Post on 06-Jul-2018
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Prepared by Chris Grove for the Nevada Gaming Policy Committee
Skin BettingThe dominant product in the market for eSports wagering
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What are skins?
Skins are virtual items that players can acquire and use in a variety of way
Acquire• Purchase• Win• Earn• Gift
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How do people bet skins?
Skin betting is broadly similar to traditional online betting
• Roulette• Lottery• Sports betting• Rock paper scissors
Deposit Play Cash O
(Internal currency) (Internal cu
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What is the size of the skin betting market?
$6bn+Skin betting handle E2016$4.2bn
NV sports betting handle 2015
$2D
Sources: Narus Advisors, Nevada Gaming Control, Eilers & Krejcik Gaming
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Organic search interest in skin betting
Source: Google Trends
PokerStars(leading online poker site)
FanDuel(leading DFS site)
CSGO Lounge(leading skin betting site)
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Landscape for skin betting
No formal oversight
Limited visibility into companies and products
Game design emphasis on simplicity and speed
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Regulated online gambling in the U.S.Status quo
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States with regulated online gambling in 2016
Sources: Narus Advisors, GamblingCompliance
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Financial performance to date: U.S. Online Poker
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
$4,000
$4,500
In $000s. New Jersey + estimate for Nevada. Sources: Nevada Gaming, New Jersey DGE, PlayNJ.com
2014 2015
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Financial performance to date: U.S. Online Casino
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
In $000s. New Jersey. Sources: New Jersey DGE, PlayNJ.com
2014 2015
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Factors inhibiting revenue
Payment processing
Persistent lack of consumer awareness
Relatively underdeveloped product set
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Regulatory outcomes
No known AML issues
Geolocation technology proven effective
Age and identity controls proven effective
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Regulated online gambling in the U.S.Looking ahead
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States considering regulated online gambling in 2016
Sources: Narus Advisors, GamblingCompliance
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Factors inhibiting legislative progress
Stakeholder fragmentation
Political apathy
Online gambling leapfrogged by other products
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Legislative landscape for DFS in 2016
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Expanding beyond pokerA brief cost benefit analysis
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Costs of expanding beyond poker
Material degree of uncertainty
Industry divisions
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Benefits of expanding beyond poker
Technological and regulatory framework already in place
Revenue potential
Expansion of mobile footprint
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Casino play one of the few things you can’t do on mobile in Vega
• Board plane with mobile pass• Play games on plane to earn
comps• Text friends in town on landing• Hail an Uber to hotel• Mobile check-in• Research entertainment options• Explore property options via app• Make restaurant reservations• Buy show tickets• Reserve cabana or table at club
• Check rewards / comp status• Play poker• Bet on sports events• Check rewards status and
available comps• Navigate within and between
properties• Enter events with mobile ticket• Take photos and videos• Share experience via social
media accounts
• Download • Schedule m• Take notes
meetings• Arrange so
conference• Set alarm f• Check flig• Review ho• Buy coffee• Uber to air
Arrival Leisure Work
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Questions?chris@narusadvisors.com