iGaming Daily

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Brazil has never looked better for the gambling industry. So pack your pandeiros, pack your drums. We're going to Brazil in this new episode of iGaming Daily. I'm Fernando Nott, your host for today. And I'm joined by no other than the boss, Lucia Gando, editor at SBC Noticias. Lu, how are you today? I'm very good. It's super early here in Argentina, but we are happy to be doing this episode today. How are you? I'm very good. It's like you first gave like this very long sigh, like, ah, gorgeous. And then you said, yeah, very good. You almost got me there. And also, of course, Isadora Marcanti from the relationships team in SBC Now. We can no longer say you're in the SBC News in Brazil. Issa, why don't you tell us your new role? What's the new job title, Issa? How are you? Hello, Fer. Hello, Lu. So yeah, my new job is really different than what I used to do in media and as much as Brazil, which is also a new challenge for me. I'm enjoying it a lot. So my, let's say that my main job is to like make the brand SPC and SPC Rio. And of course, as this is Brazil, well known in Brazil is spread the word. And of course, like build and maintain relationships with or. existing and future clients in the company as well. So, which is really nice because I've been building relationships over the years with the companies and with the people that work in the industry and to be able to work more closely with them right now and to also help them, their companies grow. At the same time as we make our company grow in the country is really, really great. So yeah, I'm excited about this new position. to be working with Lucia Mourinho again very closely. We all here love her pretty much. So it's really good to be back on track with her again. OK, then a big shout out to Lu Mourinho. And great to hear that you're doing that new exciting job to help the brand grow even more than it was already growing in the Latam region, and specifically, of course, in Brazil. But let's. dive into what matters the most to us, which is what has happened in Brazil. And this discussion wouldn't be really possible without our beloved sponsor OptiMove, the number one CRM marketing solution for the iGaming market. As a special offer, OptiMove are offering new clients a free first month when they buy OptiMove. For more information and claim the free month, go to optimove.com slash SBC. We will leave. links down in the podcast episode description so you can access easily to that. So, Brazil, they have made some big progress over the last few weeks, Isa. Why don't you take us through the last changes for the iGaming operations in the country? Isa Pérez-Garcia Well, I think the first big change we had was the list of authorized companies to operate not only in the whole country, but in their own states. and the states that they were licensed actually. So we have this list on the October 1st, this list was updated on the second of October, so one day right after the first publication, and it gets continuously being updated. So we have so far 96 companies that got a license for 111, if I'm not mistaken and didn't count. didn't count wrong the numbers, 111 brands that these companies have. Because in Brazil, you can apply for with one ID number, you can get up to three brands licensed. So we have 96 companies, 111 brands already authorized in Brazil to operate in the whole territory of the country. That feels a bit like too much, doesn't it? over 100 brands. How do you feel about the long term? Like in the long run, I feel like there are not going to be so many brands in the future, right? Oh yeah, you can look at this two sides. Like we have so many, I mean, we cannot have like a real number, like an official number, let's say like that, because we still are not operational, but it will be first-gen awards. But we... People say that we have more than 3000 sports betting sites in Brazil. So if you look at this number and compared to the number of the companies that were actually licensed is not that much, but at the same time, you see so many small companies and we're about to see so many F&A happening in the in the next few months that yes, 111 companies is a bit too much. Like you said, I don't think all of them. will be operating in the next few years. I think probably most of them will be merged or fusioned with another company or be acquired by another company like what's happening right now with Betch Mice and Casa de Apostas. They are two quite known companies in Brazil. They're big. Right now, Betch Mice is part of Casa de Apostas. They had this commercial agreement placed. So I believe we're going to see that in the next few months and next few years, obviously, of the market. And of course, the government is looking to block unauthorized operators. There was a grace period for companies to end their operations, to people to withdraw their funds from these websites. When was that? That was October 11th, right? And then the government is looking to block all the operators that aren't on that list you mentioned. So how soon can we expect that to be enforced? Oh, yeah. The federal government actually gave ANATEL, which is our national telecommunications agency in Brazil, to block all the websites that are not on that list. We had two periods for this to be completed. So on the 1st of October... all the companies that weren't on the list would already be blocked from being accessed by the players. But until the October 10th, the companies would be able to be available for the clients to withdraw their funds that were still in their accounts. So on the October 11th onwards, the companies started to be blocking. But we faced this issue a couple of months ago. when this decision was made to block companies that weren't authorized by the federal government only by Lotege, which is the Rio de Janeiro state lottery. So we had the companies authorized by Lotege operating in the whole country. And then we got the decision to block these companies in the whole territory, but didn't work very well because the the national telecommunications agency doesn't have the required tools to be able to do that. So a lot of companies were blocked that weren't supposed to be blocked and they weren't even working in the real, the janitor state. So let's see how this is going to go actually right now. But yeah, it was like from October 11th, the company that didn't apply for a license and didn't get a license. by the federal government and by some states that we have some state slaughters already from Minas Gerais, Maranhão, Rio, De Janeiro and Paraná, they won't be able to operate in Brazil. Well, since you mentioned state licensing, let's go off script here. And let me ask you about the issues with the loterchi and the state licensing system versus the federal licensing system. Do you think... real licensed companies will be able to continue operating nationwide like Lotej wants because we know that they are clashing with the federal government right now. Yeah, well, my personal opinion is that in the long run, at the end of the day, Lotej will lose this because as much as Lotej has the autonomy to create their own credential rules and to establish their own... decisions for what they're going to do with their own lottery, they are clashing with the federal government rules, like you said, Fer. For instance, in 2018, when the law that legalized sports betting, fixed odd sports betting in Brazil decided to say that sports betting are a modality of lottery. That started the problem because in 2019, one year after that... we got our Supreme Court saying that Caixa, which belongs to the federal government and is a lottery operator and a bank, didn't have the monopoly of operating a lottery anymore. So all the states could have their own lottery since sports betting is a modality of lottery, like Temer said in the law that he signed in 2018. Lotteries started the procedure to offer sports betting and started to act as a regulator, not as much as an operator, but a regulator. And then we got to this today, because if they can offer sports betting because it's a modality of lottery and they have the autonomy to decide their own rules, it shouldn't be a problem for the federal government what they're doing. But I understand the position of the federal government as well, because you have the rules in place and the amount of money they have to pay for the license and the GGR and everything there, that is really different from what we have in Luters. And obviously, the Luters rule, it's more beneficial for the operators, because in the rule says that you can, you as an operator, should have your company in Rio. but your players don't need to be in Rio. So if I bring my operations to the state, I can offer sports betting for the whole country. And that's the main problem. Like if you check the lists of the minister of finance, the authorized companies in the federal government by the federal government and the authorized companies by state, it clearly says that only the players that... are in those states can play in those sports betting sites. So if you check the URL of this website, let's get for an instance, the Bplay one. Bplay got a license from Parana Loto Par. So the URL is parana.bplay.com.br. So if you're not in Parana, you're not gonna be able to access this website. So the main problem with Lotteige is this, like the federal government wants to stop Lotteige from being able to accept players from all over the country. And Lotteige is saying, no, but I have the autonomy to do that. So I can do it, you cannot stop me. So yeah, I think we're gonna see, it's going to be a very long way until something is decided. But I think Lotteige will lose in the long run. Yeah, this has also caused some issues with the sponsorships because the CBF, which is the Brazilian FA, actually issued a statement saying, okay, so if you don't have a licensed company or a company within the list that the government has issued provisionally until the end of the year of authorized operators, if your sponsor is not one of them, you should end your sponsorship. And this has caused some issues, for example, with Sportis Assorti, which was actually sponsored to Corinthians and Atlético Paranaense. And Atlético decided to actually end the sponsorship, but Corinthians stayed with them and argued that they have a loterge license and the CBF actually issued an exemption to loterge. So they are able to continue. holding that sponsorship, but we'll see how long that will stay. But that's not the only problem because the government warned that it actually might take regulation back eventually. So what's the deal with that, Issa? Oh yeah, that's really funny because as much as we have our federal government regulating the market, which is great. So you can minimize the... the operations of the parallel market. We have Lula saying that he will end with the sports betting market in Brazil if regulation doesn't go as the way it should. And Alckmin, his vice president, said the same. He said, yeah, we're going to just like get it all back if it doesn't work. So it's really hard to understand these movements and these decisions because we... This generates so much insecurity on operators, especially the international operators, because like we are saying that we are seeing actually like some bills going to the Congress right now asking to ban every single kind of sponsorships and advertisement. on sports betting. If this passes, for example, and gets approved, the international operators, let's say like that, will they continue in Brazil? Because when they sign up for it, they didn't know that this was probably going to happen or this could happen. So it's like there's a lot of insecurity right now. We never know what's going to happen. That's what we hear a lot from operators, Brazilian operators and international operators. I don't know exactly what's going to happen. And I believe that our list actually of companies that I applied for a license and got licensed in this first round in October could actually be bigger if we had a more stable decisions and regulation process in Brazil. But yeah, Lula and Alchemy are saying that they will end with the market if regulation fails. And I don't really know what this means by failing. What does failing mean? If it means that not getting a lot of companies' license and not getting a lot of amount of money they were expecting to get for the federal government. We are seeing a lot of companies that are facing problems right now with the justice system in Brazil. We are seeing the audience, actually, like the whole population in Brazil. Not whole, but like. the majority of the population in Brazil saying that sports betting should be banned because it's something that could cause addiction. It's horrible. It's only to get your money and blah, blah. Because we don't have actually education on that. People don't see sports betting. And this includes our government as well. Our federal government don't see sports betting as an entertainment. They see as maybe... a profit that they could have in the long run, especially with the licenses, because $6 million for a license is a lot of money. And we have already 196 companies that should pay 30 million BRL or $6 million for a license. So... Yeah, we don't know why exactly the government is saying that, what's the reason behind it, if it's just like the pressure from the general public that they feel that they need to answer. But yeah, it's quite frightening actually, and could be even more prejudicial for the companies that were intending to apply for a license and didn't apply yet. Well, speaking of, changing the rules and not knowing what's up with the regulation. There has been some pushes in Argentina to make some changes to existing regulation, Lu. Yes. The debate is still focused on teenagers participating in gaming sites. So the focus has been that. We saw that Mendoza announced that... during the mental health awareness day on October 10th, well, the government announced a new program to focus on mental health and addictions. Well, they are going to invest 25% of the money raised from gambling and betting sites. in these programs. So we know that Mendoza is one of the strongest markets right now in Argentina, thanks to its clear regulation. They have a great land-based market, and they recently regulated iGaming and sports betting. They also started to debate further regulations when most of Argentinian provinces the demands of society that teenagers are finding extremely easy to bet on illegal gaming sites. So right now the government announcement was aimed to address this problem and this program will start in 2025. Then we see that San Juan, another province... is also trying to be part of the Argentinian regulated market and the local gaming regulator, the Caja de Accion Social, presented a project to include iGaming and sports betting among the legalized offerings. They will be, they will work on the successful regulations. that are currently implemented in Mendoza and both Buenos Aires City and province to develop a similar framework. And even though the government is not 100% pro-gaming, they consider that the regulation is the only way to address illegal gaming, especially among underage players. So we see that this is something that is being discussed. throughout the whole country. The major concern is underage players. So we also have Cordoba. We know that they have a legal market there, but they are currently discussing if they should prohibit it again. So while they are facing a strong opposition, especially in from Luis West, which is the main oppositor of the government. He's a national senator and he presented a claim in the city council of Cordoba, which is the capital of the province. And he said, it is essential to deepen this battle in the capital by working side by side. with our counselors. He tried, he's pushing for a prohibition in Cordoba from iGaming and sports betting especially. So we'll see how this goes. Yeah, I'm sure this all these topics will be discussed in the upcoming SBC Summit Latino America, which I'm very excited to go to next October 29th through the 31st at the Seminole Hard Rock. Casino and Hotel in Hollywood, Florida. That's how you said. I'm really excited to see the René Guita keynote. I mean, he's a football legend, so I'm really looking forward to it. What are you most excited about the event? Well, Tatiana Calderon's keynote will be amazing, I think. It will be at 11 a.m. on the last day, 31st of October. She will... especially talk about how it's like to be breaking all records in a male-dominated field, as car racing is. And the panel will also be centered on how data-driven collaborations between brands and female racing drivers are reshaping the motorsport landscape. So I'm really looking forward to this panel, this keynote. What about you, Isa? Well, I'm excited actually for it. for the whole event of like Latino at the SBC Summit Latino America is something that really gets me super happy to go, I mean, it's only my second time in Miami and my second time at the event, but I'm really excited and a bit sad actually that it's going to be our last event in the Guitar Shaved Hotel. True. Yeah, it's gonna be sad because the hotel is great. Like it's just so nice when you walk in. side the lobby and you see already the slot machines and everything there. It's really nice. So I'm talking about slot machines. The keynote, actually, the session that I'm really looking forward to see is going to be the roadmap to land-based casinos in Brazil. It's going to happen on Wednesday at 12.45 until 1.10. in the leaders conference room one. And it's going to be very nice because I love land-based casinos. And at the moment we are actually discussing the legalization and regulation of land-based casinos in the Congress. So it will be nice to see the insights of industry leaders on this matter. But I'm also excited for our networking event on Thursday, on Wednesday as well, the 30th, the same day as the land based casinos session that we're going to be going to the Chase Stadium, the Inter Miami home. So yeah, I'm really excited for that. I always like when we go to, I always love when we go to, to the stadiums, like we did last year with the Miami Doughfins, like we did in Lisbon with the Benfica stadium. So yeah, it's going to be very exciting. Yeah, maybe we even run into Messi, right? It's the Chase Stadium, the home of the Inter Miami. But yeah, really excited about SPC Summit, Latin America. So make sure you are there. But this has been all for today's iGaming Daily episode. I'm hoping to see you all next time. Thanks, Anaya McDonald, for producing this episode. Thank you, girls, and we'll catch you in the next one.