GameCo LLC is intent on dragging the gaming industry into the 21st century. The creator of the world’s first Video Game Gambling Machine (VGM™) recently announced a new partnership with GRID, an innovative esports data platform.
Betting USA caught up with GameCo CEO and cofounder Blaine Graboyes to get his thoughts on the new deal and what it means for the casinos of the future.
The GRID Partnership
Betting USA: What will GameCo’s role be in bringing esports betting to casinos and sportsbook operators in North America?
Blaine Graboyes: GameCo is extremely proud to be the official partner of GRID in North America. We will be representing GRID’s revolutionary esports data platform in the US, Canada, and Mexico.
This includes acting as the sales and marketing lead for the product in North America as well as working with casinos and sportsbooks to implement and maximize the product with their current and new customers.
We have innovative concepts for how casinos and sportsbooks can use GRID’s product to attract and monetize a new, broader audience as well as bring existing sports betting customers into the esports experience.
As a licensed gaming manufacturer, GameCo will utilize, or expand as required, our gaming licenses to provide a regulatory framework for esports betting. In jurisdictions that currently do not actively support esports betting, we will work with regulators to educate the market and bring esports betting to the largest possible audience.
How GameCo Will Integrate and Deploy GRID
Betting USA: What type of esports betting experience does GameCo imagine providing to customers in the retail setting?
Blaine Graboyes: GRID has developed a truly revolutionary product for esports betting. GRID has successfully tackled challenges in esports around data extraction and processing which gives the platform the ability to provide fast, granular, and accurate data feeds across a wide, diverse array of game titles.
At the core, the most important component of GRID’s offering is official, exclusive, and real-time data from the most popular esports games such as CS:GO and Dota2, with others available in the near future.
At the core, through GRID’s game-agnostic approach real-time, official, exclusive data feeds and products for the most relevant game titles will be offered for the first time in a rapidly developing, regulated market. Being able to offer official, exclusive, and real-time data and video streaming for casinos and sportsbooks is a game changer for esports betting for two primary reasons; it likely makes it easier for regulators to approve wagering on a larger market of esports events instead of licensing esports competitions event by event and it allows casinos and sportsbooks to offer innovative wagering options such as in-play betting.
In addition to the data component which is delivered via GRID’s API, GameCo will also bring livestream video content from GRID’s partnered competitions for events along with scoreboards and widgets used for website and mobile delivery of esports betting experiences.
Targeting New, Younger Customers
Betting USA: The partnership with GRID seems to continue a GameCo trend of targeting a younger, more tech-savvy demographic. Is that an accurate description of the GameCo approach to gambling?
Blaine Graboyes: We are observing a challenge for casinos and sportsbooks in the US from a demographic perspective with a predominantly older generation being engaged by the current offering. Esports presents an untapped potential to expand the target audience through an offering that is tailored to the experiences a younger audience is expecting in a digitally transformed world.
GameCo invented the category of Video Game Gambling™ and launched the first-ever skill-based Video Game Gambling Machine (VGM™). Our focus has always been on bringing innovative new products to the casino industry that will attract and monetize new, younger, and different “net new casino gamers.”
Over the past six months, in partnership with a leading data scientist in the casino industry, GameCo completed an unprecedented effort in analyzing over three years of data from casinos in multiple markets that operate GameCo’s VGM™. The results were a strong validation of our core thesis that new, different gambling products will monetize new, different customers.
An example is that 81% of spending on GameCo’s VGM™ is from Gen X and Millennial customers compared to only 21% of spending on traditional slot machines from the same demographic. Even table games only received 32% of spending from this age group. This presents an opportunity for casinos to generate incremental revenue that is critical to grow the overall gambling industry.
Through the partnership with GRID and the agreement to bring their data platform to the US, we expect to see the same trends – a new, innovative offering for casinos and sportsbooks that will appeal to a wholly different audience as compared to traditional sports betting.
Esports in a World with No Sports
Betting USA: With sports events around the world being cancelled due to the Coronavirus pandemic, esports seems particularly well-positioned to thrive during uncertain times such as these. Has GameCo detected a significant uptick in esports betting interest in recent weeks?
Blaine Graboyes: While it is true that the current situation with the COVID-19 pandemic is bringing increased interest in esports betting in the light of traditional sports events being cancelled resulting in a void of content for betting & media, we are confident that casinos will reopen in the near future and that traditional sports will return too.
Most importantly, we believe that the current situation will widen the audience for esports in general and esports betting in particular.
With fewer traditional sports offerings right now, sports bettors will become aware of the excitement and entertainment of esports and this will grow the market for the future. As someone that has been involved in the esports industry for many years, we need to focus on growing the market and reaching casual gamers and sports audiences. Our hope is that we will emerge from the current pandemic with a larger audience for esports betting and esports in general.
The US Landscape for Esports Betting
Betting USA: The USA’s state-by-state approach to sports betting has resulted in some states authorizing esports betting and others prohibiting it. Does GameCo anticipate lawmakers and regulators growing more comfortable with esports betting considering the current situation?
Blaine Graboyes: Esports betting certainly does not have the broad reach in the US as compared to Europe and Asia. This is unfortunate and in some ways is founded in a general misunderstanding of the video game demographic and the esports industry in general.
According to the ESA, 65% of American households are “gamer households”, so this is a very large and broad audience. At the same time, there are valid concerns about integrity in esports betting, such as monitoring and addressing cheating and match fixing. But again, these concerns exist in traditional sport and we can use the same methods, in fact sometimes better methods given that esports is completely digital, to ensure the integrity of esports betting.
So yes, we definitely anticipate that lawmakers and regulators will grow more comfortable with esports betting and GameCo will take an active role in the education of the market and regulatory bodies. This is very similar to our approach with Video Game Gambling™ wherein GameCo has been able to leverage the existing regulations, standards, technology, and business models for slot machines to bring an entirely new category of games to casino floors.
How Big Could Esports Betting Get?
Betting USA: Do you see this as the moment esports betting can take off in the US and would it be realistic to project that the esports betting handle could one day be competitive with the handle generated by any of the major US professional sports leagues?
Blaine Graboyes: The current moment is absolutely a great opportunity for esports betting, and we expect to see a growth in engagement with existing fans as well as growing the entire ecosystem by engaging new fans.
Given that the entire esports industry is estimated at $1.1 billion dollars today, with only approximately 12% of that in actual consumer spending, but the global regulated esports betting market is estimated at $12.4 billion dollars in handle, we can assume that the market for esports betting in North America is an order of magnitude larger than the consumer side of the industry.
However, it is difficult to imagine that the market for esports betting will generate handle larger than most of the major, traditional U.S. professional sports leagues…but anything is possible.