eGR 10th anniversary column: The Big Bang
As eGaming Review celebrates its 10th anniversary and prepares to publish its 100th issue, four of the industry's biggest names have written columns on the evolution of egaming. The first entry in our series comes from Gala Coral's John O'Reilly.
I first became interested in the prospect of introducing a betting service over the internet in early 1996; I met up with my good friend Roger Eastoe, who was then managing director of the Mirror Group of newspapers, and we agreed to commission some very bright guys we had met to build a transactional Ladbrokes-branded betting engine onto an online portal for the sports news magazine Sporting Life. Our logic was that it would be the content that would drive consumers, and the betting engine that would monetise the traffic.
Between 1997 and 1998 all my time was devoted to defending Ladbrokes’ acquisition of Coral to a Monopolies and Mergers Commission enquiry but, in my absence, the business got cold feet about the joint venture with the Sporting Life. This left Mirror Group free to find another partner for the site we had designed and built which turned out to be Michael Spencer’s Intercap, owners of City Index.
The chaps who built our fledgling betting site had decided they needed a company name and chose Orbis “ which of course later changed to OpenBet “ and the site we had built quickly morphed into Blue Square. Having been hit with a ‘request’ from Peter Mandelson, then Secretary of State at the Department of Trade and Industry, to sell Coral within six months, we completed the sale in December 1998. I decided to return to Orbis in early 1999 to have them begin work on a new site for Ladbrokes, resulting in our first online sportsbook.
Ladbrokes.com launched in February 2000 and grew far quicker than we had ever envisaged; we launched a casino offering in October that year and poker and games sites the following year. The other key development, in 2003, was to integrate the retail and remote businesses so that customers could open an account at their local Ladbrokes shop and deposit and withdraw cash. There was always going to be a huge crossover between betting and gaming and between retail and online, but perhaps the biggest challenge was the cultural one of getting a retail business to move at the required pace in the online world.
Ladbrokes was late to online because of the distraction of the Coral acquisition and the resultant need to dispose of it quickly and without losing money “ it was perhaps not my best-ever career move even though we made money on the sale. However, when we finally did launch in 2000, the business quickly grew and by 2004-5 we were far far the biggest land-based operator in online betting and gaming.
Since then, online gambling has markedly changed consumer perception of gambling. Customers are now, rightly, much more sophisticated, much better informed and much more demanding. The source of supply is manifold and customers can and do select and deselect their chosen betting or gaming brand at will. Margins are the tightest they have ever been given the extent of competition and this has created something of a golden age for betting consumers.
Let’s just hope that the government’s proposed action to grow revenues through a point of consumption tax does not result in nonsensical legislation that works against the consumer by over-taxing UK facing and licensed operators. This would undoubtedly be to the benefit of unlicensed sites which will inevitably seize the opportunity afforded by the unfair competitive advantage they would hold. The betting consumer has benefitted from the online revolution more than most and, as a customer myself, I hope this trend continues over the next decade.