The enemy of innovation

The enemy of innovation

The industry’s ongoing battle for financial success and unwavering focus on the bottom line comes at an ultimate cost to its sustainable development, writes Thomas Rhys Jones of Xcaliber.

Published 3rd November 2016

‘'Innovation' is a word frequently thrown about in the software industry. Everyone wants to have the chance to showcase the ‘newest’, ‘latest’ and ‘greatest’. But in the igaming industry, which increasingly depends on standing out from the crowd in order to be successful, it habitually seems that this notion takes a back-seat when compared to many other industries.

This idea is driven by the pursuit of profit, which has become the causal mechanism for these things. Outsourcing to the lowest bidder is the norm, with all eyes on the bottom line. This permeates the gaming industry, which is still essentially a young business and needs to be groundbreaking in order to continue sustainable growth.

Profitability is king

What we’ve done is to define profitability in terms of percentages, rather than reward innovation, as many igaming companies are simply set up to become money-making machines, where invention and forward-thinking take a back seat to profit, to the detriment of the growth of the industry.

The problem tends to lie with those in positions of power and is perpetuated by business schools teaching that profitability is king. In the 21st century, this is an outdated notion that can leave you in the dust in an ever-changing world and more crowded marketplace. Before, it was a chore to find new alternatives or better options, but in the global web age, this is becoming easier almost by the day.

The igaming market as a whole is saturated and success appears to be dictated increasingly by those with the biggest advertising budget and best offers in order to capture market share, rather than looking to be innovative or have the courage do anything new, which many (in my experience) feel is to the detriment of the industry.

The current trend for those who enjoy financial success is to capitalise by buying out the competition, driving down costs through assimilation of services and then sitting back and enjoying the profits. From a pure business model point-of-view, this is generally a sensible option, but at what cost for the future? Again, innovation takes a back seat and is replaced by a homogenous experience for the customer; whether you’re at brand A or brand Z, you have the same experience.

Mobile gaming

There are operators out there that have tried new things, with varying degrees of success. Concentrating on mobile gaming was embraced by a few key operators. Some of these have become household names, but many have disappeared as quickly as they came along.

Focussing on mobile gaming was a fantastic concept because it is a broad approach with guaranteed growth. Added to this, there were not enough brands who had really taken the time to invest in this growing segment, so those that created a marriage of technological advancement and effective promotion found themselves riding a wave of enormous growth.

Social gaming

Integrating a social element has been popular at several operators, but again this can limit the range of potential customers. These aren’t generally the same group of people gaming operators want on their site, as they want them to bet big and consistently. Those who join for social reasons generally are of a younger generation, with less disposable income and more chance of being a ‘flighty’ customer. Conversely, some brands have leveraged free gaming on Facebook for the same reasons.

Virtual reality

Virtual reality has been hyped as the next great gambling innovation, and with the release of the revolutionary Oculus Rift VR headset and other similar devices for home use the interest in VR has risen exponentially. The first full VR casino is now available and major software developers are working to advance casinos providing an accurate realworld experience.

As impressive a step as this is, this focusses on a very niche market. Many also feel this goes against the very nature of online casino gaming and could simply be seen as another gimmick, no matter how technologically advanced. With ever-rising traffic figures for mobile, for instance, how does the VR experience fit into this trend? Embracing this new technology is a step in the right direction, but may not be as revolutionary as it seems on the surface.

Conclusion 

Many of these features are simply borrowed from other industries or are a ‘gimmick’, rather than forcing the industry forward with something truly clever or revolutionary. What cannot be abstracted here are the core services. If a customer cannot play at a brand without being able to deposit in confidence, play the best games available and withdraw quickly and simply on a constant basis, then this is what needs to be fixed before looking to ‘push the envelope’ of your brand.

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