Earlier this month, Asia Gaming Brief reached out to two skill-based slot manufacturers to understand what happened to skill-based slots after all the hype that surrounded them in 2019. We also wanted to find out about their experience as slot providers during the lengthy pandemic.
In today’s Face-to-Face interview, Asia Gaming Brief editor Felix Ng further explores some of the issues raised in the article with Michael Darley, CEO of Next Gaming.
We discuss Next Gaming’s experience during the Covid-19 pandemic, and whether this was any different to the traditional video reel industry. We also discuss where he sees skill-based slots fitting in the casino floor of today, compared to where they will be in ten years time.
AGBrief: Slot manufacturers found the last few years quite tough to say the least. What’s been the situation for skill based slot companies?
Michael Darley: It hasn’t been unique for us with the pandemic and social distancing. In Las Vegas and other jurisdictions, when casinos closed, there was no business. Slot manufacturers, whether it was video reel or skill based gaming faced the same dilemma. There were no placements. Not only that, casinos had to remove products from the floor to accommodate for social distancing rules. They were also waiting for the customers to return and see to what degree they would return and spend, and they were looking at the demographics, taking into consideration that younger players would have a propensity to return early, while the older demographic returned at a slower pace. So all of us encountered our restricted opportunity to place any machines on the casino floor.
AGBrief: Now that customers are coming back in a big way, particularly in the U.S. market where you’re based, what have you been seeing in terms of recovery?
Michael Darley: It came back very strong. In fact, we’re having record numbers in Las Vegas and in the U.S. for gaming. People enjoy gaming. They’re back out in public, where you can get entertainment, go to restaurants, you can get the gang gaming, you can get your friends together. So the market came back strong.
AGBrief: Have you seen that translate into more interest in skill based games from operators?
Michael Darley: They’re still interested in skill based games. There’s still a hesitancy when you look at win per device and casino space and all the other attributes that a slot director will use as a measurement tool to get a skill based game on the floor. For others, they understand where we started. The assumption when we started skill-based gaming was that it was going to bring a younger demographic, and that seems to still be common sense.
Consumers eventually age out of a product, and at the same time will age into a product. And the goal was to age the younger people into a product that offers a different experience than pushing a button and spinning a reel.
Did it culminate in what the expectations were? No it did not. Because it was so different. I liken it to ticket in ticket out (TITO). Back when coins came out of machines, people were really resistant to ticket in ticket out. But eventually it got to be common practice. It took a while for people to get comfortable with it. And I do think that because we’re a technology driven product, it’s taking more time than we anticipated for player acceptance because it doesn’t look or feel or anything like a slot machine.
However, while we have not yet been able to bring enough people to play on a continual basis that keeps pace with the traditional video reel games, we bring in younger people that may not play slot machines.
I’ve had many people say they come into a casino and don’t usually gamble. Yet they play our machines. They’re so different. With that, I’ve just secured some wallet that they would have not otherwise have had.
AGBrief: Do you have any data on how your skill-based slots have performed from a revenue standpoint?
Michael Darley: Certainly we do. They don’t perform like a wheel of fortune or one of those games that have been on the casino floor. But casinos don’t expect that. The casino floor is complicated, and the slot floor is complicated. It’s a retail floor. Which zone they’re placed in can contribute to the performance of a machine. We also know that how machines are supported within the casino can also contribute to the performance of the machine.
How are they supported within the casino? Do they have people that are interacting with the customers? Are they able to explain the game? Can they answer questions about them? Are there promotions around them?
So while they’re not performing to the level that a regular slot machine does, in terms of revenue, many people view it as found-money. It’s money that they may not have captured before and it’s a demographic that they may not have captured before.
“We just need to get more of a population that enjoys our games. It’ll happen.”
You were at the gaming trade shows, and you sat down and said: “Wow, these are cool.” We just need to get more of a population saying the same thing in a real casino environment. That’s why we are and some of the other skill based manufacturers are utilizing our game content to get online.
AGBrief: So you are offering real money gaming online as well?
Michael Darley: We’ve got Bust-A-Move real money online. We’ve got a number of our games that are in transition, because there’s work we’ve got to do to change the game dynamic, length of play, and the way it’s coded. But yes, that’s a goal of ours. And as you know, the number of online providers are really aggressive in trying to get new content. And that’s an advantage to us. I think two things are converging with the skill based attribute and the online experience.
AGBrief: Where do you see your slot machines fitting on the casino floor today? And what about 10 years from now?
Michael Darley: Right now, I don’t think you can avoid being attracted to our machines. They’re so different. The graphics are good and the hardware is different. You will notice machines. I just need to get butts in seats and time on the device. It’s about people playing the game.
It’s about the enthusiasm that I can generate on the machines when people are having fun, and they’re yelling and screaming and doing high fives. I’ve got all that right now, I just have to increase the population. I think it’s going to be a transition.
What does the slot floor look like in 10 years? I think there’s going to be things that we don’t even know about yet. There’s going to be a blending of eSports, there’ll be a blending of demographics, there’s going to be a number of things that we don’t recognize. The transition is going to be from strictly video reel to a skill based offering to a combination of eSports to a transition where people are not simply dependent on table games and slots. Instead, they’re dependent on a multitude of experiences in a casino that appeal to a wide variety of customers.
AGBrief: Definitely something that I’m looking forward to seeing in a decade’s time. Thank you very much for the chat today, it’s been very enlightening. And I look forward to seeing the new heights that next gaming will achieve in the next few years.
“I just need to get butts in seats and time on the device.”Michael Darley, CEO, Next Gaming