Table of Contents
Issues in the Market
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- Main issues
- Definition
- Abbreviations
Insights and Opportunities
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- If you can’t beat the bookies, join them
- Raising seaside stakes
- Tabloid tasters
Market in Brief
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- A market in decline
- An industry blaming the government…
- …but with some responsibility for its own plight
- New legislation to bookies’ benefit…
- …but leaves arcades with a gambling problem
- External forces damage pub sector
- Major players diversify to survive
- Problem gambling: Perception worse than reality
- Ready to uncork the innovation dam?
- Possibility of remote success
- The future: safety in numbers?
Fast Forward Trends
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- Trend 1: Nostalgia
- What’s it about?
- Observations
- What next?
- Trend 2: Customisation
- What’s it about?
- Observations
- What next?
Internal Market Environment
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- Key points
- The Gambling Act – no dice for gaming machines?
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- Figure 1: Maximum permitted numbers of gaming machines, by type of premises, May 2008
- Odds fixed in favour of betting shops?
- Cash box down for traditional sector…
- …as players follow the prize money
- Who’s responsible?
- Review of legislation demanded
- Industry not amused by licence duty and tax
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- Figure 2: Amusement machine licence duty, classification and annual rates, 2006-08
- Revenue trends reflect shrinking machine base
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- Figure 3: Amusement machine licence duty revenues, 1997/98-2006/07
- Stakes and prizes
- Smoking ban stunts growth prospects
- Leaving Las Vegas
- Fewer bingo houses to fill
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- Figure 4: Number of bingo clubs in operation* in the UK, 1996-2007
- Problem gambling – or not?
Broader Market Environment
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- Key points
- Credit crunch to squeeze gaming machine spending?
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- Figure 5: Trends in selected areas of discretionary expenditure, at current and constant prices, 1984-94
- An ageing population, but a more affluent one
- UK holiday market experiencing mixed fortunes
- The pub market: A glass half empty
- Rescue mission a political gamble
Competitive Context
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- Key points
- The gambling market
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- Figure 6: Participation in gambling activities among active gamblers, 2007
- Competition remains fierce
- The challenge of increasing frequency
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- Figure 7: Frequency of participation in gambling activities among active gamblers, 2007
- Remote gambling: how big a threat?
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- Figure 8: Participation in remote gambling, excluding National Lottery games, 2006-08
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- Figure 9: Participation in remote gambling, by type of gambling activity, 2006-08
- Internal competition: AGCs v LBOs
- The leisure market
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- Figure 10: Consumer expenditure on selected leisure goods and activities, 2002-07
- Machines have fingers in some of the largest pies
- Novelty competition is no joke
Strengths and Weaknesses in the Market
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- Strengths
- Well-placed in gambling market
- Untapped potential
- New technology
- Online opportunities
- Weaknesses
- Market in decline
- Continuing climate of uncertainty
- Restrictions on prices
- Predominance of casual play
- Vulnerable to external shocks
Who’s Innovating?
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- The future is digital
- Loopholes
- Machines on mobiles
- Alerting players to opportunities
- Bookmakers take a punt
- Tournament play
Market Size and Forecast
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- Key points
- Fewer machines taking more money
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- Figure 11: UK gaming machines installed base and expenditure, 2003-13
- Figure 12: Gaming machines installed base and average revenue per machine, 2003-07
- The Gambling Act becomes a harsh reality
- Radical change ahead?
- Forecast
- Factors used in the forecast
Segment Performance
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- Key points
- Video aims to revive AWP fortunes
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- Figure 13: UK gaming machines installed base, by type, 2003-07
- FOBTs bringing home the bacon
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- Figure 14: UK gaming machines, by location, 2003-07
- Continued decline expected across all sectors
Companies and Products
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- Key points
- Manufacturing in decline…
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- Figure 15: Section 27 applications to sell, supply and/or maintain gaming machines, 2004/05-06/07
- …with diversification the big names’ safety net
- Major operators
- Danoptra Gaming Group
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- Figure 16: Selected financial data, Danoptra Gaming Group Ltd, 2006 and 2007
- Inspired Gaming Group
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- Figure 17: Selected financial data, INGG, 2006 and 2007
- IGT-UK
Who Plays Gaming Machines?
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- Key points
- Venues where gaming machines are played
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- Figure 18: Where gaming machines are played, February 2008
- Sector vulnerable to closing time for pubs
- LBOs v AGCs: Value beats volume
- Who are the main players?
- Problem gambling: The rich have less to lose
- Red top targeting
- Regulars to day trippers: Machines can be part of the scene
- Venue preference segments market
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- Figure 19: Combinations of locations where gaming machines are played, February 2008
Frequency of Playing Gaming Machines
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- Key points
- Fruit machines
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- Figure 20: Frequency of playing fruit machines, February 2008
- Low prices, low volumes: how the sums struggle to add up
- Quiz machines
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- Figure 21: Frequency of playing quiz machines, February 2008
- Fruit with a harder core
- Fruit machine players vs quiz machine players – who are they?
- The wrong sort of regular – for operators and players alike
- High maintenance couples
- Socialites v players
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- Figure 22: Where gaming machines are played, by frequency of playing fruit machines and quiz machines, February 2008
Attitudes Towards Gaming Machines
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- Key points
- Suspicion and confusion the key barriers
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- Figure 23: Attitudes towards gaming machines, February 2008
- Staking a claim on cyberspace
- Positive vs negative attitudes – key demographics
- Lapsed players: once bitten, twice shy?
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- Figure 24: Attitudes towards gaming machines, by playing of gaming machines, February 2008
- It’s easy if you try…
- Spare change in spare moments
- Kiss me quick
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- Figure 25: Attitudes towards gaming machines, by where gaming machines are played, February 2008
- Quiz players’ great expectations
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- Figure 26: Attitudes towards gaming machines, by frequency of playing gaming machines, February 2008
Gaming Machines Target Groups
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- Key points
- Pro-Gaming Machines (21% of the sample or 10.1 million adults aged 18+)
- Who are they?
- Anti-Gaming Machines (15% of the sample or 7.2 million adults aged 18+)
- Who are they?
- Apathetic (64% of the sample or 30.9 million adults aged 18+)
- Who are they?
- We all like to play beside the seaside
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- Figure 27: Where gaming machines are played, by gaming machines target groups, February 2008
- Smoking out the regulars?
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- Figure 28: Attitudes towards gaming machines, by gaming machines target groups, February 2008
Appendix: Broader Market Environment
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- PDI and consumer expenditure
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- Figure 29: Trends in personal disposable income and consumer expenditure, 2003-13
- Age
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- Figure 30: Trends in the age structure of the UK population, by gender, 2003-13
- Lifestage
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- Figure 31: Forecast adult population trends, by lifestage, 2003-13
- Socio-economic group
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- Figure 32: Forecast adult population trends, by socio-economic group, 2003-13
Appendix: Who Plays Gaming Machines?
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- Who plays?
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- Figure 33: Playing of gaming machines, by demographic sub-group, February 2008
- Where do they play?
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- Figure 34: Where gaming machines are played, by demographic sub-group, February 2008
Appendix: Frequency of Playing Gaming Machines
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- Figure 35: Frequency of playing fruit machines and quiz machines, by demographic sub-group, February 2008
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Appendix: Attitudes Towards Gaming Machines
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- Attitudes towards gaming machines – detailed demographics
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- Figure 36: Most popular attitudes towards gaming machines, by demographic sub-group, February 2008
- Figure 37: Next most popular attitudes towards gaming machines, by demographic sub-group, February 2008
- Combinations of attitudes
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- Figure 38: Attitudes towards gaming machines, by most popular other attitudes, February 2008
- Figure 39: Attitudes towards gaming machines, by next most popular other attitudes, February 2008
Appendix: Gaming Machines Target Groups
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- Figure 40: Gaming machines target groups, by demographic sub-group, February 2008
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