Opinion: Online gaming in South America - opportunities and challenges
The lack of regional legislation is a catalyst for an absence of reliable payment solutions and marketing channels in South America, however while it may be easy to launch an operation; the challenge is making it profitable, argues Offside Gaming's CEGO Matt Jellicoe.
With changes in gambling legislation across Europe, where recent restrictions and local licensing requirements present new obstacles for both existing and new operators, South America is viewed as an attractive market with new opportunities for software suppliers, operators and investors. A combined population of more than 350m and high internet penetration, should surely make it anm ideal territory for online gaming…
However, despite all the optimistic statistics and while land based gaming is continuing to thrive and expand, egaming growth in the region remains slow. This can partially be explained by a lack of regulation in the largest markets such as Brazil and Argentina. The lack of legislation is a catalyst for secondary obstacles such as an absence of reliable payment solutions, marketing channels and so on. It is easy to launch an operation; the challenge is making it profitable in the long term.
Latin America is not one homogenous lump, but a myriad of very different countries and this is definitely not the EU. Latin American politics are hectic, bureaucratic and often corrupt. There is not the same co-operation between countries and this does not lend itself to swift implementation of gaming laws. The thing that surprises many people is that Central and South America already has a number of regulated markets for internet gaming with Argentina, Peru, Costa Rica and Panama with some form of egaming regulations in place.
Broadband penetration is also much lower than in Europe and the US and in reality many of the web products built for the European market are much less suitable for the Latin American market. For example, load speeds in most of Latin America are five to seven times slower than in Europe, whilst latency is also a factor with sites that take 1.5 seconds to download, often taking 10 to 15 seconds in Sao Paulo, for instance, while local servers for graphics need serious consideration.
However, in spite of all this, we have managed to get all the major factors right with our partnerships in South America and they have delivered good results in the last year, and we are working hard to maintain the momentum, and continue this growth into the new season.
Since Power LatAm in 2011, we have launched two new successful partnerships in the region and are currently in the process of rolling out our new retail solution with licensed partners. The South American market offers great opportunities for business and we will keep building on our presence and continue to focus on the region with licensed partners. Power LatAm proved to be a good platform for us and we will be supporting the show again this year.
Offsidegaming isa full platform operator specialising in working with strategic marketing partners across Europe and South America by building bespoke brands and solutions for any given market.
eGaming Review’s annual Power Latam event is on at The Park Hyatt hotel in Buenos Aires from 12 to 13 November 2012.