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Second Act

IGT applies its R&D prowess to spread its game content across new and varied channels

Second Act

If one thing has defined slot-maker International Game Technology over the years, it is this: From day one, IGT has stayed ahead of the technological curve.

This point was true from the start, when the company was formed around a radical product no one thought would take off—video poker. But just as Si Redd ran with the video poker idea when his former bosses at Bally in the late 1970s thought it would go nowhere, IGT has jumped into the water with new idea after new idea, breaking ground over the years with innovations ranging from themed slots to ticket-in/ticket-out to server-based gaming.

These days, the company is consumed with redefining slot-machine gaming once again, and as always, IGT is using its R&D prowess and game experience to stay one step ahead of slot technology. This time, though, the technological charge is being led by the company’s new generation of executives—mostly veterans of the information-technology and telecommunications industries, who are using the expertise gained in those tech-savvy businesses to bring slot-machine gaming fully into the digital age.

This effort has not been without controversy, particularly in the investment community. Some analysts have questioned IGT’s latest acquisitions, most notably the purchase earlier this year of Double Down Interactive, the social media company that runs a popular free-play slot game on the ubiquitous Facebook network. While a few analysts questioned the $500 million purchase price—others have given opposite reports, praising the acquisition—some of IGT’s customers complained that Double Down’s slot games could compete with their own online casinos set to go live this year in Nevada, should Facebook decide to entertain wagers after expected legalization of online gaming.

Chris Satchell, who as chief technology officer is heading IGT’s moves into such uncharted waters, insists the company has no intention of changing the business-to-business relationship it has forged with operators over the past 30 years. The idea behind the Double Down acquisition, he says, is to spread IGT game content to the vast audience of Facebook customers, creating new players for its games—and new business for its B2B customers.

According to Satchell, it’s all part of an effort to spread IGT content to all possible channels of distribution, from bricks-and-mortar casinos to legal internet casinos to social media, with versions of IGT games designed for social media, for mobile devices, and for internet casinos.

“At our heart, we build great casino content, and great casino entertainment,” Satchell says. “And for us, the question is, ‘How do we get it to everybody who wants to play that type of content?’ Whether it’s people playing in casinos, in lottery jurisdictions, at racetracks, on riverboats, or wherever it’s legal, people playing online, on mobile devices or on web browsers.”

Satchell says IGT is concentrating on spreading for-wager games across all legal channels, including the jurisdictions outside the U.S. where i-gaming is already well-established, but the social media audience is being viewed as untapped potential for the industry. “There’s this whole other massive group of people who love playing all sorts of games, and they play via social networks,” he says. “I’m going to guess that those people like our style of content as well, so it becomes another distribution channel for us. Now, we can distribute for online cash-based wagering to casinos, to lotteries, to social gaming. It’s really about taking what we have and moving in all those channels.”

Satchell says his response to customer concerns of competition is that IGT’s effort will create new bricks-and-mortar casino customers. “What we know from running both is that the cash-based wagering world looks very different than the social gaming world,” he explains. “And our cash-based wagering is all B2B. We work through operators to do that, (including) our online cash-based wagering.

“The social gaming looks a little different. You still have to go effectively by an operator, who happens to be Facebook at the moment, and they take their cut, just like our MegaJackpots business.”

Last month, IGT’s Double Down strategy became more clear as one of its marquee casino titles, American Idol, was released in a social-slots version for Facebook’s DoubleDown Casino. The social-game version of American Idol features the final 24 contestants from the popular reality show’s current season. It uses a simulcast strategy—the game changes weekly as contestants are eliminated from the American Idol TV show; the game is actually timed with the airing of each episode.

“American Idol Social Slots players will enjoy a dynamic entertainment experience, four unique bonus games and an ability to customize the slot reels to feature images of their favorite Idol contestants,” said Double Down Interactive Vice President Greg Enell in a press release when the game was introduced May 3. IGT CEO Patti Hart added that the game represents a milestone for IGT, “as we bring one of the most popular television shows, featuring this season’s contestants, to the millions of DoubleDown players and fans on Facebook.”

American Idol represents IGT’s first example of maintaining familiarity with a casino title through a social gaming site—and the first example of how social gaming is distinctly different from the for-wager versions of IGT games. Satchell notes that the virtual-currency wagering Double Down accepts on Facebook is “a different style of game play… But the good side is, we’re introducing slot content to a whole new set of people that may have never played it before.”

On Facebook, he says, that’s upwards of 1.3 million daily active users. “That’s a huge flow of people, who are seeing our games every day. That’s going to be great when they go to a casino, and maybe now they won’t go past the slot content. They will say, ‘I know that game; I want to play it in a casino for real money.'”

King of Content

When it comes to all those IGT games, there has been no slowdown in R&D, or the parade of innovations in all game categories.

“We’re still just as committed to our traditional core business as we ever were,” Satchell says. “We spend over $200 million a year in R&D, which is way more than anybody else in the industry. We take creative risks, which can be seen in the games. If you’re willing to do those things, and you keep raising the quality bar—which the performance of our games suggests we are—that’s how you stay ahead.”

IGT, of course, has “stayed ahead” for more than two decades, remaining atop the industry in market share since the early 1990s. While that share is not what it once was, the response of IGT to strong competition always began with R&D. In fact, the company still renews its top historic games, applying today’s technology to classics ranging from “Double Diamond” and “Red, White & Blue” to new versions of original late-’90s video favorites such as “Wolf Run,” the subject of a photo-enriched reprise this year.

Along with slot classics like these and continuous enhancements to video poker—a segment in which the company’s market dominance has never been challenged—IGT has gone interactive in its game design, producing slots that bring a new kind of experience to the casino. Some, like “American Idol,” “The Dark Knight” and others in the movie-style Center Stage series, bring players together in competitive or collaborative bonus rounds that engulf players in the theme of the game.

Others represent a move toward arcade-style entertainment—none more than “Big Buck Hunter Pro,” which replicates the experience of the popular Big Buck Hunter arcade game in a bonus round that actually has players aiming plastic rifles at the game screen.

“Big Buck Hunter is a great example of an apparent skill-based bonus,” says Satchell, “which allows you to do something fun in the bonus round you haven’t gotten to do before.” A large video screen spanning two slot games displays one of several woodland scenes—or even scenes with targets and cans on fence posts for the PETA-friendly—and allows the player to pick up the light gun and fire at animated animals as they run across the screen, in a very well-orchestrated application of perceived skill.

“That’s just bringing a direct kind of arcade-style experience to the slot floor,” Satchell says, adding that a number of other IGT games, in a series called Reel Edge, employ actual skill. “Some of the games, like ‘Centipede,’ are based on classic arcade games. Others are arcade games we’ve made up. For a certain segment of the audience, it’s a really interesting way to do a bonus.”

That’s not to say IGT is abandoning the tried-and-true bonuses like picking games, free spins and, of course, the wheel. “There are still a lot of people who like pick bonuses and free spins, and there always will be,” Satchell says, “but generally, we’re getting more people who play slots who also like to experience some interactivity. And they’re used to playing on multiple devices now. In a game like “Godzilla,” it’s not that we put particular hardware on the machine, but we’re using the touch display a lot to bring more interactivity into the bonus rounds, along with more choice and selection.

“The good thing is, we have a little company out there called Apple, teaching the world to do touch. So, everybody’s becoming used to swiping; they’re used to gesturing. That gives us great interactivity styles we can use in bonuses as we move forward.”

Into the Cloud

In addition to improving IGT’s library of casino games, interactive play styles are improving the networked functions appearing over IGT’s server-based systems as they spread to more and more casinos—from the original sbX system, in place on new high-speed casino floors like Aria and, more recently, Revel in Atlantic City, to smaller-scale installations across the U.S. using the Tier One system.

In all cases, the idea is for operators to have access to IGT’s ever-changing library of base games in a dynamic group of machines—allowing the game mix to adapt to the preferences of customers on the floor. IGT has made the advantages of server-based operation available to more customers, thanks to its recent application of the internet cloud.

The IGT Cloud gives casinos instant access to a library of 300 games, which can be mixed and matched according to preference on a given group of machines, without the need for a physical server to store and download the content. All that is needed is a connection. “You do need to have your floor wired for high speed; it’s got to be an Ethernet floor,” Satchell explains. “But you give us the connection and we can give you these services without you purchasing infrastructure. And then we can layer on new advancements as we go, without having to do these lengthy upgrade cycles.”

Satchell says the IGT Cloud allows operators of all sizes to have the agility that comes with a networked operation—not just in terms of downloading content, but in the “deep analytics” made possible with a live network. “The nice thing about sbX and a G2S (game-to-system) network is that you get very good analytics of what’s going on out on the floor,” he says, “per-domination, per-session, per-user information that you can use to create a very rich view of what’s happening. With our client analytics, you get that. You get it in real time; you get it on mobile devices if you want it. That allows the operators to optimize their floor. How do we get the right games to the right user, at the right time?”

He adds that the IGT Cloud simplifies the delivery of this capability. “We’ve looked at how we could use cloud technologies to really enable operators,” he says, “and one of the things we hear from our initial partners is that agility, and being able to differentiate their product to patrons, is more important than cost reduction.

“Sure, you’ll get operational efficiencies and cost reduction, but what they really want is agility—the ability to bring new content to the user very quickly, and bring the right content—and by using deep analytics, to be able to add new customer experiences. As we layer in social customer experiences, we’re able to bring that to operators without the big capital investment.”

The Social Experience

These “social customer experiences” are key to what Satchell sees as the evolution of the slot floor in the digital age. At last year’s Global Gaming Expo, IGT revealed applications like “Team Challenge,” a floor-wide networked bonus that separates players into teams for a game on the touch-screen display. Game play builds points for the team, and all team members of the winning side are rewarded with credits.

Also introduced last year was “Auction Auction,” which allows the operator to “auction” discounts and freebies to fill show seats, offer a spa session, or auction off rooms at low prices during a slow period—all through a game that appears on the screens of any or all of the slots on the floor, allowing players to use their points to bid on the free stuff.

Other social-experience applications that players may soon see on the IGT networked floor include a “Friend Finder” that allows players to find friends on the floor and text them on a pop-up keyboard, and a “meta-game” called “Wonders”—part of IGT’s Intelligent Bonusing Suite—where the object is to build a video model of France’s Eiffel Tower, Rome’s Coliseum or other wonders of the world, through periodic bonus games.

“We’re starting to look at different fun applications and intelligent bonusing, and we’re building a suite of applications internally,” Satchell says. “And I think that the imagination’s the limit. What will really take it to the next level is when we add those social functions to it, because if you know your social graph, that’s when you can do the things like finding your friends on the floor and challenging them to games. We’ll have all these meta-games that go on, so while you’re having your fun casino slot experience, there’s another game going on in the background—a ‘me versus you’ for an hour, to see who can play the most, for instance—which I think brings a whole new layer of entertainment to the casino floor, using the same inventory that casinos already have.”

Satchell predicts that these meta-games will be available on demand at some point. “You’ll touch the Service Window and say, ‘I’d like a tournament right now; invite my 10 friends who are on the floor to a tournament.’ We’re still playing the base game, but now it’s got a tournament. Or, maybe it’s a red-versus-blue team; and who can get the most wins in the next hour gets a bonus. It’s still driving play through the base game. You take the base game—the asset the casino already has—and add another dimension to it to make it even more fun to play.”

It’s another example of IGT’s efforts to expand the slot floor beyond what it is today. Satchell says the company has concentrated for the past year on “merging its technology stacks” to make its games available across all possible channels. “We actually serve mobile games and web-based games from the same servers,” he says, “and what this is going to allow us to do is really double our output of interactive content. It will make it much easier for us to integrate with the operators we work with in Europe.”

Satchell says the company’s efforts to move its content among many channels begins with the R&D efforts on the casino games themselves. “How do we take all the great content we’ve built—we’ve got 30 years of experience building casino content—and get it into all the different end points, all the different distribution channels?” he says.

Conversely, he says, while players will soon be able to access IGT game content everywhere from the internet to mobile devices to social networks, the nature of the core games on casino floors will continue to change.

Asked to envision the casino floor of 10 years from now, Satchell sees a supermarket of different experiences. “I think the casino floor will be configured differently,” he predicts. “I think there will be different zones, depending on what kind of play you want. We’re already seeing this trend start. You’ll have a zone for people that will look much like a lounge or club today. You’ll see other areas tailored to different segments of the customer base, all over the casino. I think you’ll see a variety of device types—a whole number of different form factors, some of which become more social to allow people to play and interact much more closely than they do today.”

The machines themselves will offer everything from holographs to virtual-reality rides. “You’ll see display technologies that really raise the experience, whether it’s a combination of holograms, gesture control, full surround-sound… I also think your personal mobile device will be a key part of the experience, from how you log into the machine to how it recognizes you, to the games it brings up, to your social network—and when you leave, your experience will continue on your mobile device.”

And to cap it all off, Satchell says, there will be traditional three-reel steppers—maybe in a “retro” area—because at least in the U.S., the traditional slot machine is not showing any signs of fading in popularity.

And by the way, IGT makes those, too.

Frank Legato is editor of Global Gaming Business magazine. He has been writing on gaming topics since 1984, when he launched and served as editor of Casino Gaming magazine. Legato, a nationally recognized expert on slot machines, has served as editor and reporter for a variety of gaming publications, including Public Gaming, IGWB, Casino Journal, Casino Player, Strictly Slots and Atlantic City Insider. He has an B.A. in journalism and an M.A. in communications from Duquesne University in Pittsburgh, PA. He is the author of the books, How To Win Millions Playing Slot Machines... Or Lose Trying, and Atlantic City: In Living Color.  

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