An evolving market

AS THE EGAMING INDUSTRY continues to evolve, the sportsbook industry is facing evermore challenges in the form of increasing technological demands. eGaming Review speaks to two industry experts about the factors contributing to the continued growth of the sportsbook industry and the opportunities that lie ahead in the future.

eGaming Review (eGR): In what ways has the sportsbook industry evolved over recent years?

Ron Regan (RR): The betting and gaming industry has taken an evolutionary leap in recent years. Huge global expansion coupled with new legislative changes means things are opening up increased opportunities for sports betting businesses. This, coupled with continuing technological advancements, means that punters can now place bets through a variety of channels on a huge range of gambling products.

If you compare this to what was available ten years ago, then it is easy to see the massive growth in our industry in a short space of time

Thorvar Hafsteinsson (TH): In recent times, casino and poker gaming have been at the more visible end of the online spectrum, while sports betting has perhaps been viewed as a solid, if less glamorous, option. Today, however, live betting on sports is becoming an increasingly important revenue generator, with latest figures from leading sportsbook operators suggesting that it now accounts for 60-80% of all profits.

As a result, growing numbers of online casino operators are seeking to secure a share of this potentially lucrative market by adding live sports betting to their portfolios.

eGR: What are the main challenges currently facing sportsbooks and how can they best be dealt with?

TH: Scalability, extendibility, robustness, fault-tolerance and a fast transaction engine are the key challenges facing any operator, and it was to meet these needs that Parspro developed Miranda, our sports and horse racing betting platform.

Built on an Event Driven Architecture (EDA) and a Data Grid (DG), Miranda is comprised of a series of multiple interconnected layers, each of which is responsible for a portion of the overall business logic.

Functionality is partitioned into each of the layers to boost performance and distribute load evenly across the entire system, providing clients with a stable, reliable and fast solution to their bookmaking requirements.

RR: The changes I mentioned previously are also bringing new levels of risk, with bookmakers having to offer a wider range of markets and content for a wider range of countries in order to differentiate themselves. This, in turn, increases their operational costs as they take on more traders and, if they are still using traditional risk management methods, exposes them to much more risk than they would like. Equally, the cost of set up for a start-up bookmaker is hugely prohibitive given the breadth of events that need to be covered in order to be competitive.

Bookmakers can deal with this extra burden by using companies such as GBE. For instance, if they have no expertise in-house to cover horse racing, they can take all the event set up, pricing and resulting from GBE, and, if they so wish, hedge all the risk back into the GBE exchange. This will have huge operational overheads savings and can cut any liabilities down to zero depending on the amount of risk the operator wants to take.

eGR: How important it is for data to be up-to-the-second, and what steps can be taken to ensure this?

RR: One of the potential future drivers of change in the interactive gambling industry will come from the ability to give the end user real time data, including audio and video, across multiple channels. For obvious reasons, this is becoming increasingly necessary as in running applications become more advanced. The question is: how do you do this without overloading your current infrastructure? The answer is to manage data by pushing updates only to the end user, as opposed to systems polling to refresh all the data every five seconds or so. There are a few companies out there who specialise in this areas: Push Technology is one who springs to mind. Using push rather than polling will not only allow operators to deliver content in real time but also will take a lot of strain away from their current IT infrastructure.

TH: Given the rise in popularity of live betting and its vital role as a revenue generator, the importance of up-to-the-second data can hardly be emphasised enough. It was certainly a prime consideration when Parspro was developing Juliet, our ground-breaking new live betting solution which enables online bookmakers to offer, for the first time ever, live betting with tournaments.

Built on the Miranda sports betting platform, Juliet combines the key industry trends of live betting and multi-player gaming by supporting both. The result is a completely unique solution that not only enables operators to run live match bets, but also allows them to create groups of multiple matches and events on which large numbers of players can bet simultaneously.

Tournaments can be created from any combination and type of sporting events, enabling operators to provide clients with a virtually limitless range of novel, attractive offerings.

Central to the system is the concept of a live betting tournament network, which allows multiple players from different customers to participate in the same tournament, greatly increasing rake size, prizes and the number of potential players. What’s more,
operator risk in tournaments is entirely eliminated, as winnings derive from the pool created by the players involved.

Access is provided through a series of user-friendly interfaces, which provide both bookmakers and players with a wealth of real-time information designed to create an optimum gaming experience, all of which is changed and updated fully automatically.

Of further benefit is the fact that the Juliet Live Betting client can be integrated into any existing web site or run as a standalone application, while the purpose-built Management Client provides a complete overview of the system and full control of running bets, enabling operators to start, stop, or delay bets, change odds and pay out to winners, all in real time.

eGR: To what extent does marketing impact upon the success of a sportsbook brand?

TH: While the ultimate success of a brand depends strongly on a high level of market knowledge and awareness, this must be backed up by dynamic, attractive marketing campaigns and sheer hard work, in order to create a high level of brand awareness.

However, the freedom to concentrate on achieving this is itself dependent on first-class software and a 24/7 service that can be relied upon at all times. That’s why from the outset, Parspro has focused strongly on our software architecture to provide operators with a high level of availability, scalability and reliability. Security and fault-tolerance have been key considerations from the very beginning, leaving our customers free to do what they do best, market and promote their businesses.

eGR: What impact do you think the growing popularity of live betting will have on the industry?

RR: Since 2002 live betting has exploded – suddenly more betting opportunities became available to the punters and they stayed on the site for the duration of the event. Events such as tennis, never an appealing betting sport previously, have rocketed in popularity due to the bookmakers offering live markets during a match.

The punters will bet on what they can see, so, essentially, if it is on television, then it is a potential betting sport. The trick for the bookmakers is to offer ‘as close to TV experience’ as possible, and by this I mean rich content including video, audio and text surrounding a broad range of live betting markets.

I also believe live betting is where mobile wagering will come into its own. The ease by which punters can place bets either at the event itself or while they are down the pub gives this channel huge appeal.

TH: With the increasing importance of live betting to operator revenues, the industry will probably see the introduction of a range of new offerings, such as live betting with tournaments and other innovative features provided by the Parspro Juliet live betting system.

eGR: What opportunities do you anticipate for the industry in the future?

TH: As competition increases, the ability to supply clients with a regular stream of attractive new offerings is becoming more important than ever, placing increased pressure on system developers and operators to exploit the latest developments in technology and media.

For example, Parspro is currently working on an iPhone application that will allow bookmakers to monitor live betting and tournament events from our Juliet servers in real-time, including a high-level overview of the running system and risk-management

RR: There are two areas that will decide how the sportsbook industry will shape up over the next few years: legal and technology. As I mentioned previously, legislative changes will be a driving force in deciding how and where the industry will grow. No one can second-guess how this will pan out, only that it will change over time.

Technology is the other driving force. While there is focus today on connectivity and convergence, for instance, new ways of seamlessly connecting to punters via devices such as internet, mobile, kiosks and mobiles, there are other technologies that can change the infrastructure even more like pay, micro payments and mobile phone payment cards. These types of solutions will open up countries where credit/debit cards are not widely used, such as certain regions in Africa, India and the Far East.

Thorvar Hafsteinsson (black shirt) joined Parspro as a web designer in 2006 and became marketing manager in 2008. Previously, he worked for several years as a multimedia designer, and as a TV producer/technician.