Spielo International President and CEOWalter Bugnodiscusses Lottomatica’s decision to go with the Spielo International name and the underlying strategy.

After several years of corporate co-branding, Atronic and Spielo, the two companies that make up Lottomatica’s gaming division, were renamed Spielo International last month. Spielo International President and CEO Walter Bugno’s career has included top jobs with Tabcorp’s casino division, Campbell Soup Asia Pacific, and Lion Nathan. He’s now responsible for managing and overseeing Spielo International’s long-term strategic direction, including future technology and content development. He spoke with executive editor Charles Anderer to discuss Lottomatica’s decision to go with the Spielo International name and the underlying strategy.

How has Lottomatica brought this company together over the past few years?
Bugno: Lottomatica acquired Gtech Corp. back in 2006. In completing that acquisition, it inherited Spielo, which had been previously acquired. Later, in 2008, Lottomatica completed its acquisition of Atronic. Initially, the two businesses continued to operate within the Gtech business as separate entities. Spielo focused on the distributed gaming side, Atronic on casinos. When Marco Sala was appointed group CEO of Lottomatica in 2009, he created groupings of distinct business units, including the gaming division, which comprised Spielo and Atronic. I was brought in during 2010 to integrate the gaming business so that we could start leveraging our strengths. Here we are, about one year in, with the first part of the job done, and the integration essentially complete.

In the course of integrating Spielo and Atronic, what were the natural synergies, as opposed to discrete parts that needed to be left as stand-alones?
Bugno: Both businesses operate in the area of gaming machines, systems, and the development and supply of content in the form of games. The main difference between the two was their market segments. Depending on the distributed gaming or casino side, there might be more emphasis on systems, or the level of volatility of games. But when you drill down to the core, they’re essentially the same. Both businesses were moderate in size; not necessarily large. And they were competing against some of the larger, more global businesses in the sector. As individual organizations, their biggest challenge was the ability to compete against the scale of larger competitors.

This integration is an opportunity for us to say, for the things that are common at the core, let’s do it once rather than twice, let’s do it on the same platform rather than on a separate platform, and then let’s customize at the tail end of the process for market segments. So we can still be focused, deliver solutions that target specific market segments, and recognize differences, while making our investment dollar go a lot further-and, as I like to say, “do more with same.”

You were integrating organizations that had been through a fair amount of change merging and acquiring businesses on their own. Did that help move things along?
Bugno: The difficult part of the task was not finding the integration leverage points. Nor was it a question of having the right people or the right skill sets, the quality of thinking or product; we had that all internally. What happens invariably over time, and it’s not just with Spielo or Atronic, but it happens in most cases, is internal bias becomes a stumbling block. Coming in from the outside allowed me to harness all the thinking, the leverage points and opportunities, have no bias toward one or the other, but drive the team to reach the optimal solution.

What are some of the leverage points that you identified?
Bugno: There are different positions for different segments. There is no such thing as one answer that addresses everything. In the distributed gaming market, Spielo has a strong, world-leading position. Certainly, we didn’t want to see that diminish or harmed in any way. Atronic, on the other hand, had built up its position over time, particularly in the international markets, rather than the U.S. market, as a significant, reliable performer that produced good games for the market and, more importantly, was very flexible at adapting and customizing its offers to local markets, which, sometimes, the bigger organizations found very difficult to do. That was a great strength.

So we wanted to leverage those positions, and take the next step by asking, “What are the core drivers that make the business in this category successful?” For us, there were two key points: One was the game and the content that you put in front of players. So we needed to shift both our focus and our investment to becoming a developer and provider of great content.

The second key point was to say technology is important, but it’s an enabler, not the driver. With technology, it’s important for us to be relevant from a competitive standpoint. We don’t have to be at the front end of technology development, but we’d better make sure that we are relevant in the marketplace, so that when customers are choosing technology solutions, they know that they can get the same thing from us as they can get from everyone else. Content will always be the point of differentiation, not technology.

Those two areas were where we focused and, by combining, we’ve freed up resources from trying to lots of little things in individual markets, to harnessing this one consistent, common set of platforms for both content and technology.

Why did you go with the Spielo International name for the division?
Bugno: We had three options at the end of the day: We could come up with a combined name that used both the organizations, a brand new name that reflected neither of the two organizations, or we could choose one or the other as the lead for a new corporate unit.

We ended up choosing Spielo for a number of very simple reasons, and we added “International” to reflect our global position. In its market of distributed gaming, Spielo is recognized around the world as one of the leaders of that industry, and I think that’s an important starting point. Secondly, we effectively compete in two markets: distributed and casino. As a brand, Spielo had already gone across segments. It was also operating in the casino sector. Customers had an awareness of Spielo, whereas in the distributed, lottery-controlled area, Atronic was not as well known. So it has been an easy transition for many of our customers to make.

The Atronic name stays alive on the product side?
Bugno: It will remain as a product brand in most markets. For instance, we’ve entered into the AWP market in Europe in the last four months with a range of Atronic products. Atronic stays very much alive as one of our core commercial product brands.

As president and CEO of Spielo International, Walter Bugno leads Lottomatica Group’s overall Gaming Solutions business unit to capitalize on the many growth opportunities in the gaming industry. He is responsible for managing and overseeing the long-term strategic direction of Spielo International, including the future technology and content development objectives, in order to achieve market leadership in the government sponsored and commercial gaming industries worldwide. Bugno joined Lottomatica in July 2010.