Betting has changed drastically in the past 30 years, from the introduction of Sports Information Services (SIS), wider access to sports content, the move from telephone betting to online gaming and so on. Even since 2019, the industry has changed considerably, moving away from retail environments to online platforms, serving a much greater number of customers worldwide. Moreover, legalisation in countries such as the United States and Canada has played a huge role in the industry’s growth. AI has also been a big changing point in recent years, as it has given operators a better understanding of their customer base; it’s a more personalised experience for customers that come onboard.

With the Grand National quickly approaching, one of the UK’s most anticipated sporting events, we spoke with some of the industry’s most influential figures to find out how Sportsbooks handle demand during high profile sporting events, as well as the changes experienced by Sportsbooks from a technological and operational perspective. Keith Laidlaw, a highly successful technology leader, offers his insights into the topic, as well as discussing his iGaming career, which spans over an impressive 18 years.

Can you discuss your iGaming background and how you first got into the industry?

I joined Party Gaming in January 2006 in Gibraltar until 2010, where I joined Ongame as Interim CTO for 6 months in Stockholm. My next role was with GVC Holdings, where Kenny Alexander’s modus operandi was to look for good assets that were badly run. Superbahis Sportingbet acquisitions and transformations then allowed us to acquire Bwin Party which was a great asset. I left the company in 2018, and since then, I have been doing small consultancy gigs. My pitch there, why I should be involved, is online gaming companies are at least a third technology orientated, but M&A teams tend to be Marketing & Finance and you can easily fail on an acquisition if you don’t have your technology strategy understood and put together. M&A, Due Diligence, or a CEO/Chairman will express to me they’re not getting what they think they’re paying for out of their Technology section. I will then come in and assess what’s happening and what needs to be improved and I will provide a report with some options. On the other side of the spectrum, a business with a great technology group who have plans to make a step change soon will approach me as they require help assessing ‘if their current team is up to the challenge and if not, how they can be assisted to do so’.

How have things changed in technology since you began your iGaming career in 2006?

Online gaming is all about data, we collect copious amounts of data on the customer, their profile, their gaming habits, their demographics, their transactions and their implied preferences. Until relatively recently, technology platforms completed a batch job at night and transferred all the daily transactional data to a decision support warehouse where they conducted analytics reporting on customer segmentation, promotion bonus values, financial reports etc. What’s happened now with the advent of AI, if you can get your infrastructure correct, where you’re collecting in near real time your transactional data lake and running your AI widgets on that, then you’re pushing that result in near real time back to the production platform, such that you’re customising what the customer is seeing, your able to improve the efficiency of your promotions and bonuses, increasing positive customer experience and value.

Marketing is around ten times the budget of IT, so if you can improve their promotion/bonus costs by a quarter, you’re ultimately paying for IT. So, the platforms are changing, they’re transitioning from batch jobs to near real time, doing your work on the data lake and pushing that back into the production platform. The way I describe it is if you search, for example, ‘chocolate Easter eggs’, suddenly your Google searches and Facebook Meta page will be populated with ads for chocolate Easter eggs. It’s the same tactic; they are capturing what just happened from the near real time by cookies and are pushing it back to you as advertising because it’s what you’re interested in now. It’s the sort of concept online gaming is moving towards.

When I started in the industry, poker made up around 90% of the revenue. Now adays, online casinos that cause endorphins and immediate hits are dominating 50-60% of the revenue stream. It’s interesting to see what’s happening to the other online games; Are there different types of players that are there? Are they cross-selling? There’s real interesting dynamics going on. The same applies to lottery. If you took a pie chart of all spending on gaming activity about 5-6 years ago whether it was bingo, sportsbook, poker, or casino, lottery was about 50% and the other 50% was divided up between the other products. The interesting thing discovered about lottery was the retail market is expensive to service due to the terminals at retail outlets, and in the UK, there is around 45,000 of them. Lotteries now seem to be moving towards instant scratch cards which give the customer that endorphin hit/instant gratification. The problem with this is the mathematics do not allow as much of the revenue to go to good causes on instant wins, the cost base of servicing is high. So, online will have more instant win scratch cards that look like casino, far lower cost base, recapturing younger clients again and contributing a higher percentage of revenue to good causes.  ALL of this is enabled by the technology platform.

With the Grand National fast approaching, can you discuss your top tips when it comes to delivering a scalable Sportsbook from a tech perspective?

In the UK, the Grand National was always the big event for Sportsbook. Around eight years ago, people were concerned about stability. But now, stability should be standard for the Grand National. The way some platforms would change is an interesting dynamic from a technical point of view. Operationally, it used to be that you would purchase computing and storage capacity for peak plus a percentage. For example, if I was receiving 50,000+ bets per minute, I had to purchase my hardware to cope with that plus, say 60,000. Therefore, if you were buying a transactional system to satisfy customer needs, you had to spend a huge sum cost on equipment to satisfy that demand to ensure the customer experience was positive.

The interesting thing that’s happened is ‘Cloud’, which is also called ‘On-Demand Computing’. For peak capacity events such as the Grand National, it should be a non-issue to have on-hand stability responsiveness for your customers.

Additionally, and thankfully occasionally, you’ll see some things happening such as if there are any ‘bad actors’ out there who target online games, as its one of the biggest victims of malform IT attacks. However, the teams who provide the infrastructure are very good at being able to cope with this type of attack. During a peak event like the Grand National, you should be able to handle it, but we also must be able to contend with bad actors trying to influence things. It’s interesting; stressful but fun.

In 2022, major sites went down during the Grand National due to unprecedented levels of traffic. How likely is it that this will occur again?

I think there was a combination of things that happened there. Like I said, all technologies involved with the companies know it’s a big event. All of them prepare for it, all of them scale up their systems. However, if you have a ‘bad actor’ attacking you at that time, it can mess up things that you never expected, but the key is to plan for that beforehand.

Big events such as the World Cup have lots of customers coming in to do things, which from my system point of view, wasn’t a challenge. From my perspective, the big challenge is sporting bets on live feeds, because most of the revenue is about live betting. Live betting takes all these different feeds from providers and comes in in near real time. For example, a single football match might have 300 different betting types. Therefore, if you’ve got various football matches at the same time you have a huge amount of process you can do with live feed coming in; you have to change your odds, present those odds, re-calculate your risk, and all of that is a large computing task.

How important is it to be resilient in your line of work?

If the technology system is down, you’re not earning revenue, but it depends on your technology system. For example, you might have a short downtime and you tend to be able to roll it out on different sections. If you have an unplanned downtime your revenue generator for the company is not generating revenue and therefore, you’re at risk of a reputational hit, especially as unplanned downtime tends to happen during peak periods of activity. Your customers want a betting fix now, so they’ll go to another operator, which is really bad news, it has cost the company a lot to acquire and keep customers. You want lifetime value from them, therefore providing a slick online experience is essential.

Do you have any tips for those looking to pursue a tech career within the iGaming industry?

It’s an interesting industry. DevOps has evolved and Cyber Security and Data Scientists are huge. Cyber Security and Data Science are the two key areas I would focus on if I was entering the industry. We have all this data, and we must understand how to deal with it, populate it and get value out if it in near real time. Cyber Security is a constant threat, especially with AI helping to protect but also having the potential to drive the attack.

As Keith discusses, various elements have evolved within the industry in recent years. The fact bettors ultimately have a full betting shop in their pockets has been a result of a shift towards a more digital world, as well as other external influences such as Covid-19. Additionally, widespread coverage of other sporting events in recent years such as the NFL, NBA, and IPL has meant the demographic has increased and now targets a much larger number of bettors.

The emergence of AI has also played a huge part in how Sportsbooks operate across the board, particularly during huge sporting events. AI allows Sportsbooks to identify customer habits and target bettors with tailored ads whilst also helping recognise problem gamblers and provides protection from impending cyber-attacks.

When it comes to delivering a scalable Sportsbook during high profile events, preparation is vital. Business continuity plans will go into place months in advance to ensure backup scenarios are in place in the instance anything goes down. Teams will be on high alert for more than four weeks, monitoring situations in advance and running technology to assess if the traffic coming through is consistent with what they forecasted. However, even with all preventions in place, Sportsbooks can only truly test something when it’s at full capacity.

Special thanks to Keith Laidlaw for joining us in this edition of BettingJobs News.