Chapter 1 – Introduction
1.5 Industry roundtable discussion: review of 2015
Several industry experts were asked to answer the following question: What trends or developments
have affected your business over the last year (i.e. 2015)?
Peter Bertilsson, president and chief executive, Metric Gaming:
“As underscored by the UK’s transition to a point-of-consumption taxation and licensing regime,
very few countries remain that accommodate the old ‘dot com’ strategies of the early days of internet
gaming. The result is a more prohibitive gaming landscape, with stricter regulatory and security
standards, coupled with higher tax rates, which drives costs and slims margins. This environment
in turn yields a higher rate of M&A activity, which leads to a decrease in competition among both
gaming operators and suppliers.
“In this environment, most gaming companies are compelled to outsource their technology,
recognising the inefficiency and impracticability of trying to tackle both marketing and technology
under one roof, with little hope of excelling on both fronts. The online gaming industry is thus
evolving to more closely mimic the rest of the marketplace, where large in-house technology
departments are becoming scarce. We are therefore seeing a much greater interest from operators
willing to outsource their technology to specialists in exchange for a percentage of revenues,
rather than undertake the large up-front and maintenance costs associated with developing that
competence in-house, not to mention risking diversion of resources away from core business.”
Nick Zajdel, director of commercial operations, Ladbrokes:
“The 21st Century is an age of customer choice and convenience - the emergence of services such as
Pay as You Go, On demand and Click and Collect are testament to that. It isn’t a generation thing it is
a social change, enabled by technology experiences. Age isn’t a barrier to stream something, make a
micro payment, or to send an e-voucher etc. Our industry has to embrace these developments in order
to grow, via both new customers and capturing existing market share. Traditional brands cannot live
on their heritage, they have to adapt and change otherwise existing or new competitors will capture
the market.
“We have recognised and acted on the opportunity to join our retail and digital channels together
to better serve our customers. Our retail sector is driven by long-standing or new event-based
behaviours. In the digital world these have been served in a timely fashion in partnership with our
technology suppliers.
“ There are two key objectives for us, one is future proofing the business as behaviours have already
changed, the second is providing services that join our products together across all channels.
Whatever a customer’s event or game of choice is, recognise them and enable the same experience in
all channels.”
Warren Murphy, chief executive, Sporting Index:
“It’s been a tremendously exciting year for Sporting Index. On the trading side of things we had a
fantastic UK general election. Our political trading team was one of the most accurate around, and we
were one of the few companies to emerge with a profit on what was one of the most unpredictable UK
elections in a generation.
“Away from the trading floor has been equally busy. Sporting Index was acquired by private investor
Magnus Hedman, who is also the majority shareholder at Pinnacle Sports and Touchbet. Our core skills
of modelling, pricing, trading and risk management developed over 20 years of operation remain at
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