Malta offers access to talent, an abundance of potential clients and partners all within 20 minutes of each other, reasonable office rents, a respected licensing regime, and the willingness to do business, says Richard Hogg, CEO, Openbox.
The coronavirus pandemic has changed many aspects of business all over the globe, but the crisis has also brought new ideas, strategies and technologies. How has the pandemic and the pressure it put on digitalization affect your business plans?
Technology, connectivity, and customer-satisfaction have always been our primary objectives so the ability to ensure we can deliver services regardless of things like power failures, natural disasters, or the recent global pandemic has always been a priority.
We have multiple levels of redundancy and contingency in place at all times to ensure our operations remain undisrupted. This pandemic in particular has highlighted one significant aspect which everyone is addressing, that of remote or hybrid work. While we have a number of offices across the globe, they have all been hit in the same way by the pandemic, so moving location has not been an option. We have always ensured our key staff had access to devices that would enable them to work from home as the nature of our services may demand on occasion. When the pandemic hit, all we had to do was to roll this option out to more of our staff. As a result, some areas of the business have actually increased the numbers of products and services they deliver to customers whose own productivity has been hit by travel bans and quarantine.
Were there any benefits that made you decide Malta was the place to be for the future of OpenBox Gaming?
I have been coming to Malta since 2007 when the UK added the country to its first whitelist, easing the possibility of overseas operations from the UK gaming market. We moved from Curacao after quickly seeing the many benefits Malta offers. At the time, it was possible to obtain an MGA licence within just three months of starting the application process. We obtained tier 1 PSP’s and banking services, recruited experienced staff and migrated operations seamlessly and effectively, benefitting immediately from the attractive tax regime.
In the US we are seeing an explosion of new entrants and operators
While things have changed over the years, those changes are not unique to Malta, and we have seen every jurisdiction having to cope with issues involving licensing, banking and Brexit among other things. What Malta continues to offer is access to a knowledgeable talent pool, an abundance of potential clients and partners all within 20 minutes of each other, reasonable office rents, a respected licensing regime, and the willingness to do business. The work permit application for overseas workers is easier and simpler than some other European destinations, which has ensured we have been able to place some of our localised talent directly onto Malta. It also has SiGMA and sunshine, as well as good transportation routes to the UK, so it makes sense for Openbox Gaming in so many ways.
Given Openbox’s potential as a bridge between the European and Asian iGaming markets, how does the company’s background in Asia factor into any future initiatives?
I started off in the industry while based in Hong Kong in 1999. On opening up our first online sportsbook in 2000 it was clear there was a massive gulf between how the industry worked in Asia and in Europe. The bet sizes were huge, the odds format was different and customer acquisition was a sea change due to the fact that agents played an important part in the operation and cash was always king. As the online betting and gaming industry exploded across Europe and competition became fiercer, operators looked to new markets to operate in. Asia was a natural step forward for many. What most of them didn’t understand were the complexities of delivering an attractive sales-pitch over there. I have witnessed many European or North American entities try to launch in Asia and seen most fail, even after haemorrhaging cash to try to enter and last in the market. Even today, while some operators and suppliers have had some success in the region with what they perceive to be “localised” products and services, more experienced and familiar “locals” still manage to reap far more rewards.
Openbox Gaming has some exclusive access to these channels and hopes to be able to work with European partners – suppliers and operators alike – in order to give them a foothold in the Asian market. While we too offer our own products, we don’t tend to compete with our partners in terms of content so local operators get a complete suite of games such as table games, slots, board and poker games via one single and convenient integration. That gives them access to over 1,000,000 (100,000 concurrent) players and 3,000 operational sites.
How do you see the iGaming industry evolving in the near future?
As we see more and more legislation being implemented in established jurisdictions, we are likely to see more operators looking at emerging markets with potential, including those currently considered to be grey. Developing systems and operations to comply with the myriad requirements implemented across the globe takes time and resources, a price that affects the bottom line of many an operator or supplier. Other considerations will be banking and processing of player payments, which differ across territories. As the perception of gambling changes and legislators get tougher, we will see margins decrease and the industry will need to work within this new and evolving landscape. Operators who are able to deliver a suite of products to suit a wider audience with a sufficient amount of capital behind them will be the ones who emerge successfully.
In the US we are seeing an explosion of new entrants and operators, but the current levels of financial haemorrhaging on acquisition and marketing are unsustainable for such low returns. Many of these operators have no experience of operating in the US nor the market’s nuances. We are still seeing offshore operations booming without any of the associated costs, so it will be interesting to watch this market evolve, even more so when investors start looking for returns.
Do you have any exciting new projects in the pipeline?
We are always looking to get involved in new projects and are currently exploring opportunities in the blockchain and digital currency space. We have several ongoing initiatives in this area and Malta will always fit into our plans wherever possible. As a tech hub, we are confident we can utilise the island to deliver what we need in this respect. As a licensing regime we will watch closely to understand how this process can work with our plans to deliver our content to our clients.
Beyond Malta, do you have any plans to exhibit in international shows next year?
SiGMA in Malta is our first event, and the timing could not be better. Having attended SBC in Barcelona and iGB in Amsterdam, I’m confident the industry has the appetite for events again after a near two-year hiatus due to the pandemic. The next major event in the calendar for us is ICE in London and we are very busy preparing for that. Having seen SiGMA go from strength to strength over the years I’m confident this will give us the platform we need to start a sustained marketing and events campaign for the future.