Sometimes, the best innovations come from the simplest of ideas. In the world of online casino gaming, for example, some bright spark wondered if they could utilize technological advancements in internet speeds and mobile devices to create a realistic casino experience in peoples’ homes. And so live dealer games were born.
Today, a small handful of slots providers have diversified into the live casino realm, producing games like blackjack and roulette that are enhanced by the presence of professional dealers and croupiers. The action is recorded live in a studio environment, and streamed immediately to the player’s device. Not only can you see the cards being dealt, and the wheel being spun, in front of your very eyes, you can also place bets and even chat with the dealer – creating a ‘home from home’ casino atmosphere.
These live dealer games have been one of the key innovations in the online casino space over the past decade or so, and yet so few software providers have diversified into producing these unique offerings. For the most part, if you play a live dealer game at an online casino, there’s a very strong chance that it will have been produced by one of two specialists: Evolution or Pragmatic Play. So why have so few firms moved into this ever popular niche of casino gaming?
Size Matters
When a developer of casino software designs a static game, let’s say a slot, it becomes a ‘cash cow’ product from the moment it’s finished.
The ongoing costs are minimal; once the game has been designed, developed, tested, and approved, it can be shared with partner casinos and remain in place on their site indefinitely. And then, the developer moves onto the next title in their release schedule.
Compare and contrast that to live casino games, which come with a catalog of ongoing costs and overheads to pay for. Most are filmed in a purpose-built studio, which have initial build and set-up costs, as well as ongoing maintenance fees – professional lighting, heating, rent etc. The dealers, croupiers and support staff, such as the floor manager and/or producer, also need to be paid!
And then there’s the technical infrastructure, which ensures that the stream is as smooth as possible for players. Investment in a robust server is essential, and there may be additional costs paid to storage and hosting providers. Besides that, companies also need the right licenses to run live-dealer games, and these often come with stricter rules and regular compliance checks.
The website and/or app on which the live dealer games are located also incur costs, such as hosting, security certificates, marketing, and ongoing maintenance. So creating live dealer games is an expensive exercise, which perhaps explains why there are so few newcomers to the sector.
Developing and publishing a static online casino game, such as slots or blackjack, can be expensive, but once completed the ongoing fees are minimal. But not so in the live casino environment, which racks up costs on a daily basis.
Best of the Best
There’s another reason why there are so few new entrants to the live casino space: Evolution and Pragmatic Play are just so good at what they do.
Evolution was founded way back in 2006, which enabled them to establish the ‘first mover advantage’ which can be so vital in any emerging industry or sector.
By 2013, they were celebrating the creation of their 100th live game, with studios located across Europe – in Riga, Malta and Spain, principally – that enable Evolution to localize their content for different audiences and languages.
They have since expanded into North America, while securing the licenses that allow them to create branded content – the Monopoly and Deal or No Deal live games are some of the most popular to this day.
Such was Evolution’s growth that they were able to acquire other key players in online casino gaming, like NetEnt and Red Tiger, to create an industry behemoth – today, their annual revenue exceeds $2 billion.
Pragmatic Play also has the scale and resources to produce high quality live dealer games in great quantity, and have been doing so for more than a decade. Their titles are featured at thousands of live casinos around the globe.
It would be very difficult for a new startup to enter this space, given the dominance of Evolution and Pragmatic Play, not to mention the initial, and ongoing, costs of delivering live dealer content that players return to time after time.