Inside Asian Gaming

INSIDE ASIAN GAMING | March 2011 18 T here are technical as well as regulatory challenges when it comes to enabling global online sports betting businesses, says Carlos Salas. “We’ve had to deal with the latency issue between Asia and Europe. That means Sunplus of after-sales input is critical to building a successful software business—especially as your client list grows, says Tom Hall. “We learned lessons from earlier experience in the gaming software market. When you start having multiple licensees, you need to have software that is user friendly—otherwise your time gets tied up in helping with standard customisation inquiries and that hits your ability to develop new products and Regulatory Landscape How Sunplus ensures ‘turnkey solution’ means what it says “T here are some regulatory constraints about how we license people in Europe,” says Tom Hall. “We’re working our way through that and having meetings with relevant government representatives. Regulated markets can be very stringent,” adds Carlos Salas. Some require you to make a certain amount of profit, or offer a certain number of games, or not to surpass a certain amount of profitability, so we have to look at markets on a case by case basis.” “Our job is to make our licensees’ lives as smooth as possible,” says Mr Hall. “So if we can say to licensees: ‘We’ve set up this system with X, Y, Z jurisdiction. We’ve got a lot of servers we’ve linked together so the system all works and you as our licensee don’t have to invest in any of that,’ then we’ve got it right. We ensure that wherever the gaming operator is already licensed, by taking on a sports book they have minimal additional regulatory headaches. “We’re getting a lot of enquiries from regulated markets such as Italy as our product and commercial terms make us very competitive in Italy and enable us to access that market and possibly neighbouring markets. “In some regulated markets revenue sharing is hard—an extreme case is Nevada where no profit sharing is allowed with the casino operators. We built the business model so that we offer a range of licensing models” says Mr Hall. Time is money—technical challenges with Internet betting Business goal—Sunplus claims access to the world’s largest book of live sports betting events The Latency Issue Some technical challenges faced by global online betting businesses features,” he explains. “No software company can ever do instantly everything that a customer wants—even though that’s the customer’s expectation. But we’ve tried to structure the business so that the development queue is as organised as possible. That’s a really important thing, because as you grow you want to minimise the amount of support time you spend on each one—that’s for everyone’s benefit.” the speed of Internet data traffic flowing between Europe and Asia. FFor sports betting the optimal number is about 180 milliseconds, and the best that can currently be achieved is about 280 milliseconds, though customers don’t really notice any difference so long as it’s under 300ms. That’s about a thirtieth of a percent of a second. It’s way better than live TV, which has about a three second gap between the live action in a soccer ground in Europe and the pictures that appear on TV in Asia. Still, betting traffic is not as fast as we would like it, but that’s because the bandwidth is not there on the Internet.” All online betting platforms are beholden to the inherent architectural strengths and weaknesses of the Internet. But Sunplus says that by licensing out of established online gaming jurisdictions with the best available technical infrastructure, it can offer the most stable system to be found anywhere in the world. “In the most developed online jurisdictions such as CEZA [Cagayan Economic Zone Authority] in the Philippines, Kahnawake in Canada or the Isle of Man, they have so much bandwidth and pipe and so many tools that they can deal with all contingencies, including things such as a DDOS [distributeddenial-of-service] attacks,” states Tom Hall. “And by coming to Europe we are creating a shared hosting environment so that we don’t have the latency issue,” adds Carlos Salas. “For Europe this is a new kind of service. There’s never been a licensing regime for it or any regulatory structure for it. We are talking to jurisdictions that are open to the idea of this product and are interested in having us in their jurisdiction.”