Pulse

Foundation: Acres Manufacturing

By William - 9 November 2021

Acres Manufacturing’s Founder, John Acres, has a track record of creating genre-defining gaming technlogy.

His company’s latest blockbuster, Foundation, is set to revolutionise the casino systems sector, not only by generating unprecedented real-time player data, but by creating an open environment that promotes competition, new ideas and new entrants. It puts casinos on a level playing field with Google, Netflix and Facebook by being in control of their player data for the first time.

G3 spoke to Acres Manufacturing’s Noah Acres to discuss the new systems solution from the company – Foundation.

Noah, what’s the background to Foundation?

If you look at legacy slot systems in the US and Asia, there are four primary systems providers: Aristocrat, Konami, IGT and Scientific Games. The dirty secret of the industry is that the hardware powering all these systems was created in the late 1990s – early 2000s. It’s the primary reason why this industry lags so far behind in terms of technology.

Coming at this problem, we were trying to create applications using the data from these legacy systems. We found that the more installations we performed, the harder the systems providers worked to keep us out of their environments. They want to be one-stop-shops for everything systems-related and sought to keep us out and stop us from consuming their data. So not only did we meet resistance from the suppliers, but the data wasn’t great in the first place.

Slot machines speak SAS (Slot Accounting System), which writes around 120-150 rows of machine data, but the way the legacy systems work is that they only collect around 20 rows of SAS data, with the majority simply lost to the ether. Compounding the issue is that data is only collected at specific intervals.

Legacy systems run a meter-reading report on system events, such as card-in, card-out or bill- in or bill-out, these types of events. So if you’re a players inserting 50 dollars into a game, the system is not monitoring your play, it’s recording after the fact. The interval to the next report means the player has most likely cashed-out before you’re made aware of their play. If the casino wants to market or communicate with that player, the opportunity is lost. There is no option with the legacy systems to market and communicate in real-time while the player is at the slot machine.

Foundation addresses these issues?

What Foundation does is that it collects all of the data in real-time and instead of blocking others from our environment, we welcome them. The fundamental change is that the casino controls that data. Foundation includes an interface that allows the casino to change the credit metre on any slot machine at any time. This allows them to implement any type of bonusing and any type of cashless.

Most large scale operators today are looking for a single wallet solution that works at any slot machine or table game in their portfolio of properties. Using Foundation, operators can blend real-time data with the wallet solution, allowing them to layer on real-time messaging and bonusing into the app.

What is the Foundation environment?

Our Foundation environment starts with the hardware that we place inside the slot machine. You unplug the legacy system and plug our device into the SAS port of the game and reconnect the legacy system to our device. The legacy system operates as normal, but we send our data to another piece of hardware located at bank level and ultimately, all that data goes to an environment that we call the ‘Blender.’

If you imagine a firehose, the Blender is a firehose of data. Our system does not store any data. We give the casino all the API documentation that they need to request the data that they need from the Blender. So the casino gets to decide what they want to store and how they want to utilise that data. Foundation lets casinos own, possess and control all their own data.

If you want to build an application that communicates with your slot games, that application interfaces with the Blender. One example is cashless – if a player wants to add credit to a slot machine via the Penn App, the request is communicated via wifi or the cellular network to the payment processor’s network, which verifies the account and the available funds. The payment processor is interfaced with the Blender and credit is sent to the player’s phone.

As the player calls up the transaction on the App, simultaneously a Bluetooth sensor within the specific slot on the floor communicates with the App. Funds are transferred to that slot with confirmation of the game title on the App. All of this communication takes thousandths of a second and cash-out is exactly the same process and it’s just as fast.

So Blender doesn’t process the payment itself?

That’s right, we don’t process any payments. We interface with the payments processor of choice. Penn National chose Everi as its payment processor, which has a cashless solution called the CashClub Wallet, which allows players to move money from a bank account or card into their CashClub Wallet. Everi handles the transaction between the bank and the phone App, but without Foundation they have no way to transfer those funds to the game. We consider Foundation as the last piece of the pipe that connects the outside world to the game.

We can connect to any external payments processor, bonus provider or analytical tool – anything the casino authorises. The great thing is that everything is modular. We don’t need to find out what’s allowed or not by the banks. We partner with experts like Everi and benefit from the separation of duties.

Is Foundation practical for uncarded / anonymous play?

The casino industry works in a back-to-front manner when it comes to data. Operators ask new players to register with their loyalty programme and reveal everything about themselves so the casino can decide how/if it wants to reward their play. It’s the exact opposite of how Facebook operates, whereby you get to try things for free and if you like it – then they start to charge you for the privilege.

So to answer your question about uncarded play, because we collect so much more data, we are able to identify where an uncarded session begins and ends. The fact that a legacy system infrequently pulls data means that its SAS checks miss the point at which an uncarded player leaves a device. It won’t register that the player has left until another player inserts their card into the machine and generates another pull of the data. Right now, casinos can’t identify the start and end of uncarded sessions, but because our data is so granular we can identify every session.

Why have system suppliers continued pulling those 20 rows of data from SAS and not sought to evolve beyond this?

If you look at what casinos wanted to accomplish 20 years ago in the late 1990s early 2000s, even to this day, casinos in the US are still direct mailing their customers. Every casino wants to add players to their mailing list in order to send them snail mail. It’s what businesses did back in the 1990s, but now that everything is digital and driven through mobile devices, the technology that was adequate for that era is no longer viable today.

In the last 20 years we have at least doubled the number of casinos in the US. There has been a massive increase in the number of operations as new states and tribal gaming expanded the casino offer. However, instead of working on efficiencies to improve operations, the casino industry has just been scaling – making what they do bigger and exporting those processes from Las Vegas to new locations without any real thought as to how we improve casino systems.

If you take the inaction of vendors, maintaining the status quo means that everyone has to buy their product. Layer on top the fact that this is a highly regulated industry, the cost of entry is so prohibitive, plus it takes a high level of expertise to create something like Foundation for the gaming industry.

If we were to create this technology for the retail sector the bar would be much, much lower, but because we’re involved in the deeply, highly regulated casino industry, it becomes very difficult. A lot of companies that could have entered this sector and solved this problem have simply been scared away.

My father, John Acres, is one of the pioneers of the industry in terms of understanding SAS and he’s kept himself up to speed in terms of modern technology. His expertise helped us to understand the value of Foundation and he helped us to make a product that we feel is badly needed.

Foundation works with all the legacy systems on the market – but does Foundation need these systems to operate? If I’m a new casino – is Foundation all I need?

Foundation doesn’t need a legacy system to operate. We can offer cashless, bonusing and operational data independently, but we knew that if the deployment of Foundation came with the caveat that the operator had to remove their existing system, we’d have a problem. There are too many critical applications connected to the CMS solution for this to be practical. So we invented a process called SAS-sharing, which allows the legacy system to use Foundation as a pass-thru device.

Foundation collects a thousand time more the data than legacy systems, which means that operates can consider this as a long runway to kicking their dependency on their legacy system. Eventually, once they start flipping over different functionalities from the legacy system over to Foundation, they’ll reach a critical point at which they can just remove it altogether – if they want to. However, if you have a brand new casino – you can plug into Foundation and you don’t need anything else.

Do you expect the legacy systems providers to pivot at this point and embrace the added functionality of Foundation? And what does Foundation mean for new market entrants in the system space?

I think Foundation will provoke both outcomes. Right now legacy systems suppliers consider us to be competition, but I think there will come a point at which they see us as an opportunity. The four providers know that the least attractive part of their business is the systems hardware. If we can take that off their plate – they don’t have to support hardware any more, they don’t need to create and maintain it – and that’s a benefit.

We can give legacy suppliers all the data they never had before so that they can concentrate on creating whatever applications they want. I think that’s a really attractive proposition. However, I don’t think they realise that just yet – but I think they will soon.

Foundation enables the legacy suppliers to move away from a hardware model to an a’la carte software model. And the opportunities are huge. For example, Penn National uses Scientific Games’ system solution, which means that Aristocrat, Konami and IGT can’t sell their system Apps to Penn. The installation of Foundation changes that. Open environments increase market potential. In time, we open that market potential not only to the four legacy providers, we open it open to everybody.

At G2E we saw dozens of data analytics and AI companies that specialise in consuming casino data. Before Foundation they were basically shut out of the market consuming poor quality data that isn’t generated in real-time. Now they have everything they need. So they’ll become competition for the legacy providers and it’s the casinos and the players that really benefit because there’s more entrants, new ideas and greater implementation than ever before.

Foundation doesn’t store player data, but does the collection of the data require permission and regulatory approvals?

The casino and the App provider can tailor the solution to fulfil all regulatory requirements. The great thing about Foundation is that it provides the data necessary to accomplish that. It also means that Acres doesn’t get involved in that part, which is a benefit to us and the operator. We aren’t stuck providing a one-size-fits-all solution. It can be customised for any jurisdiction.

Why is Foundation open technology?

I don’t think it benefits any operator to think that they’d be the only ones able to utilise Foundation. Think about the App Store for Apple. If you were the only one able to use the App Store there wouldn’t be any Apps. Casinos are going to rely on companies that design Apps dedicated to the open environment.

If we limit the number of operators utilising Foundation, we limit its ability to scale by providers. We don’t view IGT or Konami as our competitors. Our competition is Facebook, Netflix and Google. The gaming industry is competing for discretionary entertainment dollars. We think of Foundation as a rising tide that lifts all boats, instead of something that just lifts our section of the water.

Does Foundation make an operator’s existing Apps redundant?

The operator has complete control. They can repurpose their existing Apps to operate using Foundation, which gives them all this additional data in real-time, making the App more accurate and efficient. They can create something totally new or they can approach a third-party to create a solution designed for multiple environments – it is totally up to the operator.

The great thing is that because we’re not trying to ‘own the relationship,’ Foundation opens up everything up to competition, new ideas and price. Acres can’t make the only bonusing App that works with Foundation and make it insanely expensive, because the operator can create its own solution or hire a third-party to create it for them. Foundation creates competition of ideas and price and that’s beneficial for the casino and the player.

Acres is installing Foundation on 25,000 machines in 2021 and 115,000 machines in 2022. How simple is the roll-out and installation of Foundation?

It’s incredibly easy to install. We designed Foundation in such a way that slot technicians can conduct the installation themselves. Foundation installs in around two minutes per game and the DMI installs into the bridge and that’s it. There’s no wiring that goes under the floor – there’s no prolonged down-time of the machines. It’s a couple of minutes per game and everything’s good to go.

There are 900,000 machines in the US and everybody wants to make the switch to cashless, so I think in the next three years or sooner we’ll see 80+ per cent of the machines in the US cashless compatible. Going cashless requires every type of machine to undergo a hardware upgrade of some kind. So if the choice is to buy Foundation or a legacy product – I think the choice is pretty clear – and we’re less expensive than those products too.

Foundation is more capable, easier to install and less expensive… it gives operators complement autonomy of their data – it is just a superior product, which is why we expect to achieve such great business with Foundation.

Of those 900,000 machines in the US market – how many are compatible with Foundation?

We are compatible with any machine that’s SAS 5 or greater, which is anything within the last 15 years. Many of the pre-SAS games, such as the older stepper products, can also be brought online on a case-by-case basis. So we’re compatible with around 98 per cent of the machines on casino floors.

What are some of the operational efficiencies of Foundation?

Operators want to go cashless and they want to go mobile. The problem is that up to this point, legacy system providers offering this solution have only contemplated their own products. If the casino wants to facilitate cashless, plus bonusing and casino credit from all the different providers, they end up with multiples of different Apps, which means that the player must use a unique App for every experience. We want to consolidate all this into the Acres Wallet.

Acres Wallet contemplates all the different funding options available to a player. We have cash, free-play, we have points and casino credit. This means that when we send free-play credits to a game, Foundation ensures that players can’t cash-out those credits, they can only withdraw them to the free-play category of the mobile Wallet.

And so when we initiate bonusing we can make the bonus pay either to the game’s credit meter or to any value category of that Wallet. That’s really powerful because we can now pay players in any currency and all the offers and redemptions go straight to the Wallet. The added bonus is this also eliminates the need to queue at the player’s club or kiosk, as everything becomes automated.

Where is Foundation currently licensed?

Due to the fact that we extract raw data from the game and change the credit meter, we have to submit to the highest level of regulation in each jurisdiction. Penn National has one of the largest state-by-state footprints in the US, operating 41 casinos in 19 states.

We are either licensed or in the process of being licensed in all those jurisdictions. We are already live with Penn in both Pennsylvania and Ohio and have certified Foundation with GLI. We have already submitted to the highest level of regulation and don’t foresee any problems in any other states. The only limiting factor is the time it takes to process our applications.

Is Foundation omni-channel?

Omni-channel is where everything works via one interface, which is exactly what Foundation delivers. If you look at Penn National’s implementation; walk into any casino in their portfolio, approach any slot, terminal or table, you’ll connect to those games via one App.

Penn also wanted the ability to allow players to make a sports bet over their phone, play igaming where legal and receive marketing messages via the same App. We are the perfect solution to achieve that. We are an open interface. Operators can attach our data to anything that they want.

Legacy providers want to control everything. Yes, you can have omni-channel as long as all the channels come from the same provider. Foundation allows the operator to talk to every provider in the same app, without seeking to collect a fee from those parties. We’re not seeking to control the channels, instead we provide the tools casinos need, to go do it themselves.

Can Foundation be used as a tool in safeguarding players from the harms of problem gambling?

Yes, and it again comes back to the data. Allowing operators to collect data to know their players better. Models can be built to react in real-time to trigger events tailored to the players. We can initiate an intervention, be that an alert or a human response level to advise and prompt appropriately. Using analytics to help players in real-time means we can become a lot more successful at protecting consumers.

Online operators have always had the advantage of data gathering in real-time. Does this level the field for land-based?

If you’re a land-based operator, then Candy Crush is a competitor. Angry Birds is your competitor. These games are not just collecting all the player’s in-game data, they are consuming other metrics too. Land-based operators are simply not doing this right now. Foundation gives them that ability.

How integral is the deployment of cashless as part of Foundation? How do the synergies play together and is one less effective without the other?

Foundation is undoubtedly effective without cashless, but they go hand-in-hand. When we started creating Foundation before Covid, we knew that cashless was a functionality that casinos wanted, but we weren’t really contemplating the roll-out of cashless to be so fast. The regulatory environment was also a major hurdle and regulators were not especially interested in cashless at that time. Covid changed everything and the push is now coming from the regulator for casinos to move to cashless, which is a boon for us as it has accelerated the timeline of operators seeking to implement Foundation.

Beyond cashless, I think that operators understand the importance of data. They know that they want cashless in the immediate future, but in the long-term they want the data. They want to know everything about their players. Netflix and Facebook know it’s all about the data. Combining the two – cashless and data – is the holy grail.

Monitoring players in real-time, knowing everything about them, means that operators can intervene in their gaming experience with the right reward, incentive, cooling off period – whatever is most appropriate to that individual.

Could slot games evolve with Foundation – not to just reward with bonuses and inventive, but influence the creation of games that adapt to play style, configuration and even themes?

Yes. Foundation will usher in a new generation of games that will adapt to the player in real- time. Acres is working on this next generation of games. I don’t think anyone else is contemplating this right now, but as Foundation grows its casino footprint, I think more and more developers will evolve their games to become adaptive. In the near-term, I think there will be a lot of external ancillary content that’s designed to be played on the phone while players are playing the base game, with the base gaming adapting to their player profile.

John Acres is the inventor of slot progressives and player loyalty systems. How does Foundation compare to these inventions?

We are 20-30 years on from those technologies, but I believe Foundation will have the same impact for a new generation. When my father moved to Las Vegas in 1972 and first started work in casinos, he said that one of the promotions running in the casino was for a free long-distance phone call for playing the slots.

Back then you had three channels on the TV, there was no satellite or cable television, and so the standards of what it took to entertain the public were different back then. The progressive jackpot was really exciting for that generation, but for my generation and for my kids’ generation, we demand more. Foundation delivers the type of applications to fulfil those needs.

John recently said that the casino industry has been at a technological standstill since 2003. Is this though a lack of innovation, the fault of heavy-handed regulation or conservatism on the part of operators?

I think it’s a perfect storm. As I mentioned earlier, all this has happened in the context of casino growth, which the industry considers a success – but we don’t see it that way. Net slot win peaked in 2007 when the recession happened and casinos have never gained back those dollars. The dialogue has been the same ever since. It’s about ageing player bases and the lack of new players, but instead of blaming these factors we need to look hard at why this has happened.

It wasn’t just the recession that happened in 2007/8, there was also the product launch of the iPhone. The smartphone ushered in a new era of online games that stole a generation of players for the land-based casino industry. We lost a generation of play due to our slow application of technology, while at the same time we’ve continued to build and expand the footprint of casinos.

The casino sector has been a growth sector, but not at the pace of Amazon, Facebook and Google. And the common factor is that this growth is fuelled by data. Casinos have not been collecting the data and changing the experience of the players by adapting to their play.

I don’t think there’s anyone to blame specifically. I just don’t think it’s been the problem that people have been focused upon. And it’s not a problem that many have the capability to address. The system vendors have been selling their product this whole time and so why disrupt a profitable revenue stream? Meanwhile the regulators have blocked out new entrants making it difficult to penetrate the industry.

I’ve been told that the gambling industry in the US is the second highest regulated industry in the country. The top three include aviation, gaming and nuclear industries. I’m not sure if we’re above nuclear or aviation, but that’s pretty significant!

Can Foundation reverse the downward trend in land-based slots play?

Yes. If you consider RTP – which varies from state to state – in Nevada you must return at least 75 per cent to the player. We could theoretically take the percentage all the way back to 75 per cent with Foundation. We make the games tighter at the base game level, but we get to the 90-95 per cent level through personalised bonuses. This isn’t random selection based on luck, the bonus is adapting to you and your playing style and I think this will change everything for slots.

How emergent is Foundation in terms of evolving the casino-going experience?

We have created a platform in which we get to implement all of our ideas, and at the same time we’re the facilitator for others to bring fresh ideas into the mix. We don’t have a monopoly on good ideas – but if we expose the platform to everybody that wants to create and innovate, there is going to be a lot of great outcomes for operators and players.

What do you envisage are the future outcomes – bearing in mind that the usage of data by Amazon, Google and Netflix changed the everything about the delivery of goods, services and entertainment?

Right now we’re seeing multi-national media companies looking to enter the gaming space, especially on the sports betting side in the US. Companies want end-to-end relationships with players and data changes everything. Where operators have used systems to host slots and table games to fulfil the processes and procedures incumbent upon them, now they can take player data and combine it with any other service.

Gaming has also become so much more mainstream in the last couple of years. Sports betting is now legal in all these new states and we can combine with media companies, break out into new areas and and Foundation can become a major facilitator for that.

How does the quality and quantity of the data scraped by Facebook and Google compare with Foundation’s data pull?

If you look at the limited amount of SAS data the legacy systems collect on the player, everything is tied to the player ID. Outside of that, the casinos have very limited scope to link that data to a player’s outside life. They only know their player by their player ID.

However, if we migrate that player to cashless via the App, we can gamify surveys and contact forms to gather more data and interface with Google or Facebook to gather external data. Casinos are shifting from gathering a very limited amount of data about their players that’s limited solely to their gaming activity at the casino, to being able to subscribe to all the same services that you get through Amazon, Facebook, Netflix, Spotify etc.

How holistic a picture can Foundation deliver of a player’s journey within and outside their location?

Foundation allows the operator to gather data at a granular level and combine everything into an omni-channel solution. We’re not providing the channels, it’s for the operators to decide which channels they want. They can interface with whoever they want to provide the best experience and to gather the best data.

Foundation provides the potential to gather all the data from every player activity. For example, we utilise Bluetooth to identify the player’s phone when we credit the slot machine. The identification of the serial number on the mobile phone means that we can locate extra Bluetooth sensors around the property to recognise the most popular bar or restaurants of specific types of players. Foundation allows operators to use advanced tools to tailor their offerings to their players – even if they’re uncarded.

If 10 per cent of the casinos in the US install Foundation next year, what’s the potential for the solution ultimately in North America and globally?

We expect to secure a large footprint because we provide so much value and capability for the operator. It is such a light-weight solution that delivers so much. We are expecting to become the dominant systems provider in short-order. The time-frame is three-years to grow that 10 per cent to a commanding share of the industry.

I think that for operators that want to control their data and implement omni-channel in a way that is customisable to their operations, we are the only solution. Everybody wants the App that connects the sportsbook to the iGaming offer, to the slots, restaurants and accommodation. Foundation is the only way to get everything they want.