Casino Enterprise Management

Yogi Berra once remarked, “The future isn’t what it used to be!”  The average casino executive can probably identify with that statement. The casino industry used to be relentlessly upbeat. But with today’s economic uncertainty, lackluster capital markets and thinning tourism levels, there are plenty of reasons for concern now.

Yet one company, BetStone, feels bullish about the future of the gaming industry in general, and about server-based gaming (SBG) specifically. BetStone believes that SBG in the current casino industry is directly relevant to solving some of the problems of the industry today: scarcity of capital, diminishing customer loyalty and increasing costs of managing complex IT installations. SBG’s ability to deliver excellent content and powerful management tools not only makes it attractive for casino executives, but it’s also attractive to the all-important players.

Introducing BetStone
BetStone is headquartered in Ireland and has global installations. BetStone has already achieved success in other parts of the world, such as Europe, South America and Asia, and it has entered the North American market with successful installations at various Mexican operators. It also has a long-range plan for the U.S. and Canada. In the past five years, BetStone has established one of the most sophisticated SBG platforms in the world, and it offers some of the richest content. At the time of writing, BetStone has a content library of more than 80 games and a continued commitment to an aggressive rollout schedule of five games per month.

Server-Based Gaming
Before we discuss specifically what SBG is, it’s important to make a distinction between SBG and downloadable gaming. The term “downloadable gaming” often refers to nothing more than standalone slot machines linked to a central server that can download new gaming content on demand. SBG goes much, much further. First, the games are stored and controlled on a central server, as is the case with downloadable gaming. But the game determination (i.e., the result) is also controlled on the central server and all results are managed and reported centrally. In addition, different math models and return-to-player percentages can be managed interactively, all in real time. Floor content can be freshened, different promotions can be rolled out, advertising messages can be broadcast, and new games can be implemented in seconds. For the first time, simultaneous global rollout of content has become a reality. This is a tremendous windfall for management reporting, money reconciliation, player trend analysis, customer loyalty—and the list goes on.

The BetStone Model
BetStone is a true pioneer in SBG solutions, having had its product ready for market five years ago—which was probably some time before the market was ready for it. Driven and maintained by an international team of developers and support staff, the BetStone SBG platform creates high levels of security, can pinpoint accounting accuracy, allows access to information about each machine in real time, and provides a large and continually growing library of games.

The SBG platform can easily be integrated into almost any gaming floor. It is not necessary to upgrade existing slot machines or back-office systems to access the functionality of the BetStone platform. All that is required is access to the Internet via standard broadband connections. This allows operators to connect their BetStone gaming machines to a global library of games and gives them access to powerful operational modeling tools. And the platform architecture is highly scalable: One server in one implementation was handling more than 6 million real-time transactions per day with no latency or bandwidth issues.

Once a BetStone machine has been installed, it joins an international network of machines with full access to an always-growing library of content. Therefore, when an operator installs a BetStone machine, it’s making a longer-term investment and not simply buying a slot machine game. Games currently available on the BetStone platform include video slots, Class II games, table games, video poker, bingo-style games, fixed-odds betting games, table games and some of the largest progressive jackpots games in the world. Emphasis and expenditure can now be concentrated where it belongs—on content rather than on machines. It is, after all, the games that people want to play, not the cabinets.

Hidden Benefits
There are obvious benefits to central control and real-time monitoring, but there are hidden benefits to SBG as well. If a casino property is going gangbusters on a Friday night, it may not want to offer “loose” games to the public. Instead, it can tighten up its return-to-player percentage and maximize the venue’s profitability. But on a quiet Tuesday afternoon, the venue can cater to the locals by providing a more rewarding RTP to the players, encouraging their involvement and loyalty.

But that’s not all. An operator can determine micro-demographics about which people play what games on which days and at what time of the day. For example, you can tell which games that social groups of middle-aged women are playing versus, say, younger men who are at the casino on their own. Or what a husband and wife team is playing versus a group of festive 20-somethings. A casino can feature the right mix of game titles featured on the main display screens to appeal to its clientele. But it can also run different promotions, mix up the advertising splash screens and rotate the content across different machines—all interactively—so that the gaming floor is always changing, always fresh. And if you think about the Vegas-style casinos and some of the larger tribal casinos, they have the constant challenge of keeping the gaming floor invigorated but without having to spend thousands per machine for a game upgrade or a change to the artwork. A strong SBG platform can do all of that—with no new capital required.

Avron Goss is a director of BetStone. If you met Goss and spent time with him while he’s visiting his customers’ casino venues, you could tell that he’s dedicated to the success of not only his direct customers, the casino operators, but of their customers as well—the players. “We like to think of BetStone games as ‘The Player’s Choice’,” he said. “We focus on delivering games that are highly interactive and rewarding for people to play. When people sit down to a BetStone machine, they have a lot of choice and they have a lot of things happening in the game.”

He added: “We have actually had casino owners ask for us by name because their customers were demanding BetStone machines. We have been told that players have never demanded a slot machine by its manufacturer before.”

SBG Benefits
When you walk into a Vegas-style casino, you are generally confronted with a floor of similar looking, but ultimately different, slot machines. They generally feature one unique game per cabinet, with specific belly glass and artwork. So if you get tired of playing Big Kahuna, for example, you have to get up and walk over to Treasure Nile and start over. The sentiment for some players is that they are abandoning their “investment.” In other words, they have sat at the same machine for some time, priming it with their money, and it’s just about to win for them.

With the BetStone model, players can change games without changing their “lucky” machine. They simply go to the main menu, and then select a different game. Even though there are typically 50 or more games to choose from, people seem to get the knack of it quickly. They scroll through the choices, all represented graphically, and then pick a theme they like the look of. If they like the playing experience, then they’re hooked all over again. If not, no problem—just go ahead and select another game.

John Gevisser is BetStone’s head of sales and marketing, and he has spent quite a few years traveling the world preparing casino markets for the BetStone SBG model. When asked about the choice of games, he responded: “When we first offered up multiple games on each machine, we weren’t sure whether it would confuse the player and maybe reduce play. In fact, we didn’t know quite what to expect. To our surprise, people would stay at a machine and simply change the game they were playing. In busy venues, we have seen people lined three or four deep waiting to get on a BetStone machine because the people sitting down playing are obviously enjoying themselves.”

At one of BetStone’s customers, a slot parlor in Mexico, the average net win for a BetStone machine is about three times higher than the next highest performing manufacturer. But what is it that makes players choose BetStone over other machines? Goss thinks that it’s partly the content, partly the multigame nature of the platform, and partly because of the math model. “The combination of all the elements—sound, math, graphics, etc.—adds up to create a magic that attracts and keeps players for longer. This is something that BetStone hasn’t pulled out of the ether, but honed and researched and delivered for many years.”

He then added: “Experience is everything. I don’t think you can just enter the SBG market and hope to win.”

The Future … Again
When you stop and talk to casino and gaming executives nowadays, you can’t help but get some bad news when you scratch beneath the surface. Average net wins are often down, room occupancy rates are lower than normal, the numbers of casino visitors are substantially reduced and overall financial performance is disappointing at best. The adage “build it and they will come” is no longer the sacred cow it might have once been. With tight capital budgets, casino owners have to keep their floors fresh and encourage players to play, but they need to do this by using innovation and imagination rather than just the sheer weight of investment dollars. Clearly, a different model is needed.

The Internet revolutionized the way people access information and manage applications. In the same way, networked technology enables SBG to revolutionize the way that casinos manage their gaming floor, attract new players and keep their customers loyal. Goss is always quick to point out that the beauty of BetStone is implementing this technology is no more complicated than wiring up PCs in hotel rooms. Thanks to SBG, for many casino operators the future is suddenly looking a whole lot brighter again.

Paul Miller is an experienced management consultant to the gaming industry, having held executive positions at BMM Compliance as well as performing major business development projects for more than 50 Fortune 500 companies. He can be reached at pmiller@o2consultinggroup.com.