... Category C Sector Overview
Communication is key
According to Tony Glanville, sales director for RLMS, the evaluation process is critical to ensure the ongoing success of Cat C. “We conduct joint visits with our manufacturers’ partners to view the product in the field and listen to the com- ments from the coal face to ensure product development is matched to the market need,” he said.
SWOT ANALYSIS
Cat C’s versatile platform continues to drive innovation
Despite the many challenges currently facing the sector, continued innovation in the realm of Category C is providing consumers with a new generation of gaming options.
T
he Category C gaming sector remains a key pillar in the UK amusements and leisure industry.
The many and varied styles of products reg- ulated under the £1/£70 stake and prize structure are found everywhere from adult gaming centres and pubs to bingo halls and seaside amusement venues. The sheer versatility of the Category C gaming value proposition is also reflected in the fact that machines falling under this category cater to a wide adult demographic - one that is perhaps not matched by any other sector in the coin-operated amuse- ments industry. It is precisely for this reason that the pre- vious 50p/£35 stake-to-prize ratio - brought into play once the Gambling Act 2005 came into force in September 2007 - led many within the industry to lament what was per- ceived to be a swift deterioration in the future appeal of the sector, particularly as many machines in operation prior to the Act were granted ‘Legacy’ status and remained unaffected by the legislative changes. Following a review of the Gambling Act,
new regulations implemented in June 2009 brought about, among other things, an increase the stake-to-prize ratio for Cate- gory C machines to £1/£70. And while many within the industry continue to voice their disenchantment regarding the sector, it is generally agreed that - compared to 50p/£35, at least - the new legislation has given developers greater freedom to design more attractive games, while the increased flexibility of the platform allows operators to make better commercial decisions. As with many - if not all - sectors within
SWOT ANALYSIS CATEGORY C
STRENGTHS
• Core UK gaming format, widely recog- nised and embraced by a wide variety of venues
• Stake and prize uplift to £1/£70 has allowed for greater game creativity than 50p/£35 ratio and generally con- sidered adequate
• Robust Category C performance in certain venues, particularly bingo halls
WEAKNESSES
•Weakness in key UK pub sector trans- lates to drop in cashbox takings
• Legacy machines prohibiting influx of new product
• Some industry observers feel Cate- gory C technical standards limit designers’ ability to create the most captivating product
OPPORTUNITIES
the amusements industry, legislative hur- dles are just one challenge faced by the Cat- egory C sector amid the current trading climate. Ironically, however, the sector’s versatility across different venues has resulted in it being exposed to a multitude of complications that are being endured separately by a diverse range of out-of- home leisure venues. “Manufacturers and developers have continued to provide good quality prod- ucts, and the change in stakes has been well received on the whole,” said Gamestec commercial director Peter Davies. “How- ever, it has not had as much of an impact on the industry as some have predicted. Players have less disposable income. High levels of unemployment, the rising cost of living and the rising cost of drinks in pubs mean many players do not have as much cash in their pockets to put in machines.” In addition to being an important cul- tural issue that relates to wider ideas sur-
rounding traditional communities and their place within an increasingly post- modern society, the protracted decline in the UK pubs sector has had a damaging effect on the Category C gaming sector. Ultimately, however, as the following
pages indicate, Category C’s resilience amid the economic malaise is becoming increasingly apparent to both suppliers and operators. Recent trading updates from leading pub groups suggest the sector has bottomed out, leading analysts to predict a slow return to buoyancy in the market. Moreover, although purchase of Cate-
gory C product is slightly deflated as we draw closer to the second half of 2011, cer- tain operational pockets within the indus- try - particularly bingo - have been reporting robust returns within the sector, particularly as the benefits of multi-stake and community options continue to be realised by an increasingly knowledgeable player base.
• No triennial review, but industry has demonstrated its ability to success- fully approach government for change, as with current review of technical standards
•Community, multi-stake games increasing in penetration
•New wave of high-tech Cat C machines ushering in next generation of players
THREATS
• New B3 legislation could impact on operators’ Category C estates
• Continued pub closures will further reduce Category C product installed base
• Increasing competition for con- sumers’ leisure spend from other gaming sectors
Coinslot MAY 20 - MAY 26, 2011
Commission defends new standards
The recently proposed amendments to the Category C sector’s technical standards will have no implications in respect of problem gamblers, the Gambling Commission has stressed. “The player’s potential rate of loss on Category C machines would not be increased as the stake and speed of play are scaled propor- tionally,” the Commission said.
Flexible solutions
With an ever-strong focus on quality, flexible gaming plat- forms, Barcrest Group’s portfolio of products span the full spectrum of the Category C sector. “From a mar- keting perspective, we believe we have a strong range of games devel- opers who can develop games for all types of markets,” said Gareth Scott, director of UK sales, earlier this year.
The ultimate experience
Project’s Widescreengam- ing initiative, which delivers gaming on a massive 6sq.ft of screen space, is de- signed to make Category C products look, feel and play differently. The company’s development plan aims Cat- egory C at the sector of the player base whose prime drivers are amusement and entertainment.
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