Sweden's technical teething problems

Sweden was a top talking point for the sector in 2018 and many have predicted 2019 will be much of the same, as movements in the market dictate further industry consolidation and the latest in product development.

And it was a busy Christmas for the Swedes in preparation for the long-awaited opening of the Swedish online gambling market. In a similar fashion to Father Christmas (or Jultomten to our Swedish friends), the gambling regulator (Spelinspektionen) spent December in a frantic rush awarding as many licences as possible to the seemingly never-ending list of operators seeking entry into the hottest new jurisdiction.

By 3 January, 60 licences had been granted with 35 yet to be decided. On the flipside, operators worked tirelessly to prepare the launch of their brand new and fully compliant products as soon as the doors opened on 1 January 2019.

But between the months of August when the licensing window opened, and January when the market flooded with offerings, a catalogue of strict technical requirements had to be implemented, as well as the ability for all players to connect to the national self-exclusion scheme Spelpaus.

On these strict guidelines, Kristoffer Lindström, Swedish analyst for technology research fi rm Redeye, praises operators for their work: “It’s always hard work to be done when there are new technical requirements – in particular, the compliance part – as the stipulations have increased. The hurdle to launch a new casino in Sweden has indeed increased in that the barriers to entry are higher, which will likely benefit the established players,” Lindström tells EGR Technology.

“The new regulation has not been created with the intention of making it difficult for the companies to S operate, but to improve the experience for users and the industry. I think the regulation will create benefits for all stakeholders in the long-term.”

The CIO at state-owned, former monopoly operator Svenska Spel, Jörgon Olofsson, agrees that adhering to the requirements, which stipulate very strict responsible gambling rules, was a challenge in such a short timeframe.

“There is a certain lack of consistency between the law, the ordinance and the regulations issued by the supervisory authority – not even the various regulations are fully consistent. We would have wished for more dialogue in these matters, but understand that also the regulator has been under hard pressure this last year. We have had internal resources that have worked hard to make sound judgements and translate the requirements into technical functionalities, to ensure we keep our responsible gambling work at the high standard we aim for,” he says.

Global Gaming head of development Duncan Snaith adds: “Because the SGA requirements were so new there were always going to be challenges involved in implementing these, as no one had done this before. Many of these requirements were very specific and we wanted to make sure we understood these fully before beginning to build these features.”

However, according to the regulator, Spelinspektionen’s technical regulations have been deemed “too weak” by other regulators. Coordinator against matchfixing Katarina Abrahamsson explains: “We leave a lot up to the licence holder. We have a way of working in Sweden where we do not regulate in the details, we often have a legislation’s framework from the government, and then we have the possibility of adding more detailed regulations from an authority level but very often we won’t specify how things should be done, just that they have to meet the requirements.”

Svenska Spel set out to switch on its new products in a prioritised order, Olofsson says, which started with the Tur site (lotteries and scratchcards), and moved on to Svenska Spel Sport & Casino online and finally its omni-channel offering, belonging to its bricks-and-mortar casino, Casino Cosmopol.

“It was a very extensive job that was completed at nine in the morning. After that tests and verifications started. At 3pm, we opened operations to customers in a prioritised order, one at a time,” Olofsson adds.

Arguably, Svenska Spel faced the greatest challenge of all operators, in that it had to divide its business into three separate areas in terms of technology, operations and customer-facing product. What’s hot? It’s no secret that Sweden is a leader in technology and novel and disruptive solutions, and in this respect it is likely too early to pinpoint any revolutionary egaming features to come out of the nascent market.

Payments is the first area of technology Sweden-facing firms have been tapping into with the likes of LeoVegas and Global Gaming adopting new solutions offered by local providers. LeoVegas launched with Swedish payments solution Swish in an effort to lower customer transactions costs. Swish is used by 6.7 million Swedes and 180,000 businesses, and is said to be the fastest depositing method in the jurisdiction.

After the launch, LeoVegas Group CEO Gustaf Hagman said: “LeoVegas is now offering the favourite way of making payments in Sweden. That we are also lowering our transaction costs makes this a win-win arrangement and exemplifies the new opportunities for LeoVegas in the Swedish market.”

Speaking to EGR Technology, Hagman adds: “Adding Swish wasn’t possible before but this is one example of opportunities we now have when Sweden is regulated. This gives the customers a very smooth customer journey. We don’t charge the customers any payments fees so lowering the transactions cost will have a positive effect on our margins.”

Similarly, Global Gaming has introduced local payments system Zimpler into its casino sites to diversify its offering. Previously the operator’s no registration and fast withdrawal products were powered by Trustly after they secured a deal with the supplier to offer its payments process exclusively to its Swedish players. But within a year, the new casino model took the Swedish market by storm and many of the tier one firms adopted a similar BankID-powered solution.

Soneby says: “The Swedish customer is a fairly international focused customer, with interest in many of the major European leagues, and even American sports, especially NHL, NBA and NFL. “However, to be perceived as a local Swedish operator, you have to be able to provide a good offering for the sports local to Sweden, such as ice hockey, bandy, trotting, handball and winter sports.”

UX specialist Staffan Schröder insists that BankID is the most commonly used electronic identification system in the country, used by over seven million Swedes. He believes that for an operator to succeed in the jurisdiction, it must integrate a BankID authentication system.

“As always we need to lower the barriers for people to start to play,” Schröder notes. “Operators must let players register using their BankID and not have to fill in long forms and send in ID documents for account verification.”

Betsson chief strategy officer and former VP of product and marketing at Svenska Spel Peter Zäll says the operator has recently implemented BankID into its registration system in order to meet Spelinspektionen requirements.

Zäll says Swish is the next payments technology to look out for and anticipates it will be widely adopted. For companies like Betsson, the market liberalisation will allow it to direct its gaze towards the offline gambling sector, and Zäll says that it has already forged a number of partnerships with retail companies to provide voucher systems and loyalty schemes to players more likely to dabble in playing via multiple channels.

Being responsible Zäll highlights the introduction of new responsible gambling features by operators as a notable difference to UX on Swedish sites. All operators have been required to tack their systems on to the national self-exclusion scheme, much as UK-facing sites integrate GAMSTOP in the UK. Betsson has also added pause buttons to all its products and adopted new deposit limits for Swedish players.

He says tapping into the Spelpaus selfexclusion scheme was a relatively easy task for Betsson, although others have faced difficulties. The Swedish news has this month been awash with reports that a handful of operators had failed to connect to the register.

Spelinspektionen confirmed the discovery of “shortcomings” in its cross-checking mechanism due to some licence holders not possessing an active connection to the Spelpaus.se register, resulting in self-excluded players being able to access egaming sites. Aspire Global was one example, with COO Dima Reiderman confirming to Swedish news outlet Breakit that the company had not joined Spelpaus despite having been live in the market for a week.

“We are planning to implement this integration very soon,” Reiderman said. “In the meantime, we will, from today, retrieve the data from the registry manually and if we find members that match the registry, we will close the account and give the money back.”

Spelinspektionen has not yet divulged what penalties operators will face if they do not comply with the self-exclusion requirements, although Abrahamsson says the regulator could issue injunctions, penalties and fines to those failing to comply with the Gambling Act’s requirement for all licence holders to be connected.

She insists the Spelpaus technology is relatively simple to understand and connect to, but she also acknowledges operators have had a very short timeframe in which to understand the technology. Svenska Spel’s Olofsson agrees, adding: “The challenge has been that the full range of requirements became known to us at a late stage and that they are tricky to interpret legally and therefore into technical functionalities. The last features of the national exclusions register were not known until as late as the last week of December. This has given us very little time to test our systems the way we would normally do before such a huge launch.”

But despite all the hurdles, business is booming. Olofsson emphasises the huge traction the sites have received in the first week of being live. He says the sites were flooded with thousands of new customers soon after launching, with numbers up every day since then.

Betsson’s Zäll rightly notes that there are bound to be teething problems in the initial stages of the market opening, and for long-standing Swedish veterans like Betsson and LeoVegas, online experience will be a key advantage. But once former monopolies Svenska Spel and ATG get a handle on their player’s behaviours, it is fair game for all.