How LocationSmart Is Shielding Gaming Operators from Coronavirus Financial Damage - CorpGov
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How LocationSmart Is Shielding Gaming Operators from Coronavirus Financial Damage
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How LocationSmart Is Shielding Gaming Operators from Coronavirus Financial Damage

By CorpGov Staff

The previously-unknown coronavirus, officially known as COVID-19, has made its way around the world since it was discovered in Wuhan, China late last year. The spread of the disease has moved at an alarming rate with an ever-increasing number of infections and deaths. Secondarily, it has also adversely impacted almost all industries, particularly in the travel, hospitality, dining and entertainment sectors. Airlines, hotels, cruise lines, and tour operators have all seen a sharp drop in business. Restaurants are being asked to voluntarily reduce operations, while grocery stores shelves are being cleared out while shoppers stock up. In correlation with ongoing developments with the disease, casinos, sporting, resort and gaming institutions across the globe are on virtual lock-downs. Any industry that can sustain remote-work and off-site fulfilment are being mandated or voluntarily moving to those modes of operation. For this new reality, there is a viable solution for the hit to the on-site gaming industry to become more virtual and it’s one that LocationSmart’s services can support.

Coronavirus’ Impact on Casinos and Gaming

In one of the first highly impacted regions, the heavily hit Macau casino business has struggled after the coronavirus radically reduced the number of customers that visited during what was meant to be a very busy holiday season over the Lunar New Year. In early February, 41 of Macau’s casinos closed for a two-week period. Macau is the largest gambling destination in the world, and it relies heavily on people from mainland China as a large part of their customer base. Some estimates have the number of casino customers in Macau down by as much as 80%} over the past few weeks. This has resulted in an 88% drop in revenues.

As things have developed, Macau hasn’t been the only gaming region to feel the impact of the coronavirus. Casino closures have been happening across the globe. The Las Vegas strip has gone dark as Nevada orders the closure of all casinos, while casinos in many other states and in Canada have also closed. In Australia, Crown Resorts Limited in Melbourne and Star Entertainment Group in Sydney have chosen to enforce social distancing by limiting the number of payers at tables and shutting down half of their poker machines. Casino closures have also happened across Europe and South America.

Online Gaming an Answer?

In the wake of Macau’s closure and the potential danger of being in public areas with large numbers of people, more and more people have been turning to online gaming. In Asia, the only country in which online gaming is legal is the Philippines (it is illegal in China and unregulated elsewhere in Asia), which means they have benefitted almost exclusively from the. 90% increase in online gambling that has occurred over the Lunar New Year. As of March 17th, FOX Bet says that its online casino and poker have doubled the rate at which it is adding new customers over the last week.

Given the increase in interest, and the fact that legalization of online gambling is slowly making its way across Europe and the U.S, the latter having four legalized states – New Jersey, Nevada, Delaware and Pennsylvania, the benefits to governments are clear. Once online gaming is legalized, it can be regulated and taxed. However, one of the biggest concerns is the control over access to online gaming. Simply put, how can an online gaming company maintain regulatory compliance and verification of its customers? Fortunately, LocationSmart has a way to help businesses manage through the current state of the industry, as well as moving forward with a longer-term perspective.

LocationSmart’s Geolocation Services

Online gaming poses a unique challenge to the companies that offer it. There are very strict regulations that restrict online gaming to specific regions, states, or countries. This means that people located outside the areas in which online gaming is legal are not permitted to play. The challenge is how to know where your gaming customers are located, so that you can control their access based on whether they are within the jurisdictional boundaries. This is the only way application developers can ensure full compliance and gaming verification for their companies.

To accomplish the location verification of their customers, the gaming industry uses the following:

  • IP geolocation and data intelligence
  • Presence verification via Wi-Fi
  • Browser and App-based geolocation
  • Device profiling, data consistency & confidence scoring
  • Additional GPS or network identification tools
  • Boundary checks and geofencing

With this in mind, it’s important to note that there isn’t one solution that fits every online gaming company or even every situation. This is why LocationSmart offers a suite of verification capabilities to ensure a layered approach to device location including the following:

LocationSmart Method 1: IP Geolocation

Determining the IP address of the device used and ensuring it is located within the proper boundaries can be an effective way to verify that a customer is located within the regulated gaming area. For example, when the IP address of the device being used has a fixed connection source, such as Cable or DSL, it is reasonable to expect that the user is well within the local service area of their Internet Service Provider. Then, using that location information, it can be determined whether the user is inside or outside of a given jurisdictional boundary.

LocationSmart only uses the best available IP intelligence data. However, it is important to note that this is not a fool-proof method, as the location of the user’s IP address connection may not always be the same as their device location. This can be the case if the user is using a proxy, a satellite connection, or a mobile gateway. In these situations, a wager cannot be authorized without additional validation through alternative data sources, location technology, or the use of manual procedures by secondary means to verify the user’s location.

LocationSmart Method 2: Browser and App-based Location

Another layer of location verification comes in the form of LocationSmart’s browser location technology and mobile app SDK, which can use Wi-Fi, cell site, and GPS location capabilities to verify the user’s device location via the browser being used or within a gaming app. This technology does not require any software or additional apps to be downloaded to the device and it requires the user’s permission to gain access to their location. Once that permission is given, LocationSmart technology running on the online gaming company’s website or within the app is activated whenever the operator needs to confirm the location of the user.  This may be whenever a user accesses the customer web site to create an account, logs into their account, or attempts a transaction that must be verified.

Using LocationSmart’s browser and app-based location service, application developers can tailor various settings to the needs of their company. This includes options such as setting a maximum location age, how long information can be cached, the accuracy desired and how long to wait for the location before timing out. In addition, accuracy will depend on the technology used, with GPS providing the greatest accuracy. Typical accuracy for each type of location technology is as follows (results may vary due to device’s local environment and settings):

  • GPS – 10 to 50 meters
  • Wi-Fi – 50 to 150 meters
  • Cell ID – 300 to 4,000 meters

LocationSmart Method 3: Device Profiling

LocationSmart further enhances location verification through the use of comprehensive device intelligence data to profile the device being used for gaming. This technology monitors over one billion transactions across thousands of online sites every month and identifies patterns and anomalies in those patterns that can indicate fraudulent activity in real-time. Device profile data that can be obtained and analyzed includes:

  • VPN or proxy use
  • Remote Desktop Access (able to detect new RDA in real-time)
  • Virtual Machine use
  • Bot detection
  • Device configuration integrity
  • Velocity, spoofing and data consistency checks

Again, nothing additional needs to be downloaded onto a device for this technology to work. It allows online gaming companies to ensure the customer’s location and whether the device can be trusted based on current and past activity.

LocationSmart Boundary Checks and Geofencing

It is important that online gaming companies have a way to check a customer’s location in relation to geographic areas that are approved for gaming transactions. Geofencing can be used to set up very specific zones of inclusion and exclusion so that a device’s location can be used to determine where it is in relation to relevant zones.

Overall, LocationSmart provides a layered approach to location services for online gaming compliance. This is highly relevant as gaming organizations and casinos face the potential of continued setbacks due to the growing impact the coronavirus has on the travel industry and potential longer-term changes in consumer behavior.

To stay up-to-date on how LocationSmart can help manage businesses through coronavirus, follow the company on LinkedIn and Twitter.

CorpGov Contact:

John Jannarone, Editor-in-Chief

Twitter: @CorpGovernor


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