Asia provides extremely fertile ground for the entrepreneur and investor alike who are considering opportunities in the mobile gaming field. Asia easily outdistances the rest of the world in gross mobile gambling yield and is expected to maintain this lead for many years to come.1 Furthermore, Asia has the second-highest annual average growth rate in mobile device subscribers in the world.2 Opportunity abounds in Asia and one only has to look at Vietnam for substantiation.
Vietnam, with a population of 90 million, is one of Asia's most populated and economically vibrant countries. Since 2000, its gross domestic product, or G.D.P., has grown at a steady rate of 8 percent and this growth rate is expected to remain consistent for at least the next 10 years. Currently, its G.D.P. sits at $100 billion. Only three million people make up its tax base.3
In 2006, Vietnam's paper lottery revenues were audited at $1.2 billion dollars.4 Meanwhile, mobile phone usage has skyrocketed in recent years and there is a trend toward more sophisticated lottery systems. There is a future in gambling via mobile devices. In 2006, an estimated 30 million people in Vietnam were mobile phone subscribers. In just the past two years, the number of subscribers has grown by five million and by 2010, it is expected that 50 million Vietnamese will have a mobile phone.5
What is true in Vietnam will also hold true for the rest of Asia. Between 2001 and 2006 the annual average growth rate of mobile subscribers in Asia was 27.3 percent.6 In 2006, 64.58 percent of Asians purchasing phones chose mobile phones over landlines.7 Mobile phone penetration has increased in all countries in Asia with the United Arab Emirates experiencing an incredible 215.3 percent penetration rate in 2006.8
Currently, e-lottery only represents approximately 1 percent of all lottery sales in China.9 However, in Hong Kong, there has been an increasing trend toward cashless betting, and this can be expected to expand throughout all of Asia.10 The gross mobile gambling yield in Asia grew from $56 million to $232 million between 2001 and 2006 and is estimated to reach $730 million by 2012.11
Mobile gambling can be broken into three distinct categories: casino-style gaming, or m-gaming, sports betting, or m-betting, and lotteries, or m-lotteries. Casino-style gaming, sports betting, and lotteries all adapt well to mobile gambling but high-frequency games and sports betting adapt the easiest.
One of the advantages of m-betting, which is often offered by bookmakers who provide commercial fixed odds betting, exchange betting or spread betting, is that the behavior of players can easily be monitored. This allows the bookmaker the opportunity to act proactively and contact the player in advance when that player's betting preferences are available. Technologically advanced mobile phones offer more opportunities for m-betting than those with less-sophisticated technology.
One of the drawbacks to m-gaming is that it requires advanced handsets -- beyond the second generation -- which may not be readily available in some of the developing countries. As well, it has additional costs tied to it. However, gaming experts expect that Asians will continue to favor playing table games. Often, m-gaming is available as play-for-fun and as play-for-prizes games.
Those considering the potential of the mobile gambling field in Asia should be aware that it can also present a number of significant challenges. For instance, some of the developing countries may lack technology or the infrastructure to support it. This would pose a considerable challenge to the success of any mobile gambling venture.
In order to evaluate the potential of an opportunity in the mobile gambling market it is necessary to consider four conditions that must exist for successful penetration. These conditions are as follows:
1. A cooperative regulatory environment
2. Availability of technical infrastructure
3. The mobile gaming technology that will be introduced
4. Public acceptance and awareness of the gaming product
The first condition to consider is the regulatory environment. The gaming industry is one that is highly regulated and if unable to attain the necessary regulatory or government approvals then the venture is doomed to fail. As well, governments will have concerns regarding the verification of a player's age and the impact of mobile gambling on its citizens. Another factor to consider is the country's taxation rates.
The second condition to consider is the availability of technical infrastructure. For example, infrastructure will need to be in place for payment processing and this can be complicated. Money-laundering regulations and related issues may also be a concern. As well, the country must have mobile network operators; without whom mobile phones are pointless.
The third condition to consider is the mobile gaming technology that will be introduced.
The fourth and last condition to consider is the public's awareness and acceptance of the mobile gambling product. The public needs to be aware of the product which of course can be promoted through advertising. But more importantly, the public needs to accept the product. Some jurisdictions may have active anti-gaming lobbyists or gambling may be culturally frowned upon. The public must also be confident that the games offered are not fraudulent. If the public does not accept the product, public perception can become a barrier to government action.
Asia provides both fertile ground and substantial challenge for the entrepreneur or investor considering opportunities in the mobile gambling market. But by taking these four conditions into consideration it is possible to build an effective and efficient model to evaluate mobile gambling opportunities in a methodical and structural manner and determine the likelihood of success.
1Simon Holliday and Tihana Jurican, mGaming for the Future Is the Industry's Future already in the Player's Hand? (Global Betting and Gaming Consultants, 2008), pp. 76-77.
2International Telecommunications Union. Nov. 28, 2007; June 12, 2008. [http://www.itu.int/ITU-D/ict/statistics/ict/index.html].
3Vietnam, Minister of Finance
4Vietnam, Minister of Finance
5Vietnam, Ministry of Information and Communications
6International Telecommunications Union. Nov. 28, 2007; June 12, 2008. [http://www.itu.int/ITU-D/ict/statistics/ict/index.html].
7International Telecommunications Union. Nov. 28, 2007; June 12, 2008. [www.itu.int/ITU-D/ict/statistics/ict/index.html].
8Simon Holliday and Tihana Jurican, mGaming for the Future Is the Industry's Future already in the Player's Hand? (Global Betting and Gaming Consultants, 2008) p. 88.
9Simon Holliday and Tihana Jurican, mGaming for the Future Is the Industry's Future already in the Player's Hand? (Global Betting and Gaming Consultants, 2008) p. 26.
10Simon Holliday and Tihana Jurican, mGaming for the Future Is the Industry's Future already in the Player's Hand? (Global Betting and Gaming Consultants, 2008) p. 27.
11Simon Holliday and Tihana Jurican, mGaming for the Future Is the Industry's Future already in the Player's Hand? (Global Betting and Gaming Consultants, 2008) p. 76.