BetMarkets has consolidated its position as a 'must-attend' event for sports betting industry professionals around the world, after its strengthened programme led to a strong rise in delegates. James Walker takes a look at the highlights...

The second annual global sports betting conference and expo opened its doors in Vienna on March 31, and wasted no time in getting down to the key issues relating to this important gaming sector.

Although the organiser of the event, Clarion Gaming, have yet to publish official attendance figures, the company’s Dawn Kirkwood said delegate numbers had already surpassed last year’s total earlier in the month, and it was clear from the outset that BetMarkets has now started to carve out its own unique niche in the industry events calendar.

Last year, the show took place at Le Meridien Hotel in the heart of the Austrian capital, but it has now moved to a larger space on the first floor of the nearby Marriott to make room for the 13 exhibitors - nearly triple the five companies that set up camp at BetMarkets in 2007.

Turnkey solutions provider Best Gaming Technology again secured the lead sponsor position, backed up by Admiral Sportwetten and exhibitors Net Entertainment, TAB Austria and Arland Technologies, among others.

Maurits Bruggink, executive director for the International Federation of Horseracing Authorities, chaired the conference for the first half of the day, and oversaw lectures from a range of industry figureheads who addressed the contradictory nature of global sports betting regulation in both emerging and mature markets.

The concept of ‘gambling as entertainment’ was an important discussion point for many of the speakers throughout the show, including Keith McDonnell, director of European operations for Bodog Entertainment and Brian MacSweeney, managing director of Endemol Gaming, the company behind the Big Brother reality television series.

However, while many of the speakers said it was important to bridge the gap between gambling and entertainment, Web 2.0 specialist Alex Czajkowski was keen push the online sector forward in terms of its continued evolution, stating: "We are already entertainers. Companies now need to think about how their players are contributing to the mission of their websites."

Spanish (Sports Betting) Revoution

One of the first speakers to take to the podium was Alberto Eljarrat, CEO of Cirsa-Ladbrokes Betting Company, who signalled an imminent change in Spain’s sports betting laws.

In February, developers received final approval to break ground on Gran Scala, a Las Vegas-style mega-resort in Spain that is likely to herald a casino renaissance in the European country. However, as the world’s media remains firmly focused on the ambitious project, it seems that casino gaming is not the only avenue opening up for international operators.

In 2008, two provinces of Spain - the Autonomous Community of Madrid and the Basque Country - will bear witness to the first licensed betting offices in the country. And although these two regions make up a relatively small percentage of Spain’s 17 autonomous areas, one of the country’s leading industry figures in the gaming field has said they represent just the tip of the iceberg in potential operator revenues.

Eljarrat drew attention to the fact that although the overall gambling market in Spain totalled €28.9m in 2006, this was due primarily to revenues drawn from slots machines, Quiniela, a traditional game of chance, and the state-run ONLAE lottery, which was recently bolstered by the EuroMillions franchise.

Up until now, however, no revenue has been drawn from retail, land-based sports betting, which has always been illegal. "The betting industry in Spain is still not developed," said Eljarrat. "But sports betting will soon be evolving in the country."

The imminent change in Spanish law has led to the formation of numerous partnerships between local operators and global gambling groups. Cirsa-Ladbrokes is one such venture, representing an agreement between UK-based gaming giant Ladbrokes and Spanish entertainment and leisure group, Cirsa. The two companies have created Sportium, a newborn brand designed specifically for the soon-to-be-open LBO regions.

"The first venture will open in the coming weeks in Madrid," Eljarrat said. "The product is customised to Spanish taste, with a heavy focus being placed, obviously, on football. We will also rely heavily on self-service terminals because Spanish customers are already very knowledgeable about interactive gaming machines."

Eljarrat suggested that joint ventures with local operators would be key to entering the Spanish LBO market. He said the symbiotic relationship between Spanish operators and international bookmakers would work well because where the former have the regional-specific knowledge and existing brand penetration to reach a wide audience, the latter have the technology and the expertise to ensure profitable returns.

Indeed, similar ventures have been ratified between other companies. William Hill and Codere, for example, have formed an Anglo-Spanish partnership that has led to the birth of the Victoria brand, which has similar ambitions to that of Sportium.

While Eljarrat remained adamant that local operators would play a key role in the regulatory process surrounding Spain’s future LBOs, he reiterated the idea that the country’s 17 autonomous regions must always be treated as entirely different entities, with their own unique requirements. "Depending on the region, we could see LBOs being created not only in standalone shops, but in arcades, casinos, bingo halls and even bars," he said.

When questioned over the fate of the other 15 autonomous communities in Spain, Eljarrat hinted that the province of Valencia might be the next to house LBOs before concluding: "Some are taking their first steps. This is a wait and see situation. Madrid is a testing ground and other regions are waiting to see how it goes."

UK leads the way in compliance

Online and land-based gambling companies in the UK have demonstrated a higher level of advertising compliance than any other industry sector, according to Laure Alexandre, a leading voice in European marketing regulation, as she addressed the BetMarkets audience.

A survey conducted by the European Advertising Standards Alliance in the wake of the UK Gambling Act, which was implemented in September 2007, analysed gambling adverts in the national press, consumer magazines, posters, direct mailings, internet, television and radio.

Speaking at the show, Alexandre, project and compliance officer for the Brussels-based EASA, said the compliance rate was 99 per cent. "The survey was very encouraging," she stated. "Out of 784 advertisements, only seven seemed to breach the code. To my knowledge, this is the highest compliance rate we have found in a specific sector."

Following the implementation of the Gambling Act, all types of gambling advertising in the UK are now regulated under one law. However, while the law has provided gambling companies a generally larger degree of advertising freedom, they must still adhere to a strict code of conduct.

Gambling adverts must not imply that solitary gambling is preferable to social gambling; they must not exploit cultural beliefs or traditions about gambling or luck; and advertisements must not link gambling to seduction, sexual success of enhanced attractiveness. In addition, no gambling advert may be scheduled or placed in or around media directed at under 18s.

"The results were extremely encouraging, suggesting that marketers have heeded the new code changes," Alexandre continued. "The ball has been thrown at the industry, and it is therefore up to individual companies to toe the line responsibly and make sure they don’t provide regulators with further reasons to legislate."

"The behaviour of one can affect the entire industry. We have seen it with other sectors, so it could easily happen here too. So don’t risk it," she concluded.

Mobile gaming is on the move

Although mobile betting continues to be one of the most talked about gaming channels, it is still generally considered to be a niche activity. Now, in an effort to quash rumours that mobile gambling is a non-starter, two industry observers have stated that, when correctly applied, it can become a creditable and profitable addition to your business.

Speaking at the Vienna conference, Christian Rajter, CEO of Mobenga, and Lars Söderlund, business development officer for NordicBet, took an in-depth look at mobile gaming.

"To me, the term mobile does not refer to a device or product," said Rajter. "It is a distribution channel, a way of reaching your customers through a device. It is unique in that it is the only distribution channel that is carried by consumers at all times."

Söderlund added: "The main reason we began looking into mobile gaming is for the customer. The technology is now there for operators to create an effective and efficient mobile offering. The question is: are you ready?"

Moreover, Söderlund noted that consumers are increasingly using mobile devices for information, and that puts pressure on operators to generate good content. However, once this has been achieved he said this new revenue stream could be used to effectively introduce new behavioural patterns such as impulse betting.

"However, you must know your limitations," Rajter added. "Commit to a long-term strategy. Dont get ahead of yourself, thinking the mobile sector is going to account for 70 per cent of your revenue in the first year."

Although there are many pitfalls when it comes to establishing a mobile presence, the two speakers agreed that the channel yields many rewards. "The churn rate is extremely low," said Söderlund. "Those who decide to go mobile stay mobile."

Exclusivity key for webstreaming

Companies looking to utilise live video streaming in order to bolster their online sports betting offering should strive to secure exclusive rights to specific events, according to Ross McEacharn, commercial director of Perform Group.

Hosting an animated debate at BetMarkets, McEacharn was quick to dismiss views that webstreaming was not suited to the live, in-play betting sector due to latency problems.

"Live online video streaming is just as quick as television. In fact, Flash streaming methods ensure images are delivered as fast, and in many instances, faster than TV pictures. This makes it the perfect in-play betting product."

Although the technology is now in place for webstreaming to be effective, McEacharn said it was important that operators differentiate their product from their competitors.
"Many sports events are not widely distributed on television and not strong enough to generate a large online pay-per-view audience," he said. "Exclusivity is therefore a major plus point for the online gaming industry, when there is no blanket coverage on terrestrial TV."

McEacharn said that a successful webstreaming operation was all about finding a niche: "Be strategic. Content that is widely available on mass-market television will have less value than those events that aren’t available."