Sweeping Changes

So another G2E is in the books. I was involved in G2E for 17 years, helping out with the conference program from the start in 2001, so I’ve been to every one, except for 2021 when you were required to be vaxxed during the pandemic. But I was in the house, however, doing podcasts in my hotel suite, so I give myself half credit for that.

Like every year, G2E is a great place to catch up with old friends, network with the top brass and learn about the trends and issues that will impact the gaming business in the future. But I don’t think I’ve ever seen a more contentious G2E than what occurred this year.

Sweepstakes was the main point of contention. This segment of wagering has exploded in the last year, going from almost nothing to more than $4 billion in five years. Sweepstakes casinos run under the cover of social gaming. There’s nothing to buy; you get a limited amount of coins when you sign up and play the games—which are often provided by legitimate game developers.

But then, when you run out of coins, you have an option to buy a different level of coins. Some sites call them “gold” coins, but they still theoretically have no value even though you pay real money for them. Then you are entered into a “sweepstakes” where you can win money just like you would on a real-money slot machine. But since the winnings are awarded as part of a sweepstakes—just like Publisher’s Clearinghouse—somehow it is legal.

At G2E, there were passionate arguments on both sides. And some of the proponents of sweepstakes are often recognizable and legitimate casino operators—online and land-based. But the fact that a player has to risk money to win money means sweepstakes are outright gambling. At Publisher’s Clearinghouse, you kind of knew you had to buy some magazine subscriptions to have even the slightest chance. At a sweepstakes casino, you definitely have to buy some of those “gold” coins to participate.

But the bottom line is that sweepstakes operators are unregulated, untaxed and have little to no KYC—although they would argue that point. If they were willing to become regulated, pay taxes and have a robust RG and KYC plan, we’d be OK with that. But of course, if that was the case, why wouldn’t they just become real-money online gaming?

Watch for our January issue, where we’ll present both sides of the issue by speaking with those who are in favor of sweepstakes and those who are opposed. It should be an interesting topic.

Another contentious issue was the relationship of sports betting operators and players. Most of the legal sportsbooks in the U.S. have rules that prevent expert sports bettors from participating in any meaningful sense. The terms and conditions that you are forced to agree with to participate are sometimes hundreds of pages long and hide the fact that sportsbooks have the ability to prevent a good player from wagering any significant amount of money.

Some people say that sportsbooks have every right to limit the way their players wager because of the sometimes onerous tax rates that they pay the states. Others say that as a regulated entity, sportsbooks should treat every player the same, no matter the regulatory handicaps under which they operate.

Our friend Richard Schuetz is the CEO of American Bettors’ Voice, an organization founded by professional gamblers Gadoon “Spanky” Kyrollos and Billy Walters, which hopes to give bettors a seat at the table in the discussions between sportsbook operators and regulators. Will this group have success in reaching some kind of consensus with sportsbooks? Too early to tell but still a battleground.

As always, responsible gaming was a hot topic, as experts outlined that the industry is attracting younger players—one keynote speaker said the average age for the online gambler is now 34 years old! This suggests that the industry must have a plan for sustainable growth by developing effective responsible gaming practices to maintain its appeal to that younger demographic. But how do we get there?

Yes, another milestone G2E is in the books, and now we look forward to the ICE trade show and conference to be held for the first time in Barcelona, Spain. We’re confident that ICE will address the issues raised at G2E and help us understand where the industry is going at such a great speed.