Remote Gaming Industry in Malta
21 November, 2011
The Malta Remote Gaming Council is an initiative of the Lotteries and Gaming Authority as part of its strategic plan to create a dynamic regulatory environment for Remote Gaming. In an interview with Dana Bonello, Alan Alden, General Secretary, outlines his experience in the gaming industry.
Q: How do you feel your dual role, both as a systems reviewer and a Board Member of the MRGC enhance this council as a whole?
I wouldn’t exactly say that any role in particular that I have enhances the council as a whole or as a part. My experience in the gaming industry and throughout my long working career helps me to look at things from various angles and keeping different objectives in mind. I am also a consultant, with the majority of my clients being from the industry I am constantly faced with new questions, scenarios, business models, products and problems. More often than not a problem highlighted by one operator is also shared by other operators or service providers. Due to the various roles I carry out I become aware of most problems quite early on and this puts me in a position to immediately discuss at Board level. The same can also be said about the other Board members. As I am currently the only Service Provider on the Board I have more chance of encountering various issues than the operators on the Board. However, their vast experience in the industry, from the operations side, is required to have a clear picture of how the problems are affecting operators, what the operators want and we can eventually come up with possible solutions that we can discuss with the membership and also with the Authority or any other entity with whom the problem/s lie.
Q: From your experience, what can the Government do to attract larger companies to our gaming jurisdiction?
Malta has already attracted some of the largest International gaming companies in the world some of which have been operating successfully from Malta for a number of years. Some of the larger companies, especially those with a focus on the UK market, seem reluctant to move to Malta as they are quite well set up in other jurisdictions. Some of these have obtained specific licenses in Malta for some of their product offerings although they have refrained from moving their whole operation. I do not think Malta can do much more than it has already done to attract them to our shores, more likely it will be influences or actions outside Malta that will attract them to our shores, as has happened in the past.
Q: What do you think the Government should do to safeguard the current industry?
First we need to understand what an operator is looking for when they obtain a remote gaming license before we can say what the Government needs to do. The operators generally look for the following:
1. A reputable, globally accepted license.
2. Sound technical and legal infrastructure.
3. Good working relationship with the regulatory Authority.
4. Consistency and efficiency from the regulatory Authority.
5. Legal backing by the Government in court cases affecting the acceptability and legality of the license.
6. Fair taxes.
7. Licensing costs.
8. Operational Costs.
9. Good environment and standard of living for employees.
Malta is quite strong in most of these points.
Two areas where there is still some discontent among the operators lie with the Authority and with the bandwidth costs. The Authority needs to be more efficient and practical in handling license applications, especially where the licensees are already well known. The bandwidth costs, although they have dropped in price in recent years, are still very high compared to continental Europe. Another issue which needs to be revised is the number of licenses that an operator has to obtain to offer different products.
Although these issues are within the control of the Government, the EU situation is not. Malta’s efforts to challenge the EU’s handling of online gaming have been relentless. Unfortunately, Malta has found itself on its own as even the UK, in a bid to increase tax revenues, has stopped challenging and is now favouring the national authorisation path. If the EU accepts this trend then the Malta license may not remain that attractive any more unless bilateral agreements are reached with the various jurisdictions. The regulations were changed this year to accommodate such possible scenarios. I sincerely believe that the Government has really done a lot for the industry, and was pro-active enough to identify the potentials of the industry in the first place. The Maltese have accepted the industry with open arms and now we even have our own home grown specialists to cater for various requirements of the sector.
Q: The Remote Gambling Association (RGA) is one of the most powerful lobby groups in the iGaming Sector, what is stopping the MRGC from reaching these heights?
You are correct, the RGA is probably the most well known association for the sector. The main differences between them and the MRGC are firstly, the statute; secondly membership fees; and thirdly they have full time staff. The MRGC was set up with fixed objectives which were focused on being more of a forum for discussion for, and to promote, the local industry and handle locally licensed operators and matters. Although, we feel we should be doing more at an EU level, with the current setup and available funds this is not possible. The membership fees are set by the statute and there has been reluctance to increase these to a level which will give us more funds for these sort of ventures. We must also bear in mind that a number of the main operators who are members of the MRGC are also members of the RGA. It would be difficult for us to compete with an already existing setup and well known association. Moreover, we do not want to create competition between associations. One of the criticisms levied at the industry is that we do not have a common lobby group with fixed and common objectives.
We have worked with and backed the other associations when we were required to. We have also done our bit for the industry in a less publicised manner, by working with the Ministry and the Authority on various issues whilst also submitting our responses to the EU commission’s green paper on online gambling to mention a few activities. As part time Board Members and with no full time staff there is only so much that we can do, as we are all very busy and often have to work extra hours to manage to carry out some MRGC work. Having said all this, we believe that the Council has been effective and has been a very important contributor to the local industry. We hope that the MRGC carries on contributing and that the stakeholders understand the importance of the Council and facilitate its work by participation, inclusion, and continued membership.
Q: The MRGC has access to some of the most brilliant people in the industry, and financing aside, has the opportunity to increase its knowledge base considerably via think tanks, regular meetings and such. What do you feel is holding the council back at this point?
Potentially yes, we can access some of the brilliant minds out there, however, it’s not always possible as these persons are very busy and hardly find time to attend or participate in these types of meetings. When required, and absolutely necessary, we have managed to put together sub-committees with specific objectives and these have worked well. In short, when push comes to shove we do manage to make use of specialists to achieve particular objectives. We must always keep in mind what the objectives of the Council are, and the particularities of the remote gaming industry which is a highly competitive and secretive sector. It is also important that the Council’s Management Board is composed of highly experienced and knowledgeable persons who can themselves handle most of the matters arising without having to turn to their membership each time, after all that is why they are elected in the first place. The Council is not there to come up with any innovative products, new marketing strategies, new business models and other such ideas but rather to assist, and direct the industry in accordance with the statute’s objectives. I think it’s important that the objectives of the Council are specified for better understanding of its role in the industry, these are:
1. To provide a forum for discussion within the Remote Gaming Industry in Malta, thereby enabling licensees to use their collective experience to meet new challenges;
2. The attainment of the highest possible levels of sustainable development within the Remote Gaming Industry;
3. To act as the voice of the industry and to provide input towards all issues relevant to the Remote Gaming Industry including regulatory matters, technical standards and benchmarking;
4. To promote fair and responsible gaming;
5. To establish and promote trade guidelines and practices that enhance consumer confidence;
6. To assist and make recommendations to the relative authorities in conducting arrangements involving the organisation of any programme or information campaign, with the aim of combating irresponsible or illegal gaming, or gaming by under aged persons;
7. To build credibility in the Remote Gaming Industry;
8. To generally promote and enhance the industry;
Q: How do you feel the MRGC could possibly gain the commitment of local experts and, together with the LGA, move towards a achieving a more harmonious and long lasting local iGaming Sector?
As stated, when we have called upon the local experts for their help we have generally found it. Bear in mind that their assistance is provided for free and in their own spare time. We would like to see better participation from our members when we organise events, or carry out surveys, as response is normally quite poor. Service providers in particular should do more for the industry. We have quite a few service providers who are members but hardly participate. It seems that way to the Board, however, we may be mistaken. We would like them to inform their gaming customers about the Council and the importance of membership and participation.
We also feel that the Authority do not make use of us and our knowledge and experience as much as they should or could. We have always tried to make ourselves available and worked hard to fulfil the objectives of the Council. We can only be effective if we are more involved in matters affecting the industry and consequently, our members. We require that both operators and service providers, get more involved too when we their feedback is required. We also need them to communicate with us on issues they are encountering as otherwise we cannot assist them.
Prepared by Alan Alden, General Secretary of Malta Remote Gaming Council
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