Tech & innovation

Uncovering El Dorado

4 minutes read
Mediatech Solutions executive director Daniel Graetzer looks at the technical and knowledge infrastructure needed to make the most of the opportunities opening up in Latin America.

Mediatech Solutions executive director Daniel Graetzer looks at the technical and knowledge infrastructure needed to make the most of the opportunities opening up in Latin America.

Latin America has been the next big thing for far too long. Yet even the most pessimistic observers of this vast, as yet untapped, market believe its door will finally swing open soon.

With a population of over 600 million, a high mobile penetration, some GDPs in the trillions, and few established local operators to get in the way, it looks ripe with opportunities for new entrants.

But what are the requirements for both operators and suppliers with their eyes on the prize, and can a continent of so many different countries and cultures be treated homogeneously?

Bypass desktop
A mobile first strategy will certainly be key to anyone hoping to establish a toehold. Due to the inadequacy of landline telephone infrastructure in some countries and tropical weather conditions in others, mobile phone penetration at 94% was well above the world average by 2011.

This will only continue to grow as a young population becomes more affluent, so there is little point lining your offering up for desktop devices only.

Such a large market provides great opportunities for mobile game operators which rely on this technology for the propagation of their product.

Yet the existence of retail betting and gaming operations in some LatAm countries mean an omni-channel approach must be employed too.

The flexibility to switch between channels is also reflected in the need for a great deal of choice on the type of content operators can offer.

Whilst we’ve seen from Europe and Asia that many games have cross-country appeal and will be popular with a wide variety of customers, the smarter operators will know their markets sufficiently to understand where local gaming solutions are essential to survive and prosper.

Speaking to operators in Latin America, we’ve found they desire absolute flexibility in their platform, so they can offer a product which is tailored to very specific regulatory and consumer needs.

That means fully API-driven, responsive, reliable and scalable platforms. It also means a very large range of content and payment providers – including local options – to suit a diverse population.

And needless to say a customisable back-end including advanced data, player and marketing management tools will be a must-have requirement, as it now is in any gambling market.

The war on illegal gaming
The regulatory landscape in LatAm is quickly shifting from the wild west to a strongly-regulated and well-policed one. But it’s not without it challenges. 

Chile is believed to still have 300,000 illegal slot machines, whilst an estimated 20% of Colombian gaming is still in the hands of criminals. Brazil is struggling to weed out the dodgy street lottery vendors too.

However, with strong regulation comes strong benefits for both legal operators, governments and suppliers.

The Brazilian government estimates it can generate more than €5.5 billion in revenue in its first year alone, as well as creating hundreds of thousands of jobs.

This also provides a perfect opportunity for regulated and experienced machine and software vendors to build the infrastructure to power this regulatory revolution.

Knowledge and localisation
The most important consideration for any new entrant will be to obtain sufficient local knowledge to avoid looking like you’ve just parachuted in.

In an ideal world they will need people who have been on the ground for several years, who know how to present and promote their services and can adapt their product to the different markets.

That will help operators avoid the mistakes made elsewhere by many of the largest platform suppliers, which have a tendency to believe customers in emerging markets will be happy to accept a watered-down version of their main product.

If regulation doesn’t permit a certain feature, suppliers should also find ways of making it compliant rather than taking the easy route of just blacking it out.

And it is no longer good enough to translate content into local languages and claim it is tailored for that market.

Ultimately, making the most of LatAm will come down to having sufficient boots on the ground and an open dialogue with regulators.

Only then will they have any chance of gaining the level of understanding required to innovate – and only then will they stand a chance of being a player in an inevitably successful market.

Daniel Graetzer is the executive director and deputy CEO of Mediatech Solutions, an omni-channel platform provider and part of the R. Franco Group, headquartered in Madrid. 

Subscribe to the iGaming newsletter

Big Time Gaming