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Alliance Global [AGI 6.87, down 2.0%; 141% avgVol] [link] confirmed that its subsidiary, Newport World Resorts (NWR, née Resorts World Manila), was “strengthening its online gaming system and platform to be able to compete in the online gaming segment of the Philippine gaming industry”. It clarified that it was not building a “new gaming application”, just that it will “strengthen” and “enhance” its existing “gaming system and platform”. AGI did not dispute the report's claims that its online gaming platform had been “soft-launched a few months back”, or that the newly “strengthened” version would be “dropping in the next few months.”
MB bottom-line: Of course, right? Like, how would any major casino brand in the Philippines hope to compete in the post-COVID gaming landscape without a significant online gaming presence? While it was odd that it took so long for DigiPlus [PLUS 48.30, down 1.7%] competitors to arrive, now we will have Solaire Online from Bloomberry [BLOOM 3.99, down 0.3%] and Newport World Casino Online from AGI. Given PLUS’s ridiculous profitability, it was only a matter of time before this had to happen. I’m watching closely to see how this coming war for gaming eyeballs will be waged and won. All gaming is a marketing exercise, but online gaming is even more so. Would someone who is brand-loyal to NWR’s physical casino feel that same loyalty online while trying to gamble on the toilet in a poorly-lit CR? The online gaming bonanza in the US that was set off by the legalization of sports betting shows that the publicly-traded behemoths spend between 20% to 30% of revenue on marketing to capture those eyeballs. For PLUS, it’s already spent P4.8 billion in Q1 against P22.7 billion in gaming revenue (~21%), but that’s a little on the low side relative to the US sports betting guys, and it’s probably going to go up as the newcomers come online. Will the newcomers spend more aggressively, forcing PLUS to counter, or will they play a different game with their physical locations?
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