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Gambling Convergence : New Business Model

04/02/2012 : GAMBLING CONVERGENCE - AN INTERESTING NEW BUSINESS MODEL
 
Latin American bookies turn to specialised internet operators to beef up business
 
One of the more interesting articles surfacing over the weekend was a piece from Friday's New York Times on the development of an innovative pay-per-head administrative business model used by mainly Latin American bookmakers.
 
Headed by a photograph showing the Costa Rica-based PerHead support centre, the article examined the growing phenomenon of street bookies on the land and often illegal side of the business who are now turning to the internet for three main reasons - player convenience, ease of accounting and financial administration, and to increase business.
 
But these bookies do not operate their own websites in the conventional business model - instead they use specialised pay-per-head websites with which they have a relationship.  
 
"The basic setup is simple: Instead of taking a phone call from every bettor, the bookie directs his clients to a Web site, where bets can be recorded, tracked and totaled. The bookie can then log on and see who owes - or is owed - money in the coming week," the article explained.
 
"It is also a drastic departure from the entrenched notion of bookies operating out of basements or back offices, with jumbles of phone-line wires, drop safes and handwritten ledgers."
 
Steve Budin, a gambling expert who formerly operated an online sports book, told the newspaper:
 
“There is always going to be a huge market for local bookmakers because they are the ones who let players bet with credit, with money they don’t have to produce. People don’t want to give out their credit cards or send money offshore someplace. They like dealing with real people and real cash. These sites just make it a whole lot easier for the bookies serving them.”
 
Bookies who use the sites pay the companies that operate them a small fee per client - usually around $20.
 
The most significant difference between pay-per-head sites and offshore online sports books, is that pay-per-head sites do not handle any betting money; they simply offer the players a place to record their bets and the bookies a register for organising them.
 
"Settling up - and the threatening that occasionally goes along with that for those who try to evade paying - is still done locally," the newspaper notes.
 
Travis Prescott, an executive at PerHead.com, said in a telephone interview. “With our setup, everything is streamlined and anyone can run their operation on their own.”
 
Prescott revealed that his organisation is based in Costa Rica and has nearly 100 employees working in a modern office building. There are six full-time employees focused on I.T., working to ward off hackers and maintain the company’s servers. There is one person dedicated to increasing the company’s search engine optimisation, which helps attract bookies of all experience levels, he said.
 
The New York Times reports that the surge in per-head start-ups began in earnest about three to five years ago - perhaps in response to US government crackdowns on traditional online sports books.
 
Although exact figures are unavailable, some estimates have the number of per-head sites operating to be “in the hundreds.”
 
“Younger bettors are used to ease and quality — they don’t want busy signals or guys who don’t answer their phone,” Steve Budin told the newspaper. “They want Web sites. They want a number they can trust where someone says, ‘How can I help you?’ if they have to call.”
 
One bookie said that the pay-per-head business model was a tremendous time saver, and was more convenient for his customers. “I can tweak the lines if I want, I can set minimum and maximum bets for different customers. There are still some older guys who like hearing my voice, but most of my clients just go to the site. They can see it all there,” he said.
 
A US-based gambler whose bookie uses the service said he was leery of sending his credit card number to traditional online sports books because he had friends who lost money when their online sports books were suddenly shut down.
 
He prefers the per-head setup because it gives him access to a Web site but also allows him to build a trusting relationship with his local bookie; when he won a bet that came with a $20,000 payoff, the bookie still met him at the usual time and paid up, the article reports.
 
Because the sites administer information but do not handle the money involved in the betting process, there is arguably little legal risk for those involved.

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Gambling News :

Amaya FY2016 Trading Update - The Montreal-based Amaya online gambling group has issued a trading update covering FY 2016 and improving its forecast revenue and earnings numbers.

Another Mega Fortune Dreams jackpot for Euro 3.5 million - In a statement Friday NetEnt advised that the lucky player is a 62-year-old woman from central Finland who won the seven-figure sum from a Euro 1 stake.

Stanleybet has filed a legal action against the government of Cyprus - Bookmaking firm Stanleybet has filed a legal action against the government of Cyprus, claiming Euro 12.5 million as compensation for what it claims is loss of profits and opportunities, prejudice to image and business reputation and legal costs.

LeoVegas To Sponsor Leicester Tigers - The agreement includes official partner accreditation, media space at Welford Road stadium and matchday tickets and VIP hospitality as well as two pitchside perimeter boards from the 2017/18 season and one for duration of the 2016/17 season.

Optima Information Services iShop - Industry visitors to the recent TVC Bookmakers Trade Fair in Solihull, UK were much taken by Spanish betting technology firm Optima Information Services' iShop product, and the company went on to win the SBC Best Retail Betting Product award with it last month.

Golden Nugget Las Vegas Launches New Betting App - Golden Nugget Las Vegas has unveiled a sports wagering app offering Nevada punters the comfort and convenience of being able to wager from anywhere in the state.

CAGAYAN CHIEF MOVES TO REASSURE LICENSEES - Apparently $4 million is going into improvements of the Authority’s data centre in the Freeport at Cagayan, whilst another $3 million has been earmarked for an upgrade to data infrastructure located outside the Freeport.

New Massachusetts Online Gambling Bill - It seems that every two years (give or take a few months) Massachusetts state Senator Bruce Tarr flights an online gambling legalization bill in the state Senate.

Las Vegas Sands Fined for foreign bribery allegations - #lasvegassands Las Vegas Sands, the land casino company owned by multi-billionaire US mogul Sheldon Adelson, has again had to cough up a stiff penalty for non-compliance with the law.

Libratus AI Program Destroying Human Poker Opponents - #Libratus With 40,340 hands played (about a third of the 120,000 planned) Dong Kim is down $29,506, whilst Jimmy Chou ($113,7728), Daniel McAuley ($141,877) and Jason Les ($186,489) are all carrying losses.

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