Public Gaming International Gaming July/August 2021

25 PUBLIC GAMING INTERNATIONAL • JULY/AUGUST 2021 equation the ability to deduct bonus money, which could be pretty aggressive as we know is the case in sport betting where reported data shows that bonus reach 45-50% of GGR by many. Now take the same $100m in GGR from iLottery, and you will see that based on the range of commercial deals with iLottery technology and service partners, and after blending in other costs of modest promo dollars, marketing costs and teams, lotteries will typically see more than 75% of that turned into contribution to good causes. That’s 4-5 times on a dollar spent! Now I’m not suggesting that states should not regulate online sport betting. In fact, what we see in all states where we operate iLottery side- by-side with regulatedSport Betting, is that the two different game categories appeal to different audiences and that both thrive one next to the other. And this is before considering the obvious reasons to enabling iLottery for its ability to create the platform for the truly interactive relationship between players and lotteries that is vital for the sustainability of our industry. So – I’m not sure I know the answer to your question as to why states have taken so long to regulate iLottery and are now rushing to legalize sports betting, but its clear that iLottery authorization is meeting a bit different challenges, interest groups and stakeholders in the path for approval. Hopefully, now that lawmakers see the compelling logic to regulate instead of prohibit, and are applying it so quickly to sports betting, they will apply that same reasoning to iLottery. It appears that they are doing that to some extent, though the momentum of sports betting continues to outstrip iLottery. Think about it – it was almost ten years ago that the U.S. Department of Justice cleared the way for states to have the authority to implement iLottery if they so choose (by clarifying at the end of 2011 that the Wire-Act of 1961 only applies to sports betting). It was less than three years ago that the federal prohibition against sports betting was struck down. Now, about 30 states have already legalized/regulated sports betting in three years compared to only about 10 that have authorized their own state lotteries to make lottery games available online in ten years. That is dis- heartening because we now have almost the same number of states regulating iGaming as states that regulate iLottery. I can’t emphasize enough that this should not be an either/or decision. iLottery, sports betting, iGaming and other forms of gaming should all be regulated for all the same reasons – regulation serves the interests of society and the players so much better than prohibition. We are doing our very best to assist the lottery industry in the US, working closely with Directors in different states to provide them with the vast experience, data and evidence to help promote the benefits of iLottery. We appreciate that lottery directors in the US understand that well and in most cases are as eager to implement iLottery as we are. How do we apply “best practices” when regulatory structures, consumer attitudes, and gaming cultures vary so widely throughout the world? M. Malul: First, there are many common- alities about human behaviour, the way markets operate, and the way marketing is performed throughout the world. People may play games-of-chance for different reasons, but common throughout the world is a love for lottery. Common throughout the world is the need to connect buyer and seller, operator and consumer. Common throughout the world is the need to com- municate with a diverse audience. Common throughout the world is the need to create games that appeal to the players. Second, we can learn from our differences as well as commonalities. For example Neogames Studio applies science to the goal of deconstructing the game attributes down to a molecular level in order to analyze and understand more precisely the properties and impacts of each component part. Nobody would presume that a game that is successful in France or Portugal will be similarly received in California. But there are many elements to success- ful games in one market place that can be paired with other game attributes to reproduce successful results in other markets. This is where data-analytics enters the picture. M. Malul: Exactly. The one “best practice” that is a key to success is the effective application of data-analytics. That is a universal principle that applies everywhere. The methodologies used to extract, capture, and organize data and convert data into useful business intelligence are constantly evolving, but the best of those are being applied all around the world regardless of variables like gaming culture that are unique to each market and jurisdiction. Data-analytics is what enables us to isolate and identify the attributes of a great game to see which component parts are the killer-ap- ps that can likely be applied to equally great effect in other markets. It is what enables us to segment the market and customize the messaging to appeal to different player sensibilities. Data-analytics enables us to understand the differences and similarities between markets and player groups. In fact, it is the insights derived from data-analytics that enable us to customize the portfolio of games and marketing strategies for each individual market, to appeal to the unique characteristics of the players in each market. We know that “all markets are local”. That is why we need data-analytics to help us sort through the enormous brain-trust of past experience to guide our current strategies and actions. And the more insights we glean from the data, the more we realize how we are only “ “Hopefully, now that lawmakers see the compelling logic to regulate instead of prohibit, and are applying it so quickly to sports betting, they will apply that same reasoning to iLottery.” Continued on page 47