Casino Software Maker Not Afraid of Chinese Gambling Regulation

Due to very restrictive Chinese gambling laws, one would think that online casino companies would not want to expand their efforts and money on an uncertain market. Yet, in an attempt of conquering the huge market and beating the deadly competitors, there is one Australian player not afraid of ceaseless gambling bureaucracy.

Aristocrat, reports China gambling news, is an Australian casino game developer. The company develops mobile casino games, online slots, and lottery systems. In comparison to Playtech and Microgaming, it is a small player.

To move up the food chain, Aristocrat is placing its stakes on the Chinese gambling market. This is not an attempt to offer technology to land-based casinos in Macau. Quite to the contrary, the company is seeking to offer its software to online and mobile casinos in China.

The first attempt at Chinese market, though, is with mobile casinos account management systems, which the company is testing in one of Chinese provinces. This may, indeed, be a desperate move. However, the company’s 2011 profit, at $66 million, is down 14% in comparison to a year-ago period.

It may seem to many that casino software is an exciting and quickly growing market, which is true. But, when one investigates the industry competitive forces, the barriers to entry are low. At the same time, the existing powerful competitors, in the form of Microgaming and others, will not give up easily their market share.

As a result, one option for the gambling software companies is to find a niche play for such areas as social media gambling or mobile betting (with a focus on being category killer on one platform such as Android or even less used ones such as Symbian). The other option is to become a gaming giant and offer comprehensive, turn-key solutions to the Internet casinos.

The analysis of casino software shows that online casinos tend to choose only one platform for all of their games, thus only one software maker wins. It’s a zero-sum game with no spoils left for those who lose.