Thank You, Covid!
Gaming Laboratories International CEO James Maida was the first to say it as he led off our series of CEO One-On-One interviews at G2E.
Covid, as difficult as it was for many, was a blessing to the gaming industry. It prompted the acceleration of sports betting and iGaming adoption by five to seven years, Maida said.
Other CEOs unanimously agreed when asked about Maida’s observation, and for more than sports betting and iGaming.
They cited acceleration ranging from expanding other uses of technology to casino operators learning what expenses were truly necessary, thus allowing them to cut costs without cutting revenues.
We’ll see as time goes on, but CEOs, at least, think there are permanent improvements in how they do business that should help the bottom line from here on out
Fingers-Crossed Resilience
Third quarter earnings season is about to launch and we’ll hear from casino operators then, but if games and technology CEOs have a good handle on the industry overall, neither inflation nor fears of recession are affecting their casino customers or, in turn, the casinos’ player customers.
Not one CEO among the 25 interviewed said he saw an impact in casino buying plans because of economic uncertainty.
The caveat: This was said with fingers crossed.
Let’s Go Digital
A couple of years ago, suppliers were entering the world of placing their games on online channels. Some were there. Some were just entering. Some planned to do so.
Today, they are all in. And every CEO interviewed, spoke with confidence about the potential significant benefit of this emerging market to their companies.
Omni-channel was the term a couple years ago. Today it’s cross-platform. But the meaning is the same. If there’s a way to deliver a game to a player, companies are actively doing it.
Cashless Inevitable
No one said it, but I get the impression that cashless gaming is nearing the tipping point where adoption will accelerate wildly and it will become as standard as its much-compared-to innovation of a couple decades ago, ticket-in, ticket-out.
The number of casino operators now employing some form of cashless has grown significantly, with Penn Entertainment and Red Rock Resorts’ Station Casinos among the recent adopters.
What is unclear at present is who the supplier winners will be with companies like Acres Technology, Everi, Konami and IGT among those scoring significant wins.
In brief, this is an innovation whose time is near and there will be winners.
Let’s Talk Opportunities
A long time ago, I was attracted to a small Minnesota company named Shuffle Master.
Company founder John Breeding, an over-the-road truck driver, had invented what was then a clunky device to convert card dealing from manual to automated.
The nascent market was growing 30 percent a year and Shuffle Master was its leader. What was more important was the clear common sense conclusion that someday shufflers would be standard in casinos everywhere.
That happened, and Shuffle Master, now owned by Light And Wonder, became a big success.
Two product categories today appear to have the same inevitability: electronic table games and virtual sports games.
Like shufflers before them, two companies have clear leads today: privately owned Interblock and publicly traded Inspired Entertainment.
Unlike shufflers, e-tables and virtual sports are more crowded competitive fields. Yet, their growth potential is big and the growth is still in early stages.
Yay, Matt
The appointment of popular heir apparent Matt Wilson as CEO of Light And Wonder completes, in a sense, the Aussification of the former Scientific Games, which is headed by fellow Aristocrat alumnus Executive Chairman Jamie Odell.
More importantly, Light And Wonder now has reorganized to give it focus that was lacking in recent years as it digested a number of acquisitions, gained more gaming-oriented institutional investor leadership and improved its balance sheet.
Further, Matt’s ascension means LNW is now being led again by a gaming executive as opposed to his two predecessors who helped guide the company into the new technology age, but appeared to lack an understanding of, or enthusiasm for, the core business.
IGT also has undergone a reorganization and Aristocrat has continued to develop its digital business until it now represents half of revenues.
So the stage is set for the Big Three to begin a new era of competition.
Hear Them Yourself
The above observations and conclusions are among those I inferred, or had refreshed, from discussions with 25 industry CEOs including those of the companies mentioned above.
You can get your own impressions by listening to these brief interviews at www.fantiniresearch.com. Just click on the CEO One-On-One link.
