Technology advances are affecting the gaming industry

April 15, 2023 2:42 PM

Technology advances are affecting the gaming industry

Photo: Generated by Midjourney AI by Cory Roberts
  • Rege Behe, CDC Gaming Reports
April 15, 2023 2:42 PM
  • Rege Behe, CDC Gaming Reports
  • United States
  • Commercial Casinos
  • Igaming
  • Sports Betting
  • Suppliers

Bill Gates once said, “The advance of technology is based on making it fit in, so you don’t really even notice it, so it’s part of everyday life.”

The gaming industry takes that idea to heart.

While some aspects of brick-and-mortar casinos seem timeless – the plangent jangle of slot machines, the thrum of background music, the sheer excitement of hitting a jackpot – in the background, technology is indelibly changing the industry. Artificial intelligence, facial-recognition software, and cashless-payment technologies are among the innovations making inroads without fanfare or notice.

And there’s much more to come in the way of integrating tech, so it’s a part of everyday life in gaming.

“It takes a long time to truly give the customer the experience that people are looking for,” says Sightline Payments SVP Strategic Development and Government Affairs Jonathan Michaels. “That’s the key. Customer experiences need to make life easier.”

“I’m aware of things that will wow the planet in coming years,” says Luisa Woods, vice president, market – gaming and entertainment for Delaware North. “They’re going to wow mankind in general.”

CDC Gaming Reports talked to five gaming-industry thought leaders about technology’s inexorable effect on the gaming industry. Here are their ideas:

Kelly Brooks, CEO and Founder, Quarter4

Brooks entered the gaming industry in 2018 with the launch of Quarter 4, an artificial-intelligence platform combining thousands of performance-data statistics with unique non-performance data to determine reliable predictions for fans, fantasy-league players, and content creators. She believes that the gaming industry has been successful in integrating “certain pieces of technology,” but other technologies, notably AI, are still being examined for how to be best deployed.

Kelly Brooks, CEO and Founder, Quarter 4

“I think AI was initially a very pretty shiny thing and people didn’t really understand how to use it,” Brooks says. “It had a wow factor about it and there was a little bit of ‘how do we use it?’ That alone was a whole education process, where it can be used, this is where it can be beneficial. And I think when any new technology comes into an ecosystem, people are afraid to integrate it. ‘How do we integrate it? What’s the effect going to be?’ … I think people are still trying to figure out how we do AI. Do we hire people and bring them in-house? Do we work with an AI service provider such as Quarter4 or somebody else?”

Brooks notes that whenever a new technology emerges, it needs a champion, a company or person that “learns it first, develops the skill set, and backs it on their own,” she says. To initially learn that tech through an “elite classroom” can cost a lot of money. “But I think as time moves on and AI normalizes as a business requirement, as a business efficiency, people will pick up the skills, perhaps on the dime of their company,” Brooks says, in order to keep abreast of others and developments in the industry.

But even as tech makes inroads, Brooks thinks one defining factor will determine its use: a business motivation to engage and retain users.

“Regardless of what industry you’re in, technology should help the bottom line,” she says. “It needs to drive viewership. It needs to make processes more efficient. It needs to perhaps play a regulatory role and make things ultimately function well and produce new insights and learning. That’s what AI is really good for in the industry.”

Luisa Woods at SBC Summit 2022/CDC Gaming Reports

Luisa Woods, Delaware North Vice President Marketing – Gaming and Entertainment

Woods has worked in the gaming industry for almost three decades, with operators in Las Vegas, Canada, Malaysia, Brazil, and Argentina. One of the advances she’s tracked in recent years is linked to tech that became necessary in the wake of the pandemic.

“For the purpose of contact tracing during COVID, scanning and recording IDs was a very simple deployment that allows us to have much better perspectives on who’s coming into the building, how many people are coming in, and to be able to control or track incidents that occur in a building,” Woods says. “There were a lot of unforeseen benefits from simple technologies.”

The gathering of information by way of players cards is also ramping up, providing perks and benefits more quickly. Woods calls it the “democratization of access to information,” allowing operators to gain insights, make decisions, and create customer experiences with “velocity.”

“Where 10 years ago a customer might have come  to a casino, signed up for a loyalty program, and waited for an offer to come in the mail a month or two down the road, now we’re breaking down those barriers,” Woods says. “We’re reaching them through email, we’re reaching out to them through time-drop mail services, we’re reaching out to them through their mobile devices, we’re sending geo-targeted messages. We’re getting them to opt in to receive SMS messaging and we’re monitoring specific behavioral events that we can respond to.”

Woods adds that Delaware North also employs a social customer-care team to monitor social-media channels for complaints or questions.

“By having teams and technologies that can monitor, process, and synthesize that information, we have the opportunity to reach out to the guest and make it right while they’re still on the property,” Woods says. “We’re leveraging all kinds of complexity to make the customer experience feel more effortless and immediate.”

Jonathan Michaels, Sightline Payments SVP Strategic Development and Government Affairs

Jonathan Michaels, Sightline Payments SVP Strategic Development and Government Affairs

Gaming floors, superficially, look the same as they did 25-30 years ago: banks of slot machines and clusters of table games. But while the basic design of a casino floor may not change radically in coming years, subtle changes will be taking place behind the scenes.

Michaels points out that the introduction of high-speed cables allowed information to move much more quickly. But it’s possible that information will flow even faster when cloud-based systems are introduced.

“Instead of all the machines needing to be hardwired into a system, there would be a secure cloud server,” Michaels says. “I think that will give slot floors a lot more flexibility in terms of how you design them, as opposed to now, where you have these banks of games because they need to be hardwired into single source.”

Michaels believes that technology can be used in myriad ways to help enhance customer experiences at resorts and casinos. One element that can be deployed at table games is the use of radio frequency identification (RFID) technology in chips. Where previously, a pit boss at a crap game might have to write down what a player bought in for and how much is being bet, RFID chips eliminate guesswork and enable a more personal connection.

“Now the pit boss can say, ‘Thanks for coming and playing with us,’” Michaels says. “You use technology to understand what (players) are doing. Using it properly, it can be used for personalization in ways across the experience.”

Technology also may be used to help identify when players are at risk. Sightline Payments recently released data to the University of Nevada Las Vegas International Gaming Institute identifying various clusters of payments that can help detect problematic behavior.

“Essentially, 95 percent of players have a very common pattern,” Michaels says. “Five percent fits in with what may be problem gambling risk. How do we build and use AI to help them see if they’re choosing riskier behavior and might have a problem?”

Tom Soukup, Konami SVP & Chief Systems Product Officer

Tom Soukup, Konami SVP & Chief Systems Product Officer

While much of the focus on gaming-industry technology is aimed at improving the customer experience, employees can also benefit from better tech. When employees are able to access player information through mobile applications, they’re able to better assist patrons.

“It enables the staff to actually be on the floor with the player, versus sitting behind a desk,” Soukup says.

Soukup notes that one issue that has been streamlined via technology is the payment of taxable jackpots. Sometimes that process can take as long as an hour.

Lawrence Shen, CFA, C3 Gaming Co-Founder

“Konami has a process where they can, through your cell phone, send you the W2-G electronically,” he says, noting this is a popular option with high rollers.

Lawrence Shen, CFA, C3 Gaming Co-Founder

Casino-management systems are essential in order to ensure gaming goes smoothly. But Shen says, “All casinos complain about their current casino-management systems,” even though they all have their merits.

One way for operators to leverage technology for better outcomes is to ensure that CMS produce information that is shared throughout a gaming ecosystem.

“On the back end, they better have a platform so that all departments can contribute and benefit from the data,” Shen says. “Right now, it’s very siloed. The slot department sees its data, but the marketing department has to put in a request to get that data, instead of having a shared platform.”

Shen also expects technology powering sports betting to evolve and provide new opportunities for operators and bettors. He noted that the “very robust systems and platforms” from Europe and the Caribbean, where sports betting has been legal for decades, is now being copied and developed.

“If you watch a European soccer game, most of data here is collected by Microsoft or Amazon,” Shen says. “Those big tech companies are extending their grasp into sports betting already. And I think the tech behind sports betting, about the live feed of data and the best live setting, those are really coming up.

“A lot of tech start-up companies are focusing on this. Some are overhyped, but some will emerge. It’s really necessary, because all the companies aren’t thinking about making money from sports betting, they’re thinking about grabbing market share. … They’re already tightening up on promotions to start making money. When there is more money to be made, then the technology will get better.”

Rege Behe is lead contributor to CDC Gaming Reports. He can be reached at rbehe@cdcgaming.com. Please follow @RegeBehe_exPTR on Twitter.