As technology continues to develop, operators are having to choose between keeping up with the times or sticking to what they know best, a decision that has an ongoing impact on customers. Bob Akeret, vice president of operations, North America for FSB Technology, explores how legacy technology could be make or break for operators.
The prevalence of legacy technology and platforms is high in the US market, due to the existing relationships in place between operators and technology providers for land-based casino and sports betting.
As the market has opened up across North America, operators and technology providers have seen online casino and sports betting simply as something that can be bolted onto their existing setup. These providers have also been able to deliver speed to market as their legacy platforms are quick and easy to switch on if the operator is already working with them in the land-based sector.
But these operators are now realising that online gambling is technology-driven and that they need to build their online business on a platform that provides real-time analytics, margin control, multiple data feeds, player monitoring, automation and more to deliver the experience players are expecting and to compete with their rivals that opted for cutting-edge tech instead.
Some areas more than others
This impacts an operator’s entire business but in some areas more than others. One that really stands out is margin control which allows operators to have influence over their trading and strategy and gives the ability to pick and choose data and pricing feeds as well as the possibility of taking more of the trading function in-house in the future. The other is operational efficiencies.
Regulation and compliance also become an issue as legacy technologies make it incredibly difficult to meet the different requirements in each state, and for operators to pivot to meet any new standards that come into force.
Ultimately, this is detrimental to the player experience. This is compounded by issues around latency and a lack of customisation on the front end which stops operators from being able to fine-tune the user journey and differentiate from their rivals – a lot of casinos and sportsbooks powered by legacy platforms all look the same just with a different logo and colour scheme. Nor can they offer automated bonuses that deliver true value to individual players.
This really is going to hurt every department from compliance and payments to accounting, fraud, marketing and customer service. Each becomes handcuffed to whatever came out of the box, but many operators do not realize this until it is too late.
A large number of us have been on the operator side of the industry at some point so we have first-hand experience of the difference between legacy tech and state-of-the-art platforms. Most of us have learned the hard way having been promised platforms that are gold standard only to learn that they are not.
The biggest risk is non-compliance, fines and the possibility of losing their licence if regulations change, which regulators can and have done. Take New Jersey, which has just introduced two-factor authentication. Operators must roll this out in the time given by the Division of Gaming Enforcement, and those running on legacy tech will find this incredibly hard to achieve.
They will also be ineffective in their acquisition and retention efforts, and they are not able to deliver the high levels of personalisation that players have come to expect, nor are they able to deliver communications via the right platforms and in real-time. What’s more, as technologies continue to evolve, they will find themselves stuck in a black box. In short, they will be the last picked and unable to play with the rest of us.
Flexibility above all
Operators need to look for flexibility above all else as this will give them the freedom they need to develop a product specifically for their players in the jurisdictions they target. Localisation will be key to unlocking the US market, and localisation ultimately requires flexibility. The platform providers that offer the highest levels of flexibility are those that have positioned themselves as tech companies and have invested heavily in their stacks.
Newer tech is going to be more expensive for operators, but in the long term, it is what they must use if they are to build sustainable online businesses and brands. Just look at how far computers have come in the past five years – the same evolution of technology and product will occur in online sports betting and casino, so operators must have strong tech foundations to keep pace with this evolution.
It helps grow every aspect/silo of the business. Cutting-edge technologies landing in the market have also introduced healthy competition among suppliers, with each being forced to level up and deliver a superior product/solution/service to operators.
This includes new innovations and ways for operators to collaborate with their technology providers to build new features and enhance the player experience across all aspects of the book or casino. This covers bonusing, communication, reward schemes – anything that will strengthen player engagement. Of course, this is just not possible with legacy technologies and platforms.