Online gambling has exploded in recent years. Thanks to smartphone technology and the proliferation of the internet, the virtual casino industry continues to grow. New casino platforms appear almost every day and the games they carry are getting more and more varied.
Credit to that goes to the more than 150 casino software providers now serving the sector. Companies like NetEnt, Microgaming, and Playtech create the games that punters win and lose fortunes on. But, just why are there so many of them?
Online Gambling is Big Business!
The global online gambling market was valued at $53.7 billion in 2019. It’s expected to continue growing too, with some estimates projecting it to swell to $127.5 by 2027. In the United Kingdom, which has legalized and highly regulated online gambling, online casinos accounted for £3.2 billion ($4.4 billion) of the £14.5 billion ($19.8 billion) spent gambling online between Oct. 2018 and Sept. 2019.
Although younger and much more restrictive, the United States online gambling industry is expected to grow by 15.41% between 2020 and 2025. New Jersey continues to dominate the US iGaming landscape. Its three largest online casinos, The Golden Nugget/Betfair, the Resorts AC, and Borgata/Party, raked in $13.6 million, $6.39 million, and $5.66 million.
Elsewhere, there are plenty of other hot markets for casino software providers to work. Despite being banned under the Commonwealth Interactive Gambling Act 2001, Australia represents a thriving market. In fact, in 2018, the New York Times attested to the nation being ‘the world’s biggest gambling losers’. Of course, what’s their loss is the industry’s (and the software designers’) gain.
The online casinos taking all that money wouldn’t be much without their games. This huge and expanding market is clearly already accommodating enough for 150 game providers. Given growth projections, the number could be twice that by 2027.
These days, online casinos can take an even larger share by acting as affiliates. Affiliates earn their revenue through the losses of the players they introduce. Under such arrangements, game providers are essentially getting operators to pay them based on the losses from players who play their games. This means the better, the stickier, and the more popular a game is, the more revenue earned.
Everyone Has Access
Among other things, casino software providers can thank the proliferation of smartphones, as well as the cost of internet access decreasing at the same time as its coverage is increasing. Today, there are thought to be 5.11 billion mobile users around the world. Not bad considering that the earth’s current population is just over 7.6 billion. Of those owning phones, 2.87 billion are smartphones. A huge portion of that number can register at an online casino if they choose to.
The creation of HTML-5 was the missing piece in the puzzle for casino accessibility though. By allowing apps to fit any screen size, HTML-5 extended the reach of online casinos to almost everyone with a smartphone. Developers at companies like NetEnt no longer have to worry about creating multiple versions of the same game to play on different devices.
Similarly, advances in payment technologies have helped extend access to a wider market. The integration of SSL and TLS ensured that regular bank payments to online casinos were safe, taking some of the risks of early online gambling online. Then e-wallet providers, like Neteller, PaySafeCard, and Skrill came along, removing the need to trust a site with your bank details.
In recent years, there has been an explosion of fintech applications, often called neo-banks. Apps like Revolut, Venmo, CashApp, and others provide bank-like services with a much less intrusive signup process, further extending access. Finally, cryptocurrencies and their integration with casinos have made it so anyone can start online gambling. Thanks to digital assets like bitcoin, you literally only need some money, an internet connection, and a device to browse on to enjoy the online casino games Microgaming and others create.
Possibilities are Growing
Not only do more people own mobile phones around the world today but the phones themselves are increasingly powerful. This gives young and creative game designers endless possibilities to create products with that must-play vibe.
Recently, we’ve seen slots get increasingly sophisticated, incorporating story modes and different stages. Take, for example, Fantasma Games’ Serpent Shine online slot. The title is impressive on all fronts but the frosting on the cake is the enormous snake feature that chomps down on the reels during free spins. The technology available today gives game designers a completely blank slate to create while the enormous global market is hungry for innovative new games. A winning combination.
Different Folks, Different Strokes
With increasingly universal potential access, online casino software companies are starting to try and appeal to an entirely different market than they might have done a few years ago. Companies like Thunderkick have a really wacky side to some of the games they create. For example, Babushkas is all about Russian dolls. It’s not what you’d expect to see at all and is a clear attempt to attract those who might not be your typical gambler.
The same goes for titles like Sadie Swift: Guns ‘n Glyphs by Kalamba Games. Featuring a non-sexed-up female lead who, by all accounts, is a total badass, this title has girl power written all over it. Typically, one associates gambling with men but there’s a growing effort to appeal to absolutely everyone from many companies in the industry.
If the Market is Healthy with So Many Companies, What’s the Problem?
Ultimately, competition in markets isn’t a bad thing. With 150 companies each trying to appeal to such a massive market, the gambling industry moves fast. Slots have already been getting highly sophisticated over recent years. Now, AR and VR technology are looking to bring even more opportunities for creativity to the industry.
The largest driver behind so many companies setting up is a healthy market. In the 10s of billions of dollars each year, there’s a lot of opportunity in the online gambling industry. And at the end of the day, being involved in a rapidly expanding industry is a pretty savvy business move!