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On February 26, 2013, New Jersey celebrated a historic milestone. It was on that day that then Governor Chris Christie signed Assembly Bill 2578, which legalized online poker and casino games in the state, into law.
Exactly nine months later the first regulated sites went live. And while the industry was not without its growing pains, it has proven an overwhelming success, generating over $130 million for state coffers and contributing to the revitalization of downtrodden Atlantic City.
In this retrospect we take a look at some of the biggest lessons learned during the industry’s first five years, paying particular attention to unexpected trends that threw analysts for a loop. New states considering iGaming legislation can look to these examples in order to glean a better perspective as to how to max out their own industries.
1 — Outrageous projections are damaging
Exaggerated revenue projections are nothing new, especially in regard to nascent industries. But when those predictions are so outrageous that the new industry has absolutely no chance of meeting expectations, it can have a long-term detrimental impact on public perception.
This is exactly what happened to the NJ online gambling industry.
Conservative estimates projected $200 – $300 million in first-year revenue; lofty but attainable under the right circumstances. They weren’t the problem. It was Morgan Stanley‘s estimate of $1 billion, and Chris Christie’s own projection of $1.2 billion which made headlines, ultimately putting the industry in an unenviable spot.
How Christie derived this figure is anyone’s guess, but we suspect it has something to do with bolstering his political clout. Unfortunately, when the industry posted first-year revenue of $122.9 million — a very respectable number — it was widely viewed as a colossal failure. As a result, other state legislators shied away from online gambling, and it wouldn’t be until 2017 that another state (Pennsylvania) legalized the activity.
Thankfully, industry operators weren’t deterred by the negativity. Last year, NJ online gambling generated $245.6 million, and in January 2018, it set a new high-water mark for monthly revenue.
States on the fence about iGaming legislation are advised to look at this growth trajectory, and not be fazed that NJ online gambling sites didn’t live up to the bombastic predictions set forth by Christie in 2013.
2 — Online casino is the new online poker
When Black Friday forced PokerStars, Full Tilt, and other major online poker brands out of the US in 2011, players were rightly devastated. At the time, poker was something of a national pastime in the states, and its sudden removal cost many residents their livelihood, and a significant number their jobs.
By 2013 online poker was well past its popularity peak, but that didn’t prevent players from becoming enthused about its return to New Jersey. Unfortunately, these players were met with a hard reality early on, that this new online poker market was merely a shadow of its former self.
Most of the problem had to do with the capped liquidity of the NJ market. Prior to Black Friday, sites had a population reach in the hundreds of millions. Now their reach was just under 9 million. Factor in the industry’s various early struggles (payment processing limitations, geolocation failures) and traffic and revenue quickly floundered.
During those early days, operators poured countless marketing dollars into poker (remember 888’s 80% rakeback deal?), believing it to be the best use of their funds. They were wrong, and in being wrong they hindered the growth of online casino — a vertical that did not depend on high liquidity for success.
Since, they’ve learned their lesson and online casino sites have thrived. In 2017, online casino accounted for a staggering 90.1% of industry revenue.
Granted, we do think online poker will capture more market share in 2018, but that’s only because NJ has taken steps to rid itself of its liquidity problem, by forging a player pooling compact with Nevada and Delaware.
3 — What’s in a brand? Apparently, not everything
When NJ online gambling launched in November 2013, analysts believed that Caesars and Borgata sites would dominate the landscape. They did, for a time.
But it quickly became clear that over the long-haul, strong branding was only one piece of the puzzle. Nowhere was this more evident than on Golden Nugget licensed sites. A relatively small casino brand in New Jersey, at least compared to Borgata and Caesars, Golden Nugget purposely held back on its marketing spend for about a year, only to open the floodgates once other sites pulled back on their initial promotional blitz. It was also around this time that it picked up Betfair, a highly regarded international brand, under its license.
This one-two punch worked, and the positive results were amplified by the operator’s aggressiveness, resulting in a rapidly expanding game library, new formats, better software, and top-flight payment processing. Since, Golden Nugget has never looked back, and in January 2018 it became the first operator to generate over $7 million in a calendar month. For perspective, no other operator has ever pulled in $5 million.
Other smaller brands have also done well. Resorts, Atlantic City’s smallest casino brand and a latecomer to the online market, defied all odds and now accounts for significant market share. Why? Probably because its casino software and game libraries are second to none.
And for what it’s worth smaller brands are apparently making an impression on AC’s big hitters. Recently we’ve seen sites under the Caesars license make a host of improvements, and Borgata has been upping its online casino game considerably of late, via new games and creative promotions.
The lesson here is that smaller casino brands in other states have plenty of reason to lobby for iGaming, perhaps even more than bigger names, because the online space is a more level playing field.
4 — AC and NJ online gambling, perfect together
One of the chief concerns revolving around NJ online gambling was that the industry might cannibalize Atlantic City revenue. Not only were these worries quickly put to bed, but it was revealed that online gambling had a complementary impact on brick & mortar casinos.
As early as February 2014, three months after industry launch, it was shown that online and land-based players come from very different stock, with little overlap. Going further, a portion of these online players were incentivized to visit Atlantic City for the first time.
We’re not saying online gambling is the sole reason Atlantic City land-based gaming revenue has stabilized, but it’s certainly a factor.
Not only that, but iGaming has proven to bolster Atlantic City revenue under select circumstances. To wit, it was recently reported that AC revenue was down a sharp 10% in January, primarily due to a string of inclement weather early in the month. However, for that very same reason, online gambling soared to a new revenue record.
Without online to cushion the blow, AC revenue would have fallen by a much larger margin, and that’s worth something.
Unfortunately there are still some holdouts that earnestly believe online will cannibalize their business. Hopefully these misguided fears will be dispelled once proof mounts in other states that this is not the case.
5 — Live Dealer proves a critical addition
The impact of Live Dealer games, launched on Golden Nugget Casino in 2016 and Betfair Casino in 2017, is not to be overlooked.
Not only do Live Dealer games take in some healthy wagers, but they’re proving a gateway to online gambling for those more comfortable with brick & mortar casino settings. In turn, some of these new players eventually warm up to electronic games.
We don’t have exact revenue figures for Live Dealer games, but based on the vertical’s growth — both in the number of tables running and hours of operation — we suspect it’s growing quickly.
Expect Golden Nugget to roll out several more Live Dealer games this year, including the Bet Behindfeature for blackjack, which could be a game changer. It’s also plausible that Golden Nugget will lease its studio space to more operators (Betfair currently utilizes it), as the cost of running an independent studio might prove too high for most.
Source: European Gaming News
Could UK Government Policy Threaten Online Betting Promos?
Most observers would agree that the UK political class is pursuing a dialogue on the very nature of the gambling industry. The headline issue is, of course, fixed-odds betting terminals (FOBT’s), which have been the focus of a huge campaign. This week the UK Chancellor, Phillip Hammond, announced that the maximum stake in these gaming machines will be cut dramatically starting in October 2019. The move has cross-party support, and even the gambling industry has been vocally supportive, knowing that it at least makes sense from a PR perspective to seem concerned about the issue.
However, FOBT’s are not the only issue being discussed about the industry in the UK, with some changes perhaps having a big impact on punters. Advertising has come under scrutiny recently, with an almost saturated feel to the volume of sports betting adverts played on television during events like Premier League games. Sky, the UK’s dominant figure in sports broadcasting, has agreed to ‘regulate itself’ and limit the number of betting adverts beginning at the start of the 2019 Premier League season.
The move by Sky, while seemingly commendable as they will lose out on a chunk of the estimated £460 million gambling companies spend on advertising in the UK, is also indicative of the fact that the landscape is changing. The Labour Party, in particular, has signalled that they will try to put curbs on many aspects of the industry should they win the next election. For example, Labour deputy leader, Tom Watson, has called for a ban on funding accounts with credit cards and any advertising during live sports events.
However, one area that will be keenly watched by casino players and bettors is that of promotions. Incentives like free bets, price boosts, reload bonuses and the rest are the “carrot” that usually acts as a tipping point to encourage a player to join a new site, but they are certainly not the only reason why people bet. If a Government decides that promotions force people to bet, rather than supplement a decision that has already been made, could they too be in the firing line as the UK authorities try to further regulate the industry?
Free bets offers popular with punters
One would argue that would come to the detriment of the customer, rather than the industry. Consider how a punter might want to bet with William Hill on Real Madrid at 12/1 to win the Champions League, or the Boston Celtics at 7/1 with Bet365 to win the NBA Championships; they could check a list of free bet no deposit 2018 offers and potentially make their bet for free. Is it fair to take away those incentives from the customer?
There is a fine line between the idea of a promotion and the “bet now!” command that is being looked at by the Advertising Standards Agency, but it’s hard to know where that line will be drawn in the future. Punters would be irate to learn that they can’t, for example, go to a bookie and find an incentive like a price boost on the current odds of 12/1 for Chelsea to win the Premier League.
In the end though, money usually settles these matters. While the UK Government has made moves on FOBTs, it was slow-acting because bookmaker shops were keen to point out that those betting terminals equate to jobs. 2017/18 was estimated to have raised £2.8 billion in gaming tax receipts for the UK Exchequer. The Government will be loath to jeopardise that income. The point is: if the bookies can make their case, those promos will be here to stay.
Pragmatic Play roars to life with 5 lions
New release sees ancient spirits guarding amazing riches
15 June 2018: Pragmatic Play, the multi-award-winning games provider, has announced the launch of 5 Lions, a 3×5 video slot steeped in myth and legend.
Chinese iconography lights up the reels of 5 Lions, with turtles, phoenixes and dragons appearing covered in glittering gemstones.
The mystical lions of the game’s title act as the wild symbols, granting the player a random multiplier of up to 40x and springing to life when they appear in any winning line.
Melissa Summerfield, Chief Commercial Officer at Pragmatic Play, said: “Our suite of high quality games continues to go from strength to strength, and 5 Lions is a great addition that we are proud to introduce to our partners and players.
“The game’s mystical air is complemented by an engaging and visually satisfying array of bonus content, and it certainly has the potential to keep players coming back.”
Three gilded yin-yang symbols unlock 5 Lions unique free spins feature, expanding the three central reels to four symbols in height and boosting the potential ways to win from 243 to 576.
Players then have the opportunity to choose between seven lions, offering a wide selection of different multiplier ranges. These options range from six free spins with a range of high multipliers (15x, 30x, or 40x) to 25 free spins with a range of lower multipliers (2x, 3x, or 5x).
Pragmatic Play’s portfolio contains more than 80 proven HTML5 video slots, including Wolf Gold, Chilli Heat and The Champions. These titles are now live with a growing list of leading casino brands, including Mr Green, Betsson and LeoVegas.
For more information on this release or to arrange an interview please contact Tom Lewis at Square in the Air on 020 3586 8257 or firstname.lastname@example.org
About Pragmatic Play
Pragmatic Play is one of the fastest growing providers of slots games in the online gaming industry. It has proven expertise in creating mobile and desktop content that engages modern players. Its expanding portfolio features more than 80 proven HTML5 titles, which support 26 languages and all major currencies, and are built on unique in-house designs.
The provider’s games are attuned to the needs of players and operators in regulated markets all over the world and are now a fixture on many of the leading casino brands.
For more information please visit http://pragmaticplay.com/
Source: European Gaming News
21Bet upgrades Sportsbook with Digitain
Reading Time: 2 minutes
June 15th, 2018 – Digitain the multi-channel casino and sports betting platform provider confirmed that Malta-licensed 21Bet had been successfully migrated to Digitain’s fully managed sportsbook solution.
21Bet is operated by Aureate Gaming Solutions Ltd and is also the official shirt sponsors of Waterford FC. Under the agreement, Digitain provided its API technology for 21Bet’s online operations including a new improved version of their sportsbook, with features that include cash out, edit my bet, and express bonus and the latest promotional tools for player marketing acquisition and retention.
Digitain CEO, Suren Khachatryan, said: “21Bet is a growing brand in Europe and we are delighted to be their technology partner of choice. Digitain’s frictionless API integration along with our fully managed Sportsbook will deliver 21Bet with enhanced user experience and over 30,000 real live monthly events and full coverage of the most popular sports in Pre-match and Live Betting, and cash out options. 21Bet will also have access to the latest World Cup content zone, including team news, standings, and head-2-head to further engage players throughout this year’s largest betting tournament.”
James Hudson CEO at 21bet, said: “Our company’s vision is to have the optimal strategic partnership with our technology providers. Digitain has a proven international and European market expertise, and their technology allows our brand to be agile and flexible, and in control of our roadmap to adapt to ever-changing market conditions and player preferences. The Digitain team are a delight to work with and they made the migration to our new sportsbook as smooth as silk! ”
Digitain has more than 1,000 employees, 35+ global partners, and more than 400 betting shops worldwide.
The multi-channel Digitain Gaming Platform allows for a frictionless turnkey or white-label solution for both land-based and online operators via our API’s to integrate a sportsbook, casino, live dealer, and virtual sports modules. The stack also includes an extensive payment gateway, bonus engine, CRM system, and dedicated customer support 24/7.
The sportsbook product covers 30,000 live events each month, across 65 sports taking in 7,500 leagues, and more than 3,000 betting markets, while our casino solution has 3,000+ games from the likes of NetEnt, Microgaming, and Playson and many more.
Source: European Gaming News
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