EDITORIAL: Server-based gaming, decade
November 11, 2011
There was a lot of focus on server-based gaming at last month’s Global Gaming Expo (G2E), and much of it started with how long the industry has been talking about the topic.
There are reasons for that, some good, others less so.
For one, the value proposition hasn’t turned out to be what everyone said it would be, namely the ability to download games from a central distribution point, adjusting product and pay tables on the fly. Not unlike slot systems, which started out as accounting vehicles but only really took off with player tracking, it wasn’t until the systems side of server-based was leveraged via the player-user-interface that the value proposition of the networked floor became fully apparent.
Another challenge is dual protocol floors that are filled with incompatible, proprietary solutions. We tackle that topic in this month’s cover story on page 12, which addresses the heavy lifting that the Gaming Standards Association is doing in the critical area of interoperability.
But realizing the full promise of plug-and-play world in an era of slow replacement cycles will take time, up to ten years, judging from the comments from informed industry players at a session on server-based gaming at G2E last month and elsewhere around the conference. The better news is that the real and actual potential of the networked floor has come much more clearly into view than even just a year or two ago.
Progress is evident on both the game and system fronts. In Europe, for instance, operators of Inspired Gaming Group’s network of 35,000 server-based games across multiple countries, have realized double-digit gains since changing out their terminals from fixed to network-based, according to CEO Luke Alvarez. These games are found in venues from clubs with four to 20 machines and casinos with hundreds of machines.
“The wide-area guys don’t have much real estate to offer variety and they also have players who come three to four times a week all year round,” said Alvarez. “Those players, who have smart phones with hundreds of thousands of apps and TVs with hundreds of channels, get bored easily. The demographic is youngish, more male than female; you have to give them novelty. The core thing that server-based does for those players is give them new games frequently. They know now that there is always something exciting at their new mini-casino or their local arcade as opposed to the other one down the street where the machines are depreciated over four years.”
On the systems side, there is the well-chronicled potential of the player-user-interface (which the Canadian and Oregon VLT network operators are working to standardize) and benefits in such areas as responsible gaming, per this interesting anecdote from Norway via Nick Kihn, president, Aristocrat Technologies, which supplies the VLT network there.
“In Norway, server-based is being implemented more for control than for yield management,” said Kihn. “The Norwegian Lottery wanted complete control over their 2,500 machines. They wanted to be able to shut down their machines over a public holiday and limit player losses. Every player has a card that is linked to their social security number. Once a player has lost 50 euros in a day, they can’t play anywhere else in Norway. Same thing happens once they’ve lost 200 euros in a month.”
Powerful new forms of player development and retention, attracting younger players, developing best practices that can and will be applied to the online and mobile worlds; it’s happening courtesy of server-based gaming, even if it may not soon be coming to your casino. But that’s OK; you wouldn’t be in this business if you weren’t patient.