Visitors to the inaugural Scientific Games’ EMPOWER Customer Conference, which recently took place at the Planet Hollywood Resort & Casino in Las Vegas, likely came with the expectation that they would be hearing about the company’s current slate of products and systems. What they left with was this update and something much more valuable—a glimpse into what the gaming floor of the future may entail.
For three days, a host of Sci Games executives along with casino gaming and technology experts provided 450 guests from 150 casinos and lottery corporations more than 40 interactive breakout sessions and how-to workshops that outlined current company offerings in addition to its take on commercial gaming’s future; and the products, systems and technologies they’re developing to help customers with the transition. Tracks devoted to games, systems, table products, lottery and interactive covered a myriad of topics including mobile, marketing, Big Data, the 360-degree customer, slot floor of the future and emerging technology, just to name a few.
Attendees to EMPOWER, which has its roots in the systems user conference formerly sponsored by the Bally division of Sci Games, were also treated to a keynote Q&A featuring Apple Computer Co-Founder Steve Wozniak in addition to a golf tournament, wine-tasting lunch and a number of other entertainment and networking opportunities. The event also included a show floor in which EMPOWER co-sponsors displayed some of the concepts they were working on with Sci Games.
These attractions aside, what conference goers really came to see, hear and participate in were discussions on Sci Games and its slate of products and systems. They got that and something more—a macro look at some of the trends and technologies impacting the gaming industry, and a preview of the products and systems Sci Games is developing to ease this transition into the future
CURRENT STATE OF AFFAIRS
An overview on the current state of the company and its growing lines of product was provided by Scientific Games President and CEO Gavin Isaacs during his opening keynote, where he also touched upon disruptive trends facing the gaming industry as a whole. He described how the company spent most of 2015 reorganizing after its previous acquisitions of WMS Gaming and Bally Technologies. The end result of this process was the reformation of the company into three large divisions—SG Gaming, SG Lottery and SG Interactive; all adhering to a guiding mission, which is to empower its customers by offering the best gaming experiences, and a common set of core values that go by the moniker, “How We Play.” These steps made sure the disparate divisions operate as a unified entity, a vital component for a company seeking to become a one-stop shop for all gaming operator needs across multiple platforms and devices.
“2015 was a transformational year for us,” Isaacs said. “We now have one company, one mission and three very strong businesses. We are very profitable and we are going to continue to invest that money into the business.”
This transformation to an all-encompassing gaming products and systems provider is an ongoing process, with the company still trying to figure out the full impact and potential of its various synergies, Isaacs noted. Some examples: game designers now need to engineer their content to be easily adaptable to multiple platforms and gaming segments (casino, lottery and online); and various iterations of new games can now be tested online through SG Universe for customer feedback before final versions are created for slot machines.
“Bringing all the companies together has also created some great financial synergies as well, leaving us with more money to invest in R&D,” Isaacs said. “Of our 8,400 employees, more than 3,500 are in innovation, purely focused on R&D.”
For Sci Games, this R&D strategy takes the form of creating or improving products, systems and technologies that help drive customer growth, either by attracting new gaming patrons, making operation more efficient or both. This infrastructure backbone will be vital for gaming operators going forward, especially those seeking to take advantage of the recent uptick in gaming industry fortunes. Isaacs believes gaming is now going through a growth spurt—nowhere near pre-recession levels, but still significant with revenue gain reported by all industry segments (casinos, lotters and online) in multiple regions across the U.S. and the world.
“Prior to 2007, everyone was fat and happy and no matter what the circumstances, you could just put another game on the floor that would bring more people in and make money,” Isaacs said. “But then the recession happened and the world changed. For the first few years we assumed revenue growth would just bounce back; now we all realize this is not going to happen. We have a new normal out there, and it is low growth. But our players are getting accustomed to it, and they are coming back to the casinos… Players respond very well to operators that invest in their properties.”
And some of these properties are in sore need of technological investment, especially if they want to take advantage of all the latest advances in systems and communications. “I believe only 40 percent of the casinos around the world have Ethernet enabled floors, which means 60 percent of the industry still running serial-based floors,” Isaacs said. “We understand the difficulties of transitioning and will still support serial floors, but we have to find a way to bring these IT infrastructures up to speed if we are to put game changing innovation in place.”
Such improvements will likely prove necessary if gaming operators are to advance through the headwinds created by the growing number of disruptive trends and technologies Isaacs described to the audience. This list included customer preference to do everything through their own mobile devices; the need to create customized messaging and experiences for each consumer; player desire to have game and other content available through all channels at all times in any location; the movement toward non-cash, electronic transactions and the need to better manage and use Big Data.
Isaacs also touched on a couple of trends that he felt where being somewhat overblown, one of which was the need to attract Millennials to existing gaming facilities.
“There is a lot of talk out there that the reason why gaming is flat is because we are not attracting Millennials,” Isaacs said. “While it is really important that we start looking for ways to make what we do attractive to that group, it should not be our prime focus. Millennial-age generations have never come to casinos… they do not have the time or the disposable money to enjoy that form of discretionary spending. Meanwhile, Baby Boomers control 75 percent of the nation’s wealth and account for over 50 percent of its discretionary spending. It is really, really important that we continue to cultivate that group of people… if you are fishing, that is where the fish are.”
The other trend that may be causing too much of a stir is the push toward more skill-based gaming. “To me, skill-based gaming is a fantastic effort by regulators to give us better tools and flexibility to develop games,” Isaacs said. “However, I don’t believe the gaming world will become all skills-based and that casinos will have shooting galleries and things like that in place of slot machines.”
Skill-based gaming and Millennials aside, Scientific Games has recently released or augmented a number of its products and services to help its customers better cope with the challenges of advancing technology. On the mobile and online gaming front, the company continues to augment its SG Universe product suite which features multiple platforms that empower land-based casinos to increase engagement with their players at home, on-the-go and during each visit to the casino floor. Vital components in this lineup are the Play4Fun Network platform, a white-label social casino platform and VenueBet, which turns a player’s personal mobile device into an incremental gaming position, one they can enjoy off the casino floor and elsewhere throughout the facility.
“Recent studies show mobile users spend 80 percent of their time using apps, that 40 percent of these apps are games and that 50 percent of the top 100 app games are casino-based games,” said Tom Wood, vice president and chief product officer for SG Interactive. “This is a good opportunity for us… to provide our customers access to these players and the ability to speak to them and draw them into the casino.”
From the systems side, Sci Games emphasized iVIEW4, the latest iteration of its hardware platform that offers increased speed, memory and flexibility.
From a platforms perspective, Scientific Games offers ARGOS, a new operating system that combines the best aspects of systems developed by Bally, WMS and Shuffle Master. “We set about to create a new gaming platform that we could use to develop games across the company,” said Nathan Watt, chief technology officer, gaming, for Scientific Games. “We wanted to be transformative with the technology, and incorporated some of the tools used by Xbox and PlayStation to develop games. It’s a framework of tools and components that make it much easier for the game teams to get creative right out of the gate.”
Slot advancements were also touched upon. New for slots is the TwinStar cabinet, which delivers titles with maximum impact, keeping player engagement high with multiple progressives and great games. According to company press material, this for-sale cabinet supports Bally and WMS games, giving casino operators more content and the ability to adapt it for their players. Game themes include player-favorite Bally and WMS brands such as Gold Fish, Quick Hit, Quick Shot and Zeus, along with exciting new games Steam Dream and Hot Blooded, but new content is also being developed for the platform.
Bryan Kelly, senior vice president technology for the innovation lab at Scientific Games, provided an overview of the products the company is developing for the gaming floor of the future, which he believes will be increasingly reliant on mobile technology.
“The new consumer is used to getting media on their own device in their own time,” Kelly said. “We need to learn how to entertain this person through a 24/7 omni-channel experience with the cell phone acting at the key engagement tool.”
Kelly then provided an update on the products to make this vision a reality, which, at the company’s request, could not be reported on.