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IGT Waiting for Legal Online Gambling
Sunday September 16, 2012 : IGT MARKING TIME UNTIL ONLINE GAMBLING IS LEGALISED
“...right now, we’re in a period of uncertainty with U.S. legislation,” says IGT exec.
The scaling back of the IGT Poker network this week has again brought into focus International Game Technology's online gambling plans, and it appears that these centre on leveraging its DoubleDown Casino social gaming acquisition to prepare for real money online gambling.
In a revealing interview with the publication Inside Social Games, IGT's vice president for emerging business, Robert Melendres, discussed the purchase of Double Down Interactive earlier this year for around $500 million, but said that the company is not planning to get in on real-money gaming any time soon due to political and legal uncertainty in America.
Melendres explained: ”Right now we’re very much focused on taking social gaming product and driving that very, very hard as a way of helping our casino properties leverage online gaming.”
That doesn't mean that IGT is not interested in real money online gambling when the time is right and conditions favourable.
“From IGT’s perspective, real-money gaming is ours for the taking … IGT is one of the very few companies that’s been on both sides so we’ve been able to see what happens in the real currency world and social gaming side," said Melendres, explaining that the company's
“DoubleDown Partnership Program” spreads the DoubleDown Casino’s presence on the Web by allowing customers to incorporate the game into their own casino sites.
This serves three purposes: It allows IGT to stay connected to their players, providing a casino floor experience from anywhere; it creates an incentive to come back to the actual casino; and everyone gets to make money because the casinos are enabled to engage in revenue sharing.
Melendres opined that real-money gaming will come to social poker games first. When this happens, casinos will offer online poker.
”The beauty of what we’re doing right now is that I truly believe the DoubleDown Partner Program is a superior offering to the poker program,” he said.
The IGT exec acknowledged that conversion rates to real money action in social gaming tend to be low, but that only a small percentage of the massive numbers of social gamers was necessary to make a viable business.
Interestingly, he commented that conversion rates are not dissimilar to those experienced during the early days of Internet gambling, and suggested that this could rise as the sector develops.
“We want to be responsive to the marketplace. Right now we’re focused on developing the DoubleDown brand and will continue to leverage that," said Melendres.
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