Nov. 21, 2022

How Going Cashless Will Disrupt the Casino Industry

The future of gaming


LIVE from the Vegas Strip at Money20/20, the fintech industry’s biggest conference, Nora goes inside the world of casino payments with Andrew Crowe, SVP of business development for Sightline Payments. He explains why they’re working to digitize casinos and sports betting, an industry that is still mostly cash-based, and an industry that, according to Sightline, is projected to grow to more than $150 billion in the next few years. For more info on our presenting sponsor, check out https://purple.com

 

Host: Nora Ali

Producer: Raymond Luu   

Video Editor: Sebastian Vega

Production, Mixing & Sound Design: Daniel Markus

Music: Daniel Markus & Breakmaster Cylinder

Fact Checker: Kate Brandt 

Senior Producer: Katherine Milsop

VP, Head of Multimedia: Sarah Singer 

 

Full transcripts for all Business Casual episodes available at https://businesscasual.fm

Transcript

Nora Ali: For Morning Brew, this is Business Casual, bringing you convos with people you know, and some you may not know yet, to make business less intimidating. Because money talks, but it does not have to be dull. I'm your host, Nora Ali. Now let's get down to business.

I am so excited to bring you today's conversation directly from Money20/20, the fintech industry's biggest conference, held annually in Las Vegas, Nevada. Over 11,500 people attended, and the speakers included everyone from Derek Jeter to OnlyFans CEO Amrapali Gan, with over 3,000 companies represented. And because it was Vegas, we at Business Casual knew that we had to look into the business of...you guessed it...gambling. I learned all about how the money flows in casinos with Andrew Crowe, the SVP of business development for Sightline Payments. Sightline is trying to digitize casinos and sports betting in an industry that is still mostly cash-based. An industry that, according to Sightline, is projected to grow to more than $150 billion in the next few years. 

By this point, we are accustomed to digital finance in our everyday lives, from daily transactions to banking to investing. But Andrew and I talked about why casinos have remained what he called "an amazing oasis of cash" in an otherwise pretty digitized financial world. We got into how money actually travels in the casino industry, how casinos make money, how digitization may actually help with gambling addictions, and how innovation overall will change the game. It was fun to have this conversation live from Las Vegas, and odds are you'll enjoy listening to it. That's next, after the break. This is different.

Andrew Crowe: It is.

Nora Ali: We've never done this before; it feels very intimate. I'll use my podcast voice for this. Well, everybody, welcome to this live recording in Vegas at the Venetian of the Business Casual podcast for Morning Brew, and at Morning Brew and at Business Casual we like to uncover the money and the business behind things that impact our everyday lives. And what better topic to cover here in Vegas than casinos, gaming, and sports betting. And who better than Andrew Crowe, the SVP of business development at Sightline Payments to tell us how money flows in the world of gaming. So welcome, Andrew, to the podcast...

Andrew Crowe: Thank you. Happy to be here.

Nora Ali: ...and to this room. How fun. So we do like to start with icebreakers on the podcast. This is a segment called OG Occupations to get to know you a little better. What was the very first job that you have ever had in your life?

Andrew Crowe: I delivered The Washington Post newspaper in junior high school, that were 125 papers on weekdays and 150 on the weekends. I still remember that.

Nora Ali: That is a lot. What was your biggest learning from that?

Andrew Crowe: Getting yourself out of bed every morning and getting the route done no matter what, no matter what the weather was, et cetera.

Nora Ali: That is amazing. Okay, let's start with an industry overview. If you could just give us context as to how big the gaming industry is, and what businesses make up the gaming industry.

Andrew Crowe: Perfect. It's actually a staggering scale. There's probably over $300 billion in cash that's flowing across the casino floors across the entire country. There are now 1,400 casinos, mobile sports betting, as many of you are experiencing, has been expanding significantly in the last few years. It's legal in 36 states. I think it's now active and live in at least 30 states. So that's mobile sports betting. I would add into that mix lottery as well. So in most of you in states that sell lottery, there's over $100 billion in cash sales for lottery around the country as well. So massive scale, massive amount of cash still in the market, which is a staggering number in our modern digital society. Actually, here we are sitting at the leading fintech conference in the world at one of the best properties on the Strip. Most of your experience around this has been digital, whether it was booking the airplane to get here, your Uber from the airport, your Starbucks coffee, your debit card, your Apple Pay, whatever. And then we step on the casino floor and that's still cash. It's just an amazing oasis of cash out there.

Nora Ali: Why is that? Why is it still cash-centric?

Andrew Crowe: A little bit of it is regulations; the rest of it is more technology. It's actually very expensive and difficult to get that final mile onto a slot machine. So you did ask earlier and I didn't dive into who are the players in there, and I'll touch on a couple now and go into one in particular. So first of all you have the casino operators, you have the Venetian Palazzo here, which is owned by the Apollo Group. They're part of also Great Canadian. There's like a number of properties in Canada as well. But then you have all the technology partners that supply the gaming on the floor. So you have the suppliers that give you those lovely ATMs where they charge you 10 bucks to get your own money out to go pay cash on the floor. Those are companies like NRT, Everi, et cetera.

But then when you get onto the slot machines themselves, while you might have slot machines provided by a ton of different technology companies, so the actual providing of the hardware and the game dynamics, et cetera, that you're seeing. All of those connect to a single CMS or casino management system, and there are four major providers for that. That would be IGT, Light & Wonder, formerly known as Scientific Games, Konami, and Aristocrat. So on the casino floor, all of those slot machines are talking to one central system, and that central system also houses player loyalty. So if you have your loyalty card, and then that is also the point of entry if you want to get money digitally onto the slot machine. So working with those technology providers and the regulators in each market to get them to understand this technology and modify the regs, so that we can actually do that, is where the final hurdle is in all of this.

Nora Ali: It takes time to get everyone on board. So how do casinos and any gaming platforms actually make money, taking it one step back?

Andrew Crowe: Great question. So I'm going to start with surprising stats since we're sitting here on the Strip. Over two thirds of the revenue that they get on the Strip is actually from non-gaming activity. So that's the importance of the restaurants, the entertainment, the spa treatments, and all of that other stuff. So two thirds of revenue. Now if you're in a locals' market with the locals' casino, that's probably more weighted 90% towards gaming and the economics around that. But non-gaming is a critical part, particularly on the Strip, as I said. So to digress for a second, if we're talking about digital payments across the casino ecosystem, that has to touch and support that critical non-gaming channel as well, not just the gaming that I was talking about.

So if we get on the casino floor, it's going to vary by whether you're playing slots or you're doing the table games. Slots are pretty straightforward. It's a random number generator. The machines all have different dynamics, always hit max bet is what they tell me, but...

Nora Ali: Is that true?

Andrew Crowe: I don't know. I've been in the business forever. I still don't get the allure of slot machines. It's never been my cup of tea. It varies by jurisdiction. So it's a random number generated, so statistically designed to come out with the right payout over time. And I believe Vegas odds that slot machines pay out 93 cents on the dollar. But to give you maybe a little bit, I'll throw out a gaming acronym. What the casinos are interested and worry about is GGR: gross gaming revenue. So if you think of somebody that puts $100 into a slot machine, they're thinking, "Right, this machine's not hot, I'm not feeling lucky." So they take $80 out and they go to the next machine. It's still that original $100. So $100 plus $80 is not $180. In the end, it's the GGR, the gross gaming revenue, or the net dollars of dollars put in across the property versus dollars taken out as winnings. That is the revenue number that they're interested in.

Nora Ali: Are slot machines the most lucrative of games for casinos?

Andrew Crowe: It's a different dynamic. So slots have that very fixed, that construct I just mentioned. When you get to table games, it's often an exchange of...it might be thin margin but it's high volume. You're going to have a lot of transactions that drive a very thin margin. If it's blackjack, there's all the side bets that you can do beyond just the straight bet as well. All of that drives additional revenue for it. Baccarat, I think, is more about frequency of play and having more dollars go through it. 

Sports betting is another animal entirely. I know sports betting is the hot topic in the market now, and everybody is looking at the revenue that'll generate for the states. It's actually one of the thinnest margins business out there for the operators. It's more of an acquisition tool or a way to engage their players through a digital channel.

For Caesars and MGM, when the folks leave the property, how do they engage them off-property, or how do they engage in a state where they may not have a property but they may come to Vegas? It's about engaging that younger consumer. But sports betting, it varies a little bit, and the states take big tax cut on what those profits are, but they're probably only making about 6% margin on the sports betting that happens, so very thin margin. And surprisingly, despite all the attention it's getting, sports betting...I mentioned that $300 billion market and then all the GGR that's driving. I think in the GGR, for the whole US casino market, sports betting is maybe driving 6% of the GGR. So still a lot of attention, a lot of hype, and it's new and it's incredible, but it's still a very small percentage. It really is ultimately about the money that they're making in brick and mortar, and again, that critical non-gaming revenue.

Nora Ali: Are the margins expected to grow for sports betting?

Andrew Crowe: It's still a pretty tight business. It's very competitive, and you'll see this is public information from earning reports, et cetera. These guys are spending staggering amounts of money acquiring players. It's fierce competition. You have markets with 10, 15, 30 players, and you'll have players jumping between them for who offers the best promotional offer, et cetera. So some of that's going to have to settle down over time. I don't think that margins will increase, but I do think that cost of acquisition will come down. There will be winners, there'll be some that back out of the market. There are already a couple TwinSpires or related to Churchill Downs, folks that do horse racing, had tried in the US market to do sports betting. They were one of the first to actually now back out of it. TheScore, which has a big operation in Canada, is doing work with Barstool but is winding down theScore operation. So I think it's going to be more of a consolidation in who's the successful player in the market, but they've got to get down the cost of acquisition of players.

Nora Ali: Is part of that acquisition cost is they're literally giving away free money...

Andrew Crowe: They're giving away free money.

Nora Ali: ...for you to bet with.

Andrew Crowe: You have a risk-free bet of $1,000, basically.

Nora Ali: Yeah. And if you win, you could just keep playing with that. You'll never put any new money.

Andrew Crowe: You can. Playing with the house money. Exactly. Or you then go to the next operators offering a different promotion as well.

Nora Ali: Yes. And there's enough of them now that you could last a while.

Andrew Crowe: I don't want to diminish the business. It's a great business to engage the younger demographic. It's a great way to extend their brand into digital and make sure they're touching their customers on a national basis wherever it's legal.

Nora Ali: So I have only ever shown up to a casino with a lot of cash because I'm like, "That's what I'm going to spend. And when I'm done with that, then it's time to go home." And I've only ever been able to exchange my cash for poker chips or whatever as I'm playing. Same with my parents who love casinos more than I do. Can you walk through the flow of payments as it has been historically, before digitization has become more mainstream?

Andrew Crowe: Perfect. So I mentioned the ATMs earlier. So the typical dynamic...you either come with a pile of cash to...I know a guy, he and his wife come for three days. They come with each with three envelopes of $5,000, they have $15,000 apiece, and that's their $5,000 for each...I don't understand this. $5,000 is their gambling budget for each of the three days that they're at the casino. But the typical market, you're either bringing cash or you're withdrawing cash from the ATM on the property and then you're moving over to put it into a slot machine. And once the money is in the slot, the way it usually moves between slots is a TITO, a ticket in, ticket out. So it's going to be a paper receipt with a barcode on it that lets you transfer the dollars from each machine to each other.

So gone are the days, as you're experiencing, and many of you are too young for this, but gone are the days of the coins in and the coins coming out and the big buckets of coins that you carried around from machine to machine. It is all cash in and ticket out. And then at the end of the day, if you have winnings or you're finished with your gaming, you have a redemption center where you can put those tickets in and get cash out for it or for larger winnings, et cetera, you may even have to go to the cage. Similar dynamic for table...

Nora Ali: What's the cage?

Andrew Crowe: Oh sorry, the cage. Yes. So the cage would be that one window that can do everything for you money-wise. You can get chips there, you can cash out your chips from table games.

Nora Ali: That's where real humans are in there.

Andrew Crowe: That's where real humans are, behind a cage; they're behind actual bars, and they're ones that...and we'll come back to that actually. So the cage operation and the cash operation is a big part of this as well. I should pull that thread for you as well. So table games, similar thing: You can go to a table, you lay your cash out on the table, you can exchange that for chips. Chips can play, you can buy in again, there's a term called color up or cash out. So if you have a bunch of smaller denomination chips, you can say I want to color up, and get those into a handful of larger denomination chips, so it's easier to move from table to table.

But in the end, at the end of all of your play, at the end of the day, or if you want to go eat dinner with some of your winnings, you've got to typically go to the cage and convert those chips to cash, so that you can then move elsewhere on the property with your cash, or use your Apple Pay or pull a credit card out when you're shopping on the property in today's market. 

So I already mentioned it, $300 billion in cash as it's flowing through the US market. All that cash that went into the slot machines has to be picked up. So there's something called a drop team. I don't know why they call it a drop because they're actually picking things up. But there are these security teams that go around at like five o'clock in the morning and they collect the cash from the slot machines. They take it to the count room, which is usually part of that cage operation or tied to that team that does it. And it's not Ocean’s Eleven; I wish it was as glamorous and exciting on that. But it is a place where massive amounts of cash go through G+D bill counters and go through and looking for counterfeit bills. There's all kinds of security and controls in there that's scanning the money. The money is all counted and bundled and wrapped. And then keep in mind: I mentioned at the cage, they're dispersing cash for winnings. So they're figuring out what their budget is, their cash needs are for the next day up on the floor for cash going out of the property, and then the rest gets picked up in an armored truck and taken off. So it's a very labor-intensive thing, security, money-counting, the drop teams that have to go around and pick up the money on slots.

Nora Ali: It's one of the most expensive parts of running a casino, right?

Andrew Crowe: I would think it's up there. Their labor costs are pretty high across a number of other applications, but that is a very noticeable, expensive piece of the operation.

Nora Ali: So one way to save money for casinos is to further digitize. So let's talk about Sightline, on that note. So according to the website, it's US sports betting, casino gaming markets, leading digital payments provider, and mobile app developer. What does that mean?

Andrew Crowe: What does that mean? So Sightline's been around a little over 10 years. Always designed to support the gaming industry. The team that founded this actually took a company called GCA or Global Cash Access public, which is now Everi, so I mentioned Everi: They're the ones doing the ATM and the cash advance machines as well. So that's another piece of this. It's not just ATMs as in debit cards. There's a lot of volume that comes from credit cards where they do cash advances, they're paying cash advance fees, their banks are charging them fees. There's a lot of expense in there for the patron as well. I mention that because I've always seen, it's ironic but I guess it makes sense in the end. The team that spent this first part of their career getting cash onto the floor is now working to get cash off the floor.

So we'll pivot to that now. With our first cashless delivery, so there is actually a casino in Connecticut called Mohegan Sun. That was our first delivery; it was over five years ago. It's a much older technology but it really works. You can, with your player card, with a Sightline Play+ account that you can fund with credit and debit, PayPal, you can do a bank transfer into that account. I can step up to a slot machine with my player card, type a PIN on the screen and actually move money from my Play+ account, Sightline Play+ account onto the slot meter and cash out, et cetera. So that was the earliest iteration of it. And then with the repeal of PASPA...Oh, I promised no acronyms, right? Sorry. The Professional and Amateur Sports something Act. So anyways, it was a law that was originally deemed to outlaw sports betting in all but the state of Nevada, was repealed and all of a sudden sports betting exploded just a few years ago.

So we pivoted to the other side of this omnichannel solution that we have and we became a significant supplier of dollars into mobile sports betting. So with the exception of two platforms, we're in every jurisdiction and every mobile sports betting platform in the country, probably driving between 15% and 20% of the funding into that. So we are an account; it's embedded in the payment stack. So if you are at FanDuel and you're going through to see how I can move money into FanDuel, one of the options in there, it might be credit cards, debit card or Visa, MasterCard, PayPal, Play+ will be there as well. And you don't have to have an account to start with. You can complete enrollment funding and do the wager transfers entirely through the FanDuel or the DraftKings app as well, to move money in and out of Sportsbook.

That really though, in the end, was only part of it for us. So fast forward to today. Last year, Resorts World...which if you haven't been to Resorts World, beautiful property, the newest property on the Strip to open in over a decade, opened July 4th of last year. And it is the first casino where you can have an entirely digital gaming experience on the floor. So that's slots and tables, so I'll take you through that now. So I mentioned earlier the CMS or the casino management system, that's Konami in the case of Resorts World. So we are integrated, Sightline is integrated to Konami with Play+. You first open a Genting reward. So Resorts World is in the Genting casino family. You open your rewards account and then you add the optional Play+ account which is linked to it. So it's linked to your loyalty account. Everything I'm going to describe, you earn loyalty points for as well. And then much like my mobile sports betting example, I can now fund that account in real time with credit cards, debit cards, PayPal, bank transfer, you could do cash at the cage, you could do cash at kiosk. There's a number of ways of getting money into that account. And then in real time, I can now step up and connect with a slot machine and push money onto that slot machine in real time.

There are two technical ways you'll see that happening across different casinos. Konami does a QR code on the screen to connect to their slots. So it's very clean in the mobile app, which is the other part of what Sightline does, and I'll get to that last but not the least. In the Resorts World app, and if I want to do cashless gaming, I've already got my account set up, it's linked to loyalty, everything I said. All I have to do is walk up to a slot machine, say I want to connect, scan the QR code, and then say I want to push $40 on it, "enter," and the cash is real time immediately digitally moved onto the slot machine. And then when I cash out on the slot or disconnect on the mobile, the funds are automatically returned to the Play+ account.

Nora Ali: So the benefit is just a better user experience. It's how you're used to shopping now. You put your Apple Pay on the machine and that's it. So what are the benefits for casinos, for example, for the business?

Andrew Crowe: So giving the consumer a better entertainment experience and removing friction at that critical point of payments and when you're monetizing a customer really adds a tremendous value to them in terms of loyalty and additional revenue. I'm trying to think. Oh, a great illustration. Years ago, there were many McDonald's that only accepted cash. So they did a small pilot to see, if we accept debit cards, we may have to pay some banking fees to do so, but what happens? And immediately people spent more money. And in the gaming space, it's important that you balance this with responsible gaming intent to not drive...this is not about getting a ton of extra money out of everybody, but it's a modest increase in player loyalty and a modest increase in that revenue or GGR from the player. Because if you're not making them stop at an ATM and you're not extracting fees from them there, you can give them a better entertainment experience on the floor and you'll earn the revenue from that actual entertainment experience as well.

Nora Ali: We're going to take a quick break. More with Andrew when we come back. We are back with my conversation with Andrew Crowe live from Money20/20 in Las Vegas. We were talking about responsible gaming with increased digitization, and the fact that there's now more access to data on player behavior, and I asked him whether that ultimately encourages responsible gaming, and how that data is used.

Andrew Crowe: The key is how it's used. As you said, the beauty of digitizing this does mean both the player and the casino have visibility into the actual gaming activity that's happening. So let's start with the player. If you digitize it and you're running it through a Play+ account, you actually have an electronic record of how much you spent. You could set that account up as your budget for gaming for the day or for the weekend, and limit your play to the money that's in that account. 

And then on the casino side or UNLV, University of Nevada, Las Vegas—and it's Nevada, not Nevada, heard that a few times over the course of this conference, it's Nevada. So the University of Nevada, Las Vegas does a lot of work on the academic side around responsible gaming. So the actual activity that the players are doing is so much more powerful than what they say in surveys and what they get from other data points. So it'll allow regulators, academics, and operators take a much more informed and thoughtful approach to responsible gaming. One of the challenges with this is you don't know looking at a person on the floor how much money they have in the bank and what their ability is to pay. So it's not enough to just say "How much are people spending and what's too much?" You really have to take a much more thoughtful and understanding view of what that is. And interestingly enough, when you get into the type of data, it's often not the level at which people are playing, but it is spikes or sudden changes in behavior. So if someone always plays like this and then suddenly does that, that's usually a sign of something that's problematic. 

Just to pull a thread a little bit off of responsible gaming, one of the fascinating things for me with mobile sports betting, or particularly if you get to mobile, like, online poker, is there's also now a digital record of the actual gameplay. So the card play that happens across the table. So if there's concerns about money laundering or chip dumping or collusion. The fraudsters haven't really succeeded until they've pulled their winnings out, and analysts come in the next day, they look at reports of suspicious activity, they look at out-of-pattern winnings and losing, because in the end it is all mapped. There's certain patterns that you should expect, and if it's out of pattern, it's worth looking into, and they can go and re-create the play that happened at tables and follow the players across multiple tables to see what their actual gameplay was, and look for, is this a really dumb player or is this somebody that's aligned with somebody else at the table and they're up to no good? So there's a lot of fascinating things that you can do with the data.

Nora Ali: Very interesting. What would trigger someone looking into the data? Is there someone constantly tracking the data on your products and they see something looks suspicious, or it comes from the casino who thinks something suspicious happens, or...

Andrew Crowe: It can be all of the above. So those fraud teams, I think poker is the best illustration. You'll have other players that said something didn't seem right at that table. So they might float a complaint up through customer service that gets fed to the fraud team. They will look at somebody making a withdrawal for the first time and they'll see they've only been with us one day, and that they've suddenly won $20,000 and now they're cashing out. So there are a number of different triggers that can either be data, behavior, out-of-pattern experience, unusual withdrawal request, or reports from other players at the digital card tables that lead these fraud analysts to go through and look for and make sure it is all legitimate play across the...

Nora Ali: And the casinos have access to all of the data that you have access to internally at Sightline?

Andrew Crowe: So Sightline, in that scenario, we don't actually see the game play. We see the money in and money out. So that gameplay...and largely what I'm talking about on poker is really online poker. So that doesn't apply to table play; it's not as precise for table play. There are a lot of cameras watching table play. The dealers know what to look for, the pit bosses are looking for things as well. So there's a different dynamic at the table. But for digital and online poker, that's the dynamic I'm describing.

Nora Ali: With the data that casinos do have, having this much information about a person's spending habits is a dream for any brand or advertiser. Is there any cross promotions that's happening?

Andrew Crowe: I mentioned earlier, on the Strip, the value of the non-gaming spend. Funds in real time can be used anywhere across the property wherever debit cards are accepted. So I can step away from my card game, I can go buy dinner with the winnings that I had, and then I can reengage on cards or slots along the way. This account lets you move across the entire property in real time for that critical non-gaming spend, and it doesn't stop there. So we issue a debit card to the consumer linked to that same account. So they can now leave the property and that can be provisioned in Apple Pay, Google Pay, what have you. They can leave the property with that same account. They don't have to cash out when they're finished gaming. They can leave the property; the money is in an FDIC-insured account. They can use a debit card anywhere around the world, get cash at an ATM if they want to. They can ultimately transfer it back to their bank account if they prefer. 

I'll pivot back to the locals' market. You'd be surprised in the locals' markets, for a lot of people it is their entertainment, people come three or four times a week. It's not uncommon. So if you're a locals' market player and you're going to play regularly during the week, you have your budgeted funds in your Play+ account. That means if I need the money, I have a debit card so I can go to the grocery store and access those funds in real time if I need to. But I don't have to cash out when I leave, and I can return to the casino and my funds are already in that account, and to add one safety element to this, I'm not leaving a casino property at two in the morning with $15,000 in cash in my pocket. So it really adds a layer of security for the player as well.

Nora Ali: Yeah. Well, as you're making the experience more seamless for users and encouraging them to perhaps play more responsibly, it reminds me of the great social media debate, where the commercial aspirations are maybe a little bit in conflict with ethical responsibility, where Facebook, TikTok, et cetera, wants you to spend as much time as possible on their platforms because that translates to ad dollars, but then it becomes an addiction and it's not so great, objectively, for your mental health. So how do you balance your commercial aspirations and making sure you are encouraging responsibility?

Andrew Crowe: Yeah. So I feel strongly, and I've gotten the sense from just about from every operator with whom I've discussed it, they actually do take it very seriously, and in the end they don't benefit from irresponsible...nobody benefits from irresponsible players, people that get in trouble from gambling. Now, it's unfortunate, it is a small percentage of the gamblers out there. So the more data they have, the more ability they have to understand it, and frankly, there's a business sense to it as well. If they don't get ahead of it and be smart about it, then the regulators come in, and the regulators, with good intent, don't necessarily approach it the same way or the most effective way that you could if you were the operator with all of this data and all this information and being much more thoughtful about it. So I think it's important to collaborate with the regulators and the academics to get ahead of the issue before the regulators rightfully, in the interest of public policy aspirations, comes down on that.

Nora Ali: Tell me how you do work with regulators, because when you're talking banking and gaming, very highly regulated and you're having to interface with both. So is it a slow process to adopting innovation?

Andrew Crowe: You know, it's fun. Actually, that's one of my favorite parts of the job.

Nora Ali: They're not listening to you right now. It's okay.

Andrew Crowe: Well, no, it's good. I would say it if they were here as well. I've said it to both of them. So the beauty of it is these are two very highly regulated industries. They're not really familiar with each other's, but ironically, they really have a lot of the same controls, like the obligations that are on your casino around anti-money laundering controls and suspicious activities of what they report to FinCEN, the Financial Crimes Enforcement Network, which is part of the US Treasury. So they do a lot of the regulations over us as a money services business over a casino. All that flows through different regulators. But in the end we actually are very similarly regulated. So with some subtle changes and getting the two to understand each other, it actually in the end comes together quite well. 

So Boyd Gaming, for example, we're live with Aliante in Nevada, they're now live in four different states. We've gone with them to each of the regulators in new states. Most states allow cashless gaming. The regs, though, may not have fully contemplated what we're doing or the regulators may not fully understand it. So it's certainly not about selling. It really is, in the end, about going to the regulators and explaining what we do, how we do it, how we're regulated, how all of this money flows, how it goes in through that CMS platform with all of the audit and tracking controls that come with it, what we're doing with the data, how we'll address responsible gaming, et cetera. All ends up being a great story with each state that we go to, so they know what we're up to with our casino partners, and they modify the regs as needed. Great example. And this ties to user experience, and we should come back to mobile in a minute because that is super important.

Actually, as a quick aside, my one challenge to all of you in this space, and actually it's true across many markets. Don't get too enamored with the technology. The technology's super important and it has to work and it has to work well. But in the end, that technology has to be in service of a better user experience. That user experience, you know in your own lives, if you have a crappy user experience with your mobile for something, you're less likely to ever try it again. And it's not something you just release one time and walk away. You've actually got to be very thoughtful in that user experience, get consumer feedback as you add new features, be thoughtful about how it gets included in there as well.

Nora Ali: We're going to take a quick break. More with Andrew when we come back We're back with my conversation with Andrew Crowe, recorded live in Vegas. I asked Andrew whether he thought casinos would ever be completely cashless. I know there's plenty of people who go to casinos who want to use cash because they want to remain anonymous. So do you think there will ever be a totally cashless...

Andrew Crowe: No.

Nora Ali: Okay. Cash will always be a part of gaming.

Andrew Crowe: No, I don't think it'll ever go away. There are always going to be a percentage of customers that want to stay with cash. It'll be the people with the flip phones. We all have a few friends like that, or the folks...so gamblers are often very superstitious. They don't want the casino tracking their play, because...everything I've described with cashless is what we would call carded play, maybe digital, but it's a known player. It's like they put their loyalty card in the slot machine. So a lot of the gamblers will say, "I don't want the casino to know what I'm doing because if I'm hot on this machine, they're going to dial it back."

Nora Ali: Is that real?

Andrew Crowe: Oh, the casinos don't do that.

Nora Ali: They don't do that. People actually believe it though.

Andrew Crowe: But people do actually believe that, and people will guard their bank of slots. They'll be playing three machines together. Yeah. It's actually quite fascinating when you get into it.

Nora Ali: I've seen it. My mom loves slot machines and she just hovers behind the one machine that's calling to her until that person leaves and she's like, this is...

Andrew Crowe: This is the one. Because the next one's going to win, right?

Nora Ali: Yeah.

Andrew Crowe: And there are no losers. There are only non-winners. So that's the other thing. We have winners and non-winners on the casino.

Nora Ali: Gotcha.

Andrew Crowe: So I think we were talking about user experience and mobile. We realized this as a critical piece of it, and acquired a company called Joingo a little over a year ago, which coincidentally at the time was the company delivering the mobile app for Resorts World. So Sightline is now the leading provider of mobile apps for the casino industry. So set aside cashless for the moment, but I'm talking about moving loyalty and room service and your valet and your hotel key. The mobile apps that will transform or digitize how you engage with patrons across the entire casino property for non-gaming as well. So there's a good illustration in there. Well, so anyways, we're live at over 120 properties around the country. A number of them, the tribal casinos. Mobile is the way to deliver this. And it is super, super important to focus on that user experience and make sure you get it right. 

Oh, I know where I was going with this. It's the regulators. It's a great illustration. There were one major point of friction when we launched Resorts World last year, due to regulations in Nevada. And these were born out of sports betting regs. I kind of understand it. When mobile sports betting was coming online, they added a reg that said to complete enrollment with a particular mobile sports betting app, be it DraftKings, FanDuel, whoever, or Caesars or MGM, that you needed to go on site, in person, to the physical casino and be ID-verified. Now that works okay for most people, but a lot of times you're waiting online at the cage or at a loyalty desk to have your ID physically verified; you're often signing paperwork.

The logic in the mobile sports betting space was the casinos here didn't want a FanDuel partnering with some tiny little 200 slot machine casino in rural western Nevada, and then being able to export mobile sports betting across the state. So they really anchored it to the properties as well. I get that. But when it came to cashless on the gaming floor, it made for a horrible experience with the enrollment. So that process I described where I opened Genting Rewards and then opened the Play+ account, I couldn't complete that before I got to the property. I couldn't arrive on property with money in my account ready to go. I actually had to go to a kiosk or often to a window and sign papers to complete the registration process. That's a lot of friction, not good at all. So we worked with, again, with Resorts World, with our casino partners, and the Nevada Gaming Control Board, and got approved back in January, the first time in Nevada to allow a fully digital enrollment experience.

So we're implementing it, the technology is done, it's with the Gaming Control Board just for approval to release to the public. But the next iteration of the Resorts World app, I will be able to, from home, sign up for loyalty, sign up for Play+, it'll be a simple scan of the front and back of my driver's license and a selfie. And we're doing biometric comparison with a platform called LexisNexis to confirm it's who it is, and then you're done. You're registered, enrolled, and you can now fund your account. So you can do all of that from home before you even arrive on property, and you're ready to go.

Nora Ali: So easy.

Andrew Crowe: So great illustration of the old regs, there for a reason. Didn't contemplate what we’re doing, didn't contemplate the newer technology. We got them comfortable with the way banks do ID verification, and they've accepted that, and that will be live within a matter of days.

Nora Ali: Final thing. We have a game, because we are talking gaming. So this game is called Big Bets, and it's just trivia about casinos and gambling, and I want to know which answers will you bet on, Andrew Crowe? Hopefully you know the answers. If not, don't feel bad. Okay, number one. What was the first country to license online gaming? And this is multiple choice. A, Aruba; B, Singapore; C, Antigua and Barbuda; or D, Malta.

Andrew Crowe: Malta. D, Malta.

Nora Ali: You were so confident in that.

Andrew Crowe: I'm not confident at all. I'm guessing. I'm just going in strong. D, Malta. Final answer.

Nora Ali: You are unfortunately incorrect. A great guess. It is in fact Antigua and Barbuda. So according to 100bestcasinosites.com, this Caribbean island nation passed the Free Trade and Processing Act in 1994, which gave them the ability to grant real money online casino licenses. One of the first countries where gambling is not only allowed, but certificates for casinos are also issued to non-residents. So there you go. I had no idea.

Andrew Crowe: That's right. It doesn't surprise me, because a lot of the offshore and illegal gambling, which still exists in the US as well, but largely got shut down back in 2006. But a lot of that was run out of Caribbean operations. So I probably should have guessed that.

Nora Ali: You gave us a fun fact out of this question. That's all I ask for. Okay, number two. Which of the following is the biggest gambling country in the world, as measured by gaming losses per adult? So the ranking takes...

Andrew Crowe: United Kingdom. Is that one of them?

Nora Ali: The confidence is great, Andrew. So this ranking takes into account the losses in a year divided by the adult population. So your options are A, Sweden; B, Australia; C, the United States; or D, New Zealand.

Andrew Crowe: Oh, Australia. There you go. Good.

Nora Ali: You just gotta wait for the answers. So according to The Economist, Australia's loss per resident adult was around $1,000 in 2017, and was in fact the first country to deregulate gambling. I did not know that. So for reference in the US, that number, the loss per resident adult, was about $450; in Sweden, $300; in New Zealand, about $450. Yeah. So they love gambling in Australia.

Andrew Crowe: One for two.

Nora Ali: Okay. Last question. When did Nevada legalize gambling? 1905, 1918, 1931, or 1945.

Andrew Crowe: So is the most recent '45?

Nora Ali: Yeah.

Andrew Crowe: I'm going to say 1945.

Nora Ali: Is that your final guess?

Andrew Crowe: That's my final answer.

Nora Ali: It is 1931. Yes. But you were in the right vicinity. So according to history.com, at the beginning of the Depression, Nevada's mines were in decline and its economy was in shambles. So in March of 1931, Nevada's state legislature responded to population flight by taking the drastic measure of legalizing gambling, and later in the year also divorce.

Andrew Crowe: Love it.

Nora Ali: So yes, today the state gambling taxes account for the lion's share of Nevada's overall tax revenues. 1905, the first option, is when Las Vegas was established.

Andrew Crowe: Ah, very good.

Nora Ali: I thought I would throw that in there. Okay, we have a bonus question, real quick. You'll know this, because I didn't know this and I found it a cute word. What is a "whale" in casino terminology?

Andrew Crowe: Oh, a whale is a big bettor. Somebody that comes in with lots of cash and lots of money, right?

Nora Ali: Yes. They're so wealthy that they often just lose millions of dollars and it's like nothing to them.

Andrew Crowe: So we do have, back to sort of responsible gaming, like our standard limit on balances in an account for Sightline, standard is $25,000. It can go up to $100,000, that's been approved with both gaming and banking regulators. Invitation-only for VIPs is at a million dollars now. We do have players...these are the whales, the folks that do this. We have folks that run millions of dollars through this regularly, and we have one operator that's looking to get that to $5 million. And they don't do that without a review of the individuals. This is very select, very specific individuals who are running a ton of cash through now or wiring money ahead of time that we're going to start running through the digital channel.

Nora Ali: Wow. Must be nice.

Andrew Crowe: I suppose.

Nora Ali: On that note, you win. I'd say you win the game.

Andrew Crowe: All right. Thank you.

Nora Ali: And you win this interview. This has been so great. I've learned so much. Thank you, Andrew, for the time.

Andrew Crowe: I really enjoyed it. Thank you.

Nora Ali: Thanks to all of you for listening. See you later.

Andrew Crowe: Thanks, all.