SG Digital sets sights on US sports betting and ilottery

7 February 2018

World Lottery Association (WLA) markets are now a sweet spot for the new SG Digital division forged from the recent acquisition of NYX by Scientific Games, SG Digital boss Matt Davey (pictured) told the press at ICE Totally Gaming this morning.

Responding to questions following a briefing on the new division, Davey said that although the acquired NYX/Openbet businesses supplied a lot of lottery customers on the lottery side, such as Singapore Pools and Danske Spil and BCLC, they would now be able to target these more effectively.

“We think the WLA markets are a sweet spot for our kind of business, heavily regulated government monopolies, but what we hadn’t really built out was the lottery side of things.

“We provided sports betting or scratchcards or game content. Now we can actually tie it back to a true lottery system. We have 24 of the top 25 lottery customers today.”

Scientific Games CEO Kevin Sheehan also underlined the main driving rationale of the NYX acquisition to be the Openbet sports betting platform, various iterations of which are used by big global bookmakers such as Ladbrokes, William Hill, Paddy Power:

“The day I started, our biggest shareholder gave me a list of the imperatives they thought that we had, and No 1 was sports betting and No 2 was iLottery.

“We knew we needed to fill this out, and we wanted to do it now before it was too expensive to get it done, and too late. So the timing was right.”

Davey also responded to the NBA’s recent comments to a NY Senate Committee that it would push for a nationwide cut of 1% of every single bet made on its games should the Supreme Court clear the way for the federal ban under PASPA to be lifted, calling it an “aggressive position”. Davey however added that he was hopeful stakeholders would arrive at a “robust environment, where everyone can make money.”

“If you look at the [US sports betting] market, there’s about $150bn in turnover, take 1% of that, you are at $1.5bn. We think the gross gaming revenue is about $6.5bn or so, so 1% of about $6.5bn doesn’t leave a lot for everyone else.

“So we think that’s an aggressive position but we also think they are an important part of the overall equation as well. I think once we get through the PASPA ruling from the Supreme Court, see sensible minds come together and hopefully we will work well with those guys.”

Sheehan reinforced the headline message emerging from the briefing, adding that: “We can offer anything to anybody and when the Supreme Court rules, we have the logical solution, whether it’s through the gaming world or the lottery world, I don’t think anyone else is in as neat a position as us. It’s very compelling.”

Davey was also bullish on the prospects of increased roll-out of regulated igaming in the States, should the Supreme Court clear the way for a lifting of the federal ban on sports betting under PASPA later this year.

"New Jersey is the largest of the three states that have passed online gaming legislation and have live and acting participants, and we are heavily invested in that market. We control about 40% or so and are seeing strong growth.

"Pennsylvania is going to follow suit but it’s going to be roughly 50% bigger and we think there will then be four or five other states that follow closely there afterwards, so the coupling between sports betting and casino is strong.

"We have seen it in the European markets, and when you combine the two, there will be a huge pull-through effect for the other states, we think they will start to get into the business very fast."