Boost to Bwin, Stars, others as Italy bans 'totem' machines
The Italian Gaming Authority has dealt a critical blow to Italian poker giant Microgame on behalf of rivals such as Bwin and PokerStars by banning public gaming terminals.
THE Italian Gaming Authority has dealt a critical blow to Italian poker giant Microgame on behalf of rivals such as Bwin and PokerStars by banning public gaming terminals.
Microgame, which accounted for nearly 30% of Italy’s onshore poker turnover during the last quarter, owes much of its dominant position to its network of terminals, or “totems”, which are installed in public places such as coffee shops and connect to egaming websites.
The ban on the machines follows complaints from rival poker operators that despite substantial marketing investments they are not able to challenge the market share of established network providers, and provides new scope for growth to entrants to the Italian market.
Giulio Coraggio, a gaming and technology lawyer at the Rome office of law firm Hogan Lovells, said: “The prohibition of gaming terminals represents a benefit for new entrants to the market, which will not have to develop a network of gaming terminals. This should be an additional factor to be considered by operators that will be able to apply for Italian online gaming licences”.
Microgame was bought by private equity fund Monitor Clipper Partners in October 2009 to take advantage of Italy’s burgeoning egaming market, which is Europe’s largest by far and is projected to account for 22% of the continent’s entire market this year.
According to figures provided to eGaming Review by Italian data business Trust Partners, Microgame accounted for 248m (29.6%) of Italian onshore poker turnover in the first quarter of 2010, dwarfing the shares of Bwin (143m, 17%), Lottomatica (94m, 11.2%) and PokerStars (149m, 17.8%).
The company also generated 10.1% (130.1m) of online sports betting turnover during the last quarter.
However Giulio Coraggio added that he expects the ban to be challenged in the courts by the large number of gaming operators and network providers in Italy that base their online businesses upon the terminals.
“Because of the conflicting interests around the decision of the Italian Gaming Authority, I would not be surprised if this decision leads to some disputes”, he said.
For more on the growth in size and influence of the Italian market and H2’s data special on the European egaming market, see this month’s eGaming Review.