Posted 1/23/11 : 85 percent of gambling operators plan to increase efforts in social networks
The research group MECN has released results from a new study which shows that internet gambling operators seeking new revenue streams are turning increasingly to casual gamers found in social networks, online lotteries and internet bingo.
MECN's "Casual Gaming and Gambling on the Internet" report reveals that 85 percent of gambling operators plan to increase penetration in these areas in order to boost growth over the next two to three years.
The survey points to recent heavy investments by Party Gaming, 888, Playtech and others in the online bingo industry as an indicator of the casual sector's growing importance.
Social gaming offers, such as Zynga Poker, are currently dominating strategic discussions in the online gambling industry, MECN claims, noting that casual players are the primary revenue-generating segment in liberalised markets such as France and Italy.
Fantasy sports and skill gaming are increasingly viewed as strategic entryways into markets with legal restrictions such as the United States, whilst online lottery and numbers games have moved into the spotlight as remaining "untouched" sectors estimated to be worth $5.5 billion in gross revenues by 2015.
Zynga Poker is used as an example of the power of social gaming, with over 36 million active users per month and between 200,000 and 400,000 online players at any one time – significantly more than leading poker rooms.
Report co-author Martin Oelbermann says that thus far the online lotto/numbers games sector has been dominated by state operators, but this could change very soon.
"Large private operators will soon discover online lotto and numbers games," Oelbermann forecasts. "What started in 2009 with hefty investments in bingo will spread to lotto and numbers games – maybe already in 2011".
Gross revenues in the numbers game (retail and Internet) market are estimated at $100 billion, and the segment is still largely dominated by retail-focused state lotteries. However, the Internet will inexorably advance and shape this sector too, the report predicts. Total sales of Internet lotto/numbers games (lotto, keno, scratch/instant) amounted to around $1.9 billion in 2010 and will grow to $5.5 billion by 2015.
How quickly private operators enter the lotto/numbers market will likely depend on how fast the traditional sectors lose their growth potential, says Oelbermann: "The race to win over casual gamblers is surely on, and lotto/numbers games will play a vital role in this race. Therefore, state lotteries and NGO operators should start getting ready [to compete] if they do not want to lose their last stronghold".