One of the most anticipated sessions at last week’s AGE was the panel discussion of Global CEOs from the gaming industry, moderated by financial commentator Michael Pascoe. The group offered some important insights into the direction of the global gaming industry as well as how it could influence the local market.
Panellists include Danny Gladstone (CEO/Executive Director, Ainsworth Game Technology), Derik Mooberry (Group Chief Executive, Scientific Games), John Connelly (Global CEO, Interblock Gaming), Steve Sutherland (President/CEO, Konami Gaming Inc.) and Walter Bugno (Chief Executive Officer, IGT International).
All agreed that there was a big demand in the market for something new and that all manufacturers were working on how to increase engagement of existing players to achieve longer play and how to develop and attract new players.
When asked about the challenges facing the industry from the manufacturers perspective John Connelly, Global CEO for Interblock Games said operators have been investing heavily in nightclubs, shopping malls, shows, pools ….just about everything but gaming, so has seen a decline in capitalisation of traditional product.
Danny Gladstone, CEO Ainsworth Game Technology said that whilst their table games and multi-terminals were solid, working with capped markets, aggressive anti-gaming lobbies and the explosion of online gaming has made everything much harder, but that we have to work in the environment we have.
Walter Bugno, CEO of IGT International warned that after 60 years of stability and growth we are entering an era of great change. He said that slots were only one component of the broader industry and that Australia needed to open its mind to the rest of the world. We need to consider the impact of online gaming, the change in age demographics, the impact of technology and mobile usage and the impact on experience and opportunities that all those things afford.
He also said that the global trends in the growth of sports betting, which is growing at a higher rate than any other, plus the resilience of lotteries are all taking a share and a greater share of the customer’s leisure dollar.
He went on to say that marketing and technology developments were dramatic influencers of these changes.
Steve Sutherland, President and CEO of Konami said that there has always been change – things like poker in the 70’s and multi-games in the 90’s – and we need to embrace and not just accept but drive those changes and adapt them to our needs.
He said that the industry needs to work out how to get skills based games adopted in today’s environment. The advent of innovation like bill acceptors, TITO and cashless gaming has removed a lot of staff from the gaming floor and so a lot of the floors were on auto pilot resulting in less player engagement and the loss of an entertainment centre. He felt that the difference between success and failure was teaching and training people how to promote and how to play.
Eric Persso, GM USA Aruze said that online and social gaming has now become a significant revenue source for the company worldwide.
He also said that the explosion of online and social gaming was a result of the lack of regulation in that space, while the traditional bricks and mortar side of the industry suffered through fractured regulation – different in every state/jurisdiction, different for casinos, for clubs and pubs. As a result, manufacturers submit fewer titles for approval as the introduction is slow and building product is difficult and less efficient. All those things affect a customers experience.
Mr Bugno said that the industry needed constant open dialogue with regulators to understand the impact that technology is having on the industry now and in the future. “We as an industry need to change how we think about business. We are not understanding where our customers are going and how we can go with them. We are not understanding the whole concept of social gaming and the profound impact it is having and will continue to have on the gaming industry.”
Danny Gladstone backed up these sentiments and said the casino industry is now trying to embrace new technologies and the direction is mobile with the device being used both on and off-premise giving the customer the ability to gamble when they desire. “We seem to look at mobile usage as add-ons instead of integration. Mobile technology should be looked at as expansion because like it or not, the industry is moving off-premises.”
When asked about skill-based games and their likely impact on the market, Derik Mooberry Group Chief Executive Scientific Games said that skills based games had been around for a long time, just in a different form. ‘Every month of every year there are new ways to spend your money, so the industry needs to remain relevant, but it is becoming more difficult. Operators have to support new product to drive new players. Traditionally it has all been about reaching floor averages, and if it doesn’t perform it is gone in three months. But these new formats like skill-based games will take longer to develop through incremental growth and that is going to be a challenge when they are looking at their bottom line accountability to a board.
He said new slots product will persist – but for how long? By the time we as an industry decide to change, it might be too late and the market will have moved elsewhere.