How to survive regulation’s natural selection

With an increasing number of European countries regulating their online gaming sectors there is little doubt that only a few major brands will survive and thrive in these new regulated markets.

As a Frenchman and founder and chief executive of Chilipoker.com, I am in the process of applying for a licence in France and follow closely what is happening in my home country at the moment.

Once the market is open in June, French players will be offered a choice between pure-play operators and the gaming sites of major media/communications groups. Chilipoker is a medium-sized company that will operate its .fr poker site in partnership with Iliad-Free, the second biggest internet service provider in France.

But what we won’t be able to do is compete with the likes of PokerStars, Bwin or PartyGaming. Therefore, the challenge we have to address is: how do we make sure we build a strong business that can survive the inevitable marketing war that is going to be unleashed and offer our players the best possible egaming product in a regulated environment.

At the moment, the majority of the B2B deals being signed feature suppliers offering their technology with the gaming sites launched under the client’s brand. Personally I believe these sites should be launched with the gaming firm’s brand, and this is what we have done by launching Chilipoker in Ireland with Setanta and in France with Iliad-Free. This way we take on all the marketing, CRM and security tasks for these partners and at the same time build up our brand across different markets.

Major operators such as PokerStars aren’t going to offer B2B services, but for a company like Chilipoker it makes sense, since we already have the content, events (WPT in Marrakech, Deepstack Open across Europe) and assets that can be pooled and utilised across different countries. In this way we offer our expertise and content to our partners while not presenting an existential threat to them because we are not as big as Bwin, PartyGaming or PokerStars.

I believe a company like Chilipoker will grow in regulated markets by licensing its gaming brand and building up a network of ventures launched with strategic partners who provide their support and reach across different markets. This is what 888 has done recently with Endemol Italy, what we have done in Ireland and France and we are currently working on agreements in Eastern Europe, Asia and Latin America. It is also what travel specialist Expedia did in France with the national train operator SNCF and it has become the country’s leader in online travel.

For Chilipoker, such a strategy will enable us to build a strong international gaming brand and network and carve out our place in regulated markets.