Erik Nyman, Managing Director of NetEnt Americas, speaks exclusively to Gambling Insider on a range of topics, including the supplier’s plans for future growth in New Jersey and Pennsylvania, the impact of regulated sports betting on online casino and expansion across the US, Mexico and South America.
You have been with NetEnt Americas since 2010. How has the US market developed in that time and to what extent has this been in line with your expectations?
We entered the market at the end of 2015, which was about two years after market opened. We have seen a steady growth and US players are becoming familiarised with our content. Our tight collaboration with customers, and high-quality content with unique features, has proven to be a recipe for success and we are very happy so far.
How do you plan to keep adapting your offering in the growing New Jersey market?
We will continue to frequently launch new and unique games that we distribute in all jurisdictions. But we are also looking into new functionality and specific promotions we tailor for customers to optimise performance. For us, it is also important to grow our understanding of US operators and players to be able to be an even better business partner with them.
What will be your challenges for growth in the regulated Pennsylvania market?
In every new American market, NetEnt games are new to the players, as we today don’t have a presence in the land-based environment. The process of familiarisation is crucial to understand. Besides that, we also spend a lot of time with our new partners to make sure we have a good relationship and understand their real needs, which is essential in any business. Product, business relationship and understanding the market-specific conditions through business intelligence are key.
You previously commented about how a table game tax of 17.5% offsets the slot revenue tax of 54%. How confident are you that the 54% tax on slot revenue in Pennsylvania will be reduced? What do you think it should be reduced to?
I am not confident the tax will be reduced, but I am certain the market growth most likely would have been better with a lower tax. We work with local stakeholders and decision makers to inform what we know about healthy taxes from experiences in various jurisdictions globally.
With much of the US regulatory focus shifting towards sports betting, how challenging is this for online casino suppliers like NetEnt?
The introduction of sports betting is excellent for online casino for many reasons, not least as it’s a driver for online gaming in the US. Our first customers were sportsbooks, so we think the conversion of sports betting players to casino will happen in the US as well.
What are the chances we could see products such as Exclusive Virtual Casino, that launched earlier this year, launch in the US as the regulated online sports betting market grows?
Bringing live casino to the US is a major undertaking that carefully needs to be considered. Hence, we have seen very few suppliers enter the market. Regulation and setup are also different, which needs to be understood prior to launching it. We have currently no exact time plan for any of our live casino solutions in the US.
How many US states would you anticipate could regulate online casino gambling across the next 10 years?
That’s the million-dollar question, right? My assumption is that we will have an addressable regulated market in the US in three years that is some 50-75 million players and the lion’s share of that will be in the north-east.
Following the launch of your games on Caliente’s network in Mexico, how likely is it you will look to agree more deals in that market?
Our ambition is to grow the Mexican online regulated casino business in the coming years. Today we are live with Codere and Caliente, but hope to have more customers soon.
What are NetEnt Americas’ main targets for the coming years?
It is simply to grow our North American footprint and potentially enter into South America. The whole region is very interesting and considered a strong new business opportunity for us.