Feliciana Cannillo, the new Deputy CEO of global gaming supplier Digitain, talks to iGaming Times about the fast-paced changes to international markets in 2020 and beyond.
iGAMING TIMES: What mature markets do you have a presence in and how have these locations evolved over recent years?
FELICIANA CANNILLO: We’re strong in the CIS region and Western Europe. These markets have become more established and regulated. Customers’ expectations have evolved in terms of the quality of the products and services delivered – in terms of stability, range of products, quality of streaming and supporting content. We’ve worked hard with our partners to meet their, and their customers’ requirements and to ensure competitiveness.
iGT: Do you expect growth to continue and if so, where?
FC: We see our growth continuing – there is a healthy market for flexible, affordable and secure igaming platforms as well as profitably operated managed sportsbooks and highly functional turnkey solutions.
From a geographic perspective, we expect growth to continue from our existing markets, but we also expect to sign up new partners in emerging markets in Asia, Latam and Africa.
We also expect to see more land-based operators take advantage of our multi-channel products as they move to mitigate the risk of further pandemic impact on the revenues.
iGT: How difficult is to work within the environment in the mature market of Europe, where regulators seem on edge particularly with regard to the pandemic?
FC: There is a risk of higher taxation on gaming operators as governments look to reduce debts caused by reaction to the pandemic. Already in the UK, horseracing interests are also lobbying for increased levy contributions from bookmakers.
Elsewhere in Europe restrictions in marketing activity, advertising and use of bonuses are being discussed, in such countries as Spain, UK, Italy and Sweden. Europe is a mature but large market, and competition is high but so are costs – so no surprise that operators are looking abroad for new opportunities – we have to be aware and react to these changes.
iGT: Do you have a presence in the US market as yet and how do you view the igaming scene over there on a state-by-state basis?
FC: We’re taking a watching brief on the US market for now. The race for operators and suppliers to sign up big media deals has been interesting to observe – as well as some of the valuations. Cost of acquisition seems to be of secondary concern as operators look to grab market share.
In terms of states, New Jersey is very crowded, valuations through the roof and its expensive to recruit as a result. Revenues continue to grow month on month and they have a progressive regulations regarding mobile platforms.
Pennsylvania is interesting where retail betting has been strong. The launch of sports-betting apps earlier this year has delivered healthy growth in revenues which should continue. Cost of business in this state is a challenge – an effective tax rate of 36 percent plus a $10m licensing fee could be prohibitive.
Some of the other smaller states have taken a conservative approach – Delaware restricting betting to three casinos with no mobile betting, Mississippi doesn’t allow online betting and Rhode Island only permits betting via two casinos and revenue share requirements seem high.
iGT: A similar question but this time for South America, country by country?
FC: Obviously, Brazil is seen as the big opportunity, as the regulation gets closer – although it’s been getting closer for quite a long while now.
Mexico has been interesting for a few years, big for US sports and football in particular. Casinos going online can still be a growth area.
Colombia has a strong legal/regulatory environment although growth may be limited. Peru has a long history of gambling, via betting shops, slot parlours as well as horse racing – citizens are not restricted to bet offshore . Regulations are pending and this will be an interesting opportunity for new platforms/operators.
iGT: How important is it for suppliers to have ‘boots on the ground’ in an emerging market?
FC: There’s no doubt it’s an important factor. Local knowledge regarding product requirements, regulations as well as a network of contacts can all be vital ingredients.
In emerging markets, we have found reputation, being referred and trust to be important elements in developing the business
iGT: Is it true that there is no such thing as a mirror image of one market location compared to another?
FC: It’s tempting to think a one-size-fits-all could work, but experience has shown us differently. A high number of products can be ported across many markets, but in order to differentiate there is a need to localise the products to an extent as well. This localisation includes, tone of voice, look and feel, payment mechanics, marketing tactics and customer service as well as products fit for purpose. An example is the type of video bingo games required for a number of South American markets
iGT: What are the omni-channel opportunities within emerging markets?
FC: Retail to online is an obvious opportunity as operators look to extend their brand online, grow their customer base and retain their existing base. This is especially true at the moment, as the pandemic continues to threaten land based operations globally. Our one-account approach as well as ability to design a dedicated solution for operators places us in a very competitive position in these markets
iGT: Also, what technological, compliance and regulatory challenges exist for suppliers in certain emerging markets?
FC: Technology, accessibility to bandwidth and effective payment solutions remain high on the list of challenges. Confidence in online transactions can also be an issue that needs to be overcome. Impact of new regulations could be an issue for offshore operators in some markets also.
