A Virgin Online Gambling Endeavor

8 July 2004

Virgin Group launched an online gaming sites last week with hopes of attracting casual gamblers with its powerful brand. The launch of its games division, "Virgin Games," is its first foray into gambling since an ill-fated bid in 2000 to run the U.K. National Lottery.

"We see ourselves as an entertainment brand rather than a gambling brand."
-Simon Burridge
Virgin Games

Owner Sir Richard Branson said the new company will be geared toward online betting and casino gambling and will ultimately merge many of Virgin's business interests. Simon Burridge, who spearheaded the National Lottery project, has been chosen to head the company. Branson also nabbed former MGM Mirage Online Vice President Oscar Nieboer to help lead the new gaming division.

Virgin anticipates that the combination of an experienced team of executives and a strong mainstream presence will enable Virgin Games to compete in the increasingly crowded interactive gaming space.

To Burridge, delivering an entertaining product is crucial.

"Most Web sites have a rarified offer for the few rather than an entertainment-based offer for the many," Burridge said. "Too much of it is about money rather than entertainment, and that's where we hope to score. We see ourselves as an entertainment brand rather than a gambling brand."

To drive that point home, Virgin had the gambling software integrated into the Virgin Games site instead of launching a standalone gambling site. Gambling, therefore, will only be a small part of the Virgin Games experience.

Many operators have taken this approach, but it's easier said than done. With Virgin's other business interests already in place, the gaming site could easily offer music downloads, record deals, flight specials and other non-gaming related incentives.

Virgin Atlantic is the only British airline running direct flights to Las Vegas, and Burridge said plans are in place for Virgin Games' customers to be linked to the airline's loyalty scheme. Points earned gambling could be redeemable against Virgin flights as well as Virgin train journeys and wines. He added that the system could even be expanded to include in-flight gambling.

The new venture operates out of Alderney, where Virgin obtained a casino license last month. WagerWorks, which developed the gambling software for Virgin Games, has a license in the jurisdiction as well. Virgin Games has also secured a fixed-odds betting license in Britain.

Profits will be shared with WagerWorks, which provided all the investment in the back-end systems. Virgin, meanwhile, has invested around £1.5 million in set-up costs, licensing and marketing.

Virgin Games offers roulette, black jack, bingo, poker, slots and other games. The company hopes to identify a sports betting partner by summer's end.

A former managing partner of the J Walter Thompson advertising agency, Burridge said Virgin hopes to capitalize on the growing number of women taking part in online gaming. He also said the site is geared toward the casual player.

"It's aimed at those who want to spend half an hour having fun while not having to risk too much money," he said. "It's about giving people an enjoyable time even if they lose."

Virgin's online gambling venture comes at a time when the U.K. government is preparing to liberalizing its gambling laws. In addition to legalizing online casinos, the new laws will open up the land-based gambling industry to more operators. Burridge said Virgin has no immediate plans to get in on the bricks-and-mortar side, but he didn't rule out the possibility.

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