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Interview with Igor Salindrija (EEGReport Magazine – Issue 1 – October 2015 – January 2016)

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EEGReport Magazine: As we know you are involved in the industry for a long time now and also founded AskGamblers and grew it into the world’s largest, most influential, multiple award-winning authority for online casino reviews, ratings and complaints. How much has the igaming industry evolved in the recent 10 years around the world, but especially have you seen significant growth in Eastern and Central Europe recently?

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Igor Salindrija: Not at all. I work parallel in tech industry, residing in the heart of Silicon Valley where we’ve seen the greatest inventions in the past decade such as smartphones, electric cars, reusable rockets, printers for human organs, crypto currencies etc, and then I also work in the industry where the biggest innovation is a mobile-friendly website. The biggest growth I can think of is the number of new white-label casinos… and WordPress blogs… but they’re not all optimized for mobile. Yet.

Few of the largest affiliates are from Eastern and Central Europe.

EEGReport Magazine: How big is the impact of having large affiliate portals being present in Eastern Europe? Do operators feel at home by knowing they are entering markets where certain affiliates have businesses?

Igor Salindrija: If “certain” means the largest I’ve already mentioned above, then I’d frankly say they won’t be able to help much. These markets are quite small comparing to the West Europe, Scandinavia, Australia, Canada and other huge markets where big affiliates operate. They should address the smaller affiliates focused on these markets. There are a few decent ones as far as I know.

EEGReport Magazine: Do you see an opportunity for beginner affiliates, which are at a rather high number in Eastern Europe, to start new companies and maybe innovate the already innovated affiliate industry?

Igor Salindrija: If this industry needs something, then it’s innovation. We don’t need yet another casino reviewer or forum. We need problem solvers. If your idea is really needed to the world, or at least solves one single problem to anyone, you’re ready for the game. And feel free to pitch me your idea, maybe we can help! Or you can be another reviewer or forum, but you’ll have to be better than the rest. It wouldn’t be the easiest job, but it’s still possible.

EEGReport Magazine:In your opinion, which are the most popular ways of online gambling in the Eastern and Central European region? Casino, sportbetting, online poker or maybe bingo?

Igor Salindrija: We do only casinos, but I’ve seen a lot of sportbetting around. Poker is game over for the new guys and bingo is still around in smaller portions. Actually, it doesn’t matter at all. Whatever your choose, be sure to keep the focus on it for a long time and say “no” to the most opportunities that come along. I believe if you focus enough you can make a multi-multi-million business out of anything, even scratch cards or backgammon.

We don’t care if something else works better at the moment, because we have a long term vision and path how to get there, and no stress and pressure for chasing opportunities.

EEGReport Magazine:We have seen an increased activity in the Balkan region that may indicate moving towards a regulated market. Do you think that this is something to likely happen in the next 2 years?

Igor Salindrija: Apart from living and working from here, we don’t operate much in Balkan countries. Neither do any of the large casino affiliates I know. This could be a great opportunity for the new affiliates who are experiencing difficulties on the competitive markets. As far as I’m informed, there is more happening than before, definitely. It’s good timing to prepare for those upcoming markets, at least register your domain on time!

EEGReport Magazine:Which are the countries operators should look forward to welcome foreign companies to get licensed in online gambling?

Igor Salindrija: I always hoped it would be my Serbia, but it hasn’t happened, yet.  I’m still looking forward to the government recognizing this opportunity and legalizing online gambling anytime soon. That would be a huge step forward.

Thank you!

 

Bio

Igor is an entrepreneur, Founder and CEO of AskGamblers, whose mission is to build the trust within the iGaming industry. He has had a lifelong passion about design, technology and outdoors adventures. His interests yielded multiple successful products across several markets, serving millions of people.

Igor built and grew AskGamblers into the world’s largest, most influential, multiple award-winning authority for online casino reviews, ratings and complaints. AskGamblers is constantly pushing boundaries and setting the standard in the gambling industry.

Recently, Igor and his highly talented team dove into exciting new venture, working on a unique tool that will make communication between team members easier.

Igor grew up in Serbia, and today he lives with family in beautiful San Francisco, California.

EEGReport-Magazine-Issue1

Vahe Baloulian Interview – (EEGReport Magazine – Issue 1 – October 2015 – January 2016)

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EEGReport Magazine: Since Armenia, a Transcaucasian state is included in definitions of Eastern Europe or histories of Eastern Europe, we would like to know more about the developments of the online gambling in the country and neighbouring countries. What is in your opinion the way these countries need to consider issuing online gambling licenses for foreign operators?(if you could answer per country it would be great).

Vahe Baloulian:Although our largest development and service center is located in Yerevan, the capital of Armenia, BetConstruct is not involved in a licensable activities in Armenia or neighboring countries. However, we do have partners who operate in Armenia. As an operator in Armenia, you have to register a local company and get licensed by the government. It is quite an expensive exercise. Casino and poker license is different from the betting license. Armenia is one of the so-called grey markets where some foreign companies, even publicly traded ones, illegally operate without obtaining a license. Online gaming is quite popular with sports betting prevalence as it is legal to operate betting shops in the capital, while land-based casinos, with one exception, are relegated to four resort areas.

EEGReport Magazine: As we know, you are from the USA and your first contact with the igaming world happened back in 1999. How much has the igaming industry evolved in the recent 15 years around the world, but especially have you seen significant growth in Eastern and Central Europe recently?

Vahe Baloulian:– The iGaming industry during the last 15-20 years has changed dramatically in positive and negative sense. It is more regulated, which is beneficial if regulation is focused on guaranteeing safe and fair environment for the players. If regulation is simply about creating a new revenue source for the governments, the players are rarely protected.
The entrepreneurial spirit of the early years, the can-do attitude of the pioneers is replaced with corporate politics of public companies.
As to Eastern and Central Europe, it is now experiencing the growth with the benefit of knowing what has been done right and wrong by those who lead the way. Those who are capable of learning from the mistakes and achievements of others will be a lot more successful than those who think they know everything and don’t need the lessons of the past.

EEGReport Magazine: How big is the impact of having gaming software providers being present in Eastern Europe? Do operators feel “at home” by knowing they are entering markets where certain igaming software providers have offices?

Vahe Baloulian:– Suppliers should be responsive and reachable regardless of them having an office in the operator’s market. Of course, having your supplier nearby gives you comfort but it is not a recipe for success. When picking suppliers, aside from the quality of their technology and services, it would be very important for me to know if they, regardless of the physical presence in the area, are willing to understand my market, speak my language, know what my customers want, visit me to learn how they can help me reach and go beyond my goals and invite me to their offices to meet their people and see how they operate. If I was an operator, this is how I would want a supplier to make me feel at home.

EEGReport Magazine: Do you see an opportunity for young software developers, which are at a rather high number in Eastern Europe, to start new companies and maybe innovate the already known platforms?

Vahe Baloulian:– BetConstruct has two development centers in Eastern Europe – in Armenia and Ukraine, where we work with many young developers. Also, our Game Store gives young independent developers an opportunity to see their games in action, distributed through our platform.  Young software developers, especially from the up and coming regions such Eastern Europe, have an enormous role to play in the development of iGaming. They will succeed and drive us all forward as long as they figure out how to learn, without blindly following, from those who came before them and how to believe in their own ability to create better things while avoiding the trap of arrogance.

EEGReport Magazine: In your opinion, which are the most popular ways of online gambling in the Eastern and Central European region? Casino, sportbetting, online poker or maybe bingo?

Vahe Baloulian:– While Eastern and Central Europe is not a monotonous region where players have the same interests, sportsbetting and casino remain the most popular. However, the online sector is much smaller than the land-based one and represents a huge opportunity in every vertical.

EEGReport Magazine: We have seen an increased activity in the Russian region that may indicate moving towards a regulated market. Do you think that this is something to likely happen in the next 2 years?

Vahe Baloulian:– Russia is struggling and the government is looking for new revenue sources, however insignificant. As recent media reports suggest, the return of legislated online poker in Russia could be eminent. The proceeds will be used to fund the Russian National Chess team and other sports. At one point poker was considered a sport in Russia, so if this u-turn is successful, I hope and expect the other forms of online gaming to get Mr.Putin’s nod as well.

EEGReport Magazine: Which are the countries operators should look forward to welcome foreign companies to get licensed in online gambling?

Vahe Baloulian:– The prediction game is never been one of my favorites, especially when it comes to such unpredictable and illogical entities as governments are. For example, it never made sense to me that the Eastern European countries, which are so well positioned geographically and politically, didn’t go the route of Malta, when it came to online gaming. They missed such a great opportunity to create jobs and become a hub of new technologies.

 

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Vahe Baloulian is an award-winning industry veteran with over 16 years of experience in the online gaming sphere.
Prior to joining BetConstruct as its Chief Executive Officer, Vahe has worked as a Director of Gaming and Industry Relations for 888, COO of LVFH, Managing Partner of eEgaming Partners and executive consultant to BetConstruct.

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EEGReport-Magazine-Issue1

Tim Heath – INTERVIEW about BitCoin – (EEGReport Magazine – Issue 1 – October 2015 – January 2016)

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EEGReport Magazine: Experts believe that in the coming years Bitcoin will develop at about the same speed as not so long ago Internet did. Do you also adhere to this theory?

Tim Heath: If we look at the speed of disruptive technologies, such as the Internet (http protocol) and Email (smtp), it takes time for such advances to propagate throughout society, specifically the time between the early adopter group and the masses.  However the movement from early adopter to regular user is most certainly more rapid than other such innovate / disruptive technologies we have seen in the past.

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At the moment, Bitcoin is simply to complicated for the average user, but conceptually it’s an easy concept to understand (once explained). I think this is because users know how to use  bittorrent, or how skype works from their everyday use cases, but most often don’t understand (nor want to) the underlying technology. Skype (and VOIP) is an amazing technology, but I really do wonder how many average consumers understand the technology and the rails & protocols it runs on.  Skype have made a very simple user interface to point and click, to call or video to someone on the other side of the world, for free.  Therefore, perhaps we should not view Bitcoin technology as the “ultimate” goal for adoption, but rather simply the “rails” on which a trusted transaction is made and the end user simply uses a nice user interface to click “send money to a friend from my contact list”.

Perhaps to this end, the end goal (or killer Bitcoin app), is that someone can buy $20 of Bitcoins from a friend and in the background, that amount is hedged immediately, to ensure there is no volatility in the Bitcoin price which may effect their whole experience. This money could then be sent to a merchant, gaming site or used as remittance to another country. The transaction would still take place over the blockchain, but in the end user’s eyes, they see the non-technical transaction (which one would say looks and feels like any paypal transaction), just that it happens over a decentralized network with no fees to “send the money” safely and securely.

EEGReport Magazine: Full anonymity of Bitcoin transactions – is it advantage of disadvantage?

Tim Heath: Bitcoin is Pseudonymous not anonymous.

Our primary KYC resolves around a player’s digital footprint, rather than traditional (and as some would agree, forgeable) utility bills. That said, players are happy to be KYCed in traditional ways due to o gaming license requirements.  This is because we have found that player’s prefer that their Bitcoin gambling transactions are “not obvious” to family / friends.  Therefore when depositing to a Bitcoin casino, there are no deposits from a joint bank accounts or credit card statement.  Most importantly however, is that there is no gambling transactions on their bank statements which may harm future loan or mortgage applications (through traditional banks).

EEGReport Magazine: Absence of clear scheme for Bitcoin regulation and for its taxation disaffect – is it a key issue for investors?

Tim Heath: Regulation is needed is the onramp / offramp of fiat currency to Bitcoins and vice versa.  This is where governments should have sensible regulations in place; that Bitcoin exchanges should know their customers and understand the sources or destinations of incoming or outgoing funds.  In regard to taxation – this is a situation for the jurisdiction where the company is based, to know and pay their respective corporate taxes.  Taxation is based on the annual reports filed in the relevant jurisdictions and have nothing to do with a Bitcoin transaction.

These issues don’t seem to be slowing down Venture capital investment into Bitcoin or blockchain related companies.  In Q1 2015 there was a record breaking amount of venture capital invested in Bitcoin startups, over $229 million (a total of $676 million so far).

EEGReport Magazine: What are the benefits received by casino if shifting to Bitcoin payment system?

Tim Heath: Bitcoin is perfect money for the Internet:

  • You can send or receive $0.01 or $10 million+ instantly anywhere in the world
  • It is irreversible
  • There is no chargebacks or fraud
  • There are no payment processing costs
  • There are no 3rd parties “holding the money”
  • All transactions are peer 2 peer and auditable on the blockchain
  • Escrow services exist in the blockchain code.

 

Therefore when a casino utilizes Bitcoin as a payment method / gaming unit, all deposits and withdrawals are instant.  We are seeing a huge increase in localized options for conversion between fiat and Bitcoin and vice versa, which is rapidly growing Bitcoin’s accessibility.  It’s also very clear and logical, then the faster withdrawals are processed by a casino, the greater confidence a player has (in the casino) and the faster they will re-deposit.

 

Of course any business would love to have 0% merchant processing fees and to completely remove fraud and Chargebacks from their profit / loss statements…

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Tim Heath has been involved in the gaming industry for over 12 years, working predominately in the Poker segment as a land based operator, B2B software provider and online operator.  Since 2013, his main focus has been on the Bitcoin gambling niche, with clear aim to innovate and disrupt existing norms and take casino and sportsbetting solutions to non traditional markets.

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EEGReport-Magazine-Issue1

The Rise of Daily Fantasy Sports in Europe – Can Daily Fantasy Sports Overshadow Sports Betting? – (EEGReport Magazine – Issue 1 – October 2015 – January 2016)

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Daily Fantasy Sports (DFS) is a relatively new phenomenon. Sometimes labelled as ”the next big thing” after the arrival of poker 10 years ago, this trendy iGaming product is taking North America by storm and slowly knocking on Europe’s doors.

 

The way it works is simple: sports lovers select a team of real-world athletes like football stars Lionel Messi and Wayne Rooney, who then score fantasy points during their real football matches, according to set scoring rules. Fantasy sports games are more diversified and require a higher level of skill than the more established and wide-spread sports betting. Participants do not place a wager on the outcome of different matches or play against bookmakers. Instead, they put money on their own team and compete against other fantasy teams’ owners with the hope of winning their money (similar to the poker websites’ business model).

 

In countries like the USA, Canada, and, to a lesser extent, the UK, fantasy sports has been a cultural activity for decades, but has become extremely popular in the last few years with the transformation of a season-long fantasy format into a more dynamic and high-frequency daily model. We are talking about a multi-billion business here: this year alone (2015) ‒ according to the Fantasy Sports Trade Association ‒ 56.8 million people are playing fantasy sports in the USA and Canada, with each of them spending on average $465 (€413) per year. Two operators, FanDuel and DraftKings, have mastered the industry, allowing them to control the vast majority of the daily fantasy sports action. Yet, we should not forget that sports betting is illegal throughout most of the United States.

 

In many countries, the regulation of gaming is based on whether the predominance for the outcome of the game lies in skill or chance. Presently, in most US states, fantasy sports (including DFS) is generally considered a game of skill and therefore not legally considered as gambling (where there is an element of both luck and, obviously, chance). At a US federal level, fantasy sports is defined and exempted by the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA). The Act included an explicit provision noting that the law would not apply to fantasy sports games.

 

Europe is a late adopter of technological innovations, so the DFS landscape looks a bit different there. ”Talking about the legal issues of DFS in Europe is not easy,” says Valery Bollier, CEO of OulalaGames, the company that stands behind fantasy football game Oulala. ”Each country has a different vision of what iGaming/moneytainment is, as well as what a skill and luck game is. Some countries are not aware of DFS yet, and their legislator have therefore no opinion on that subject for the moment. Therefore we have to take different approaches to target different markets.”

 

Most countries allowing fantasy sports have already included fantasy sports in their traditional iGaming licences. The most obvious example is the UK, the leading EU market for fantasy sports, where DFS falls in the same category as sports betting and horse racing. Therefore, operators need to acquire an operating ”pool betting” licence from the Gambling Commission to target UK customers.

 

Legally speaking, Hungary is facing a very similar situation. ”As I understand, you have to pay a fee of €300,000 – €400,000 to obtain a gambling licence, so I believe that any DFS game would be considered as gambling because of that,” explains Tamás Varga, who has helped to create the official, season-long fantasy game of the Hungarian top-tier league Nemzeti Bajnokság.

 

Hungary is just one among many European countries where DFS has not really taken off, and most sports lovers are not well acquainted with the concept. ”Daily fantasy games are not in the public mind,” explains Varga.

 

Romania and Bulgaria represent another two emerging markets. In Romania, fantasy sports is not yet expressly regulated. ”In my view, fantasy sports are covered by the new gambling legislation,” says Cristian Tuca, a gaming law specialist. The law defines DFS as ”other gambling activities”, and if the characteristics of the game meet all the required conditions then it is to be considered a type of gambling activity (the deposit and the prize are set in real money).

 

Tuca, who does not know of any big gambling operator which have started offering fantasy sports in his country, points out an interesting legal fact: ”Players that are gambling on platforms of unlicensed operators (in Romania) are committing a misdemeanour and may be sanctioned with a fine of up to RON10,000 (approx. €2,300). However, this aspect should not be applicable to fantasy sports, as the law provides that the fine is applicable to those participants that play online games, while fantasy games would fall under ”other gambling activities”.

 

Romania’s neighbouring country, Bulgaria, has a slightly different set of rules. The Gambling Act expressly exempts from the definition of gambling ”games of sports or entertaining nature, which require the participants to manifest deftness, knowledge and skills and which are not predominately based on chance.” The main problem is that entry fees have to be entirely allocated among participants, which means that operators cannot take any commission. If they do, the game is regarded as gambling/game of luck.

 

In Germany, on the contrary, the law defines DFS as a game of skill. In its judgement of 16 October 2013, the Federal Administrative Court decided that a so-called Bundesliga manager game is not to be classified as a game of chance under the Inter-State Treaty on Gambling (GlüStV). This led to chances for media companies and sports associations to offer similar fantasy sports games without causing conflict with gaming law regulations. Indeed, one can find quite a few games, but the market potential is still huge. German people love sports, numbers, gaming and betting, so it is no wonder that the total betting market volume alone is held to be more than 7 billion Euros per annum.

 

Another potentially big market for DFS is Poland. Interestingly enough, DFS does not fall under gambling, but it is also not regulated separately. Legally speaking, it is just like any competition, such as the quiz where people receive prizes if they win. ”The companies that are offering DFS do not need to acquire any licence for it,” says betting insider Michal Kopec. According to Kopec, fantasy football competitions should be reported to the Ministry of Finance if the prize pool is more than around €500 and winners should pay 10% win tax.

 

It is obvious that DFS has not really picked up as yet in Europe. The main questions is: are DFS and traditional sports betting complementary products or is DFS a dangerous substitution product for sports betting? Without a doubt, DFS games provide richer (real-time second screen) experiences than what is being offered at the moment by well-established betting operators. However, a lot of effort will be required to evangelise people about this niche in the fantasy sports industry with DFS lovers putting hope in DraftKings, who – backed with millions to be spent on advertising – has been granted a licence to operate in the UK.

 

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Jure Rejec is Content Writer for Oulala.com, Europe’s most advanced daily fantasy football game. Oulala offers its clients the chance to join different leagues, create and manage (in real time) their virtual teams with footballers from the top four European leagues. The leagues’ winners are awarded daily cash prizes.

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