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Wednesday, October 12, 2016

The End Of The Land Based Casino As We Know It And The Rise Of the New Co Casino

It is no secret that traditional  US land based casinos have been in decline for some time with fewer players at the tables or the slots. The Caesars Bankruptcy, blamed on high debt loads , and the exit of  CEO Gary Loveman  to greener pastures in the insurance industry point to a troubled land based casino business environment that cannot magically be rectified by a change in management.

The issues impacting land based casino  participation and revenue in  Atlantic City and Vegas  are numerous; including the rise of regional native American casinos, other non native American  regional casinos, online social casino, legal and illegal online gambling.  

 The existence of alternative gaming venues can be partially blamed for a percentage  of  the decline in visits and gambling revenue in Vegas and Atlantic City. However, the nature of "gaming" engagement  itself has changed with less interest on the part of existing gamers to engage in  "Vegas" style games and land based gaming in general. The online world, and to some extent, the console gaming world in the form of eSports and other popular connected console games have taken precedence over the physical gaming experience.

 The passing of the baby boomers and the rise of the millennials has resulted in a change in gaming behavior, preference, and venues. Ironically, visits to Vegas are increasing. However, the visitors are not gambling when they arrive in Vegas.   The problem with this trend is that gamblers spend more money then tourists and party goers. This trend has created a challenge for Vegas, and to a certain extent, Atlantic City  when it comes to offering a casino style experience without the casino revenue.

The recent eSports competition  held at a Vegas casino  points to a ray of hope for casinos. This event was well covered by the media and strongly endorsed in the G2E gaming conference in Vegas.  G2E is a conference that has a long history and is predominately sponsored by land based casinos and suppliers to the land based casino industry.  The enthusiasm and curiosity of the attendees about the eSports phenomena was obvious. 

The real question going forward, is what do the land based casinos do to further encourage gaming that involve millennials?  eSports is just one flavor of "connected gaming that is popular amongst this demographic. What other connected games can the casinos leverage?

The Connected Casino Floor -  When you watch a traditional slot player sitting at a slot playing for hours you wonder how that experience could  be extended by having head to head play or at least some form of competition amongst other players on the floor.  There is no reason why you can not connect theses players in tournament style gaming. Each of this players could create a made-up/fictional name and select an avatar.  Play could start with all players participating and ending after an elimination of all players except two. This final showdown could  and would attract spectators if the floor was properly configured to broadcast the players  final competing. This could also lead to a "big money" final tournament which is televised. There would be   time limits on each competition and a jackpot achievement that would complete the competition. The start of each competition would be announced, players could decide if they want to participate and add their names to the list of participants. The connected floor players could also play against online players that have access to the same game in a virtual context.

Console Games On The Casino Floor - The connected casino floor concept  could be extended by adding console gaming in the casino itself. Instead of a slot machine a console with joy sticks, etc. would replace the slot. The console would give the player a number of game options to play individually or against other players.  Play would require coin in by the player and perhaps additional wagers as the game progresses. Players ready to play against each other would be listed and a time for a game to commence would be displayed on the machine/device and  on notifications screens through-out the casino. Big winners  engaged in console game play would be given special attention throughout the casino and on social media to keep everyone updated and engaged in the competition.

Connecting Land Based Casino  And Social Media - When a players engages in an activity on the casino floor there activity should be  broadcast  on social media. Player wins in particular or large payouts should be the focus of the communication. This will engage the social media audience within and outside   casino  in a games progression and how certain players are doing. The goal of social media communication is to increase "engagement" and "awareness" inside and outside of the casino. 

Connected Blackjack And Poker In And Out Of The Casino -  Blackjack and poker are traditional multi player gambling games that are  popular gambling games that millennials play in and out of the casino. To extend the popularity of these games amongst millennials online poker and blackjack matches should be sponsored by land based casinos leading to finals in the casino. The qualifying games should also be played with a mix of players outside the casino and within the casino. Within the casino itself the "connected" casino could have  computer terminals  placed in sections of the casino where people could also play online. These terminals would allow players in the casino to join poker and blackjack games being played worldwide on the net. The results of their play and the play of the online players would be displayed in strategic places in the casino. The final tournaments would be played in the casino either at a traditional table or in the connected casino environment.

There are certainly many options that the land based casinos have to grow and attract the "connected" generation of players.  Poker and Blackjack are  popular gambling games that conveniently  bridge the gap between offline and online game play. 

Social media can also play a big role in creating an online  audience for gambling game tournaments  keeping the  online audience aware of what is happening, when it is happening  and where gaming events are occurring. 

It is clear that  the land based casino business must change and change quickly if they want to remain "relevant" in a connected world. The recent eSports event in Vegas demonstrates that Vegas can pull this off. The question is: Do the traditional gambling business owners  have the energy, expertise, will and courage to reinvent the casino as we know it by combining the offline and online gaming audience?

Kevin Flood is the CEO of Gameinlane and FitCentrix, Inc. Kevin spent time at the Machine/Learning Lab at MIT as a technology transfer fellow engaged in model based reasoning, case based reasoning and rule based systems to enhance diagnostics systems.    Kevin has worked for and with US land based casino operators helping them evaluate social casino and iGaming platforms for the purpose of joint ventures and acquisitions in addition to launching online gambling operations in Europe. Gameinlane is also startup "friendly" understanding the unique value new gaming companies bring to the marketplace.  Kevin frequently speaks at gaming conferences around the world providing him with a unique perspective on this very interesting business sector. Kevin can be reached at kflood@gameinlane.com  and or twitter  at @kflow1776.







Friday, September 30, 2016

2016 G2E Vegas Gaming Conference Dominated By eSports

 The 2016 G2E Gaming conference   addressed a number of   interesting gaming and casino  topics and  hosted an extensive exhibit venue. However, it was clear from the attendance at various   events  that eSports was the hot topic with eSports events well attended.

For the traditional gambling crowd eSports is an enigma  because it does not involve traditional gaming content such as slots, table games, lottery, etc.  It also crisscrosses  the line between sportsbook wagering, skill gaming, online gaming, console gaming  and on-premise gaming making  it difficult to categorize from a  traditional regulatory perspective.   eSports also attracts a  "younger" demographic relative to what land based casinos currently attract.  The 20 something crowd being the dominant group engaging in the activity. This is a distinctly different demographic from traditional sportsbook punters.   One noted concern is that many eSports players are under the age  of  18. It is not clear how this will all play out from a land based casino perspective. This may also be  reason why some eSports events in Las Vegas are not being held in the casinos.

Games such as Counterstrike, League Of Legends and Dota, to name a few,  are games that are popular eSports games. These games have moved  beyond the  standalone console to a connected  online venue that allows thousands of players to engage in heated competitions.  Game competition culminates in an ultimate showdown between top players.  These showdowns  are well suited for on premise engagement. These are the events that  Vegas wants to tap into. Gaming enthusiasts,  casual spectators and sports wagers/punters want to wager on the outcome of these games and the top players. Vegas is and  wants to take wagers on these competitions. 

It was interesting to see how receptive Vegas regulators are to the idea of hosted eSports tournaments in Vegas. It is also interesting to note that there is not more concern over who is playing these games. Can a 15 year old play a game that has bets being placed on the outcome? The traditional sportsbook operators are also all in on this form of wagering with the likes of William Hill and others already taking bets on out comes.

Clearly, eSports is very attractive to land based gaming operators as it  attracts a younger audience relative to its current customer base.  eSports reverses a trend of aging gamblers in casinos .  It also exposes the  gen x, y and z audience to a land based gaming experience.  Land based gaming operators are demonstrating that they are keen to engage with this audience to  stay relevant and to grow their businesses.

eSports wagering is in the billions already. This is obviously a phenomena that has a life of its own. It has been embarrassed worldwide with Asia, North America and Europe already fully  engaged with 50 million USD paid out in 2015 in association with eSports.

The ultimate questions is this a true "sport" and if so can someone wager on a juvenile's game play.  Certainly eSports is a long time coming and represents a convergence, of machine computing, gaming, sport, on premise events and worldwide web competitions. Overall, it is an exciting phenomena that will be hard for regulators to  fully harness. However, for now they do not seem  to be concerned. The amount of wagering, the demographics, technology and an obvious desire to engage a younger  audience in a traditional wagering context is just too tempting to not  look the other way. Finally, land based gambling operators, and especially the Vegas and Atlantic City operators have a growth strategy and they are "all in".

Kevin Flood is the CEO of Gameinlane and FitCentrix, Inc. Kevin spent time at the Machine/Learning Lab at MIT as a technology transfer fellow engaged in model based reasoning, case based reasoning and rule based systems to enhance diagnostics systems.  He created a company called AI Squared as a result of that research.   Kevin has worked for and with US land based casino operators helping them evaluate social casino and iGaming platforms for the purpose of joint ventures and acquisitions in addition to launching online gambling operations in Europe. Gameinlane is also startup "friendly" understanding the unique value new gaming companies bring to the marketplace.  Kevin frequently speaks at gaming conferences around the world providing him with a unique perspective on this very interesting business sector. Kevin can be reached at kflood@gameinlane.com  and or twitter  at @kflow1776.






Tuesday, August 30, 2016

Leveraging Artificial Intelligence(AI)/Machine Learning(MI) In Gambling Games

Artificial Intelligence(AI)/ and Machine Learning(ML) have been in existence for decades with AI applications being used in a number of different domains. Video games, in particular, have leveraged AI to assist and direct gaming characters/avatars to act in a human way and to assist the characters in their interaction with the game or other  players. Gambling style games have not leveraged AI and Machine learning techniques(to my knowledge). However, this may be changing as "traditional" gambling games have to sort out a way to reinvigorate the space and grow the market and attract a younger audience.  Online gambling potentially provides the ideal  environment for AI/ML because game play   generates a significant  amount of data that can be used to profile players, spot trends, increase revenue per player and increase engagement.

The real question is what form of AI is more appropriate for the  gambling space versus the video game space where some AI is already in use? It is common knowledge that video  games use a "form" of AI. However, the AI  approach used in video games  may or may not be appropriate  for traditional gambling games that are simpler, less "role" playing oriented and lack the  massively multi-player characteristics of some video games. Online poker may be the exception to this characterization.

What are the options in terms of AI approaches?

Machine Learning(ML) - Until recently computer programs have been  hard coded anticipating what a problem will be and  reacting  to  a fixed set of scenarios  providing recommendations or executing code that drives a process to conclusion. Traditionally, computer programs have  not been able to react to events, learn from these events and automatically change a program's behavior  based on that interaction. Machine learning changes all of this as it includes  ways to  react to  unexpected events by analyzing data patterns and making recommendations based on that analysis. This approach could be used in gambling games to   solve the problem of a player continually winning or losing a game, skewed payouts, consistent losses with not enough wins, etc.  In an ML driven environment the games math model, bonus structure and payout structure could be modified during play to improve the overall experience and to increase revenue per player.

Case Based Reasoning(CBR) -  CBR is an AI approach that matches the goal of the outcome with specific "cases" that are appropriate for a scenario. This concept could be extended into the gambling environment  for specific game types,  game "states" and player profiles.  Case based reasoning has been used for diagnostic purposes to determine a specific method to address a symptom or issue. In gaming the case could be the "characteristics" of  game play and or the history of game play of a particular player. It could also be applied to the amount of the "wager" and loses to date or in a game. In a multiplayer or head to head game the game play of the players and opponents could be adjusted over time as the game progresses. Players may also chose a "case/category" to be placed in before the start of a game.

Decision Tree   - Decision trees were some of the first AI systems constructed. A decision tree starts at a point where a problem or goal is stated and then guides an individual or program  through a process of questions and answers to help that person or machine to achieve a goal. These systems are relatively static. Consequently if a scenario has not been experienced or anticipated there is no other option. In a gaming environment  it may be difficult to anticipate all possible scenarios . However, once the decision tree becomes robust it can be an effect coaching tool to help a player execute a reasonable gaming strategy or drive a slot experience based on player profiles.

Neural Networks - Neural networks are essentially 'learning" systems that evaluate behavior  and  or activity and develop "advisory" approaches to solve problems. To be effective neural networks need a constant flow of data. Neural networks would appear to be a good approach for massively multiplayer gambling games  such as poker or perhaps blackjack where a a number of players  continually engage and react in a gaming environment create large and ever changing data sets. Slot games are fertile ground for Neural Networks because they accumulate large data sets that can be associated with a single player and groups of players.

Post Play Analysis Learning  -   Although  reacting to game play activity during a game using AI/ML is the ideal scenario, post analysis of game play data is also important. Mining data from a game data depository that contains game play data that has been accumulated over time is an excellent way to determine trends,  player habits, causes of drop off and engagement. MI in particular is a great way to to do this as MI is geared to evaluating large data sets. The analysis of this data could be used to determine better ways to monetize games, improve the "stickiness" of games.    

It may seem odd to think of   gambling games  as a domain that can take advantage of advanced computing approaches.  However, given the amount of data that is generated from gambling games it actually is a perfect forum for AI/ML.  Slot machines are actually  a form of computing device that accumulate large amounts of data making for an excellent source of data for MI/AI.  From an economic perspective  gambling, relative to other gaming domains, has a high revenue per game coefficient.  This coefficient could be improved through the use of ML/AI. The real challenge is to determine what AI approach or approach is or  appropriate for a given "game".



Kevin Flood is the CEO of Gameinlane and FitCentrix, Inc. Kevin spent time at the Machine/Learning Lab at MIT as a technology transfer fellow engaged in model based reasoning, case based reasoning and rule based systems to enhance diagnostics systems.  He created a company called AI Squared as a result of that research.   Kevin has worked for and with US land based casino operators helping them evaluate social casino and iGaming platforms for the purpose of joint ventures and acquisitions in addition to launching online gambling operations in Europe. Gameinlane is also startup "friendly" understanding the unique value new gaming companies bring to the marketplace.  Kevin frequently speaks at gaming conferences around the world providing him with a unique perspective on this very interesting business sector. Kevin can be reached at kflood@gameinlane.com  and or twitter  at @kflow1776.


Wednesday, August 3, 2016

Gaming Blog "Kevin's Corner" Achieves Milestone of 130, 000 Visitors!!

Kevin's Corner traffic exceeded 130,000 visits last week marking a significant milestone in the Gaming blog!  Kevin's Corner   started 5 years ago as a "professional" blog targeting individuals and businesses engaged in the "gaming" industry. With over 200 individual  blogs  it provides a wealth of knowledge on a variety of different gaming subjects. It has covered, "real" money iGaming, social casino, freemium gaming, virtual currency transaction and the relationship between land based casino and online gaming operators. The blog continues to attract a global  audience  as  different gaming business models merge and converge creating  acquisition and business partnership  opportunities.

Kevin Flood started the blog  to encourage  an open dialogue on a subject that was becoming increasingly complicated as new forms of online gaming began to emerge and merge into a complex interwoven environment of land based gaming, online gambling, social casino, virtual currency transactions and real money transactions. The international nature of gaming and the various laws  and preferences impacting gaming made for an interesting and, perhaps, confusing mix of laws, player populations and revenue models. Kevin's own experience as a game developer, game publisher  and executive for  US  based land based casinos exposed him to many of the influences that guided gaming behavior and business models. His experience launching  online gaming operations in different countries and in different environments made him realize that there are also similarities across borders that could be shared and discussed in a public forum.

The following  blogs are the top 5 blogs in terms of volume. Although volume is a good indicator of popularity it is not necessarily  an indicator of  "value". Kevin's Corner has attempted to address many aspects of gaming for  a variety of different business  sectors. In some cases a blog that has not hit the top five in terms of volume has been very useful for its  targeted audience and the information it provided.

Number 1 -Game Analytics - Big  Data and Business Intelligence  -  With over 2500 views this blog has received the  most attention and still continues to get   high traffic views based on how important making sense out of all of the data that games and game businesses produce.  Games are unique based on the amount of data that games can produce. It is a lot harder to understand the significance of, and patterns within data, then to collect it. Planning ahead for what you really need to know and being flexible in how to add new data and new data types into the mix is the key to good gaming business intelligence. Understanding player behavior and player (state) is challenging.  Where a player is(state) in terms of the lifetime value of the player is critical for the success of a gaming business. Having comprehensive analytical systems that  individuals or even a staff of analysts pealing through the data is not uncommon as a slight difference in game content and marketing strategy can make a meaningful difference in revenue, player retention  and player acquisition.

Number 2 -What Is the Better Gaming Business Model? - With the advent of social networks, social casino, freemium play, virtual currency and various new notions of what constitutes a game of chance , skill or for fun it is easy to become confused as to what is the right gaming model for a business. The source of revenue for the models, consumers of the content , marketing approach and revenue per player differ widely across gaming business models.   This makes the choice of a gaming model difficult. In the end, the gaming business model of chose has to fit the knowledge, skills, investment capital and legal framework that fits the organization.

Number 3 - Will Social Casino Games Be Subject To Regulated Gambling Laws?  - In the early days of social casino there was much speculation that social casino would be categorized as "real" gambling. Facebook credits(virtual currency) where at the heart of the controversy. Gambling is traditionally characterized as an activity that includes chance, consideration and "prize".   Government entities and traditional online gambling regulators where skeptical about the use of virtual currency in social casino games as a prize.  After a lengthy debate on the subject of virtual currency, regulators concluded that virtual currency that could not be converted or "cashed out" into a traditional currency obviated the "prize" definition of gambling. Therefore, avoiding the need to "regulate" social casino.

The regulator's decision not to regulate social casino may also have been influenced by the  realization that the social casino and "real" money gambling populations had different characteristics. Traditional gambling attracted a smaller audience relative to social casino.  Also, social casino was heavily influenced by the social network that hosted the games with the network itself being as important, if not more important then the game play itself.  The  poor "conversion" of social casino players to "real" money gambling players also had an influence on the regulators decision.  Some players prefer social casino  over real money gambling and others prefer freemium or virtual currency games. The social casino businesses have also been careful to make a clear differentiation between their models and online gambling business models. 

Number 4 - The Merger Of Social Casino, Online Gambling And Land Based Casino Models. - Similar to number 3 in terms of content and interest blog number 4 also received a lot of attention as a number of businesses began to develop, acquire and launch a number of  gaming models. However, merging of these models has been difficult as the audience, risk and governance of these models is  very different.  Operating the  gaming models as separate and distinct businesses has proven to be the most rational and successful way to operate  these discrete models.

Number 5 - Zynga Under Investigation  By The US Justice Department -   The popularity of Zynga poker in the Facebook  social network did catch the attention of the US Justice Department as it was one of the first really large social casino businesses using Facebook virtual currency credits as a way to monetize players. The sheer size of the Zynga poker community averaging thousands of players interacting at  peak time did draw the attention of US authorities.  However, with no cash out possible the JD had little to stand on without changing the "definition" of what "prize" meant in a gambling  context. Prize is something of "tangible value" that can be exchanged and used to purchase other items of tangible value outside the origin of the currency generated. Facebook made sure that this could not happen, therefore, obviating the need to either shutdown Zynga or forces the company to change its revenue model.

Kevin's Corner continues to cover global gambling topics of all, types and  varieties. Reflecting on what has been the most sought after gaming content subject  over the past 5 years certainly reinforces what is "popular". However, the popularity of a blog does not necessarily indicate its "value" to all audiences. Thus, making it an important goal of Kevin's Corner to continue to cover many different topics.  Kevin's Corner subjects are often recommended by members of the gaming community as the community seeks to decipher what is really going on in the space and to engage others in a open dialogue about the future of gaming. If you would like a subject covered lets us know. Please send your suggestions to kflood@gameinlane.com.

Kevin Flood is the CEO of Gameinlane, Inc. Gameinlane  has developed, launched and operated Internet gambling sites in Europe,  social casino,   freemium and subscription gaming in the US.   The company engages with land based casino  operators, online gambling operators, social casino operator and game developers to assist them in determining their strategy and implementation  of game content in an online context.   Kevin has worked for and with US land based casino operators helping them evaluate social casino and iGaming platforms for the purpose of joint ventures and acquisitions in addition to launching online gambling operations in Europe. Gameinlane is also startup "friendly" understanding the unique value new gaming companies bring to the marketplace.  Kevin frequently speaks at gaming conferences around the world providing him with a unique perspective on this very interesting business sector. Kevin can be reached at kflood@gameinlane.com  and or twitter  at @kflow1776.



 









Thursday, July 21, 2016

More US States Considering Legalized Online Gambling

We continue to see more states in the US  floating legislation to legalize online gambling. Poker continues to be in the spot light as opposed to casino style slots or blackjackMichigan and Rhode Island are the latest states to join the fray. Essentially, the states are looking for more revenue sources and online gambling appears to be an option. The new states  considering legalized online gambling intend to impose licensing fees on the online gambling operators. Both Michigan and Rhode Island have land based casinos thus following the trend of other US states (Nevada, Delaware and New Jersey) with land based casinos to be the only states where online gambling is either legal or being considered.

Michigan -  Michigan has a population of 9 million people similar to New Jersey's population. Michigan also has land based casinos. However, Michigan's casino are  native american tribal owned and operated.  The  legislation is poker focused only  and does not include any  table  or slot games.   The  proposed Michigan  online gambling proposed licensing fee is 5 million USD with an additional  annual gross revenues tax of 10%.  Certainly, Michigan's population should be able to support a robust poker community.  However, a full casino offering would make for a much better business model and ultimately a better revenue source for the state. 

Rhode Island -   With a population of 1 million residents Rhode Island is following the lead of Delaware as a state with relatively few residents offering legal online gambling. It appears that the Rhode Island online gambling legislation  will be poker "only".   However, this could change with Rhode Island adding casino games mirroring Delaware online gambling options.   Delaware is quite pleased with the revenue it has garnered from online gambling leading Rhode Island to believe it can also benefit from legalized online gambling.  However,  poker may be a challenge given to relatively small population of the state. It is most likely that Rhode Island will poker poker players across state lines and with UK players.  

Population Density -  If Michigan and Rhode Island join the other states that currently offer legal online gambling  the  combined  total population of  the states that will be offering legal online gambling  is 23 million. Of course, one has to be 21 years of age to gamble so the total gambling population is lower. However, if we presume that the adult population of these states is 75% the  eligible gambling population is 17 million.  This is not a trivial number of potential online gamblers.  If poker is the only gambling option in Rhode Island  the population may not be able to support a robust poker community.   With this said it appears that poker is "working" in Delaware which has a similar population.  

Poker Player Liquidity And Players - Providing online gambling legislation is passed in Michigan and Rhode Island the result will be a meaningful population of US based gamblers. Poker appears to be the current focus for US based online gamblers. However, liquidity is always an issue  with poker as it requires a significant amount of traffic to make for a viable poker community. We have witnessed this as New Jersey has teamed with UK online poker sites to improve its own liquidity.

Poker License Barrier -  We will also have to see how many operators will be able to pay for the up front licensing  fees. The Michigan license fee is non-trivial at a 5 million USD starting point. This fee will certainly prune the candidate pool of potential online poker businesses operating in Michigan  and how many operators can coexist in the state. It will also be interesting to see how many non-US based poker rooms will participate launch in these newly added states. The Israeli based poker businesses(Pokerstars, 888, etc.)  have and are active in the other US states and will most likely extend their presence into the new states.

The recent announcement by Michigan and Rhode Island that their state governments are interested in legalizing online poker  demonstrates a growing trend on the part of US states with land based casinos to add online gambling as a regulated activity. Ironically, poker as opposed to  the real land based money makers like slots and other table games being launched online. Certainly there will be a gestation period to determine how online poker is working in individual states and how pooling players across state lines is perceived. We might see the US Justice department step in as cross state line online gambling becomes more prevalent. However, for now it appears all systems are a go and the US online gambling is a growing business sector.



Kevin Flood is the CEO of Gameinlane, Inc. Gameinlane  has developed, launched and operated Internet gambling sites in Europe,  social casino,   freemium and subscription gaming in the US.   The company engages with land based casino  operators, online gambling operators, social casino operator and game developers to assist them in determining their strategy and implementation  of game content in an online context.   Kevin has worked for and with US land based casino operators helping them evaluate social casino and iGaming platforms for the purpose of joint ventures and acquisitions in addition to launching online gambling operations in Europe. Gameinlane is also startup "friendly" understanding the unique value new gaming companies bring to the marketplace.  Kevin frequently speaks at gaming conferences around the world providing him with a unique perspective on this very interesting business sector. Kevin can be reached at kflood@gameinlane.com  and or twitter  at @kflow1776.



Friday, July 15, 2016

The Paradoxical Case Of Legalized Online Gambling In The United States

Given all of the experience that can be garnered from legal online gambling in European countries where online gambling, especially in the United Kingdom, has been very successful it is shocking that the US states have not taken advantage of  that experience and knowledge when launching or considering  launching online gaming businesses in the US.  Having personally spent time in the UK launching online gambling sites in the UK for US based casinos taught our teams a lot about what it takes to make an online gambling business work. Of course, the US and European markets are different in terms of size, history and gaming content  preferences. However,  certain lessons are transferable from the UK market and recent events may accelerate that process.  

Population Size,  Liquidity, Lead Generation And Poker - The UK has a population of 65 million people and capable of supporting liquidity dependent games such as poker and blackjack. In Europe. sports wagering  has been the primary source of  liquidity dependent online gambling as opposed to poker. However, poker  has become very popular in the UK.   This works because  of the size of the participating audience.  In the US  online sports wagering ,for the most part, is illegal. Thus eliminating that as a source  of leads for online gaming companies and especially those launching liquidity dependent game content. The lack of a liquidity pool requires US poker operators to become more creative in their approach to creating "liquidity".

Consolidation To Create Liquidity -  Pokerstars recently announced  it will combine it's UK poker players  with it's New Jersey players indicating how important "liquidity" is to making poker a viable commercial proposition. This "inter" country move is both creative and bold challenging regulators on both sides of the atlantic on how to regulate game play  and impose taxes across jurisdictions.     This will likely lead to a consolidation  with Rhode Island  (population 1 million), Nevada (population 2.8 million ) and Delaware  (population 1 million) creating a viable US and  enhancing the UK online poker market. Will blackjack be the next liquidity based game proposition that will witness intra country player sharing. 

Online  Casino Games - In contrast to poker and perhaps blackjack most casino style games  are "solitary" experiences and in many ways the money makers for online  and offline casino operators. The average slot machine  produces $240 dollars a day.   In June of 2016 New Jersey online casinos generated 14 million in gross revenue from slots.  In contrast poker produced 2 million in revenue. Paradoxically, the popularity of poker does not translate to significant revenue for either land based or online operators. However, "casino" style slots are not popular amongst European players. This dichotomy  is most likely another  reason why the we are seeing a consolidation of poker players across countries. 

Online Gaming Impact On Land Based Casinos - Clearly, consumer trends to experience gaming as an online activity as opposed to a land based activity is exerting  pressure on  regulators and land based operators on how gaming and gambling is managed in the US.   There is no denying that the land based gaming experience is becoming subservient to the online experience.  The Atlantic City situation is a primary example of this trend. It is difficult to say how Vegas is reacting to this shift in consumer preferences as they have withdrawn from poker as an online offering and have refused to consider consolidating online poker plays across state lines or launch online games other then poker.

The need for liquidity in an online poker environment and the contradictory signals that US land based casinos have conveyed  in relation to online gambling has truly created a paradoxical situation that can only be understood if one studies the history of gambling in the US and the role that land based casinos play in terms of  online gaming regulation.  Unfortunately, the current situation leads to US player confusion as to what is and is not legal. This unfortunate paradox has lead to a flourishing  illegal online gaming business sector taking advantage of the mixed messages conveyed by regulators and land based casino operators. It has also lead to a Euro based intrusion to acquire US based poker players sapping the US from a potentially robust, large and successful interstate poker offering.

Kevin Flood is the CEO of Gameinlane, Inc. Gameinlane  has developed, launched and operated Internet gambling sites in Europe,  social casino,   freemium and subscription gaming in the US.   The company engages with land based casino  operators, online gambling operators, social casino operator and game developers to assist them in determining their strategy and implementation  of game content in an online context.   Kevin has worked for and with US land based casino operators helping them evaluate social casino and iGaming platforms for the purpose of joint ventures and acquisitions in addition to launching online gambling operations in Europe. Gameinlane is also startup "friendly" understanding the unique value new gaming companies bring to the marketplace.  Kevin frequently speaks at gaming conferences around the world providing him with a unique perspective on this very interesting business sector. Kevin can be reached at kflood@gameinlane.com  and or twitter  at @kflow1776.





Tuesday, June 28, 2016

BREXIT(British Exit From European Union) Impact On European Online Gambling Business

The news that  Britain voted  to leave  the EU (BREXIT) certainly has many people, businesses  and organizations scrambling to determine the impact of the vote  on themselves, organizations and their businesses. One of the business sectors  that is especially interested in the impact is the online "gambling" industry. Great Britain is somewhat unique on a worldwide scale because they have embraced online gambling as a legal activity under the  UK Gambling Act of 2005.  In 2015 The online gambling industry generated 3 billion pounds for the UK(including Scotland and Ireland)! Clearly this amount is non-trivial?

 Great Britain's online gambling business sector  is  somewhat complicated as many online gambling business have moved their business to British ("protectorate") jurisdiction such as Alderney, GibraltarMalta and Island Of Man to avoid the standard UK business taxation regime.  These "protectorates"  are subject to British law and protection. However, their tax structures differ and their unique political status provides business in these jurisdictions to access markets they may not be able to access if they where domiciled in the UK itself.

There is currently much chatter about what happens to these "offshore" gambling business under BREXIT  and are they better off then their English counterparts(especially the sportsbook operators)?  One of the overriding points of interest is the unique status of these "Protectorates" in relationship to European EU law as opposed to UK law.   The protectorates are considered part of the EU and therefore can access Euro markets proving they adhere to EU gaming  laws of a specific country. 

Another interesting situation has been created as Northern Ireland and Scotland are actually independent countries under and part of "Great Britain". It appears they want to stay in the EU. This could also create a situation where these countries in-fact chose to host online gambling for themselves for the purpose of raising tax revenue. If they side with the EU there may be an opportunity for them to behave is a way similar to Alderney, Malta, Gibraltar and Isle Of Man. 

It is clear that the British protectorates(Alderney, Gibraltar, Malta and Isle of Man ) may come out of BREXIT as the ultimate winners in the battle for the hearts minds and wallets of European citizens if the EU clearly acknowledges these principalities as "member" states.



Kevin Flood is the CEO of Gameinlane, Inc. Gameinlane  has developed, launched and operated Internet gambling sites in Europe,  social casino,   freemium and subscription gaming in the US.   The company engages with land based casino  operators, online gambling operators, social casino operator and game developers to assist them in determining their strategy and implementation  of game content in an online context.   Kevin has worked for and with US land based casino operators helping them evaluate social casino and iGaming platforms for the purpose of joint ventures and acquisitions in addition to launching online gambling operations in Europe. Gameinlane is also startup "friendly" understanding the unique value new gaming companies bring to the marketplace.  Kevin frequently speaks at gaming conferences around the world providing him with a unique perspective on this very interesting business sector. Kevin can be reached at kflood@gameinlane.com  and or twitter  at @kflow1776.