as all cup competitions, which includes the Presidential Cup.

Sportradar head of sport content and partnerships EMEA, Jan Pomme, commented on the deal: “We are delighted to partner with the TBF to deliver advanced data, analytics and technology solutions to further grow the sport of basketball in Turkey and drive new commercial opportunities by introducing Turkish basketball to a broader and more international audience.”

The business will have international rights to all BSL and TBL games and cup competitions starting this season, and will have the domestic rights in the following season.  

Hidayet Türkoğlu, president of Turkish Basketball Federation, added: “Today, it’s quite important and necessary to take advantage of technology in sports. By signing this agreement with Sportradar, we will have the opportunity to follow the developmental process of our teams and players by using the features of cutting-edge technology.”

“We believe that our partnership with Sportradar will have a great impact on Turkish basketball. This agreement will move Turkish basketball one step forward in accordance with Turkish Basketball Federation’s aims and vision. I would like to thank everyone who contributed to signing our agreement with Sportradar.”

In June, Sportradar agreed to a similar tech driven content deal will ParionsSport en ligne, the online sports betting division of French operator Française des Jeux (FDJ). The company also recently announced intentions to acquire payment solutions provider Aleda.