In the gaming world, cash delivery is king. Perhaps also the queen, emperor and ruler.
Winners in this multibillion-dollar, breathtakingly fast business are those who can produce funding mechanisms faster than players can snap their fingers for money. Suppliers provide upgraded kiosks, ATMs and mobile apps, which in turn enable credit cards, checks and bank cards to spill money or vouchers into the player’s hand. Or onto a game.
Table devices have even emerged to let players change games, cashless, without missing a beat. Any supplier able to reduce player down time and spike casino revenue earns a seat at the table of riches.
Companies angling for this market must think outside the box. Sightline, built by former Global Cash Access executives, unveiled a card backed by a bank, a credit-card company, a gaming giant and a processing kingpin. It is used in conjunction with casino loyalty cards.
Global Cash Access, the industry leader, partnered with a social-media stalwart to position itself for online gaming, and will utilize software. This creates a new area for GCA, which already specializes in land-based properties.
While the Las Vegas companies enhance their niche, Toronto-based NRT champions kiosks. Its cashless theme spans several areas: the machines it uses with Sightline, the imminent off-site breakthrough in Las Vegas sports betting and a new currency-conversion mechanism which debuted in Connecticut in March.
All of the companies played to their strengths. Sightline and NRT found a link in the gaming chain and attached their innovation to it. Global Cash Access, more financially armed, hooked up with a finished product to become an immediate online major player.
All three companies invested millions, on spec, and hoped they were right.
For them, so far so good.
Las Vegas-based Sightline provides turn-key and licensed payment solutions to various players in the gaming world.
The company is aptly named, for it was a vision that drove five entrepreneurs to launch a bold gamble in 2010. Former GCA executives Kirk Sanford, Tom Sears, Harry Hagerty, Diran Kludjian and Omer Sattar teamed up at Sightline and found a new idea.
For the last two and a half years, they have invested millions to bring a product into gambling’s extended sphere.
Success looks to be in the cards. Or, make that, the card.
Online gaming’s new floodgates create a colossal opportunity for their Loyalty Card Plus Discover Prepaid Card. The product is the same as a casino’s loyalty card, and gives players the chance to access their prepaid account through the closed-loop proprietary Sightline network, SPAN. That network allows them to transfer funds in real time to and from a slot system, table games, race and sports book or online casino.
Sattar estimates there are 37 million casino reward cards available for conversion into a prepaid card. In the past year, his company assembled several essential teammates to go after them. Sightline obtained the backing of Sutton Bank, which issues the cards; Discover, the card network; Vantiv, which processes billions of transactions; and slot manufacturer Bally Technologies, for the brick-and-mortar and online gaming platform. For good measure, Sightline added NRT’s worldwide kiosk clout.
“We put our own butts on the line, so it is very exciting to see this happening now,” says Sattar, one of leaders behind the company’s card effort. “When you consider that New Jersey, Delaware and Nevada allow online gaming, what about the next step? We are watching California closely. That’s 40 million-50 million people. We are moving the gaming industry forward, and much of the success has finally happened in the past few months.
“We’re in a small business here, and your reputation is your gold. We didn’t want to be known as someone who sells vapor-ware (a product that exists more in concept than reality). We were able to gain some major companies willing to make a big bet on us, and we consider that thrilling.”
How does it work? Customers can pre-fund the accounts online, through their mobile phone or load funds at the casino with cash, jackpot payouts and other ways, including TITO tickets. The funds act as a bank account, with FDIC protection. Players are, in effect, drawing from their own loyalty card when they tap funds either to play or spend money elsewhere.
Because of the card’s link to Discover, they can also increase their spending flexibility.
“You can be sitting at home, using a mobile app now legal in Nevada,” Sattar says. “You have the money on deposit with a casino, and let’s say you placed a bet for $100 and you have won $500. Using the mobile app, you can cash out in real time, or deposit the money into the online gaming account.
“Now, you want to take your wife out to dinner. You can do it with the funds on your pre-paid card. Or you can buy something on Amazon.com or go to Home Depot. The most important thing is that you have access to your money at all times. You also can go to any ATM in the country to cash out.
“The advantage for the customer is that the casino is not holding their money all the time.”
That’s an edge for the casino, too. Sattar says a casino that needs to have $300 million-$500 million available in its machines now has the advantage of putting that money directly to work. If fewer funds are needed to be part of the games, the property can take a percentage of it to pay down debt. That would in turn increase a company’s earnings per share by 10-15 percent, he estimates.
“Everybody wins,” he says. “If you don’t do something that’s good for the customer, the customer won’t be part of it. If you can’t do something the casino can profit by, they won’t sell it for you.”
Casinos profit beyond the art of “untrapping” millions of dollars. Unlike many technological advancements, this one costs nothing.
“All you have to do is say yes,” Sattar asserts. “There is no hardware, absolutely nothing for you to buy.”
Sightline’s partnerships are prominent. Vantiv is a leading integrated payment processor differentiated by a single, proprietary technology platform. It offers a suite of traditional and innovative payment processing and technology solutions to merchants and financial institutions in the U.S., enabling them to address their payment processing needs through a single provider.
The correlation between Sightline and kiosk kingpin NRT was logical, according to Michael Dominelli, the vice president of marketing and product development specialist for the Toronto-based company.
“We have the largest kiosk footprint out there,” he says. “They came to us to do their integration, and it makes perfect sense. We have 100 percent market share in Macau, 100 percent share in Singapore, 95 percent in Canada, etc.
“If you have a slot voucher, you can either take the cash or load the card.”
Dominelli says the partnership addresses both client maintenance and a look to the future.
“We always like to keep options open,” he says. “If a customer likes this card, we don’t want to be the guy that says you can’t integrate. We don’t wish to restrict them. Going forward, this all goes toward cashless gaming. People ask when cash is going away in the casinos, and I think it’s going to be in about 10 years. It’s a generation thing, nothing to do with technology.
“You have guys who have grown up with cash, and they will always want cash. That person still likes to put $500 down on the table to get started. Young guys like me, who grew up more in a digital age, are comfortable with having our money on a phone, a mobile app or a card.
“We need to prepare for the day when cash does go away. We have to be ahead of the curve. When the customers are ready, you need to have already been ready.”
NRT, founded by Dominelli’s father John 20 years ago, has assertively expanded its tentacles. Infiltrating the colossal Macau market with its kiosk solutions in 2012 was a huge forward step. It followed by launching a revolutionary operation in Nevada, by which customers can remotely call in to apply for an account through a dealer, and then use funds to bet sporting events off site. That process is moving toward the experiment stage, but has the blessing of Nevada officials, Dominelli says.
NRT is allowed to install up to 35 kiosks at malls, gas stations and just about any place in which customers live or shop, he says. The combination of a live video feed and a kiosk enables a customer to speak with a live attendant to establish an account. NRT, which invested about $1 million in this technology on spec—hoping for state approval—may have up to 300 of these by the end of the year. A customer can purchase gas and a sports wager at the same time, without driving to the casino. For locals and anyone who wishes to avoid traffic on the Strip, this is a convenience breakthrough. The addition of online gaming may bring the kiosk element into play in many other states.
NRT’s next big gambit is currency conversion. Or, more formally, Dynamic Currency Conversion. Unveiled at Connecticut’s Mohegan Sun in March, it allows international players to determine whether kiosk transaction fees occur real-time, at a predetermined rate, or several days later, at an undetermined, but usually higher rate.
Customers win, Dominelli says, because NRT deals directly with a Canadian bank to establish a pre-set conversion cost, which is lower than one normally pays. There is no fluctuation based on market conditions between the world currencies on a given day.
“You know exactly what you are paying for up front,” Dominelli says. “It’s not like you make the transaction in the United States, go back to your home country and find out you paid maybe 10 percent of your money to do that.”
NRT wins, he indicates, because it shares in the revenue generated by the transaction. So, presumably, would the casino operator.
“One executive called it money coming down from the sky,” Dominelli laughs.
This process gives NRT five payment systems: ATM, cash advance, point-of-sale debit, check cashing and currency conversion.
GCA: What’s in Your Wallet?
Industry giant Global Cash Access Holdings moved into the social media and online gaming realm by announcing a partnership with Live Gamer late in 2012. The move is designed to give operators of legalized online wager-based casino games a licensed end-to-end payment, patron e-wallet and management solution.
The deal combines GCA’s casino cash management products with Live Gamer’s impact in the social industry. Live Gamer has deals with Facebook, Electronic Arts and Sony Online Entertainment, and enables customers to spend money on social and entertainment websites.
The setup, expected to roll out this year, enables GCA clients to easily transition gaming activities from off-line to online and back, creating a seamless experience. This integrated solution will allow operators to both service and expand their player base.
GCA made a follow-up move by introducing the Digital Wallet among its new products at ICE in February. The Digital Wallet solution will manage multiple currencies.
While many analysts view online gaming as its own realm, GCA can either treat it as such or leverage its land-based prominence to help operators cater to customers.
GCA already has a rich land-based network to pitch its products to. It dispensed over $19 billion in 2011, stemming from over $35,000 in transactions every minute and $52 million per day. It is licensed in over 350 jurisdictions, serves 1,100 casinos globally in more than 35 countries and has over 8,000 patron touch points around the world. GCA services exist in more than 700 casinos in the United States alone.
The company is a global provider of cash access and data intelligence services and solutions to the gaming industry.
“Half the cash on the casino floor in the U.S. comes out of our devices,” says Tim Richards, the general manager and senior vice president of interactive solutions for the Las Vegas-based industry giant. “Our biggest sell is to the casino property, enabling them to own, control and brand the experience for their players, especially as it ties in to their marketing and club efforts. We bring all their different systems together, helping them control their payments, branding and currency. Rather than having a particular pay system for poker, or sports betting, etc., casinos can have something that is as seamless as possible over different systems, whatever they choose.”
Online players, or shoppers, can become quickly comfortable with the Digital Wallet. Two major screens help players keep track of their bankroll.
“One is what we call the portfolio view,” Richards says. “The patron would use this screen to view and access the wallets from different operators. They can easily see their balances for the wallet and the individual currencies and loyalty points available. Customers would use this as a tool to add to or remove funds from the wallet, and also transfer the funds to the associated site’s wagering account or game they would like to play.
“The second is the payment wall. The screen would prompt when a customer wants to make a payment while visiting or playing on a site. The unique piece is that GCA can offer multiple forms of payment, which includes local and alternative methods that are outside the normal credit card networks. This is demonstrated by tabs across the top of the screen. This is important due to the constraints the banks have put on processing i-gaming transactions. By offering these various methods, it will ultimately make the user experience much greater and drive more funds to the sites.”