Tuesday, December 6, 2022

“The regulation of the Peru market will empower the LatAm region and encourage other countries to also regulate” | Yogonet International

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The LatAm gaming industry is set to reunite at the upcoming 19th edition of Peru Gaming Show (PGS), to take place on June 15-16 at the Jockey Exhibition Center, in Lima. Among attendees to the major regional event will be SOFTSWISS, with the iGaming expert and software provider ready to showcase a range of online gaming solutions, including sports betting, game aggregation, crypto casino, and more.

“Since March of this year, we have been working hard to enter the LatAm market,” Jonathan Felix Vilches, Regional Business Development Manager in LatAm, tells Yogonet in an exclusive interview ahead of the event. “We expect to continue generating knowledge and positioning of our brand and solutions while closing important agreements with local partners in various verticals.”

In conversation with Yogonet, Vilches explains what solutions the company will be focusing on at PGS, reflects on the role Peru -and the region at large- plays within SOFTSWISS’ operations at present time, and discusses iGaming trends in LatAm, including crypto and a move toward market regulation.

SOFTSWISS will be participating in the upcoming edition of Peru Gaming Show. What will the company’s presence at the event be like, and what will the business focus on at the expo?

The Peru Gaming Show event is one of the most important in LATAM. We see strong interest in our solutions by the executives and iGaming companies of the region. Therefore, SOFTSWISS will attend the exhibition with a stand.

For this event, we will be focused on presenting iGaming solutions in sports betting, game aggregation, platform and jackpot management, affiliate marketing, and crypto casino solutions, which have aroused a lot of interest in the region in the new projects. Our solutions are certified and available to meet the requirements for new regulatory projects.

PGS is one of the region’s most renowned trade events. What are your expectations for this upcoming edition, and what impact could it potentially have on the company?

PGS occupied an essential position in the region as a key event to present iGaming solutions and services to industry representatives of this region. Since March of this year, we have been working hard to enter the LATAM market. We expect to continue generating knowledge and positioning of our brand and solutions while closing important agreements with local partners in various verticals empowered with our innovative solutions.

What role does Peru and the LatAm region at large play within SOFTSWISS’ operations and plans at the moment? In what ways can the business assist its partners in the region?

Peru is considered one of the main markets within the region and now has international attention for the current discussion of the draft regulation for iGaming and sports betting. We believe that when the regulation is approved, the Peruvian market will consolidate and continue to grow in the coming years, supported by the implementation of state-of-the-art technology platforms and solutions.

The regulation of the Peruvian market will empower the LATAM region and encourage other countries to regulate their markets which will undoubtedly attract more investors and companies specialized in the iGaming sector to benefit the entire region and the millions of players.

Among industry trends is the growing role of iGaming, a market currently in expansion in the LatAm region. How does the landscape here differ from other jurisdictions, and what opportunities does it offer to operators seeking to extend their global footprint?

LATAM is a region with a lot of growth potential in the gambling industry. A few years ago, the retail channel led the sales and preference of players in all segments (casino, sports betting, lottery games, horse racing, bingo, among others). Until today they maintain a significant presence throughout the region, but the online channel began irreversible growth since the pandemic led to the closure of the retail channel. It prompted players to seek, learn and use the online channels as their primary and discover this exciting world of online gaming.

Now the challenge of platform providers and operators is to deliver a wide and varied portfolio of games with high speed and resolution to keep connected and satisfied players, who today are more than 75% young people between 20 to 40 years old. There are mainly men within this segment, but it is necessary to emphasize that women also join the betting world. This panorama of market potential is very attractive for global companies and investors.

We have seen a growing penetration of mobile technology and crypto in other iGaming markets. Is this also the case for LatAm? How will the market here develop?

LATAM is a region with advanced internet coverage and the deployment of mobile networks that are mainly 4G LTE technology. Now, the 5G technology is being implemented in the main cities of each country in the region. According to the leading telecommunications companies, 5G will be the main one in all the region by 2026.

With the characteristics of this technology, we hope to look at the introduction of innovative platforms and games in the world of iGaming, achieving an unprecedented leap in mobile gaming and the financial sector. A significant evolution in digital payment methods will manage to include millions of people who, until today, are outside the online financial system for different reasons.

Speaking of crypto, it is essential to mention that LATAM globally leads in using cryptocurrencies in purchase and sale transactions. Every day there are more interested people looking for information and learning about Blockchain, cryptocurrencies, and the trade of these securities. With this trend, we see crypto gambling growing, and players are experimenting and learning from this technology.

What we expect to see in the coming years is sustained growth of crypto projects operating in this high-tech segment. Brazil, Argentina, and Panama are discussing regulations for using cryptocurrencies, and we expect other countries to follow this trend.

Peru is currently reviewing gambling laws with a view to regulating online sports betting and iGaming. What are your expectations for this jurisdiction? And in your opinion, does the current regulatory landscape in the region favor the innovation and changes we are seeing in iGaming? 

Through the General Directorate of Casino Games and Slot Machines, the Ministry of Foreign Trade and Tourism presented the first draft regulation of internet gaming and sports betting three years ago. Today we see that the current government has the political will to approve the law in joint work and consensus with the republic’s Congress. This is a good sign at the international level, and we hope this law will be approved this year.

In my experience and knowledge of the market, I believe that regulation will achieve a new growth momentum in the industry that will allow full recovery in the coming years after going through a crisis due to the COVID-19 pandemic. The projections of tax collection for exploitation rights in the iGaming sector are around $200 million on average per year, which means an annual sale of more than $1.6 billion. Still, to this amount, we have to add the sales of casino games, lottery games, horse racing, and other games, so the sale per year after the regulation could exceed $2.5 billion annually and continue to grow over the next six years.

Based on the news and after talking to some regulators in LATAM, we verified that the issue of the regulation of iGaming and sports betting is on the agenda of governments. This panorama makes LATAM a potential region for investments in this sector and introducing innovative solutions. A regulated regional market benefits all sectors of industry. The economy generates more investment, employment, security, and protection of players and allows governments to obtain resources through exploitation rights.

As I see, its potential tax collection throughout the region could exceed US$3 billion annually. And the average annual market size could be more than US$30 billion, with Brazil as a leading region. These are estimated figures and can be surpassed in a market that consolidates, matures, and maintains sustained growth, as the Colombian market has shown.



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