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Monday, October 22, 2012

EiG Internet Gaming 2012 Barcelona Summary

When I entered the 2012 EiG convention hall in Barcelona and attended some of the presentations I thought I was in San Francisco and not in Barcelona. I saw more people from the San Francisco Bay area attending and presenting then the usual European Internet gambling cohort I  interact with at the EiG conferences. There were two primary reasons for such a heavily weighted US professional presence at the conference.

Social/Freemium Internet Gambling -   Yes I am going out on a limb here and actually calling Facebook,  freemium mobile and social web games that are traditional gambling games such as slots, blackjack, poker etc. as true gambling games. I realize that this may be shocking to some. However, the amount of interest on the part of the traditional European Internet gambling clearly indicates that the social/freemium gambling game offerings are having an impact on the traditional iGaming community despite the fact that their is no "payout" of winnings or deposits. 

The San Francisco Bay Area/Silicon Valley was so well represented at the conference because this is the area(outside of China,Japan and Korea) that has fully embarrassed the social/freemium gaming/gambling model based on virtual currency transactions. They have been engaged in this activity since 2007 with the launch of several Facebook gambling style games that leveraged the popularity of casino style games within Facebook. Virtual currency transactions soon followed helping to actually monetize these games and eventually Facebook itself forced all the game operators and publishers to use the Facebook  virtual currency system with a draconian 30% Facebook tax on these transactions.

The conference was populated by several groups with different objectives in terms of social/freemium gambling games.

Is This For Real? The presenters answered that question resoundingly with absolutely especially when it comes to the amount of revenue being generated and the shear popularity of these games.

Competition Is Fierce  There are so many slot type games in Facebook and on mobile that it is becoming harder and harder to break even given the cost of acquiring players and the average transaction per player. Player numbers are still remarkable. However, entering the market now will be difficult unless a company is clever in the way they acquire players or the game itself has unique characteristics that differentiate it from the standard Facebook and mobile gambling style games.  

US Legalization Of Internet Gambling - The other reason for seeing so many Americans in the audience was the prospect of legalized US Internet gambling. The European iGaming industry is desperately hoping for some form or US Internet gambling to help recharge their businesses after the collapse of the European Union as an Internet gambling governing body, the demise of the .com model and the emergence of a country by country regulated model. This change has severely impacted player liquidity, cost of operation and acquisition of players.  

The Europeans want answers from the Americans on how they envisage  regulated US Internet  unfolding in the US. Will it be state by state? What state's will legalize and when?  Will certain states share liquidity? Will their be a federal law if so when? what gaming propositions will be legalized.

Unfortunately the Americans do not not necessarily have answers to these questions either. There are so many political consequences influencing the outcome and form of legalized US Internet gambling that no one person has the magic answer to these questions. We will all have to wait and see what happens.

Social/Freemium and Internet Gambling Crossover -  There was an underlying buzz at the conference about the relationship between social/freemium and traditional Internet  gambling. Generally speaking the social gamers in the US have no experience with Internet gambling and have no real experience with Internet gambling operations so they politely deflected the cross over questions. European Internet gambling operators still remain stead fact on their position that their will be little or no crossover between the two.  It is really difficult to defend or challenge either of these positions until we get concrete evidence of operators that have tried and or are currently moving players between these to domains. We may have to wait for legalized US Internet gambling to answer this question given the fact that the US has such a large social freemium game audience playing casino style games.

Facebook/Gamesys Experiment - Many of the UK people in the  audience have tried the Gamesys bingo gambling game launched in Facebook. Overall, the opinion is a bit muted considering the implementation  less attractive then the the web version of JackPotJoy. No one revealed to me the number of players in the Facebook game. However, the lack of real enthusiasm about this gives me a hint that more work has to done. I impersonally would like to hear more about this from people in the UK playing the Gamesys Facebook gambling  game. 

Overall, the conference focus on social freemium gaming was a wise decision on the part of the organizers. I also commend the organizers for moving the conference back to Barcelona. Not to say that Milan is not a great place. However, I would much rather be in Barcelona in October.

Kevin Flood is the CEO of Gameinlane, Inc. Kevin writes  about online games and their impact and integration into iGaming and E-commerce environments. Kevin is a frequent speaker at online game events and conferences in Asia, Europe and the US. Kevin and his Gameinlane team are currently working with online gambling, social gaming and e-commerce companies integrating social gaming with online gaming operations and integrate game mechanics into e-commerce applications. 

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