December 9, 2021 -- InvestorsHub NewsWire -- via NetworkNewsWire
Editorial Coverage: The early days of ecommerce can be traced
back decades, sluggish until the 2000s, then accelerating rapidly
over the last 10-plus years. Online gaming is on a similar
trajectory. Analogous to what Amazon and Alibaba did for ecommerce,
online gaming has deep roots that go back decades and now has
entered a growth stage that many believe will chart like a hockey
stick. There are different approaches to capitalizing on what
appears to be parabolic growth across the industry. More merchants
than miners became millionaires during the California gold rush,
and servicing the companies that provide consumer gaming just might
be one of the best ways to cash a ticket. Playgon
Games Inc. (TSX.V: DEAL)
(OTCQB:
PLGNF) (Profile), a Software-as-a-Service (“SaaS”)
technology company, is laser focused on that business-to-business
(“B2B”) market, developing and licensing unique digital content for
the iGaming market. Other companies jockeying for the end user,
curating gaming and gambling services for consumers (“B2C”)
include Bally’s Corporation (NYSE:
BALY), DraftKings
Inc. (NASDAQ:
DKNG), Golden Nugget Online Gaming
Inc. (NASDAQ:
GNOG) and Penn
National Gaming Inc. (NASDAQ:
PENN).
- According to Grandview Research, global revenue in iGaming will
grow at a CAGR of 11.94% from $75 billion in 2021 to
reach $127.3
billion by 2027.
- Playgon is disrupting the $6 billion live-dealer casino
oligopoly with its mobile-first, streaming, high-definition
platform.
- The Playgon platform is currently live with 26 operators
through four content aggregators in Europe and South Africa and
commitments for more clients are growing.
- DEAL is also in the $20 billion Daily Fantasy Sports market
with its B2B platform focused on European Football and Golf (PGA
and Europe).
Click here to view the custom infographic of
the Playgon Games Inc. editorial.
Big and Getting Bigger
The online gaming industry, also known as iGaming, is of global
scale and currently generates an estimated $75 billion in annual
revenue. According to Grandview Research, revenue will grow at a
CAGR of 11.94% between 2021—2026 to reach $127.3
billion by 2027. The surging growth is undergirded by a
number of factors, including the COVID-19 pandemic, technology
advancements, increasing and rapidly evolving regulations, and
booming consumer demand. Consumer demand is key here as, much like
with ecommerce, younger generations don’t know a world without
iGaming while older generations are becoming increasingly familiar
and comfortable with the convenience of the digitized world.
The slow, seminal transition to digital gaming was given a shot
of adrenaline in 2020, as businesses were shuttered and people were
told to eat, sleep, work and play from home to prevent the viral
spread. Online gaming experienced unprecedented demand and
disruption that forever changed the face of the industry with
next-generation streaming gaming content as entertainment and a
safe social event.
Playgon Games Inc. (TSX.V: DEAL)
(OTCQB:
PLGNF) is capitalizing on the market growth,
developing and delivering digital gaming content that the industry
wants and needs. The company employs more than 80 people who
provide turnkey products and a multitenant gateway that allows
online operators the ability to offer their customers innovative
iGaming software solutions.
Playgon’s current software platform includes live-dealer casino
games, eTable games and Daily Fantasy Sports, which, through a
seamless integration at the operator level, allows their customers
access without having to share or compromise any sensitive customer
data.
DEAL is mobile focused and uses the latest technology to build
and deliver content. As a true B2B digital-content provider and
outlier in the online gaming marketplace, Playgon has zero customer
acquisition costs. The company’s current and future customers
include online casinos, sportsbook operators, land-based operators,
media groups and big database companies, just to name a few.
Live-Dealer Action
The invention of live-dealer games has captivated players
worldwide, driving growth in the online casino vertical. This is
exemplified by revenue in the nascent live-dealer casino market
forecast to rise 60% from $5 billion in 2019 to $8
billion in 2023. The live-dealer online casino market,
which unsurprisingly has a high barrier to entry, is an oligopoly
dominated by Evolution Gaming, Playtech and Microgaming, which
offer products that are relatively generic and similar, meaning
brands cannot differentiate to stand out from competitors.
Playgon is the new kid on the block, upsetting the apple cart
with the launch of Live from Las Vegas, a studio of 10 gaming
tables that delivers live-dealer, high-definition streaming video.
The company’s platform utilizes state-of-the-art augmented reality
betting technology and live dealers for four popular games:
blackjack, roulette, baccarat and its proprietary Tiger Bonus
Baccarat(TM). The user interface (“UI”) and user experience (“UX”)
are proprietary technology of Playgon that modernizes the old
incumbent technology, which was mostly designed for desktop
computers, and delivers the most-advanced and innovative products
to date.
Playgon’s platform is cloud-based for scalability. Playgon’s
games are mobile focused, device agnostic and built for
portrait-mode-only, one-handed play. Bridging the barriers to
entry, Playgon’s platform is already live with multiple online
casino operators through four content aggregator clients in South
Africa and Europe, with more expected to come on board soon. More
broadly, Playgon’s products are live with 26 operators currently,
with another 8 integrating the technology.
In addition to its live-dealer games, Playgon offers eTable
(random number-generated) versions of each game with its own set of
unique gaming features and is working on the development of a suite
of 25 games, including craps, hold ‘em poker, and 3-card poker, to
offer its customers.
DFS – Daily Fantasy Sports
The company also has its hand in the wildly popular market of
DFS, or daily fantasy sports, an accelerated variant of
traditional, season-long fantasy sports that can be condensed down
to a fantasy team for a single game. According to Research &
Markets, the global fantasy sports market is expected to grow from
$20.36 billion in 2020 to $22.31
billion in 2021.
Playgon has developed and offers a world-class, B2B,
mobile-first fantasy sports platform for operators. Built for
regulated markets, the initial sports in the platform are European
football (premier league, Bundesliga, Ligue 1, Serie A, La Liga)
and golf (PGA, European). The platform opens operators to new
gaming demographics and full control of the player database, or the
opportunity and information that is instrumental in growing revenue
and widening margins.
High-Margin (Recurring) Revenue
Unlike B2C companies that must devote significant capital to
acquire and retain users, Playgon’s business structure doesn’t
include any user acquisition costs. The company’s revenue model
includes marketing and licensing fully integrated live casino
solutions to
iGaming operators worldwide. Revenue is generated through a
typical SaaS license-fee agreement for the platform.
SaaS is a popular business model today because it typically
generates high-margin, recurring revenue as the customer pays each
term for use and support of the technology. License fees will be
due monthly and range from 6% to 12% of gross gaming revenue
(player bet minus player win before operating expenses). The exact
fee varies, depending on the customer and market size.
Playgon is led by Darcy Krogh, who is no stranger to either the
iGaming industry or B2B operations. In 1999, Krogh cofounded
TSX-listed Chartwell Technology, which pioneered the development of
browser-based digital content for the iGaming market. The company
was sold in 2011 to the Stars Group (then called Amaya) where Krogh
served post-merger as VP of business development.
The B2B asset portfolio was sold to NYX Gaming Group in 2016,
then subsequently bought by NASDAQ-listed Scientific Games Corp. in
2017. Krogh left the company upon the sale to NYX Gaming Group to
found Playgon Games Inc. (formerly Global Daily Fantasy Sports
Inc.)
Krogh is joined in the C-suite by live-dealer technology expert
Guido Ganschow as CPO. Ganschow has spent 13 years creating
real-time, live-dealer technology and platforms and was the
cofounder and creative director for a Macau-based casino
consortium. In addition, former Shaw Communications exec Steve
Baker is part of the Playgon team, serving as COO. During his time
as VP of operations at Shaw, Baker was integral to growing revenue
from $300 million to $2.8 billion and staff from 350 people to
13,000; he also led a number of M&A deals.
Success Favors the Strong, Integrated
While Playgon builds a reputation and lucrative business in the
B2B world, there are well-heeled juggernauts in the B2C market that
have moved swiftly to adopt the latest digital technology to help
attract consumers. Some omni-channel and others strictly in the
digital space, these companies are familiar names to both online
gamers and investors.
Bally’s Corporation (NYSE:
BALY) is a global casino-entertainment company
with a growing omni-channel presence of online sports betting and
iGaming offerings. The company currently owns and manages 14
casinos across 10 states as well as a horse racetrack in Colorado;
it also has access to OSB licenses in 16 states. In November,
Bally’s announced that it was awarded one
of nine licenses to conduct online sports betting in the
state of New York.
DraftKings Inc. (NASDAQ:
DKNG) is a digital sports entertainment and
gaming company created to fuel the competitive spirit of sports
fans with products that range across daily fantasy, regulated
gaming and digital media. The company is a multichannel provider of
sports betting and gaming technologies, powering sports and gaming
entertainment for operators in 17 countries. Most recently
DraftKings and the Boston Bruins announced a
new multiyear deal, which will make DraftKings the
exclusive, official Daily Fantasy Sports partner of the team and TD
Garden.
Golden
Nugget Online Gaming Inc. (NASDAQ:
GNOG), a leading online gaming company, was first to
bring live dealer and live casino floor to the U.S. online gaming
market. The company was the recipient of 17 eGaming Review North
America Awards, including the coveted Operator of the Year award in
2017, 2018, 2019 and 2020. GNOG continues to expand its footprint,
announcing in August that the Arizona Department of Gaming
has awarded its
partner, the Grand Canyon Resort Corporation, an online
tribal-event wagering operator license.
Penn
National Gaming Inc. (NASDAQ:
PENN) is North America’s largest regional gaming
operator and an innovative provider of retail and online gaming,
sports betting, live entertainment, parimutuel racing and
hospitality. Penn National operates 43 destinations across the
country with a variety of gaming, live and simulcast racing,
entertainment and hospitality offerings. The company expects to
open its Hollywood Casino Morgantown, its fourth facility
in Pennsylvania, to the public later this month.
The fact is that many gamblers will say that nothing can replace
the sights, sounds and excitement of a casino. However, there’s a
change in sentiment that picked up some strong tailwinds during the
pandemic. Technology is bringing the feel of a live casino to a
player’s living room, and while bricks-and-mortar casinos aren’t
going anywhere, both gamblers and investors alike are astutely
aware of the fun and money to be made in the virtual sphere.
For more information about Playgon Games,
please visit Playgon
Games Inc.
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