Month: April 2023

The Gaming Software licences are to be a requirement for any B2B business who continues its relationships with operators in Sweden. The new requirement – which was passed by the Swedish legislature in November – is intended to help throttle the development of the black market in Sweden by restricting the unlicensed operator sector’s access to providers.

The suppliers who have been issued licences by the regulator includes state-owned former monopoly Svenska Spel, Comeon brand Co-Gaming, Game Shop Limited and its Maltese subsidiary. Online and mobile gaming developer Push Gaming received licences for both its products and Malta subsidiary, as did Swedish slot developer Slotmill who received two licences.

Including subsidiaries, there are now 24 total suppliers who have been authorised enter into commercial agreements with operators in the Nordic country.

Spelinspektionen funding boost

The introduction of B2B licensing requirements are just part of a range of new measures brought in by the Swedish authorities to disrupt the illegal gaming sector. At the beginning of the month, the government announced that Spelinspektionen would be granted additional funding as part of a pledge to give the gambling regulator more powers to fight back against the sector.

“We welcome these extra funds which enable further strengthened measures in the fight against unlicensed gambling, money laundering and match-fixing,” said Spelinspektionen director general Camilla Rosenberg.

This move was supported by industry trade body the Online Gaming Industry Association (BOS), which stated its agreement with the policy to raise gaming fees to fund the proposal.

Gustaf Hoffstedt, BOS’ secretary-general, said: “We believe that the Gambling Authority is underfunded, at least in terms of maintaining an acceptable dialogue with the industry the authority is set to monitor.

“More precisely, this lack of dialogue does not apply to the Spelinspektionen’s dialogue with BOS – it now works well – but the lack concerns the difficulty for an individual licence holder to establish a functioning dialogue with the authority.”

Top Philippine gaming regulator at Pagcor Alejandro Tengco seeks “partnerships” with the gaming industry to expand revenue beyond pre-pandemic levels.

As part of that drive, the Pagcor chairman and CEO hopes to increase the activities and scope of Philippine offshore gaming operators (POGOs), dismissing China’s tourism blacklist threats.

Alejandro Tengco was appointed chairman and CEO of Pagcor by President Ferdinand ‘Bong-Bong’ Marcos
Picture source: Pagcor

Appointed by President Ferdinand “Bong-Bong” Marcos Jr, Tengco took office in September with no ambivalence about gaming and Pagcor’s role in it, unlike previous Philippine President Rodrigo Duterte and his Pagcor chair Andrea Domingo, who initially cast themselves as anti-gambling. Tengco wants to expand gaming to increase Pagcor’s revenue, and thus its contribution to “nation building” through payments to the national treasury and other agencies. 

In an interview with iGB on the sidelines of the ASEAN Gaming Summit in Manila last month following his keynote address to the conference, Tengco spoke of forming mutually beneficial “partnerships with the Philippine industry.”

“A partner to address the needs of operators”

That echoed Tengco’s keynote proposition: “We want to be a partner to address the needs of operators and giving the gaming industry help to take Philippine gaming to greater heights to increase our commitment to nation building. I ask you to join in this endeavor.”

The longtime construction executive promised, on behalf of Pagcor, “We aim to level up. Level up in cooperation with stakeholders to understand our obligation to create a Philippine industry with better regulation and expand gaming.”

Tengco expressed interest in reviving attempts sell Pagcor’s Casino Filipino operations and make Pagcor solely a regulator. The Duterte administration initially tried to privatize Pagcor’s casinos, but switched gears when it didn’t find a buyer.  

Tengco may have better luck. He holds the reins at government owned Pagcor – short for Philippine Amusement and Gaming Corporation – with the Philippine gaming industry in the midst of resurgent growth.

Record in range

Last year, gross gaming revenue reached 214.3 billion Philippine pesos (US$3.95 billion), 84% of 2019’s record PHP256.5 billion for Pagcor and its licensees. Pagcor projects 2023 GGR at PHP244.8 billion, 95% of the 2019 total. Last year’s Pagcor projection underestimated actual GGR by 16.5% or PHP31 billion. Similar outperformance this year would result in a new revenue record, potentially surpassing Singapore as runner-up to Macau in Asian gaming revenue tables.

Outperforming estimates would hardly come as a shock, given the gaming floor crowds and world class products in casino resorts in Entertainment City on Manila Bay and beyond.

Celebrating its tenth anniversary in March, market leader Solaire hosted Sting in its state of the art theater, and, on a recent Monday night, the casino floor looked like New Year’s Eve.

City of Dreams Manila features operator Melco Resorts’ luxury hotel brand Nuwa, plus a Nobu restaurant and hotel. Okada Manila includes Entertainment City’s largest gaming floor and the world’s largest dancing fountain. Newport World Resorts (formerly Resorts World Manila), on the doorstep of the airport, has the Philippines’ largest hotel ballroom and the most casino property hotel rooms, anchoring its MICE offering, plus a shopping mall and concert hall.

A two hour drive north of Manila in Clark, Hann Resorts debuted a new casino in late 2021 serving its three hotels, providing a sophisticated escape from the city within 15 minutes of Clark’s newly expanded international airport. Last year, beachfront Nustar Resort and Casino opened its first of at least three hotels on Cebu island in the midst of the Philippines’ second largest metropolitan area.

Underenthused and overbuilt?

Contrary to these outward signs of prosperity, it’s notable that most enthusiasm for development lies beyond Pagcor’s Entertainment City hub. In fact, the four Entertainment City licensees haven’t fully built out their properties despite strong growth pre- and post-Covid.

Travellers has dragged its feet on Westside City for years with its casino hotel now scheduled to open late next year. Solaire’s parent company Bloomberry hasn’t even begun planning its Phase 2 on land it paid US$710 million to acquire in 2018. City of Dreams Manila owner Belle Corporation hasn’t used its second license, even though the controlling billionaire Sy family has extensive nearby land holdings. Okada Manila hasn’t finished its resort more than six years after opening and is trying to sell adjacent undeveloped land.

Tengco, however, denies Entertainment City is overbuilt. “I don’t believe so. The numbers say it’s not.”

The Okada Manila saga

Speaking of Okada Manila, where founder Kazuo Okada and his backers temporarily retook possession of the resort bearing his name last year until ousted by Pagcor via a court order just before Tengco assumed office, there remains the matter of the resort’s US stock listing as UE Resorts, spinning it out of Japanese pachinko giant Universal Entertainment.

In October 2021, former Las Vegas Sands board member and activist investor Jason Ader began the process to list the resort in US through a merger with 26 Capital, a special purpose acquisition company (SPAC).

Last October, 26 Capital extended the listing venture to a third year. However, Tengco says neither US market regulator the Securities and Exchange Commission nor the NASDAQ stock exchange have contacted Pagcor regarding a possible Okada listing. That’s particularly puzzling following the 2022 Okada takeover and expulsion.

Balanced growth

The Philippine gaming market outlook remains attractive with its balance of domestic and international players.

“There is little doubt, barring any black swan events, that the Philippines economy will grow this year and over the next few years,” longtime gaming executive and former UNLV Singapore Dean Andy Nazarechek, now living in Philippines, says. “Tourism is one area that the government has put on its list of priorities. I think the Philippines has great potential for the gaming industry as inbound tourist arrivals grow and local discretionary income spending improves.”

Domestic economic growth reached 7.6% last year, its fastest expansion since 1976, and unemployment is falling as business activity ramps to pre-Covid levels.

International visitor arrivals have accelerated since early last year under loosened Philippine travel restrictions. Foreign arrivals in 2022 topped 2 million, less than a quarter of 2019’s 8.3 million, but by December, the count had reached 49% of 2019 as airlines ramped up service and barriers eased in source markets. Arrivals for the first two months of 2023 climbed to 57.5% of the 2019 total.

Blacklist? What blacklist?

Beijing has announced a secret tourist blacklist against countries encouraging Chinese citizens to gamble. POGOs targeting mainland China players had reportedly landed the Philippines on that blacklist. However, when Beijing reopened outbound travel in December, the Philippines was among the first batch of the countries approved for Chinese visitors. “There’s no evidence of a blacklist,” Tengco said.

He aims to expand POGO activities, as well as domestic online gaming enterprises known as PIGOs, to increase Pagcor’s revenue. Tengco has proposed licensing a special category of business processing outsourcing to service offshore gaming companies licensed in other jurisdictions. 

Even absent a blacklist and Zero Covid restrictions, mainland Chinese visitors to the Philippiens remain a trickle, 24,552 this January-February compared with 305,391 in 2019. Numbers are expected to increase throughout the year; last month China approved resumption of group tours to the Philippines. Pre-pandemic, Chinese visitors topped 1.7 million with growth on pace to overtake South Korea as the Philippines’ leading visitor source.

By contrast, South Korean visitors rebounded past 250,000 this January-February, 70% of the 2019 figure. Koreans are evident at gaming tables.

Beyond the main gaming floor, “There are a lot of Korean junkets, not only in Metro Manila, but also Clark,” Tengco said. He cited Korean junket operator Do Win as having a “strong presence right now in different IRs.”

Junket postmodernism

Expanding Korean junket play is “a logical alternative” to Macau’s depleted junket sector, Tengco said, adding, “Some [Macau junkets] have shifted to our IRs. That is a plus for us. That increase in VIP players in Manila, I believe, will benefit us.”

Under Tengco, Pagcor is revising junket regulations, including junket licensing, part of a national effort to get removed from the global Financial Action Task Force’s gray list on anti-money laundering and counter terrorism financing. The Philippine government has received a list of items to address on AML/CTF, according to Tengco. “Pagcor has one item in this list, and that is related to the information that we’re committed to give on the true and beneficial owners of the junket licensees.”

In that vein, the non-junket remnant of Suncity is the casino developer and projected gaming operator under Pagcor licensee Travellers International Hotel Group for its Westside City project.

Working through Philippine listed SunTrust Resort Holdings, the former Suncity, now called LET (for Leisure, Entertainment, Travel) and publicly traded in Hong Kong, is led by Andrew Lo, former deputy to jailed former Suncity chairman and CEO Alvin Chau. When asked whether LET is an appropriate casino operator for Travellers, Tengco replied, “I don’t want to answer for Travellers.”

Travellers was once a joint venture of Philippine billionaire Andrew Tan’s Alliance Global Group and Genting Hong Kong, an arm of Malaysia’s Genting Group also holding its cruise ship business. Genting Hong Kong’s plunge into bankruptcy early last year enabled Alliance to buy it out of Travellers.

Nothing irregular

Tengco says Pagcor had no role in the change of ownership at its licensee. “Our only participation was when we were informed by our licensee that a decision had been reached for the termination of their engagement on their joint venture.

“When the letter was received by my office, I referred the matter to the department concerned. And as soon as the recommendation of the department was sent back to me, I forwarded it to the board for its approval. That was our only participation in the cessation or termination.”

As for the lack of public notice from Travellers, a formerly Philippine listed company taken private, or Pagcor, Tengco said the board decision was uploaded to Pagcor’s website.

“I don’t think it was necessary for us to go public and announce the decision that was made by those parties. I didn’t find anything irregular about it. We normally do not announce whatever decisions we make in the board. So I’d like to categorically say that I didn’t feel there was a need to make a public announcement.”

Under the deal, which is expected to complete within 60 days, Everi will take ownership of the majority of Video King’s assets and will fund the purchase using existing cash on hand.

Everi said the acquisition would provide the business with complementary assets and an established customer base to enable additional growth in its games segment. 

Video King is currently licensed in approximately 60 jurisdictions, and, subject to regulatory requirements, an estimated 20% of Video King’s installed base of portable e-gaming tablets may be enabled to provide players with traditional bingo games and Class II video poker, slots and instant win games, as well as with a digital wallet and loyalty products. 

The provider’s installed base of more than 50,000 portable electronic bingo tablets covers tribal casinos, commercial casinos, charitable bingo halls, military bases and cruise lines.

“Over the past several years, we have had great success with executing on acquisitions that grow our product capabilities and the markets we serve,” Everi chief executive Randy Taylor said. “During this time, we have established a track record of successfully scaling up acquisitions that have delivered an attractive return on investment and helped drive strong cash flow. 

“We are highly confident that by helping to elevate our current games, FinTech and digital solutions with and adjacent to our established customer base, the acquisition of Video King will meet those same criteria and offer Everi with another lever for growth.”

Video King co-founder and chief executive Tim Stuart added: “We are confident that as part of Everi, Video King will be in a very strong position to expand our product offerings to provide our long-time loyal customer base new enhanced games for our tribal, charitable and military markets.

“The combination of Everi’s games and other digital offerings with our strong electronic bingo base create a unique opportunity to accelerate future growth.”

Relocation

The deal comes after Everi last month announced that it would cease the manufacturing of gaming machines in Texas and consolidate production at a new facility in Las Vegas, Nevada.

The provider already manufactures its self-service fully integrated cash access kiosks, loyalty kiosks and other FinTech products in Las Vegas, with this production, assembly and distribution to also be relocated to the new site.

Under the deal, which was agreed in December of last year, more than 50 Leap staff will join the IMG Arena team, with Leap’s chief executive Yariv Lissauer to take on the role of senior director and general manager.

IMG Arena said will it combine its portfolio of rightsholder clients with Leap’s technology and products to unlock new revenue streams and provide sportsbooks operators and their consumers with a wider portfolio of sports content.   

Founded in 2014, Leap works with 120 sportsbook operators around the world. IMG Arena invested in Leap in 2018 and worked together to launch a number of official virtual sports betting products with Nascar and basketball’s EuroLeague.  

Last year, IMG Arena’s owner Endeavor also acquired sports betting supplier OpenBet for $800.0m.

“We are delighted to officially become part of IMG Arena, which has been a stakeholder in, and great partner to Leap for the last four years,” Lissauer said. “We are excited about the culture, product and technology synergies between our companies and teams, and the new opportunities that will arise from combining them.”

IMG Arena president Freddie Longe added: “The addition of Leap Gaming to our sports betting content portfolio will enable us to enhance our offer to sportsbooks and lead the way in shaping the future of sports betting entertainment. 

“We are looking forward to unlocking even more revenue streams and forms of fan engagement for our clients.” 

The funds will enable GamCare to continue to run the National Gambling Helpline, which it has operated for more than 25 years, with an increased focus on widening accessibility and choice for people in need.  

GamCare will improve the digital tools and resources that complement the Helpline, while the funding will also help deliver enhanced regional services and treatment across London, Yorkshire and Humber, Scotland, South East, East Midlands and the North East.

In addition, as part of GambleAware’s National Gambling Support Network (NGSN) initiative to reduce gambling-related harm, GamCare will work alongside other national and regional partners to support the primary aims of the project.

These include continuing to improve access for people seeking support for their gambling through the National Gambling Helpline and the NGSN, which rebranded from the National Gambling Treatment Service (NGTS) earlier this month.

Other aims include reducing barriers for people seeking support for their gambling, as well as ensuring strong collaboration with other organisations across the gambling harms space and that all support services are working towards a culture of continuous improvement and are designed around those who use them. 

“We are delighted with the outcome of the commissioning process and to be able to continue providing free, confidential support to anyone impacted by gambling nationally,” GamCare chief executive Anna Hemmings said.

“Having secure, sustainable funding provides a fantastic opportunity for us to look long-term at how we deliver services that can best support people and communities to reduce gambling harms. 

“We look forward to collaborating with other partner organisations in the National Gambling Support Network.”

Serving as a member of PMU’s executive committee, Chevalier will assume responsibility for the management of the operator’s financial performance and also oversee transformation projects in collaboration with general management.

He will report directly to PMU managing director Emmanuelle Malecaze-Doublet

Chevalier joins PMU after almost five years as global chief financial officer of fashion brand BA&SH, prior to which he spent 11 years with the Carrefour group.

During his time with Carrefour, Chevalier served in a number of financial management roles including group financial controller and financial director of Carrefour Supermarkets in France.

The hire comes after PMU in January also announced the appointment of Olivier Pribile, previously of Française des Jeux (FDJ), as it news marketing and product director.

Pribile took on responsibility for developing PMU’s portfolio of products, as well as driving data, customer experience and the brand as part of the PMU 2025 strategic plan announced in December.

The three-year strategic vision sets out plans for PMU to grow its annual stakes by €1bn and increase its total number of customers to four million. The business outlined a series of transformations for the company in the period including a “global approach” to PMU’s growth, the deployment of new technology and the development of marketing channels.

The regulatory board notes that supporting Ukraine’s European course is a priority for all state entities.  

Among these measures include cooperating with European regulatory bodies and associations and complying with EU gambling requirements and rules.   

This is part of an overall strategic activity plan by the government that hopes to bring Ukraine closer to EU integration.  

Parimatch suspension

Recently, Parimatch suspended its Ukranian operations due to sanctions implemented by president Volodymyr Zelensky. 

The Ukranian president signed into law Presidential Decree No. 145/2023. This imposed sanctions on 287 companies – Parimatch being one – and 120 individuals.  

Many of these companies were related to betting. On 11 March, Zelensky stated that gambling businesses had been withdrawing funds from Ukraine and financing activities in Russia. 

Parimatch suspended its operations in Ukraine and its Ukranian site was blocked for players in the country.  

The operator retaliated by saying it “never received any requests from the Security Service of Ukraine (SBU) regarding the suspension of the franchise in Russia”.  

Additionally, Parimatch appealed directly to Zelensky and accused the SBU of “illegal violations.” The company claims that the information used during the National Security Council’s decision for sanctions had been falsified and carried out by the SBU.  

The operator hopes for a further review of the situation.  

The total staked rose also increased to PLN 1.19bn in the three-month period ending 31 March, a 16% year-on-year growth from the PLN 1.03bn the company achieved in the same period the previous year.

On these stakes, the business reported gross gaming revenue (GGR) of PLN 305m, a 9% rise from the PLN PLN 279m the company reported in Q1 2022. GGR is stakes minus winnings – while NGR additionally removes bonuses and statutory gaming taxes from the total.    

In terms of non-financial metrics, the company announced that it achieved 57,000 new registrations in the three-month period, compared to the 56,000 that it reported last year. Of this total, 37,000 players made their first deposit as opposed to 35,000 in 2022. However, despite these increases – the company actually saw the business’s number of active users decline 2.4% from 339,000 to 331,000.  

STS re-confirms Polish strategy

“In line with our expectations, in Q1 2023 we achieved very good operating results. We recorded significant increases in key indicators related to our business,” said STS Holding president of the management board Mateusz Juroszek.

“STS customers remain strong and willing to place bets. In addition, a significant proportion of players acquired during the World Cup are highly active. We hope that in the coming months we will continue to effectively activate our extensive customer base, which is still growing.”  

In January, STS announced that it would be re-orienting the business’s strategy to focus on its core market Poland. Juroszek confirmed that this plan was ongoing.

“In 2023, the group is planning a number of activities aimed at increasing the profitability of its operations,” he said. “To this end, the company reorganised its operations, focusing on Poland and closing its activities under licences in the UK and Estonia.”

STS Group operations

However, the STS Group operations – that is including the UK and Estonia did not perform as well on a number of both financial and non-financial metrics as just the business’s Polish business.

The total amount staked increased 11.5% to PLN 1.20 from PLN 1.08bn. On this the company reported a NGR of 176m, an 11% increase compared to the 12% announced for just the company’s Polish strategy. GGR also rose from PLN 282m to PLN 306, a 9% increase.

New registrations including the business’s Estonian, UK and Polish operations were 57,000 compared to the 64,000 achieved by the business in Q1 2022 – an 11% fall. The number of first time depositers and active users also declined 7% and 5% respectively.

The business will be permitted to offer digital games to German consumers through its online portals Lotto24 and Tipp24. The company argue that this represents a strategic milestone for the business, since the German online lottery market leader has opted to enter a new segment.

According to Zeal, the new portfolio will go live in a “few weeks”. The business said that the offering of online slots has previously been an important vertical for the company in other international markets. Zeal highlighted its established B2B relationships with a number of third-party providers, including US-based lottery supplier Park Avenue Gaming.

“We are very pleased about the trust placed in us by the national authority and are eager to be able to offer our online games very soon,” said Zeal CEO Helmut Becker. “With this licence, we reach an important milestone in our business strategy. We are convinced to be able to offer interested customers out there a great portfolio and new gaming experience.”

“Online games are becoming increasingly important and have established themselves in the international lottery and gaming industry,” added Zeal Instant Games managing director Julian Tietz. “We are proud to finally offer our games in Germany after successful international collaborations.”

World Lottery Association

This month, Zeal announced that it would be joining the World Lottery Association (WLA) as its latest member. The company said that it therefore committed to complying with the organisation’s standards for social responsibility, responsible gaming, security and risk management.

The affiliate did not disclose the specific financial details of the purchase but confirmed that the deal was worth a six-figure sum.

ThePogg.com offers reviews of online casinos and provides players with comparisons from vetted online providers. The site also provides an alternative dispute resolution (ADR) service, which offers mediation services for operators.

Paudie O’Reilly, founder and CEO of Blexr, believes the acquisition will help the company in expanding its range of brands.

“We know this acquisition will be a great addition to our existing product portfolio and expand our presence in our target B2B markets,” said O’Reilly.

“The work Duncan [Garvie] has done over the years to build a trusted service at ThePogg.com is second to none and represents an enormous opportunity for Blexr to grow and develop that business.

“We have big plans in this space and are excited to see how it will grow in the coming months.”

Garvie,the founder of ThePogg.com, will also be joining Blexr as part of the agreement. ThePogg.com was launched in 2010 by Garvie, a former teacher with a degree in pure mathematics.

“I’m incredibly proud to be joining Blexr,” said Garvie. “We have worked hard to provide exceptional service to our users and clients over the past few years, and have developed the highest standards in the industry. I’m really happy to be joining an organisation that shares that same commitment.”

Recently, Blexr bought New Zealand-based brand CasinoReviews.net.nz for a seven-figure sum.