With the 19th annual East Coast Gaming Congress & iGaming Institute conference, the industry’s second largest, having just wrapped up in Atlantic City, New Jersey, and the subject of legalized internet gambling across Delaware, New Jersey and Nevada having been a hot topic of discussion, the mobile compliance gaming advantages of Consorteum Holdings’ (OTC: CSRH) Universal Mobile Interface (UMI) platform have come back into focus. With New Jersey and Delaware now in their second year of regulated iGaming and proponents in Delaware fighting hard to get sports betting pushed through, even as states like Pennsylvania and New York are both moving legislatively to embrace iGaming and sports betting, Morgan Stanley’s report from September of 2014 projecting that the U.S. market for online gambling could hit $5.2 billion by 2020 is looking more and more to be right on the money.
Consorteum’s wholly-owned ThreeFiftyNine, Inc. (359) subsidiary, which is known for their KenoUSA Android app on Google Play, developed in agreement with keno gaming service
provider and keno product manufacturer XpertX, has a wealth of experience leveraging their thin client application UMI architecture for executing mobile solutions in this area. In fact, 359’s software team was responsible for the first ever regulatory-compliant mobile platform for delivering third party gaming content to have been successfully vetted by the extremely rigorous Nevada Gaming Board. The UMI is a powerhouse platform architecture for this space too, as thin client cloud-enabled apps provide numerous performance benefits over native apps, offloading much of the heavy lifting to remote servers and freeing up resources on the end user’s device. Ultimately, this allows for a much more vibrant and rich interactive game to be created, as the end user’s device has less of a computational and display burden to shoulder.
Moreover, the company’s UMI solution, in addition to having the client server handle lottery and/or game content, allows the content to be displayed correctly and in the proper resolution, irrespective of the user’s device. This same capability is what makes the UMI great for a variety of other roles in the mobile space, whether its bringing a company and their brand presence to the maximum number of users via rich apps, or executing complex solutions for banking, ecommerce, healthcare, and even government markets. The ability to land presence on over 1.5k devices or more, with consistent display performance and design realization intact, and all without the need to write additional code or patch the end user’s client, is an advantage that makes CSRH’s UMI an easy pick for developers when it comes to mobile compliance gaming – but the robust and proven geo-location, geo-fencing and security features are what really sets the platform apart in this space.
Mobile compliance gaming is a market with lots of room to grow too. In New Jersey revenues from online gaming already run in the neighborhood of around $120 million, ten times more than in Nevada, where brick and mortar gambling is still king. But we all know what operations like Netflix and Amazon Prime have done to the brick and mortar video rental space, and while the obvious secondary appeal factors for casinos won’t be disappearing anytime soon the way Blockbuster stores have. The attractiveness of tax revenues for state legislators, combined with the ability to gamble for real money from increasingly ubiquitous smartphone and tablet users, will likely drive the industry forward rapidly in coming years, despite a few crusty old holdout politicians, mired in antiquated ideas and praxis left over from before the advent of smartphone and tablet computing. Take a moment to really think about how Apple’s iTunes and downloadable music has forever changed the music industry, how OTAs (online travel agencies) have changed the nature of travel, or how online brokerages like TD Ameritrade have revolutionized trading, and you can start to really get a handle on what the future of regulated online gambling might look like.
With Nevada and Delaware already engaged in an online poker liquidity-sharing compact, the writing is on the wall for the future of the industry. In California, recent estimates on the potential size of the regulated online poker market range as high as $1.3 billion (Capitol Matrix). With the average of estimates from a wide variety of sources coming in closer to the $215 million mark for the first year, and around $310 million a year thereafter, the decision over whether or not to allow regulated online gambling an easy one for state legislatures to make, especially considering the tax revenues that could be collected, as well as jobs that could be created. What’s not so easy is resolving issues like app-specific geo-fencing requirements, needed to ensure that users are gaming from within a regulated location.
Luckily this is an area where CSRH’s technology has the upper hand, having already been fully vetted by the gold standard of industry regulators, the Nevada Gaming Commission and State Gaming Control Board, as validated via Stations Casino’s Sportsbook app implementation. The company’s technology uses the native geo-location functionality of the end user’s requisitely un-jailbroken mobile device to circumvent spoofing, making it a comfortable choice for developers who want to push rich content to users, and not worry about violating regulatory compliance.
Morgan Stanley sees the possibility of exponential growth in this industry over the next several years and, as was the case during the gold rush era, its companies like CSRH, focused on selling the equivalent of picks and shovels, who will see some of the most substantial long-term upside. Giving third party developers and casinos a platform they can use to easily implement and maintain a compliant gaming solution for their customers, is a great way to win big as the trend towards regulated internet gambling evolves further. And because CSRH’s thin client approach opens up the broadest possible end user device spectrum to developers, the process of natural technology selection substantially favors UMI-based deployments.
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