Article
Gaming kiosks doing well in U.K.
The market for 'pay-to-play' machines is soaring in the U.K., thanks to gambling deregulation and widespread broadband connectivity.
August 28, 2006
In the United Kingdom and Europe several factors are driving the gaming and entertainment kiosk market, from the increasing availability of broadband connectivity to gambling deregulation.
On one hand, gambling machines, some of the most prevalent of the new recreational kiosks, can give governments direct incentive to OK more gaming kiosks.
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"The revenues garnered from sales from (lottery) kiosks go directly into government coffers," BCC Research self-service analyst Francis Duffy said.
In addition, in the private sector, which often competes with the government gaming kiosks, companies have successfully lobbied for deregulation to the point that gaming machines are now mass-produced for deployment.
The U.K.'s biggest server-based gaming kiosk deployer is a collective of five companies called Inspired Gaming Group (IGG). One of the member companies, Leisure Link, wrote a memorandum to Parliament for consideration while drafting looser restrictions on gaming machines. The memo noted that 10 percent to 25 percent of pub profits were generated through entertainment machines, and most pubs already had two.
Leisure Link at that time managed more than 90,000 pay-to-play machines in 27,000 locations and deployed thousands more as the market soared.
Now, IGG is expanding its capitalization and its network. In May, the group filed to trade its shares on the Alternative Investment Market of the London Stock Exchange with the stated goal of expanding its server-based gaming networks. In that filing, Inspired Gaming Group declared £163 million in revenues and £17 million in profits for the previous fiscal year. The group claimed server-based gaming accounted for 37 percent of those gross profits.
Revolution Entertainment Systems (RES), another member of the Inspired Gaming Group, designs the group's server-based digital entertainment kiosks. Managing director Ted Robinson said the legal deregulation enabled fulfillment of a growing demand.
"The drive is centered around the move of society to (be) cash-rich and time-poor," Robinson said. "They want more from their leisure time and are prepared to pay. In Europe and the U.K., this is assisted by deregulation of the gaming laws as governments see the move to server-based gaming as a means of revenue generation and control."
Self-service turnkey solutions and component providers also benefit from the European gaming industry's growth. As is common with most deployers, RES selected a manufacturing partner to produce their gambling kiosks.APW:I-engage, a global provider of kiosk and self-service solutions, serving RES from locations in Poland, Ireland and China, has manufactured more than 7,000 gambling kiosks for IGG/RES for use in 2,100 William Hill betting shops in the U.K. The screens for these units were manufactured byElo TouchSystems.
In another example of combining retail and entertainment applications, Coca-Cola HBC, which serves the European market, is adding server-based IGG entertainment, as well as mobile phone top-up and music download functionality, to new vending machines.
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