Looking In The Mirror
The battle the regulated gambling industry and sweepstakes sites is heating up and it's far too early to tell which side will come out on top.
The Bulletin Board
THE LEDE: Sweepstakes introduce member code of conduct and pose a valid question at NCLGS.
WEEKEND ROUNDUP: Prime approved in KY; Casino foot traffic up in Nov.
VIEWS: Gambling.com is standing out from the affiliate crowd.
BEYOND the HEADLINE: Google’s latest site reputational abuse update.
AROUND the WATERCOOLER: Are online casinos coming to FL and pulling the ladder up behind you.
STRAY THOUGHTS: Simply the best.
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The Lede: The Sweepstakes Lobby Is Not Backing Down
In a clear attempt to push back against some of the criticism lobbed its way, the Social and Promotional Gaming Association (SPGA), a trade group formed to educate and advocate for the sweepstakes industry, announced the implementation of a Code of Conduct for its operator members on Friday.
Per the press release:
”The Code of Conduct is designed to spotlight the processes and technologies already in place at both SPGA member sites and the majority of social casinos offering promotional sweepstakes, also referred to as social sweeps games.”
The Code of Conduct includes the application of regulation-grade suppliers, technology, or policies to ensure:
Age verification to limit real money play to users 18 and older
Proper identity verification (Know Your Customer or KYC)
Location verification of customers
AML policies to ensure proper transaction monitoring
The SPGA called the Code of Conduct a work in progress, with more pillars to be revealed in the future.
As I’ve mentioned in previous newsletters, the regulated industry’s arguments against sweepstakes operators are often undercut, and the code of conduct is designed to undercut those arguments further. It’s hard to claim these are nefarious operators that lack consumer protections if they use the same suppliers and implement the same geolocation and KYC checks as the regulated industry.
“Essentially, this may not be a road sweepstakes naysayers want to travel. Either the technology works, and sweepstakes sites are using it, or it doesn’t, which opens the proverbial Pandora’s Box. And you better have your own house in order if you’re going to complain about AML deficiencies.”
The pro sweepstakes side also made a very good point at the NCLGS Conference this past weekend, where attorney Bill Gantz noted that (per Jessica Welman’s reporting), “The "overwhelming" number of users on freemium social casinos and freemium+sweeps casino do not spend money on coins.”
That statistic is the fly in the proverbial ointment for the anti-sweepstakes crowd, who argue that the sweeps component is the product. But with so many free-to-play users and freemium games that charge worthless coins being an even bigger industry than sweepstakes, it appears there is some legitimacy to a social casino app without prizes being a product in itself.
Further, as Gantz said (again per Welman’s reporting), “The freemium vertical is also untaxed and unregulated and, oh, by the way, includes some of the loudest sweeps critics like Light & Wonder.” [The quote is Welman’s interpretation of Gantz’s comments].
The freemium-sweeps connection being far stronger than a sweeps-iCasino connection was also brought up in a recent note from Macquarie, which was reported on by Earnings+More:
“Despite the similarities between sweepstakes real-money operations and iCasino, the Macquarie team said they saw “little evidence” of cannibalization.
“However, the Macquarie team believed it more likely sweepstakes was cannibalizing social casino, suggesting the latter format contains a significant cohort that plays because of the lack of legal iCasino options.”
STTP Thoughts: As I said in the subhead, this fight is just starting, and it’s too early to tell who will prevail.
The anti-sweeps side has scored several victories and is assembling a powerful coalition. Anti-sweeps crusader Howard Glaser asked the NCLGS crowd to look at sweepstakes products and draw their own conclusions rather than get caught in the weeds of the law, but sometimes the weeds of the law are the important bits… and sometimes it’s not. And in this case, it’s still unclear what side the weeds of the law would grow on.
Weekend Roundup: Prime Approved in KY; Casino Foot Traffic Up in Nov.
Prime Sports approved in Kentucky via a partnership with Churchill Downs: Prime Sports will soon launch in its third state, Kentucky – the platform, which is seen as the most sharp-friendly in the US, is also live in New Jersey and Ohio. One intriguing component of this story is it marks the first state where Prime will compete against another bettor-friendly operator, Circa Sports: “It will be interesting to see how we fare alongside Circa in Kentucky since this is the first state we’re both open in,” Prime Sports Joe Brennan Jr. said. “That creates some really great options for players.”
Casino foot traffic grows in November, but still down overall: Casino revenue has been booming since land-based properties reopened following the COVID-19 pandemic, but buried within the good news is a growing concern, as visitation has been declining, leaving some to wonder if the industry can continue to squeeze more out of fewer and fewer people. There was a nice little boost in November. However, numbers are still down significantly compared to 2019: “In short, overall casino foot traffic in November included an extra weekend and was up 4.8% year-over-year, and down 12.3% versus 2019 levels,” David Katz of Jeffries said in a recent note.
Views: Gambling.com Differentiates Itself from Peers
Gambling.com made a big splash last week with the announcement it had reached an agreement to acquire OddsJam, a consumer-facing, subscription-based sports betting news and data website, in a deal worth as much as $160 million.
Per the press release:
“Odds Holdings is powered by a state-of-the-art technology platform for real-time odds data and offers services under multiple consumer and enterprise brands… OddsJam is the flagship brand offering premium, real-time odds information to empower sports bettors to make data-driven bets through a consumer-facing website and app. Under a separately managed company, Odds Holdings also provides low latency, comprehensive odds data to enterprise clients for a variety of sports betting use cases.”
“We couldn’t be more excited for the energy and global expertise that the $GAMB team is going to bring to all of the Odds Holdings companies,” OddsJam CEO Matt Restivo told STTP. “This strategic partnership would not be possible without the truly elite team of people we have been able to assemble over the last several years, which includes the team at Oakvale Capital and our counsel at Cruz-Abrams Seigel.”
Jeffries analyst David Katz said, “We view the deal as a productive tuck-in at a good price with recurring revenues and specific capabilities that enhance long-term value.”
GDC is bucking the affiliate sector’s downward trend. The acquisition, which follows a previous deal in which GDC acquired XL Media’s European and Canadian assets, is positive news for a sector that sorely needs some victories.
“Gambling.com Group has projected perhaps the biggest image of resilience of any gambling affiliate in the North American market this year amid Google changes and other industry challenges. Last month, it reported a quarterly record of $32.1 million in revenue, up 37% year-over-year, as well as 108% growth in adjusted EBITDA to $12.5 million.”
Beyond the Headline: Google Hits Affiliates Again
A significant Google update in March upended the gambling affiliate sector, with the search engine behemoth cracking down on third-party content that took advantage of a site’s reputation. Now, Google is further cracking down on reputational abuse.
In a December update, Google began penalizing not only third-party content but also sites that veer too far outside its areas of expertise. This means that even when content is written by someone on staff (not procured from a third-party source), Google will still penalize the site.
In a statement, Google said:
“Since launching the policy, we’ve reviewed situations where there might be varying degrees of first-party involvement, such as cooperation with white-label services, licensing agreements, partial ownership agreements, and other complex business arrangements. Our evaluation of numerous cases has shown that no amount of first-party involvement alters the fundamental third-party nature of the content or the unfair, exploitative nature of attempting to take advantage of the host’s sites ranking signals.”
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Around the Watercooler
Social media conversations, rumors, and gossip.
A very interesting comment from the NCLGS conference:
That approach flies in the face of reality, as online lotteries (particularly online lotteries with instant win games) view online casinos as competitors, and as Sternburg notes, competitors they can’t compete with on product, marketing, or odds and promotions.
Speaking of e-instants, Allwyn just debuted its e-instants in the US through the Michigan Lottery — like I said, a very interesting comment indeed.
And an even more interesting comment that could turn out to be the biggest story of 2025:
According to Roger Gros, “As per Jim Allen, the tribe already has the authority to use online HHR machines. He was just waiting for the right time, he told me.”
Stray Thoughts
Congrats to one of my favorite people in this industry, Sue Schneider, who was given a lifetime achievement award at NCLGS (if we’re being honest, Sue deserves several lifetime achievement awards).
As NCLGS put it:
“Sue is a true pioneer in the gaming industry, particularly known for her incredible contributions and leadership... Sue is not just an expert in her field but a trailblazer, especially for women in a male-dominated industry. Here's to celebrating her remarkable achievements and continued legacy!”
You can listen to my Podcast with Sue from October here:
