Inside Asian Gaming

March 2014 | INSIDE ASIAN GAMING 37 On the plus side of the ledger, there were 200,000 sign-ups registered from opening day in late November through the end of January (though it is unknown how many are duplicates); online poker revenue almost equaled live poker revenue; and payments processing was relatively smooth. “There haven’t been reports of major problems,” said Fred Gushin, managing director, Spectrum Gaming Group, in a webinar called, “Lessons Learned in Online Gaming,” conducted in January. Several transactions were not accepted by the issuing banks, but according to Mr Gushin, “Over time, as more states legalize Internet gaming, they’ll be able to synchronize these types of payments with the banking system in the US and it will become a lesser problem.” “Everybody needs to take into consideration that this industry is in its infancy,”Tropicana PresidentTony Rodio told The AssociatedPress early this year when announcing his property’s online partnership with Virgin Group and Gamesys. “There will be mobile applications, and a lot of the slot content isn’t operational yet.” Technical Difficulties, Emerging Upsides Clearly, it will help to be patient. Chat rooms abounded with tales of players being cut off from sessions in mid-hand. “For bwin, their mobile application today only works when you’re connected to the Internet, which kind of defeats the whole purpose of mobile,” said Mr Jones. “The conversations we’ve had about Caesars’ mobile application is that it’s borderline unusable. When I think about the younger generation, there are people out there who just have an iPad or an iPhone. You need a mobile application for it to work an HTML 5 option as well. These are just growing pains but they have to be fixed in order for it to work.” Mr Jones noted that there’s a requirement in the software that needs to check your location every couple of minutes, so it recycles whatever functionality the app is engaged in and instability can result. “It might be an issue with the software but, then again, it might be that there’s no consistency in the device that is being used,“ said Mr Jones, who added that compliance issues might be playing into the problem as well. “The operators have been physically going through some of the border areas of New Jersey. When you sign up, they will tell you if you are within a mile or two of the border that’s a gray area and they can’t guarantee that you’ll be able to get consistent service or if you’ll be able to log in at all. I think that comes from state regulators taking a very hard line about accidentally allowing someone from a neighboring state to log into your online gaming site. New York is obviously easy because you have a giant river as a border, but for the Pennsylvania state line it’s a little more challenging.” That said, “mobile is going to be the upside surprise here,” said Mr Jones, simply because there’s a massive transient community that goes through New Jersey, such as the people who take the Northeast Corridor Amtrak trains between NewYork City and Philadelphia each day. Newark Airport is one of the busiest airports in the world. There’s also a lot of commuter traffic in New Jersey, and the Jersey Shore is a very popular summer destination. “People rent a house for a week and then another group comes in,”noted Mr Jones.“There are a lot of positives that will drive New Jersey’s online gaming; they just have to get through the growing pains.” Mr Jones also found it remarkable how poker outperformed online gaming, running counter to conventional wisdom coming from the European online gaming experience. “One possibility is that there are already a number of players who understand how to play online poker, whether they used to do it before Black Friday and/or kept playing, now there’s a legal and easyway to do it and you had a huge adoption rate,” he said. “You got up to good numbers of players very fast at bwin; Party Poker is one of the most recognizable games in online poker. On the casino games front, there may be a bit of technology mistrust from a generational perspective. At the same time, bwin and Borgata were the only ones running it the whole time using IGT content. Caesars isn’t using branded content; I believe they’re trying to use some of their own content and I personally think that’s a very significant mistake.” Another area of disappointment for many observers was the initial marketing, which didn’t make it clear that transients in New Jersey are even eligible to gamble online. “We haven’t seen the marketing blitz that was expected yet,” said Mr Jones. “Sports team sponsorships, ads in airports, trains stations, you will see ads there. The ads have been generally weak about being explicit about what’s going on.” FEATURE “What is fairly clear in the early days is that there’s much more interest initially in poker than in some of the online games. That gives some support for the thought that poker is likely to be the driver and it doesn’t cannibalize existing business.” Dennis Ehling, attorney, Blank Rome