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Thursday, 18 October 2007

Consolidation challenge in the remote gaming (or eGaming) sector

I got a call from a VC friend of mine asking for my opinion regarding 'why' the consolidation of the remote gaming sector has not really arrived yet. I told him what I thought, and since I went to Paul Walsh's BIMA drinks last night, I realised that how 'slag' I have been in my blogging (to be honest, this is hard work).. and hope its worthwhile of sharing with the world our thoughts (intermittently).

below is what I already told my friend Sam:

Reason for not much 'real actions' happening in the consolidation space yet for the remote gaming market (no particular order):

* lack of transparency of how big 'really' the market is, therefore difficult to quantify the real 'worth' of the company, made worst by their usual secrecy..

#(I founded GamBond® to work with governments/regulators, gaming firms, banks and payment processors to exactly address that issue, as we will hopefully have a handle on the 'exact' size of the whole market anonymously)

* constantly changing regulations internationally

* blurring line for some gaming operators and vendors

* lack of convergence into other more acceptable 'entertainment' or 'offline/asset rich' operations.

* lack of understanding of the gaming world from outside industries (that was the reason why I founded Gambit http://www.TheGambit.info ).

However, this is mostly due to the fact that like the 'premium rate' market, most companies despite making millions, they are still mostly playing a 'short-term' game.. which means that given the points mentioned above, it does not make sense to take 'chances' nor 'invest' for the future by consolidating..

However, there is a wave of change, as likes of Gigi Levy of 888.com (with backgrounds in telecoms like myself) are keen to work on the medium to long term goals.. by doing what they do better, like real CRM, reaching new audiences etc.

Challenge for us in the sector is how to become a more respectable and 'understood' sector... I humbly submit that it can only be achieved by being more transparent and communicate.

I hope that GamBond® and Gambit can play a part going forward.

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