Online gambling software provider GAN has shed more light on its deal to offer real-money online technology to a major US casino operator.
Last month, GAN (the former GameAccount Network) teased news about advanced talks it was conducting with a major US land-based casino operator regarding an international online gambling operation. On Monday, GAN offered further details without revealing the name of the operator in question.
GAN now says it has sealed a seven-year deal with the US operator and that the gambling site and app are expected to launch in H1 2017. GAN promised further details would be revealed when it releases its H1 earnings results on Sept. 30.
For the time being, GAN will say that the operator – “a major multi-property casino operator in a regional US gaming market with approximately $1b in annual land-based gaming revenues” – was one with which it already has a business relationship. GAN’s existing regional casino client roster includes American Casino & Entertainment Properties, Rock Gaming, Isle of Capri Casinos, Maryland Live, Atlantic City’s Borgata and numerous tribal casinos.
GAN says it will receive a $1.4m upfront cash payment for intellectual property assets and development services. GAN expects to book this money as income in Q4 2016. GAN said this aspect of the deal “completes the strategic B2C internet gaming divestment process first announced in September 2015.
The international site launch will be accompanied by a minimum $10m annual marketing budget (paid by the operator) over the life of the seven-year contract. Users of the site will also be able to participate in the casino operator’s rewards program, which GAN claims is the first time non-US residents will have access to such benefits.
GAN CEO Dermot Smurfit called the B2B deal “a material long term revenue opportunity” that will “contribute material revenue and earnings commencing H1 2017.”
GAN has previously expressed frustration at the tortoise-like pace of US regulated online gambling expansion and the negative effect this has had on GAN’s earnings. The numbers would have been even worse were it not for the success of GAN’s Simulated Gaming social gaming product.
Speaking of, GAN has now revealed the identity of the tribal casino operator who signed up for Simulated Gaming in June. GAN says the Oneida Indian Nation, which runs the Turning Stone Resort Casino in upstate New York, will launch the social casino product in early 2017.