NEW PARADIGMS IN GAMING Lima, Peru 2012

GAMING IN THE NEW ERA AND THE IMPORTANCE OF GSA Peter DeRaedt - President

PLATINUM MEMBERS

AGENDA  GAMING STANDARDS ASSOCIATION (GSA)  THE WORLD IS CHANGING AROUND US  THE IMPACT ON THE GAMING INDUSTRY  EVOLVING BUSINESS REQUIREMENTS  EVOLUTION OF DATA COMMUNICATION IN GAMING  GSA’s STANDARDS TODAY  CERTIFICATION: WHY SHOULD I CARE?  THE CURRENT EGM VS SYSTEM PARADOX  WHAT IS THE PRICE OF YOUR FREEDOM?

GAMING STANDARDS ASSOCIATION  GSA is an international trade association established in  We facilitate the identification, definition, development, promotion, and implementation of open standards to enable innovation, education, and communication for the benefit of the entire industry.  GSA is funded through membership dues.  Currently, there are 60 members.  29 Manufacturers, 17 Operators, 4 OEM’s, 10 Advisory, Affiliates/ITL’s.  28 United States, 14 Canada, 10 Europe, 8 Asia/Australia.  GSA is organized into committees.  Technical Committees – establish GSA standards.  Operators Advisory Committee – provide requirements.  Board of Directors – overall direction and governance.  Board representatives from ALGC, Aristocrat, Bally, Ceasar’s, IGT, Isle of Capris, Konami, Manitoba Lotteries, OLGC, Oregon Lotteries, Spielo, WMS

GAMING STANDARDS ASSOCIATION 2012 Update  Stabilized Our Standards  Commissioned A Study On GSA’s Role In Online Gaming  Held a Seminar on Industry Collaboration  Retained Highly Respected Consulting Company To Facilitate The Strategic Planning Process  GSA Asia Finalizing MPI Gaming Knowledge Transfer  MPI Offers BSc degree with specialization in Gaming Technology  Degree accredited by Institute of Engineering & Technology, London

THE WORLD IS CHANGING AROUND US  The Internet – its size doubles every 5.32 years Oct 2012: 620,480,777 domains Total users: 2,267,233,000 Global penetration: 34% Latin America growth: 1,310% ( ) 43% pop US growth: 153% ( ) 79% pop Speed of adoption is significantly faster as population gets more tech savvy

THE WORLD IS CHANGING AROUND US  Online revolution has changed customer behavior  Ebay is the world’s largest garage sale online  Expedia the world’s largest travel agency online  Amazon the world’s largest department store online  Pokerstar the world’s largest poker room online  Mobile devices: 49% of time spend on gaming applications and 30% on social networking applications

IMPACT ON THE GAMING INDUSTRY  NVGCB now using Independent Testing Labs (ITL’s) for certification  Old technologies ‘crush’ the ability to drive business  As the markets mature, operators that do not innovate will die  Players want to be recognized, social gaming is important  Gaming is moving to a personal device anywhere anytime  Gaming is shifting from game centric to system centric to player centric  EGM are becoming more system centric and player centric  Social gaming is driving revenue for land based casinos

EVOLVING BUSINESS REQUIREMENTS  Lottery industry – distributed gaming (WAN)  Remote Download, Configuration, and Authentication  Central monitoring and control  Real time diagnostic & analytics to enable preventive maintenance  Advanced Progressives and Bonussing concepts  Multi-game machines can be linked to multiple progressive controllers  Remote printing from central system to game terminal (promotions…)  Enhanced Player Experience  In game player tracking  Player messaging through Player User Interface (PUI)

EVOLVING BUSINESS REQUIREMENTS Player User Interface PUI Window 1 PUI Window 2

EVOLVING BUSINESS REQUIREMENTS Player User Interface  Advertising.  Progressive and bonus jackpot values.  Player account balances.  Wagering account transfers.  Sports betting.  Self-service food and beverage.  Restaurant reservations.  Hotel reservations.

EVOLUTION OF DATA COMMUNICATION  Multiple protocols in the market: SAS, SS, BESS, ASP, QCOM, X-series, CC – talk, GDAP, SDT, GamPro, DXS, SuperSAS, BOB, and many more…  Our industry is plagued by too many proprietary protocols  You are NOT in control of your business  You are NOT able to innovate and differentiate your product offering  You will PAY more to maintain your current infrastructures  You will LOOSE new players

EVOLUTION OF DATA COMMUNICATION Let’s Talk SAS  SAS was created by IGT early 1980 and for a long time IGT enjoyed a significant market share in the US which lead to the defacto standard  Last functionality enabled by SAS was TITO announced in 1999  GSA took control of SAS in 2004  Helped the industry by ‘cleaning up’ this de-facto industry standard  Developed SAS certification program and toolkit  Industry embraced an ‘end of life’ strategy:  GSA’s SAS version was handed back to IGT end of 2009  Certification by GSA of SAS was terminated end of 2009  Industry adopted G2S as replacement for SAS effective 2010

1982 SAS era 2008 GSA era

EVOLUTION OF DATA COMMUNICATION The Cost Of A New Feature Here’s why Innovation has been slow ____

GSA STANDARDS TODAY  List of GSA protocols  G2S – Game to System (released 2006)  S2S – System to System (released 2004)  GDS – Game Device Standard (released 2004)  GAT – Game Authentication

GSA STANDARDS TODAY Industry Recognition  JAN 05, 2007 – Global Gaming Business  G2S: Top honors as Best Productivity- Enhancement Technology  JAN 22, IGWB  G2S: one of the top 3 gaming products of the year  APR 25, 2007 – Casino Enterprise Management  G2S: Slot Floor Technology Award  MAY 3, UNLV  The UNLV foundation honors Gaming Standards Association with membership in The Benefactor Society of the University of Nevada, Las Vegas.  MAY 24, 2007 – Casino Journal  G2S: Silver award in top 20 most innovative gaming products of the year 2007

GSA STANDARDS TODAY  Designed to operate in a multi-host environment  Subscription based communication model  TCP/IP network instead of proprietary network  Extensible Standard  GSA Standards Awareness  Created industry awareness in Malta, Greece, South Africa, Canada, Philippines  Loto-Quebec operator developed their own bonussing application

GSA STANDARDS TODAY Adoption G2S  Sweden: Nationwide G2S network.  Italy: Some concessionaires using G2S networks and modified S2S  Canada: Multiple Provinces converting to G2S networks.  Victoria, Australia: Using protocol convertors to link legacy games to G2S networks.  Austria: Central monitoring of concessionaires over G2S networks.  Casinos: 100s of locations using G2S download and configuration worldwide.  Las Vegas: Native G2S floors at Aria and Cosmopolitan.  Class II gaming using S2S for player tracking, accounting and TITO

CERTIFICATION: WHY SHOULD I CARE?  GSA board Committed to the Creation of a Compliance Verification Tool (CVT)  Radical Blue Gaming, Reno, NV won the contract  The impact of the Certification Verification Tool (CVT)  Development cycle R&D/QA  Reduce time to market  Process for operators to purchase GSA certified Systems or EGM’s  Purchase GSA certified system  Purchase GSA certified EGM  Certification and the impact on Interoperability  Product certification is THE first step  The importance of the iterative process  Impacts certification, CVT, standards and ITL’s

THE CURRENT EGM VS SYSTEM PARADOX  The realities of multi-vendor game and system integration  EGM’s require regulatory approval, system has less stringent requirements  Each installation is ‘unique’  Business impact and realities  Operators wants stuff to work! BUT….  Opening date has been set  Operators witness multi-vendor interoperability issues  Business realities are currently interfering with true interoperability as commercial pressures force compromises > Chaotic Ecosystem  Reduces speed of innovation and adoption  As an industry we have embraced a strategy of Band-Aid engineering  Operator have the power to solve the paradox through business methods forcing vendors to get GSA certified well before installing  Do we want the government to dictate certification?  Seat belts were mandated

BUSINESS IMPACT AND REALITIES  GSA standards are stable and matured  GSA standards are being adopted but why has it taken so long?  What about certification, who is certified?  Casinos, Lotteries and governments are embracing GSA open standards  Operators are recognizing the ability to innovate

What Is The Price Of Freedom?

As Nevada Gaming Commissioner Randolph Townsend stated: “Its not about the green felt anymore, its not about dealing cards anymore, its not even about slot machines anymore – its all about technology” To interest the next generation of casino players, one has to be on the cutting edge of technology. LETS TALK ABOUT TODAY’S BUSINESS REALITY IN THE GAMING…

How Does It Feel To Be Trapped?

“Why can’t an operator install games made by independent third party content providers into agnostic slot cabinets?”

How Does It Feel To Be Handcuffed To Your Vendors?

“This Is What I Need To Grow The Business!” CMO to CIO…

“When Can You Make This Happen?” CIO to Vendor…

“These Are My Terms And Conditions.” Vendor to CIO…

“This Is The Best Our Vendor Can Do.” CIO to CMO…

Control your Own Destiny

Do You Want The Freedom To Drive Your Business?

What Is The Price Of Your Freedom?

STANDARDS CERTIFICATION MEMBERSHIP