Challenged by Calvinayre.com on sharing with you what in my opinion are the most promising markets for the gaming in Latin America, the first thing that occurs to me is that Latam (as we call it in business) is the great unknown of the online gaming industry, both in Real-Money Gambling (RMG) and the more recent social casino phenomenon. Most of the industry, dominated by an English speaking mindset sees Latam as difficult to navigate, mostly in the “grey” or “black” corners of the industry and, to top it off, has a scent of corruption and muddy bureaucracy. As in most clichés, there is some truth in that, but the trees are not letting most people see the forest.
Let me try to walk you thought this promising land; Latam is thriving in general but you could define it to at least five different sub-regions. On one side, there is often overlooked U.S. Latino market which, in terms of revenues, might be the second most relevant market for present and future RMG and social casino games. Second, Mexico is a region in itself as it is very Latin in culture and very North American in, for example, marketing channels. Third, you have the “stable” free market South American economies such as Colombia, Chile and Peru and, to a lesser degree, Uruguay and Paraguay. Fourth, there is Brazil, which is basically a continent within a continent, with major differences (starting with the obvious one: Portuguese instead of Spanish) and should be treated as a separate And last, there are the problematic markets such as Argentina, Bolivia, Ecuador and Venezuela.
At Akamon we have always made our “raison d´être” to lead in Latam, and this means, leading in each one of the above five sub-regions except number five – these are the problematic economies which are not a priority for us and they should not be for you either.
Taking previously mentioned sub-regions into consideration, let me test how much are you updated on what is happening there: are you aware, for instance, that today IGT (not an example of a second tier operator) and Codere, the recently troubled but large Spanish land-based operator, have a perfectly legal online casino called greenplay.mx up and running and a few powerful media partnerships to go along with it? Probably, you did not know.
And this is kind of surprise, as this operation is live, generating significant revenues, perfectly legal and most of the industry is unaware of it. Ironically, the same companies that are ignoring Mexico are throwing money and energy for what is still today a much smaller pie north of the border in the United States.
But the truth is Latam offers an amazing opportunity for gaming companies if they are willing to understand the region. Both social casino (which is both a complement and a substitute for RMG) and online real money gambling operate in Latam under a different framework compared to other regions. First, from a platform perspective, the open web, a.k.a. dot com destinations are still the dominant platforms which needs to be combined with the Facebook canvas (for social casino) and mobile. You could argue that in Latam you still have the luxury of being somewhat late to the mobile transition and be OK…. Although not for long: even in Latam, if you are not mobile soon, you will be dead.
Let´s zoom on Brazil for a moment, Akamon´s main market and my personal favorite, it encapsulates in one example all the good and bad of Latin America: huge potential, complex regulation and the need for local knowledge. In Brazilian social casinos, for example, if you operate under a Brazilian legal entity, your relationship with the indispensable local payment systems will be exponentially easier. The flip side is that you will have to be careful on the use of virtual currency, particularly with bingo and poker, as unclear regulation can bite back precisely because you decided to be closer to the market and create a Brazilian company.
Navigating these catch-22 situations is what Latin America is all about.
However, even with these enormous challenges, turning your back on Latin America is, in my opinion, a bad idea. The continent has lived through a decade of unparalleled political stability and what lies ahead is even more encouraging.
The population is young, mobile savvy (android will battle in Latam eventually even if monetization is substantially better on iOS today) and governments in the most progressive parts of the continent such as Colombia and Peru are starting to seriously consider full-fledged, European style regulation.
Moreover, Latinos love to play on social casino sited such as Akamon´s, on land-based casinos scattered in the streets of Bogotá, Lima and Panama city and, of course, on hundreds of affiliate networks or skins benefiting from lucrative agreements with dot com operators that are quietly making a bundle in Latin America, while the gaming establishment chooses to ignore the region at its own risk.
So my point is: if you are in gaming, being RMG or social casino, you better start saying “Hola” to Latam right now instead of “Mañana“.
CEO and Co-founder of Akamon Entertainment, Vicenç Martí is an expert in the specifics of the gaming industry, where he had previously worked as Managing Director at Cirsa Gaming Corporation. His professional record also includes being Chief Marketing Officer at Spanish low-cost airline Vueling, and CEO at fashion label Custo Barcelona.
He graduated in communications from Saint Louis University, and earned an MBA from IESE Business School, completed with an Executive program at Stanford University Graduate School of Business.
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