Category Archives: Business

PlanetWin365 new #2 in Italy’s online sports betting market


italy-online-sports-betting-planetwin365The SKS365 Group’s PlanetWin365 betting brand held on to second place in Italy’s online revenue charts for the second straight month.

Figures compiled by Italian gaming news agency Agimeg.it show Italian-licensed online sports betting sites handling total wagers of €486.6m in the month of May, down roughly 10% from April’s €542m handle. The combined online and land-based betting handle totaled €860m.

As usual, Bet365’s Italian site claimed the largest slice (€150.2m) of the online betting pie, but PlanetWin365 ranked second for the second straight month with €49.1m, edging out Gala Coral’s Eurobet brand at €46.5m. Snaitech and Sisal rounded out the top five with €31.4m and €31.1m, respectively.

The online casino vertical reported revenue of €46.3m, up €1.1m from the previous month but a full one-third higher than the casino vertical reported in May 2016. Lottomatica remained top casino dog with a 10% share, followed by Sisal (7.5%), Amaya Gaming’s PokerStars brand (7.2%), Eurobet (6.9%) and William Hill (5.8%).

As for online poker, GiocoNews reported that tournament entry fees totaled €6.9m, €300k higher than in April and a 16.7% year-on-year improvement. As ever, PokerStars dominated this category, claiming 65.5% of all tournament fees. Poker cash game revenue totaled €5.4m, down €200k from April and 8.3% below May 2016’s figure.

On the land-based front, Italy’s four brick-and-mortar casinos have earned a combined €119.3m over the first five months of 2017, with nearly two-thirds (63.3%) of that sum coming via slots.

THE GREAT VLT PURGE BEGINS
Speaking of spinning reels, the Italian legislature’s lower house recently confirmed plans to reduce the nation’s complement of video lottery terminals (VLTs) by 140k machines. The cull, which is to be completed by April 1, 2018, represents about one-third of the total 407k VLTs currently whirring and buzzing in some 80k small venues across the country.

The lower house also approved plans to boost the tax on slot machine revenue by 1.5 points to 19%, while VLT taxes will rise half a point to 6%. On Thursday, Italy’s Senate gave its approval to these plans.

Meanwhile, the city of Rome has approved new restrictions on where VLTs and other electronic gaming machines (EGM) can be located. The changes, previewed last November by Rome’s major Virginia Raggi, prohibit new EGMs from being installed in any venue located within 500m of a ‘sensitive’ place, i.e. schools, churches, youth centers, etc.). Existing EGM venues will learn what fate Rome has in store for them within 120 days.

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Malta regulator suspends online license of CenturionBet/Bet1128


malta-suspend-centurionbet-bet1128-online-gambling-licenseMalta’s gaming regulators have suspended the online gambling license of CenturionBet Ltd, which operates the Bet1128 brand.

On Tuesday, the Malta Gaming Authority (MGA) announced that it had suspended CenturionBet’s remote gambling license, and ordered the company to “indefinitely suspend all gaming operations, cease to register new players, suspend all transactions on all websites, including deposits and withdrawals,” and fully comply with MGA requests for data and documentation.

The MGA notice insists that all websites operating under CenturionBet’s license are “not approved to be operational by the Authority.” However, at present, the Bet1128.com site still prominently displays the MGA logo and the suspended MGA/CL2/527/2008 license number.

Italian gaming news agency Agimeg quoted a CenturionBet statement saying the MGA had “identified procedural irregularities in signing contracts with consultants.” The company expressed “deep regret” over the kerfuffle, while insisting that it had “acted in full compliance” with its regulatory obligations and promising that “all the payment activities of the winnings will be guaranteed.”

Last month, Agimeg reported that CenturionBet had attempted to sell 80% of its operations for €12m to online gambling operator SKS365, which operates in Italy under the Planetwin brand. SKS365 claimed that it receives lots of these types of offers, but that these particular negotiations “did not materialize.”

The CenturionBet/Bet1128 business has a colorful history in Italy, where investigators have fingered the site’s owner as Francesco Martiradonna, who has been linked to the Sacra Corona Unita crime syndicate. Last October, the Martiradonna family’s lawyer denied any links between the family and CenturionBet, despite Italian media reports that linked two Martiradonna brothers as managers of gambling operations that shared Maltese addresses with CenturionBet.

Two years ago, Italian authorities launched a major crackdown on the illegal gambling operations of Malta-licensed online betting site Betuniq, which was accused of having ties to the ‘Ndrangheta crime family. The MGA subsequently suspended the licenses of a number of associated online operators.

A more recent anti-mafia operation that Italian authorities dubbed ‘Jonny’ linked the CenturionBet operations to the ‘Ndrangheta syndicate, which reportedly earned €1.3m over a 17-month period for allowing CenturionBet to set up internet-connected retail operations on ‘Ndrangheta-controlled territory.

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BTCC joins China’s major exchanges in resuming bitcoin withdrawals


China’s withdrawal freeze has finally come to an end.

BTCC joins China’s major exchanges in resuming bitcoin withdrawalsBTC China, the last of the so-called Big 3 exchanges in China, has also resumed cryptocurrency withdrawals on its platform. Bobby Lee, chief executive of BTC China, said in a statement that the exchange has started “testing” withdrawals following the upgrades it made to its anti-money laundering systems.

Industry sources said OKCoin, China’s largest bitcoin exchange by trade volume, and Huobi have also allowed withdrawals.

In February, major digital currency exchanges in China stopped bitcoin and litecoin withdrawals on their respective platforms as they improve their anti-money laundering capabilities to prevent “illegal transactions.” The upgrades were part of the requirements set by the People’s Bank of China, who called on digital currency operators to step up their game against anti-money laundering.

The upgrades were completed in March, but the exchanges had to wait for Chinese regulators’ approval before they were able to resume bitcoin withdrawals, hence the delay.

Back in the game

News that the Big 3 exchanges are resuming their regular operations have made a telling impact on the Chinese markets. OKCoin’s announcement, in particular, spurred investor activity to nearly 20 percent of the world’s trading volumes on Wednesday.

On Thursday, trading in Chinese markets rose to nearly 25 percent of the global market following BTC China’s news.

Virtual currency users arrested in Bolivia

Meanwhile, at least 60 “cryptocurrency promoters” were recently arrested in Bolivia on charges of “training” other people on how to invest in virtual currencies.

Lenny Valdivia Bautista, executive director general of the Bolivian Supervisory Authority of the Financial System (ASFI), said the Central bank of Bolivia has forbidden the use of virtual currencies of any kind in the country.

“We seized brochures that have to do with business schemes relating to virtual currencies that would be operating abroad, and are advising the Bolivian population not be fooled with such schemes that only take advantage of the population by acquiring their money,” Bautista said in a statement.

In 2014, Bolivia became the first country in South America to ban digital currencies like bitcoin, fearing that cryptocurrencies will diminish the power of the local currency. Citing consumer protection concerns, the central bank issued a resolution banning “any kind of currency that is not issued and controlled by a government or an authorized entity.”

Current bitcoin price

The price of bitcoin rose to $2,449.55 during early Friday morning’s trading.

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Sky Bet seek Malta license; Purple Lounge crowdfunding lawsuit


media-corp-purple-lounge-crowdfunding-lawsuitLeeds-based online gambling operator Sky Betting & Gaming (SBG) has applied for a Malta Gaming Authority (MGA) license ahead of the UK operator’s planned launch into Germany’s online sports betting market.

On Wednesday, the MGA announced that it had received SBG’s formal application for a local sports betting license. SBG, which already holds licenses issued by regulatory agencies in the UK, Alderney and Italy, plans to begin accepting German sports bettors via SkyBet.de later this year.

MGA exec chairman Joseph Cuschieri said SBG’s interest in a Malta license reflected the high value that “world leading brands” like SBG place on Malta’s “reputation as a gaming jurisdiction.”

The MGA also announced regulatory data covering the first four months of 2017, during which the MGA received 59 applications, representing a 79% increase over the same period last year. The MGA issued 36 licenses over this span, one-third more than last year.

The number of administrative fines the MGA has levied against its licensees is also up from nine last year to 14 so far in 2017, while the number of terminated or cancelled licenses fell from 20 to 12.

The MGA has so far suspended only one license, down from two last year, although the MGA also suspended the license of Sunderlands Online Limited on May 19. The MGA declined to explain why Sunderlands was taken to the woodshed, saying it didn’t want to “compromise any investigations that may need to be performed” in the wake of the suspension.

PURPLE LOUNGE LEFT CUSTOMERS BLACK & BLUE
Meanwhile, the long dead ghost of a former Malta-licensed site has been reanimated by an investor looking to crowd-fund a class action lawsuit. Steven Egan, a former “substantial” shareholder in the AIM-listed Media Corporation Plc, is looking to raise £1k via Crowdjustice.com to fund a lawsuit over the demise of online gambling site Purple Lounge.

Purple Lounge, which was licensed by the MGA’s predecessor, the Lotteries and Gaming Authority (LGA), shut down abruptly in 2012, taking the deposited funds of thousands of players with it. Egan claims “millions of pounds” was stolen by Media Corp’s former directors and he’s hoping to raise enough cash to fund a civil action to compel the thieves to fork over their ill-gotten gains.

Sadly, Egan’s campaign has so far raised exactly £0, but the deadline for contributing isn’t until June 29, so lots of time remains for Purple Lounge’s former customers to throw good money after bad.

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500.com buys Maltese parent of Multilotto.com


500-com-multilotto-acquistionStruggling online lottery operator 500.com has made another attempt to diversify its business model by acquiring the parent company of Nordic-facing online gambling operator Multilotto.com.

On Friday, the Nasdaq-listed 500.com announced that it had reached a deal to acquire 93% of the outstanding shares of The Multi Group Ltd, the Malta-headquartered parent of Multilotto. The deal, which is worth €49.8m (US $56m), is subject to regulatory approval.

Multilotto offers lottery betting and online casino services via a Curacao eGaming license. Multi Group also holds online licenses issued by Maltese, UK and Irish gaming regulators. In 2015, the company reported revenue of €4m and earnings of €1.2m, while 2016’s revenue rose to €10m and earnings improved to €5.7m.

500.com stressed that Multilotto doesn’t accept customers from China, including Hong Kong and Macau. Until China imposed its ‘temporary’ suspension of online lottery sales in March 2015, the Shenzhen-based 500.com was one of two companies authorized to take part in a ‘pilot program’ of online sports lottery sales in China.

The suspension has wrought havoc on 500.com’s bottom line. The company reported a net loss of $52.3m in 2016 and announced earlier this month that it had lost a further $9.3m in Q1 2017. Last November, 500.com acquired social poker operator Qufan Internet Technology Inc. in a bid to keep the lights on while it awaits Beijing’s approval to recommence online lottery sales.

China’s Ministry of Finance has been conducting field trials of mobile lottery sales in a number of provinces, and recently concluded a two-year trial in Jiangsu province. The government reportedly concluded that the trial demonstrated no significant risk but when that conclusion might translate to a market-wide restart of online lottery activity remains anyone’s guess.

The Ministry reported April’s overall lottery sales were up 9.6% to RMB 38.2b ($5.55b), with sports lottery sales rising 15.2% to RMB 19.5b and welfare lottery up 4.3% to RMB 18.7b. For the year-to-date, overall sales are up 6.2% to RMB 133.5b.

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Kenya betting operators win reprieve on proposed tax hike


kenya-sports-betting-tax-reprieveKenya’s sports betting operators are breathing a sigh of relief after legislators rejected plans to dramatically hike betting taxes, while retaining hikes for other gaming operators.

On Thursday, Kenya’s parliament voted down plans to hike betting operators’ tax obligations from their original 7.5% of revenue to 50%. The proposed change to the Betting, Lotteries and Gaming Act was part of the government’s Finance Bill, which sought to impose a uniform 50% tax on all gambling revenue, be it betting, lotteries or gaming.

Treasury Secretary Henry Rotich said the proposed tax hikes were intended as both a revenue generator for the government as well as a means of discouraging gamblers from going overboard. But betting operator SportPesa mounted a legal challenge based on the argument that the hikes, which were on top of operators’ corporate tax obligations, were unconstitutional.

On Wednesday, members of the Assembly’s Finance Committee rejected the tax on betting operators, issuing a report that said the rate was “punitive enough to discourage such activities.” The report was met with opposition from government representatives, who urged Assembly members to stick with Rotich’s plan for the good of society.

On Thursday, MPs voted in favor of an amendment to the Finance Bill that preserved the original 7.5% rate for betting operators. However, betting was the only vertical offered this exemption, as the new 50% tax rate will still be imposed on gaming, lottery and prize competition revenue. MPs have reportedly agreed to revisit the issue of whether to maintain the 50% rate on the other verticals next week after more discussion with the Treasury and stakeholders.

KENYAN FOOTBALL LOOKS GIFT HORSE IN THE MOUTH
The government’s proposed tax hike had been staunchly opposed by Kenya’s sporting bodies, which have come to rely on lucrative sponsorship deals with betting operators. That said, the Kenyan Premier League (KPL) appears poised to bite the hand that feeds, based on its belief that its sponsorship deals left a lot of money on the table.

Earlier this month, SportPesa inked a shirt sponsorship with English Premier League side Everton FC. The deal, said to be worth up to £9.6m per year, was touted by the team as the biggest commercial partnership in the club’s history.

SportPesa also sponsors the KPL, as well as several individual KPL clubs. But news of the Everton deal prompted some KPL execs to believe that they’d sold themselves short when negotiating their own SportPesa deals. The KPL’s Bob Munro spoke for a number of execs when he told Allafrica.com that the league “will have to renegotiate afresh when this contract ends.”

SportPesa CEO Ronald Karauri pointed out that the company’s UK division is completely autonomous and needs to up its visibility to compete with the major UK betting operators. Karauri said he “cannot stop [the UK division] from putting in money where they feel they will be able to achieve this.”

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South Korean K-pop star jailed one year for gambling $3m online


south-korea-singer-jailed-online-gamblingA former K-pop singer has been sentenced to a year in South Korean prison for blowing over $3m on an illegal online gambling site and lying to the authorities investigating his activity.

On Monday, South Korea’s Yonhap news agency reported that the Seoul Southern District Court had sentenced Jung Jin Woo (pictured), a member of the pop group M2M who got his big break via an Idol-style television program, to one year in prison for illegal gambling.

Court documents indicate that the 32-year-old Jung was originally cautioned over his gambling activity way back in 2007, but the warning didn’t take. Jung was again caught gambling online in 2014, but he convinced his mother’s boyfriend to claim that he’d been the one gambling on Jung’s online account. Mom’s squeeze was eventually slapped with a KRW 1m (US $900) fine.

But Jung’s close call failed to dissuade him from continuing to gamble online, and he even acted as a promoter for the unidentified online sports betting site from August to September last year.

Eventually, the authorities closed in on Jung, who reportedly spent a whopping KRW 3.5b ($3.1m) in 1,500 separate transactions with the betting site over the years. Jung later told the authorities that he gambled online to make money to maintain the flash life of a celebrity that his fans had come to expect.

Jung eventually copped to his misdeeds, but in doing so, revealed the subterfuge involving his step-father. The court claimed this deception played a major role in Jung’s sentence. Worse, step-dad’s false confession earned him a sentence of two years of probation.

Jung isn’t the first South Korean celebrity to fall afoul of the country’s strict anti-gambling laws. Numerous K-pop stars, TV personalities and sports figures have all been forced to do the bow of shame after getting caught engaging in illegal gambling activity.

Incredibly, South Korea’s anti-gambling laws don’t even stop at the water’s edge. South Korean citizens are subject to prosecution even if they’re gambling in a jurisdiction in which such activity is completely above board, although prosecutions tend to be reserved for serious spenders, as leniency can be shown to those who gamble “just for momentary pleasure.”

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Online betting drives Kentucky Derby to new wagering record


kentucky-derby-online-wagering-recordRace bettors wagered a record amount on the 143rd annual Kentucky Derby thanks in large part to strong online wagering activity.

Lousy weather kept many fans away from the Churchill Downs racetrack this weekend, which culminated in betting favorite Always Dreaming winning the marquee race. The event attracted just over 158k spectators, the seventh largest figure in the race’s illustrious history.

Despite the reduced attendance, all-source wagering on Saturday’s races hit a new record of $209.2m, 8.6% higher than last year’s total and 9% better than 2015’s then-record $194.3m. Wagering on the actual marquee race was up 12% from last year and up 1% from 2015’s tally.

The disparity between on-site attendance and betting volume was mirrored for the broader Derby Week festivities, which saw attendance falling 7% from 2016 to 349k, while all-sources betting handle for Derby Week rose 7% to a new record $285.1m.

TwinSpires.com, the online advance deposit wagering site of Churchill Downs Incorporated (CDI), was a significant contributor to 2017’s record-setting performance. TwinSpire’s Derby Day racing handle improved 22% year-on-year to $32.8m, while online wagering on the marquee race was also up 22% to $20.1m.

Wagering interest and the bad weather undoubtedly contributed to NBC’s Saturday afternoon Derby coverage hitting the second-best overnight rating in the past 25 years. NBC enjoyed a 10.5 rating, 12% higher than 2016’s figure.

CDI CEO Bill Carstanjen offered “heartfelt thanks” to Kentucky Derby fans for making the 2017 event “an amazing spectacle, rain or shine.” Carstanjen told investors that the strong wagering activity would likely mean adjusted earnings of between $4m and $6m higher than the sum contributed by 2016’s Derby.

CDI’s recent Q1 2017 earnings report showed similarly opposite trajectories of its online and track-based wagering operations. While track-based revenue was down roughly 10% year-on-year, TwinSpires reported betting handle rising nearly 7% in the three months ending March 31.

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NYX revenue up 213% following “transformational year”


nyx-gaming-transformational-yearOnline gambling technology provider NYX Gaming Group reported record results in 2016 after bolstering its operations via the acquisition of sports betting tech unit OpenBet.

On Tuesday, the Toronto-listed NYX reported revenue of $54.5m in the three months ending December 31, 2016, a 196.6% improvement over the same period last year, while earnings gained 185% to $12.9m.

NYX’s numbers were goosed by the mid-2016 addition of OpenBet, but even discounting OpenBet’s $30.4m contribution, Q4 revenue was up 31.2% year-on-year. Royalty and license revenue rose nearly two-thirds, thanks in part to 2015’s acquisition of software outfits Chartwell Technology and Cryptologic from Canada’s Amaya Gaming and the mid-2016 acquisition of UK gaming content provider Betdigital.

NYX launched 14 new customers on its Open Gaming System (OGS) in Q4, while signing 16 new customer agreements for its OGS and Open Platform System. As of December 31, NYX had 24 customers in the development pipeline waiting to launch, while inking 11 new deals over the first quarter of 2017. NYX’s content division launched 27 new games in Q4.

For 2016 as a whole, revenue shot up 213% to $163.7m. Excluding the OpenBet, Chartwell and Cryptologic additions, revenue still rose a healthy 46.8% while adjusted earnings were up 305% to $42.7m.

Despite the triple-digit revenue rise, NYX reported a net loss of $57.9m in 2016. NYX blamed the shortfall on $19.7m in acquisition and restructuring costs, but also intangible asset impairments of $27.9m and goodwill impairments of $66.1m. These impairments were pinned on NYX’s acquisitions of Chartwell, Cryptologic, Sportech NYX Gaming and Game360.

Choosing to focus on the positive, NYX CEO Matt Davey heralded 2016 as “a transformational year” for his company, whose acquisitions have left it “ideally positioned” to provide content to the regulated gaming market. Davey said NYX’s new operating model “has been delivering an improved cost structure that, combined with our growth strategy, will result in increased operating leverage.”

NYX said it expects Q1’s revenue to come in between $57m and $61m, while earnings are expected to be between $15m and $17m.

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Fantasy sports bill passes Alabama House in narrow vote


The Alabama House has spoken: fantasy sports is a battle of wits and smarts.

Fantasy sports bill sails through Alabama House in a narrow voteBirmingham Business Journal reported that the Alabama House of Representatives has approved a bill that will legalize and regulate fantasy sports betting in the state in a close vote.

Voting 43-38, the House declared that fantasy sports is not dolled-up digital gambling that deserves to be banned. Instead, they recognized that fantasy sport is a game of skills deserved to be played in the state. With the House approval, the bill now moves on to the Senate.

There are at least three bills that have been introduced in Alabama including HB354 aka the Fantasy Sports Act.

The proposed legislation, which was sponsored by Rep. Alan Boothe, would require a fantasy sports operator with more than 5,000 active player accounts to pay an initial registration fee of $85,000, while an operator with fewer than 5,000 active participants would pay an initial $10,000.

A fantasy contest that has not previously operated in Alabama would pay a $5,000 fee.

The measure also said that the taxes to be imposed on fantasy sports operators’ gross revenues is similar to that in Tennessee and the one that has been proposed in Georgia.

House members are reportedly eyeing to impose at least 6 percent tax on fantasy sports revenues for the preceding 12 months. They project that an additional $216,000 will flow through the state’s General Fund if fantasy sports is legalized in the state.

However, it took the members of the House nearly two hours to narrowly pass the bill. According to the report, legislators debated one whether daily fantasy games were primarily skill- or luck-based.

There are at least 11 US states that have legalized DFS at present: Colorado, Indiana, Kansas, Maryland, Massachusetts, Mississippi, Missouri, New York, Tennessee, Virginia, and, most recently, Arkansas.

But as the legal battle for the legalization of DFS across the United States wages on, the Fantasy Sports Trade Association lamented that more than two-thirds of fantasy sports firms have closed, merged or changed focus.

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