15 February, 2021
Player verification challenges
The 1account team speaks about the player verification hurdles facing both operators and affiliates.
We understand you’ve issued a challenge to operators. Can you tell us a bit about this challenge?
The idea behind this was to prove that by using our 1account verification proposition, we can improve the player taken-on and increase revenues for gaming operators by somewhere between 5 and10% at no extra cost. It sounds like a pretty good challenge, so why not?
Something that’s inspired this is what you’ve spoken about at 1account before: operators not fully optimising verification processes and consequently losing revenue because of it. Can you explain this in more detail?
Gaming operators have been using identity verification systems for years now; it’s nothing new. But the existing solutions in the gaming sector have a success rate, that is the number of people you can successfully identify out of 100 people and bring them on board as players has more or less leveled out at around about 85-90%. It’s become accepted as the norm.
But if you think about the maths, that means you’re leaving on the table somewhere between 10-15% of new players coming to your site. That means no revenue, no deposits from that percentage. Obviously, it will never be 100% as there are bad actors out there in the world today. But the number of bad actors is actually relatively small. So if you can work on getting an additional 5 to 10% more players on board – and you can prove it – it’s a bit of a no-brainer proposition.
How has increased regulation affected operators in recent times, in the field of identity verification?
I think the regulatory environment is an interesting one. Most of this has been driven by the UK and the Gambling Commission, which is leading the charge when it comes to ever-increasing regulatory requirements in the gaming sector. Verification has got a very different feeling now, because years ago checking someone was over the age of 18 was kind of all right. But then that moved into real, more robust identity verification requirements.
Now, with increased emphasis on being able to emphasise problem gambling, compliance with anti-money laundering, the whole term of verification has become way broader. Looking down the road, I think operators just expect that to continue. The samerequirements will start rolling out, I’m sure, into other jurisdictions within regulated markets. You can see that train coming down the tunnel at you and it’s not going to stop.
Do you think the way regulations have been imposed on operators is fair?
The overall intent is fair. I think what’s maybe been slightly unfair is that some of the requirements are actually quite difficult to do, for example in the area of problem gambling.
The ability for a gambling operator to be able to assess whether a player is in a financial position to spend £50 ($68.49) a week on gambling or not is a very difficult thing to do.
It’s kind of got a bit easier recently, as there are now some data sources that can help you assess someone’s affordability when you first set up an account. So I think the intent is fair but what’s not fair on the operators is some of the requirements have been very difficult to do. It is getting easier, with some of the propositions we have for example, but sometimes technically you can understand what the regulators want you to do – but how do you do it? It starts getting more complex outside the UK in other parts of the world too. The UK is more sophisticated in terms of data sources but, in other jurisdictions, they may not exist.
But I don’t think anyone would disagree with the overall intent.
1account works with affiliates as well. Is your work the same here as with operators or does it differ?
No, it is exactly the same. The reason we’re working with the affiliates within the gaming sector is that, last year, the Gambling Commission brought in some new regulations. They brought them in to apply to operators not affiliates, but they put the onus on the operators to ensure everybody in their food chain was doing the right thing. Affiliates that provide traffic to operators are most definitely in their food chain. The specific requirement was that for free-to-play casino games, you have to be able to validate that someone’s over the age of 18 before they can play a free slot game. What that did to affiliates serving the UK market all of a sudden changed their business model.
“That could end up wrecking your affiliate business model for the UK market. It would be £0.30 per check or £0.75 per check. An affiliate has tens of thousands of people going to their sites – paying that out every time one of them wants to play a free slot game just doesn’t make sense”
They pretty much had to go out and pay somebody to check someone was the
right age before they played a free game.That could end up wrecking your affiliate business model for the UK market. It would be £0.30 per check or £0.75 per check. An affiliate has
tens of thousands of people going to their sites – paying that out every time one of them wants to play a free slot game just doesn’t make sense.
So the net result of that was a lot of the major affiliates pulled out of the UK market, because it just didn’t make commercial sense. When we launched 1account looking at this marketplace, we created a business model that enabled us to provide that age verification solution to affiliates at no cost to them. It enables affiliates to be compliant, therebyensuring operators are complaint with the new regulations without disrupting their business model. So we’ve really opened back up the UK market for affiliates, which was previously in
effect shut down for them.