International Gambling Conference New Zealand 2008 “Beyond Smart Cards to Smart Technologies” Phillip Ryan Chief Executive Officer Responsible Gaming Networks

International Gambling Conference

New Zealand 2008

“Beyond Smart Cards to Smart Technologies”

Phillip RyanChief Executive Officer

Responsible Gaming NetworksMelbourne, Australia

RESPONSIBLE GAMING NETWORKS

Speaker’s Profile EGM Corporate Affairs, Tattersall’s

Operator of half 27,500 EGMs in Victoria Member of EMT, Government relations, media relations, issues

management GM Global Communications, NAB.

Led creation of Australia’s first bank account for the disadvantaged

Government & community relations Bachelor of Science MBA and MMktg


Overview

Pre-commitment Global leadership in pre-commitment The constraints of the old technologies The new technologies for pre-commitment Australian developments in pre-commitment Internet gambling application


Problem Gambling Focus

Phase 1: Focus on venues Phase 2: Focus on machines functionality Phase 3: Focus on machine density


Problem Gambling Focus

Phase 1: Focus on venues Phase 2: Focus on machines functionality Phase 3: Focus on machine density The New Agenda: Player Pre-commitment


The New Public Policy Agenda Pre-commitment

Focus on player pre-commitment limits Player monetary loss limits – daily, weekly, monthly.

Machines must stop when limits reached Players initially set their own limits voluntarily Players set limits away from the machines Players carry an ID device connected to their limits in order

to play (e.g. plastic card, smart card or some other smart technology)

Machines only operate using an ID device. Machines still use coins and notes as usual


Global Leadership

Nova Scotia, Canada Responsible Gaming Device (RGD) trial mid-2006 Plastic Card with ‘voluntary’ capability to set limits Trialled across two towns – Windsor & Mount Uniacke Players required to use a card to play machines Initiated by the Nova Scotia Gaming Corporation


Nova Scotia Trial Findings

Significant database of player activities Extended player analysis now possible by independent

researchers over time


Nova Scotia Trial Findings

Significant database of player activities Extended player analysis now possible by independent

researchers over time

Unfortunately some players ‘beat’ the system: Plastic cards shared amongst players 37% of players shared their card with someone else Sharing of cards extended for up to a week Card sharing increased with increased PG score


Old Technologies

Limitations of plastic cards with PIN Cards have very low storage capacity (<1k) Cards & PINs can be swapped between

gamblers Cards can be easily copied/skimmed Cards require an additional card reader Cards operate on different proprietary

standards Cards limited to a single gambling venue’s

network



Old Technologies

Smart cards with PIN Player loyalty systems with convenience expenditure

Cards have minimal storage capacity (32k) Cards & PINs can be swapped between gamblers Cards require an additional expensive card reader Cards operate on different proprietary standards Cards limited to a single gambling venue’s network Smartcards use digital cash Players lose connection with the use of real money Increased risks for problem gamblers

KPMG Study for Australian Government Problem Gambling – ATM/EFTPOS functions and

capabilities 2002



University of Nevada, Las Vegas

International Gaming Institute, University of Nevada Commissioned to review Nova Scotia trial February 2007 Report

Players “beat” the system – card sharing Should pursue measures to address this problem

RESPONSIBLE GAMING NETWORKSRESPONSIBLE GAMING NETWORKS

University of Nevada, Las Vegas

International Gaming Institute, University of Nevada Commissioned to review Nova Scotia trial February 2007 Report

Players “beat” the system – card sharing Should pursue measures to address this problem Biometric ID solution required (fingerprint, facial etc) for

pre-commitment solutions

New Technology Solutions

Biometrics Unique characteristics of every human being. Eyes, fingers, voice, handwriting etc Cannot be easily exchanged between humans

Most developed biometric is fingerprints Developed by FBI in 1920’s Recognized and accepted globally Lowest cost biometric New technologies have digitized fingerprint biometrics


Fingerprint Biometrics


Fingerprint Biometrics


Player Protection Key


Player Protection Key Electronic Key – unique for each player Biometric identification of owner

Eliminates sharing of ID amongst players On-board fingerprint scanner On-board storage of biometrics




Plug-and-Play Device – no batteries Connects directly into all USB outlets Eliminates need for a card reader On board microprocessor = multi-venue




Plug-and-Play Device – no batteries Connects directly into all USB outlets Eliminates need for a card reader On board microprocessor = multi-venue Massive storage capacity (8 Gigabytes)

Coverage across all forms of gambling - gaming, lotteries, wagering, sports, spread betting.

Coverage across all channels of distribution – EGMs, Internet, Interactive TV, Kiosks.

Coverage across multiple gambling companies


Player Protection Key Players set personal dollar loss limits Encouraged to set affordable limits Limits set outside gaming room No central storage of biometrics EGMs only operate with key used by its owner Extensive player database for researchers No cost to player



Biometric Gaming Standards

Regulators - Nevada Gaming Commission Biometric technical standards established “Mobile Gaming System Policies” May 2006 Two Factor authentication (device & biometrics) for player ID Established standards for:

Cryptographic protocols Encryption algorithms

Machine Manufacturers - Gaming Standards Association USB now adopted as Gaming Device Standard – GDS – for all

EGMs globally.


Responsible Gaming Networks Socially-responsible Australian based consortium Focused on eliminating problem gambling from:

Wide area gaming machines Internet gaming

Using latest technology and Safety Net system to provide:

1. Reliable identity access for all players using biometrics

2. Safe play using player pre-commitment protection

Consortium of USA, European and Australian technology partners


Nova Scotia Today

November 2007 announcement: “Informed Player Choice System” to be introduced:

Across the entire province of Nova Scotia Across all machines Player’s to have the capability to establish loss and time pre-

commitment limits across all machines Players will be unable to swap identities Implementation within 18 months Cost of CAD$3 - $4 million per annum


Australian Developments Australian Ministerial Council on Gambling

Federal and State Ministers for Gambling Research Program on Pre-commitment Analysis of Gambler Pre-Commitment Behaviour, June 2006 Player Support for Pre-Commitment

77% of Victorians support compulsory pre-commitment limits 88% of Victorians support voluntary pre-commitment limits

Stage 2 Tender has been issued with a focus on: Gaming machine designs which support/undermine pre-

commitment


Australian Developments Victoria

Current Gaming Industry Structure Review Kirby Report October 2006

“Support for exploiting the monitoring system to develop harm minimization measures”

“a universal system of pre-commitment will possibly be more effective than a range of other proposals for enhancing responsible gaming”

South Australia Concerned about lack of national progress on pre-commitment Ministerial Working Party established November 2007 Reporting later this year on how to implement pre-commitment


Australian Developments Victoria

Current Gaming Industry Structure Review Kirby Report October 2006

“Support for exploiting the monitoring system to develop harm minimization measures”

“a universal system of pre-commitment will possibly be more effective than a range of other proposals for enhancing responsible gaming”

South Australia Concerned about lack of national progress on pre-commitment Ministerial Working Party established November 2007 Reporting later this year on how to implement pre-commitment


Internet Gambling Industry Globally:

700 million internet users globally 2,500 internet gambling sites $16 billion of player gambling losses last year

New Zealand: 75% of NZ population use the internet 50% of NZ children use the internet daily

12-17 year olds in NZ use the internet as often as the heaviest adult users

NZD$2 billion spent on terrestrial gambling Will result in an emerging digital problem


Internet Gambling Industry Globally:

700 million internet users globally 2,500 internet gambling sites $16 billion of player gambling losses last year

New Zealand: 75% of NZ population use the internet 50% of NZ children use the internet daily

12-17 year olds in NZ use the internet as often as the heaviest adult users

NZD$2 billion spent on terrestrial gambling Will result in an emerging digital problem


It’s big…

Source: Nielsen//NetRatings NetView Home & Work data (ES, CH, JAP & BR home data only), September 2004-2005

Total Visitors (000's) Growth Sept 04 - Sept 05

29,632 22%

6,223 7%

6,189* 9%

FR 5,280 23%

UK 4,867 12%

IT 2,067 62%

1,578 55%

1,452* 154%

SE 1,050 59%

980* 5%

490* 48%

…and its driven by high speed access


Internet Gambling Models

Old Internet Model: Ban onshore internet casinos Allow offshore internet casinos Risks with casino authenticity, lack of regulatory controls,

consumer protection, underage gambling & problem gambling.


Internet Gambling Models

Old Internet Model: Ban onshore internet casinos Allow offshore internet casinos Risks with casino authenticity, lack of regulatory controls,

consumer protection, underage gambling & problem gambling.

New Internet Model: Provide a safe regulated local market with full range of

player protection safeguards. Eliminates the risks Allows for government taxation.


RGN

INTERNET PORTAL

CASINO B

CASINO A

CASINO C

CASINO D

CASINO E

USBPlayer Protection Key


New Internet Model

RGN

INTERNET PORTAL

CASINO B

CASINO A

CASINO C

CASINO D

CASINO E

USBPlayer Protection Key


New Internet Model

Player Pre-Commitment and Authentication

Government Taxation

Casino Authentication & Regulatory Supervision

Internet Gaming Invitation

Academics/Researchers on the journey Australian Internet Gambling trial in 2008 Pre- and post- evaluation Impact on attitudes and behaviours Tracking over time Player Panel Database evaluation & reporting.


USB Key and Biometrics

Multi channel solution: Multiple venues (Hotels, Clubs, Casinos, TABs) Internet channel Self service kiosks Interactive TV

Eliminates identity sharing


Questions

Contact Phillip Ryan

Chief Executive Officer Responsible Gaming Networks Melbourne, Victoria. Australia [email protected] Mobile + 61417 313 726


Documents

International Gambling Conference New Zealand 2008 “Beyond Smart Cards to Smart Technologies” Phillip Ryan Chief Executive Officer Responsible Gaming Networks