According to GAN CEO Dermot Smurfit, the retail gaming industry and its consultants were quick to dismiss igaming when it emerged a few years ago.
Speaking Thursday during the panel discussion I-gaming on the Rise – Making Waves in 2021 at SBC Digital North America, Smurfit said New Jersey’s adoption of igaming in 2013 was viewed as a desperate attempt to bolster its gaming market. Then PASPA was struck down by the Supreme Court, and the gaming landscape was irrevocably changed.
“Suddenly everybody’s excited by the opportunity and away we go in the summer of 2018,” Smurfit said. “Sports betting was the original accelerant and the enormous burdens placed on technology for providers to the industry have not let up and show no sign of letting up at all. Not only do you have sports betting, which had a galvanic effect on retail casinos . . . but igaming had been around for the better part of five years. The real ugly truth of the industry is igaming is today and will continue to sit at the core of the profitability model.”
Smurfit was joined on the panel by Resorts Digital Gaming CEO Ed Andrewes, MGM Resorts CEO Bill Hornbuckle, Inspired Entertainment COO and President Brooks Pierce, and moderator Katie Lever, chief legal officer for Lottery.com.
The panel agreed that the COVID-19 pandemic helped igaming, as players forced to stay home increasingly embracing gambling online. All aspects of the industry, from gaming operators to game providers, are now dealing with igaming’s new status.
“What COVID has done with new states opening up has proven that igaming is a very important part of the overall business model,” Andrewes said. “That’s kind of changing the focus. When the third-party providers change their priorities, that’s what really speeds up the technology development. It’s been proven there’s good revenue being generated.”
Hornbuckle thinks that sports betting will lead in terms of volume, but igaming may be more profitable in the long run. But he cautions no domestic operators in the U.S. have yet made profits.
“It’s an investment that we think goes into ’24 and ’25 before we see what ends up happening,” Hornbuckle said. “But we’re excited about it. We think that there will be three or four key players when the dust settles.
“This is not for everybody,” he added. “We’re literally investing hundreds of millions to make a marketplace. But we do think and believe it’s essential to the overall universe of customers, our ability to attract them to our brick-and-mortar resorts, and then give them something when they go home. It’s a huge opportunity.”
The next 12-18 months will give operators and other invested parties a clearer idea of igaming’s future, and whether the gains made during the pandemic are sustainable.
“A lot of promises are being made to the street,” Smurfit said. “Who’s going to get what percentage of market share is always interesting. … You’re going to get some winners, and some losers.”
