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Navigating regulatory and market obstacles

By - 7 November 2019

G3 speaks to Ruben Loeches, Chief Marketing Officer at R. Franco Digital about the legacy of the business over 50 years of gaming and the future direction the company is taking in the online gaming sector

R. Franco has been prominent in the gaming industry for over 50 years. How have you been able to continually adapt to regulatory changes over such a sustained period?
Our success as Spain’s leading gaming company for more than half a century is down to our pro-active approach. We pride ourselves in staying ahead of the curve and work very closely with regulators in whatever market we are active in, none more so than with the Spanish regulatory body, the DGOJ.

We aim to continue this legacy with R. Franco Digital (our iGaming arm), which began its journey in 2015 and was consolidated in 2017 as the Digital Division of the R. Franco Group. In principle, we set out to tackle the latest challenges faced by global gaming operators by offering the latest in digital solutions. With our sights set on global coverage, we have developed services so that they can be used in any geographic and legislative context, as well as being personalised to the needs of each operator.

Markets are maturing. What are the big regulatory changes you see coming in 2020?
The greatest changes we see in the regulatory markets we operate in no doubt includes the LatAm region; and we anticipate seeing plenty more countries coming online. Colombia has proven a shining example. Since pledging to block illegal gambling websites in November 2015, Colombian regulator Coljuegos got the ball rolling by introducing robust regulatory framework and issued the country’s first sports betting licences. Several other licences have been issued since, as the market continues to develop.

As LatAm’s first market to introduce a European-style licensing framework, it is a logical entry point for the majority of operators – which ranks it high in terms of importance. But there are also other opportunities on the horizon; Brazil remains the biggest potential prize, and lawmakers continue to discuss the possibility of regulating the sector. This process will not happen overnight, but nonetheless, operators will already be laying the groundwork for market entries. Elsewhere in the region, other jurisdictions are emerging as viable online propositions, particularly the ‘grey’ markets of Mexico and Peru.

With stricter regulations on advertising and a growing trend for increasing restrictions on operators, are there any opportunity markets out there?
The world loves to bet, as well as experiencing the thrill that comes with it, so in my view there will always be opportunity markets. The Hispanic markets will always represent fantastic growth opportunities for us, given the culture lives and breathes the thrill of betting action like no other.

Of course, when it comes to opportunity, these regulatory tailwinds will certainly necessitate operators and suppliers to rethink their strategies. For us, we would suggest a measured approach, think much more where you invest your money, be much more strict with the monitoring of your metrics and in the analysis of your traffic sources, and above all, give much more value of the leads that you can get or have achieved in the different phases of a client’s life (acquisition, conversion, retention and reactivation).

No doubt regulatory obstacles will stifle growth, but with every challenge comes opportunity, and as long as resources are shifted to place more emphasis on acquisition – then risks can be easily mitigated and growth markets that suit your operations can easily be found.

Platform suppliers need to ensure operator partners are fully compliant across multiple European regulatory environments. How do you think this can be achieved from a regulatory perspective?
When it comes to Europe’s patchwork regulatory environment, it goes without saying that we’re a million miles away from the wild west of the early 2000s. Within both this developed and developing environment, the challenge for today’s operators is to identify the markets that are still profitable while finding ways to negotiate the complex web of rules and specifications required of them.

As suppliers, it’s our job to support operators in that endeavor, and our role is often underestimated. While our IRIS Platform is the driving force behind our multi-channel solution, our IRIS Vault for compliance, which is an independent layer compatible with any gambling provider or platform is key to all of our partner’s needs.

In its essence, it works as a black box that captures and registers transactions of all gambling operations. The Vault is hosted in a unique virtual machine to ensure no transfer of data and includes a data capture tool, a data warehouse for all gambling transactions and full traceability of data for a sustained period. This gives us a huge advantage compared to legacy platforms when it comes to integrating in newly regulating markets, particularly across Europe’s patchwork of regulations, as we’re able to provide for all of our partner’s regulatory needs as a bolt-on to our existing platform.

The Malta Gaming Authority continues to attract operators and suppliers. Is there anything other jurisdictions can learn from their approach?
Sensible legislation which protects consumers while allowing opportunities for growth has worked wonders for the MGA, and we hope to see other regions follow the example set by it.  The Maltese Gaming Act in 2018 was a particularly good example, replacing the previous patchwork system of regulation and licensing (that Europe is infamous for), with a single regulatory framework – and other regulators would do well to learn from this. The future of gaming is omni-channel, and enacting future-proofed regulation to cover the convergence of the licensing and regulatory framework for land-based and online gaming is a shining example of pro-active thinking.

With 2,500 affiliates and 400 sponsors and exhibitors, SiGMA promises to be the definitive iGaming showcase of 2019. Could you tell us about the products you will be showcasing?
We’ll be showcasing our iGaming catalogue at SiGMA and have been working hard this year on 10 of our latest titles – all of which we’re ready to unveil at the show! Licensed in Spain, Portugal, Colombia and Malta, is optimised for HTML5, as well as capitalising on varied infrastructure of global markets, which is especially important, none more so than when it comes to mobile. Our legacy in land-based gaming is also an excellent asset, as we have the know-how to bring the best of the original casino gaming experience into the digital world.

Alongside, our Kolyseo game server will be taking centre stage, which is a remote microservices-based games server scalable to an unlimited capacity. Able to host any type of game, it works with generic APIs that allow easy integrations with any player platform and gaming back office.

In line with our vision for an omni-channel future, it provides for all operations – no matter where. From land-based casinos to server-based terminal systems and online gaming sites, we’ve got it covered. In addition to its scalability, its architecture guarantees server and transaction security across our operator partners entire system.

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