BettingBusinessInteractive • SEPTEMBER 2011
B2B 27
ISLE OF MAN sportsbook
Player Protection - A brand building opportunity in a competitive market
Garth Kimber, head of e- gaming development at Isle of Man Government’s Department of Economic Development, looks at the potential for brands to differentiate themselves in a different way.
“
at Ladbrokes and other Mfuse clients in- clude specific interfaces for Nokia and Blackberry, richer event information, and application messaging to allow much closer interaction with the user. It is certainly Game On indeed!”
Many of the companies that we have spoken to recently about licensing in the Isle of Man
are concerned about what their licensing juris- diction infers about their brand and how this may help to differentiate them from their com- petition.
The e-gaming industry has grown quickly and as with all new industries that have rapid growth there can be a lag time before consumer protection and regulation fully catch-up. It’s still surprising however, to see how long it’s taken for players to realise how licensing and regula- tion affects them personally, but they are cer- tainly realising now. Players are in a heightened state of awareness since the US DOJ indictment
of Full Tilt and their subsequent inaction in pay- ing back their players. On the other hand, if re- ported player stats are true, numbers have virtu- ally returned to their pre-Black Friday levels at Isle of Man licensed Pokerstars, due to its ability to refund players. It’s time then to start taking issues of con-
sumer protection a little more seriously. Operators who put in place mechanisms to enable them to protect their players’ funds are able to make a valuable promise to their cus- tomers and that can be a worthwhile exercise and a relatively easy brand-building opportunity in this competitive industry. So how can opera- tors put themselves in a position to make such a promise without major impact to their balance sheets and cash flow? There is a world of difference between licens- ing jurisdictions’ requirements to start with. Segregation of funds is recommended by many regulators which is good practice, but it’s only a starting place. Keeping funds separate from op- erational cash-flow does not provide any assur- ance for the player if something goes wrong. As long as the guarantee to safeguard play- ers’ funds is met, the Isle of Man is open minded with regard to the mechanism used. Tried and tested methods include the use of trust funds
and bank guarantees. These measures have been used successfully, however, invariably both can be expensive and are simply unviable for all except the most cash rich companies. Isle of Man legislation offers another mecha- nism, that of the protected client account. All player funds (including winnings) are held with an Isle of Man licensed bank in a separate and segregated client account clearly designated as player funds and protected under Manx law from the company itself as well as creditors. The level of protection is as strong as a trust but without the expense and gives the regulator the ability to repatriate money to players if required. Operators can take interest from the account, but cannot access the fund which means that the customer is paid first and can therefore bet confidently.
As the industry continues to mature, and competition remains high, customers will con- tinue to recognise that when choosing where to chance their money, it’s not all about bonuses and fun marketing gimmicks and that some ‘chances’ are bigger than others. Those who take these concerns seriously will be well posi- tioned for the long-term.”
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