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New ad standards for Ontario's gaming biz spark a rash of reaction
Tuesday's announcement from the Alcohol and Gaming Commission of Ontario resulted in a mixed bag of thoughts from industry stakeholders, marketing experts and politicians.
In this issue:
A rash of reaction to AGCO announcement
Rivalry, NorthStar release Q2 results
We want your NFL stories
A rash of reaction to the AGCO’s ad amendments
As it relates to the regulated business of sports betting and igaming in Ontari-ari-ari-o, August is going out like Leo the Lion:
That’s a direct result of a couple of announcements coming out of the north Toronto offices of the Alcohol and Gaming Commission of Ontario over the past 10 days. First, it was the news that Dr. Karin Schnarr has been tabbed as Tom Mungham’s replacement in the CEO and registrar’s chair at the AGCO, beginning next month. And Tuesday morning (as first reported by this destination of news and information on the gambling biz), the commission sent out word(s) confirming the revised standards around advertising and marketing initiatives by regulated operators in the province.
In case you were portaging across Algonquin Park without wifi, or were avoiding all forms of media and communications because of the Blue Jays’ end-of-month stumbles, from the AGCO website:
The Alcohol and Gaming Commission of Ontario (AGCO) has updated the Registrar’s Standards for Internet Gaming to prohibit the use of athletes in internet gaming (igaming) advertising and marketing in Ontario. The standards have also been strengthened to restrict the use of celebrities who would likely be expected to appeal to minors. These new restrictions will come into effect on February 28, 2024.
To save you a click of the mouse to the website, we present the specifics around the new rules:
2.03 – Advertising, marketing materials and communications shall not target high-risk, underage or self-excluded persons to participate in lottery schemes, shall not include underage individuals, and shall not knowingly be communicated or sent to high-risk players. (Also applicable to Gaming-Related Suppliers)
Requirements – At a minimum, materials and communications shall not:
Be based on themes, or use language, intended to appeal primarily to minors.
Appear on billboards or other outdoor displays that are directly adjacent to schools or other primarily youth-oriented locations.
Use or contain cartoon figures, symbols, role models, social media influencers, celebrities, or entertainers who would likely be expected to appeal to minors. [This requirement has been changed]
Use active or retired athletes, who have an agreement or arrangement made directly or indirectly between an athlete and an operator or gaming-related supplier, in advertising and marketing except for the exclusive purpose of advocating for responsible gambling practices. [This requirement is new]
Use individuals who are, or appear to be, minors to promote gaming.
Appear in media and venues, including on websites, and in digital or online media, directed primarily to minors, or where most of the audience is reasonably expected to be minors.
Exploit the susceptibilities, aspirations, credulity, inexperience or lack of knowledge of all potentially high-risk persons, or otherwise extoll the virtues of gaming.
Entice or attract potentially high-risk players. Instead, measures shall be in place to limit marketing communications to all known high-risk players. [This requirement has been changed]
The initial attempts of Gaming News Canada to solicit feedback to the announcement were met with a Voice of the Beehive response from several operators and other industry stakeholders (we need to mention that not all of the 40-something operators will be affected by these changes):
However, thanks to our powers of perseverance and persuasion (we write, thumbs wedged firmly in cheek), there’s been a wide range of reaction from other chroniclers and your usually humble correspondent. While we were unsuccessful in our attempts to interview Mungham (who did speak with Toronto Star politics reporter Rob Ferguson) and to have the departing CEO/registrar appear on the Gaming News Canada Show podcast presented by Osler, Hoskin & Harcourt LLP, the communications folks at the AGCO answered, via email, our questions about the delay in announcing the rule changes, if/how feedback from the industry was incorporated into the amended standards, and how social media influencers and celebrities will be defined:
Due to the significant nature of this decision, additional time was taken to further assess the impact, opportunities and implications for the public policy objectives of Ontario’s new internet gaming sector.
In developing a regulatory framework that is in the public’s best interest and minimizes harm, consultations with a broad range of stakeholders, including mental health and public health organizations, responsible gambling experts, gaming operators, broadcast and marketing groups and the public, helped to inform this decision. The AGCO and the Government of Ontario also engaged further on the impact, opportunities and implications for public policy objectives of the new provincial igaming sector.
The AGCO continues to consult with key stakeholders on updating the Registrar’s Standards as required.
The AGCO’s Registrar’s Standards for Internet Gaming set out a strong responsible gambling framework that includes significant measures holding all registered operators to high standards of responsible gambling, player protection and game integrity. These standards focus on ensuring licensees and registrants achieve regulatory outcomes using widely understood terms.
Operators are responsible for understanding and complying with the Standards, and the AGCO provides additional direction as needed to help operators understand how they can be in compliance.
In regard to this announcement, the AGCO plans to issue additional guidance to operators in the coming weeks.
Canadian Gaming Association president/CEO Paul Burns, PointsBet Canada’s Nic Sulsky and Kris Abbott from Kaizen Gaming/Betano did join us on yesterday’s podcast.
“I’m just happy they’re (the new rules) are out,” Sulsky said. “The anxiety of not knowing caused more stress than the actual standards that have been released. Nothing is really a surprise with the exception of the responsible gambling being added to both retired and current athletes.”
Abbott said Betano has already moved ahead with its advertising and marketing efforts for the fall and early new year, and took a “safe approach” not knowing what the standards would be.
“We were involved in the process, so this isn’t a surprise to any operator,” he said.
Burns said the CGA will continue pushing the AGCO to keep open the lines of communication with the association and its membership, and to make “evidence-based decisions” around the regulations.
“Gaming advertising represents less than five per cent of the advertising on TV,” he said. “There’s a newness to this advertising. Ontario set up a very strong regulatory regime, the first one in this country. Today, we’re talking about how it didn’t seem to work in the first year, and why the industry needs to be reined in.
“That’s wrong from the fact that there have been no violations of responsible gambling standards in Ontario. The context of there needing to be greater protection . . . we did this without a lot of evidence.”
Rivalry responded to a request for comment with this statement from co-founder and CEO Steven Salz:
"AGCO's new guidelines will likely push operators to be more creative with their marketing versus traditional betting advertisements which have historically relied heavily on celebrity and athlete endorsements.
"Rivalry's marketing and acquisition strategy has always been rooted in content and entertainment that builds brand equity for the company as opposed to pushing the product itself and inducements. From that standpoint, we don't expect AGCO's guidelines to impact our operations materially, though we will make any necessary adjustments to ensure we remain compliant moving forward."
OLG, the provincial lottery and gaming corporation, also must abide by the AGCO rules and regulations. The corp’s communications guru, Tony Bitonti, emailed GNC this statement:
OLG is committed to upholding the integrity of gaming in Ontario in compliance with AGCO standards across our multiple lines of business. We support the new advertising standards and the AGCO’s ongoing focus on protecting children and youth. All OLG advertising, including for online offerings, will continue to be produced in alignment with AGCO standards on marketing.
Last year, OLG announced John Tavares of the Toronto Maple Leafs as its ambassador for the PROLINE brand. That partnership has since expired.
We note the new AGCO standards will exempt the use of celebrity athletes in advertising and marketing for the purposes of advocating for responsible gambling practices. OLG recently featured retired NHL goalie Curtis Joseph in a responsible gambling ad that promoted our PlaySmart program.
Our award-winning and globally-recognized PlaySmart responsible gambling program is available across all lines of our business. It helps players build knowledge, understand the risks, and engage in positive play habits with customized tools and resources. Last year, we spent more than $11 million on player education and responsible gambling advertising.
In fiscal 2023-24, we are investing $19 million in our commitment to player health across our land-based gaming, lottery and digital gaming businesses.
Gaming News Canada also reached out to the communications teams at Sportsnet and TSN, as their owners (Rogers and Bell Media) have benefited from the influx of advertising from the industry since its launch in April 2022. Sportsnet provided us with this statement yesterday:
Sportsnet will continue to comply with all regulations in accordance with iGaming Ontario and the AGCO. Sports betting ads that air on Rogers Sports & Media’s TV channels are approved in advance by thinkTV, the association that provides advertising pre-clearance services by applying the rigorous compliance standards that operators must meet.
Marketing expert Tony Chapman, in a lengthy LinkedIn post, and during his appearance on the CP24 morning show yesterday, said the use of athletes and celebrities in advertising should never have been allowed.
Senator Marty Deacon, who, with fellow senator Brent Cotter introduced Bill S-269 in June to create a national framework for sports betting advertising, said this week she would have liked to see the AGCO’s restrictions go further and that they don’t “negate the need for a single set of national standards that gambling companies must abide by across the country”. (By the by, the president of Ecuador signed a bill this week banning sports betting advertising in the South American country.)
"If other provinces open betting to private markets, nothing compels them to implement the same advertising standards," said Deacon.
It’s worth noting that the AGCO-imposed changes have no impact on the amount of advertising that operators can do, so you can expect (if it hasn’t happened already) a ubiquity of sportsbook ads with the start of the NFL regular season seven days away. A report released this week by iSpot revealed that U.S. sportsbooks are spending more than ever on marketing.
The branded content segments involving FanDuel on Bell Media (TSN/CTV) platforms (i.e. NHL/CFL/NFL games, SportsCentre, OverDrive, Mystic Mike, Meghan Chayka’s Strength in Numbers, etc.), and bet365 on Sportsnet’s Blue Jays games, and DraftKings, BetMGM, etc, on Rogers/CBC hockey broadcasts are exempt from the AGCO rules of engagement. And, the presence of in-stadium and virtual advertising during games isn’t going anywhere.
What’s certain (barring an about-face by the commission when the post-Mungham era begins) is that Georges St-Pierre, Connor McDavid, Auston Matthews, Mitch Marner, Wayne Gretzky, Kevin Garnett, Jamie Foxx, Vanessa Hudgens will no longer appear in ads shown on Ontario media and social media platforms - although you’ll continue to see some of them on U.S. networks that come into your homes across the province). The only caveat is if operators make the (long-overdue) decision to use those “brand ambassadors” in ads with responsible gambling messaging.
Finally (for now), questions remain about the Douglas Ford government’s role in a process that began April 13 with the original proposal from the AGCO to amend the standards and was finalized more than four months later. Regulators are supposed to operate at arm’s length from our elected officials. Still, over that period, there’s been a shuffling of the chairpersons at both the AGCO and iGaming Ontario (the new chair, Heidi Reinhart, moved over to iGO from the AGCO board, and was among the lawyers to be receive King’s Counsel designation in a controversial reinstitution of the honourary title by the Ford government on June 30), and incoming AGCO head honcho Schnarr was selected over some experienced in-house leaders.
We expect this chapter isn’t finished.
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Rivalry, NorthStar Gaming provide their latest financials
A couple of Toronto-based gaming businesses have released over the past week their second-quarter financial results, with a (not surprisingly) glass-half-full optimistic outlook.
Highlighted in Rivalry’s latest quarterly report were 192-per-cent growth in betting handle ($112.2 million) from a year ago, record Q2 revenue of $8.5 million, and $57.5 million in handle from its casino business that helped offset the usual April-June slowdown in the esports season.
While net loss by the company saw a slight uptick from a year ago, co-founder and CEO Steven Salz said Rivalry is on a path to profitability for the first half of next year.
“We are keen to share a number of additional product releases coming in Q3, beginning with Same Game Combos, our own proprietary version of same-game parlays for esports, which we released just last week,” Salz added. “This feature, and others arriving in the third quarter, strengthens our position at the edge of technical and product innovation, and more broadly, our ability to continue delivering a market-leading betting experience catered to young Millennial and Gen Z consumers. We have barely scratched the surface of the feature set on our deep product roadmap, which we are confident will enable us to win this global generational opportunity in betting.”
NorthStar Gaming, meanwhile, touted hikes in customer acquisition and betting activity in its Q2 report. The Toronto Star-connected company, which operates NorthStar Bets in the regulated Ontario marketplace, experienced a 15-percent increase ($160 million) in total wagers from the first three months of this year, a more-than 26-per-cent rise ($5.5 million) in gross gaming revenue, and a 27-per-cent hike in gaming revenue.
"We expect the marketing and product initiatives we have underway to continue to drive growth throughout the remainder of this year and into 2024," said NorthStar Chair and CEO Michael Moskowitz. "The Slapshot Media acquisition we completed in the second quarter was a very important milestone in our goal of expanding the NorthStar Bets brand outside of Ontario starting in the fall and further leveraging our existing infrastructure and content."
We want you(r) NFL season launch stories
Next week is a rather significant one for the business of sports betting, and especially a week from today when the NFL regular season kicks off with the Detroit Lions visiting the Super Bowl-champion Kansas City Chiefs.
Gaming News Canada will be dedicating a substantial amount of wordage in this corner next Thursday to covering the cornucopia of happenings by sportsbooks in Ontario and beyond around the start of the four-down football season. If you have a new product, a marketing initiative or something else that’s innovative/unique/special (you catch our draft), please drop us a note at firstname.lastname@example.org so we can include it in the Thursday dispatch.
On the Home Front
Canadian Gaming Association boss Paul Burns will moderate an Out of Ontario: Regulatory Roadmap for B.C., Quebec and Beyond panel discussion at next month’s SBC Summit Barcelona (tickets still available). Scheduled to join Burns are legal beagle Ron Segev, Bet99 head honcho Jared Beber, Sports Interaction CEO Leon Thomas and Fitzdares CEO William Woodhams.
Betting on Pro Pickleball Association events is now a thing in Ontario and 10 U.S. states with regulated sports wagering:
The Hard Rock Hotel & Casino in Ottawa, formerly known as Rideau Carleton Casino, has landed Senators defenceman Jacob Chychrun as a brand ambassador.
Atlantic Lottery expressed its chagrin, via LinkedIn, about a grey-market operator sponsoring a New Brunswick event recently.
Some inside baseball on the acquisition of a Vancouver company by another Vancouver company.
FansUnite Entertainment has a deal with UK sportsbook DragonBet, and is expected to migrate off the Chameleon Gaming platform over the Labour Day weekend. The agreement completes the move by the Vancouver-based company away from B2B platform licensing.
Eight days remain for tech groups to register for the Play Well Challenge, an initiative of Flutter Entertainment and the Responsible Gambling Council.
Classified (Jobs) Information
PointsBet is on a seek-and-employ mission for a Head of Casino to work out of its Toronto office.
Kaizen Gaming, proprietors of the Betano business in Ontario, are seeking a Technology Manager for their offices in Sofia, Bulgaria.
Atlantic Lottery is searching for two Digital Product Specialists.
Woodbine Entertainment is advertising for a full-time Specialist, Communications and Content.
Greo is still accepting applications for a Project and Information Specialist position.
GBG Plc has a plethora of job opportunities available right now
Fitzdares has a trifecta of openings in the UK.
IGT is in hiring mode for a PlaySport Marketing & Communications Specialist at its Rhode Island offices.
Viral Network is in the market for a Senior Art Director (Gaming).
Maple Leaf Sports & Entertainment has an opening for an Event Supervisor, Live Events.
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