Luis de Prat, Regional Head of Sales at igaming and sportsbook platform solutions provider GiG, shares some insights around the importance of having a partner in Latin America with extensive experience in regulated markets. Regulation, he advised, is a complex process that requires timely coordination in order to meet regulatory requirements.
Given the vast size and potential of the developing LatAm market, and a constantly-evolving legal framework in each jurisdiction, how should operators prioritise their approach to the opportunities unfolding there?
As a B2B provider for the online gaming industry, we follow the regional markets in Latin America closely, and have taken a two-tiered approach based on regulated vs regulating markets, which I believe is a good strategy for operators looking to enter LatAm. We actively market our services to qualified operators in the markets that are currently regulated, such as Colombia, Argentina and Mexico, while we also monitor markets that are in the process of regulating, such as Brazil, Peru, and Chile.
Online gaming operators with aspirations to compete in Latin American markets will benefit from this tailored approach, adapted to the regulated and regulating markets, due to the fact that the most recent countries to regulate online gaming have generally replicated the frameworks already in place in other countries in the region. We have seen this with the Colombian regulation as an example, which was replicated to some degree by provinces in Argentina and, subsequently, by Peru.
Could you talk us through the trends, opportunities and obstacles that you see in LatAm and how those obstacles, in particular, can be overcome?
Latin America is a diverse region encompassing two continents, but there are definitely some trends. The gaming industry in Latin America is primarily land-based, and though digitalisation is progressing, it is not at the same levels seen in Europe. This is an important factor to consider since land-based players typically are anonymous and wager in cash, whereas online gaming requires player identification and the use of payment methods that are generally not accessible to players without a bank account and a credit card.
Consequently, omnichannel operations are a growing trend, where players can register online and top up their accounts in cash at physical venues, mainly urban betshops. With the average online wager proving to be higher per-capita than land-based alternatives, offering a cross-channel solution where players can access both a retail and online casino, allowing the players to choose when, where and how they play, increase brand loyalty, player retention and ultimately revenue.
An important factor that operators must keep in mind is the need to offer localised gaming and wagering content adapted to the preferences of specific countries in Latin America. For example, local leagues aside, sports betting players in Mexico and the Caribbean follow the major US leagues and US horse racing, with a special interest in pre-match betting markets. Conversely, players in Chile and Argentina have a stronger interest in local and European leagues.
In regards to casino content localisation, table and slot games vary as well. In Brazil and Mexico, Brazilian slots or bingo-themed slot games are very popular, whereas five-reel slot games are preferred in Colombia. For table games, American roulette (double zero) is preferred over European (single zero). There are a lot of factors to consider.
Brazil has often been cited as the sleeping giant in the LatAm gaming space. How big an opportunity is it for the market and how do you view prospects for other countries that are in advanced regulatory processes?
Brazil is arguably the most exciting market in Latin America at present. After effectively shutting down legalised gambling in 2006, the global gaming industry has been eyeing this 12 billion dollar market for online gaming and monitoring its potential regulation. While federal regulation of gambling on a national level has suffered continued delays since law 442/91 was initially approved by the Senate in February 2022, it appears that Brazil will develop this industry at a state level first, as has been the case in the US.
To this effect, an important development has been the publication of licensing tender offers for online sports betting in the Brazilian states of Rio de Janeiro and Paraná by the state governments, respectively. Both licensing processes allow qualified applicants to obtain a five-year concession to operate online and land-based sports betting in these respective jurisdictions, and it is expected that casino and bingo games will be approved by these states before the end of 2023.
Peru is also undergoing a regulatory process. After approving law 31.557 in July 2022 to regulate online gaming, we’re awaiting the final consensus from the gaming authority Mincetur on the liability of operators based outside of Peru, and the applicable taxes and fees for future licensees.
What are the advantages for operators in placing trust in a regulated markets expert and what would you say they should be looking for in that partner?
Regulation is a complex process that requires timely coordination between the licence applicants and the platform and sportsbook providers in order to meet the requirements mandated by the relevant regulatory body. For a favourable entry into a regulated market, operators are best advised to work with platform and sportsbook providers that are familiar with the regulatory process in the jurisdiction and can save the client time and resources by drawing from previous experience in the given market.
Additionally, experienced platform and sportsbook providers have already identified the functionalities, whether they be operational (e.g, payment methods, promotion types, etc.) or content related (e.g., betting markets, game types, etc.) that are necessary to succeed in a given market.
GiG is exhibiting at the Peru gaming Show for the first time. What are you hoping to achieve?
Now in its 20th edition, the PGS is a relevant event in the Latin American gaming calendar that attracts both local and international operators from the region. The mix of land-based and online operators exhibiting gives them an opportunity to meet with platform and sportsbook providers such as GiG, and find solutions that will allow them to expand their existing business, enter the digital gaming space or take their retail casino online.
As an award-winning platform and sportsbook provider, with a wealth of experience in LatAm markets and regulated markets worldwide, we’re looking forward to the opportunity to showcase what we can offer our new and existing partners in the industry.