5 US iGaming Insights From 888’s Itai Frieberger

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Over his decade at 888, Itai Frieberger has helped shape what was once a relatively niche player in the online gambling space into a competitive force with profitable sports, casino, bingo and poker brands in a variety of international markets.

And, over the last two years, 888 has positioned itself at the forefront of the nascent market for regulated iGaming in the United States.

That combination provides Frieberger – COO of 888 since April 2011 – a unique vantage point from which to survey and assess the likely trajectory of U.S. online gambling. I recently spoke with Frieberger by phone and came away with the following five insights.

AAPN to launch ASAP

There’s been a fair amount of speculation regarding which online poker rooms will be a part of New Jersey’s online gambling launch.

While he stopped short of a guarantee, Frieberger stressed that 888 is working “very hard” to to ensure that the New Jersey arm of their All American Poker Network (AAPN) – a partnership with Wynn Interactive that will operate under one of Caesars’ NJ licenses – is a part of the first wave of online poker sites this November in NJ.

As for Nevada, where 888 will be operating in partnership with Treasure Island, Frieberger said we should expect a firm launch date “soon,” noting that the software powering AAPN in Nevada is similar – although not identical – to the software powering WSOP.com, a platform that Nevada regulators have already approved.

And, of course, in both states 888 will be powering a second (separate) network through Caesars WSOP.com brand, which operates on the 888 platform.

Delaware will offer online poker from day one

The chatter back in the summer was that Delaware – whose online gambling products will be powered by 888 and partner Scientific Games – might eschew online poker at launch.

Poker, the argument went, would be more trouble than it was worth given Delaware’s small player base and the regulatory complexity involved.

Frieberger definitively dismissed that speculation, telling me that poker would “absolutely” be a part of the package when Delaware goes live with regulated Internet gambling, a launch tentatively slated for later this month.

Frieberger also clarified that Delaware will not be a part of the AAPN and that 888 will not have a standalone brand in the state’s online gambling market.

Interstate compacts are complex, but progress is being made

When asked if he saw interstate iGaming compacts in the near future, Frieberger was cautiously enthusiastic, noting that compacts require some “heavy lifting” on the part of regulators.

Frieberger was quick to praise the rapid acclimation of state regulators to online gambling, saying that U.S. gaming regulators are “key in shaping the future of online gaming in America” and “making progress” on the issue of interstate compacts.

According to Frieberger, technological hurdles to compacts also remain. While 888 developed its American platform in a way that anticipated compacts, Frieberger made it clear that the process of actually linking up said rooms is “not that simple” and will only become more complex as the individual sites grow and diverge.

Frieberger’s comments and tone on the subject of compacts echoed the optimism of MGM head Jim Murren, who told reporters back in August that a compact between Nevada and New Jersey was “likely” in 2014.

The next four states to watch for iGaming regulation are …

I asked Frieberger to name the two states 888 was paying closest attention to now that New Jersey, Delaware and Nevada have regulation in place.

His immediate response: “I’ll give you four.” In no particular order, Frieberger pointed to:

  • California, where speculation is increasing that legislators will finally pull the iGaming trigger in 2014.
  • New York, where legislators tried – and failed – to attach online gambling to the state budget in early 2013.
  • Illinois, where an iGaming vote is expected in 2013 or 2014.
  • Pennsylvania, where rumors of a new iGaming bill emerged over the summer and were rekindled by news of an impending bill on October 3rd.

One interesting omission from his list: Massachusetts, where iGaming proponents have taken an increasing number of shots at regulation in recent months, most recently in July of 2013.

888’s plan to maintain – and grow – their regulated U.S. iGaming lead

The platform

888 owes no small part of its US success to an end-to-end online gaming technology platform that has attracted top-tier casino partners such as Caesars and Wynn.

That platform, some 20 years in the making, has two distinct components. There’s the consumer side – the lobby, the tables, the actual gameplay and all of the features that accompany it. And then there’s the back office, the operational side of an online poker site that players rarely think about or interact with.

Frieberger rattled off a list of the various back office functions that the 888 platform provides out of the box, including “state of the art CRM and customer acquisition protocols, payment processing technology and fraud prevention.” That suite of tools, developed over the last two decades by 888, allows casino partners to focus their iGaming efforts squarely on what casinos generally do best – marketing to players.

The partnerships

But 888’s strong relationships in another industry vertical – gaming supplies – may prove just as critical to maintaining 888’s lead as the regulated map expands. I’m referring to 888’s partnerships with the soon-to-merge Scientific Games and WMS, partnerships that Frieberger indicated are “strong” and set to continue post-merger.

Scientific’s lottery supply business and the track record 888 & SG are set to establish with Delaware, said Frieberger, gives 888 a “head start” in states where iGaming regulation ends up running through the state lottery.

And Frieberger sees WMS “coming into play as we move into new markets,” especially “fragmented markets like California,” where WMS’ existing relationships with a wide array of land-based operators positions 888 as a primary choice for casinos seeking a technology solution to power their move online.

- Chris is the publisher of OnlinePokerReport.com. Grove also serves as a consultant to various stakeholders in the regulated market for online gambling in the United States.
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