Early movers had the most to lose in online gaming, and some failed spectacularly. Here’s what we can learn from their mistakes.
The late great Bill Hicks once quipped “all truths are easy to understand once they are discovered; the point is to discover them.” I don’t know if the following hard truths about iGaming web applications count as absolute truths, but they do seem obvious in retrospect. And understanding them may make you a bunch of money.
Back when mobile devices were just called ‘smart’ because they were smarter than you, the internet was the new frontier for established land-based gaming operators. Everyone wanted a piece of the online action—and fast.
Some paid attention to the finer points of e-commerce and converted their land-based brands into viable web properties. Others rushed to market without doing the proper legwork—or hiring competent developers. In the ensuing years these reckless early adopters have either gone out of business or been acquired by more prudent, tech-savvy competitors.
So let’s take a look at some of the missteps that led to their downfall and how to avoid them. Because even though the regulatory environment has become much stricter since the wild west days of the early 2000s, there’s still a lot of money to be made in iGaming—if you play it smart(er).
888poker Review - Sites and Bonuses for UK Players in 2023Poneriya Online Casino
Poneriya Translates To: ‘Underworld’
Location: Former Serbian province of Vojvodina
Online Counterpart: Jocsuperliganen.com (Sweden); Tonybet.com; Betwinner.com
Mobsters with an Internet connection: Untested
Launched around 2004, Poneriya was the first and only serious organized crime attempt at monopolizing the Balkan gambling market. It wasn’t a complete failure, as the site continued to operate until very recently, but it didn’t exactly conquer Europe either.
Lesson Learned: Stick to your own territory.
Poneriya was active in the Balkans and Western/Eastern Europe, which isn’t where any serious gambling operator wants to park their horse. Why? Because these regions are home to the EU’s strictest gaming regulators who aren’t big fans of organized crime.
It doesn’t take Nostradamus to predict that any website with ‘mafia’ in the domain name is going to raise a few red flags with the authorities. In fact, Poneriya.com was shut down multiple times, only to reappear under different domains.
Even if you manage to overcome this obstacle, trying to compete against established operators in unfriendly markets requires deep pockets and top-notch software. The Mafia may rule by fear, but they don’t know jack about servers and SSL certificates—two things you can’t skimp on in the online world.
In short, sticking to what you know is good advice for everyone, not just the Mob. If you try to expand beyond your comfort zone, you’d better be prepared to invest in local offices, staff and marketing. Otherwise, you’re setting yourself up for failure.
There are plenty of other fish in the sea, so focus your resources on the demographics you know you can serve.
Celeb Bingo
Prized possession: A photo of Mike Tindall showing his bingo ticket
Online counterparts: Every single bingo site
Celebrity endorsements: Numerous
Top Rated Casinos in Ohio - 2023's RankingMobility: Proprietary app and mobile site
Launched in March 2014, Celeb Bingo benefited from numerous high-profile celebrity endorsements and a TV advertising campaign. Developed by Dragonfish---a reputable iGaming software provider—the site offered all the usual bingo variants, slots and other side games.
There was just one problem: the site was slower than molasses in January.
Page loading took forever, the chat feature was glitchy and players often had difficulty purchasing tickets. Worse yet, the proprietary mobile app wasn’t much better, forcing users to wait minutes between each turn.
Best Online Casinos in USA (2023-2024)Needless to say, customers weren’t happy. Some even reported the company to the UK Gambling Commission for slow payments. According to , the company was forced to lay off dozens of employees due to “financial imperatives.” This may have had something to do with the fact that the average Celeb Bingo deposit in April 2015 was just £5 compared to £20 prior to Mike Tindall’s involvement.
Lesson learned: Speed is king.
I don’t care if you’ve got a picture of the Virgin Mary weeping tear of diamonds on your site —if it takes longer than a few seconds to load, nobody’s going to stay. People have been conditioned to expect instant gratification, and if they have to wait too long they’ll just go somewhere else.
This applies to desktop and mobile versions, so be sure to test both platforms regularly to ensure optimal performance under various conditions.
You should also hire the best development team you can afford, regardless of their location.
As Celeb Bingo painfully demonstrated, in-house developers aren't always the best option. Outsourcing to countries like India can save you money in the short term, but communication problems and time differences can lead to delays and subpar products.
Best Real Money Poker Sites Ranked (On the USA) '23Ask to see samples of their work and check their references before signing a contract. Otherwise, you might as well train a monkey to code your site—you could end up with pretty much the same results.
Eurobet
Prominent shareholders: Gala Coral Group
Site Features: Live streaming, in-play betting
Launch Date: 2003
Downfall: Bloated, buggy software
When it launched in 2003 Eurobet was hailed as the future of online sports betting. Backed by the Gala Coral Group, this cutting edge site featured innovative live streaming technology and other advanced features.
However, the software was riddled with bugs, making it slow, crash prone and difficult to use. Customers complained constantly, but nothing seemed to get done.
Eventually, Gala Interactive—which also owned the bettor.com and blitzbonus.com sites---decided to sell the whole kit and kaboodle to Groupe PartyGaming in 2005 for $46 million. Party took Eurobet under its wing and began working on a new platform while allowing Gala to continue milking the cash cow in the meantime.
Once the new site was ready, customers were encouraged to make the switch. After that, the old version was slowly phased out… and forgotten.
Lesson learned: Beta testing isn’t optional.
We live in an age where even the crappiest game developer will run a beta test before releasing their product to the public. Yet despite a decade’s worth of video game related wedgies, some companies still think they’re above such trivial matters.
Don’t be those guys.
of the Best Slot Machine Games You Can Play Online in 2023Beta testing allows you to identify and fix issues before they cause widespread damage. No matter how many quality assurance tests you perform internally, there will always be glitches you missed. Only by exposing your software to a large group of users under real world conditions can you hope to root them all out.
If your customer support lines aren’t ringing off the hook with complaints, you aren’t reaching enough people during your beta test. Embrace the criticism and use it to make your software better. Your clients will appreciate it, trust me.
Blue Chip Casino
Locations: Three land-based casinos in Michigan City, Indiana
Online Application: Poorly coded rewards program
Year of Doom: 2007
Aftermath: Massive data breach in 2016
Blue Chip Casino was one of the first major land-based gaming operations in the US to dip its toes into the online ocean. In 2007 they developed a Flash-based rewards program called Mybluechip.com that allowed patrons to track their slot machine play and earn discounts at hotel and restaurants.
At first everything went smoothly, but then the site started acting wonky. Users experienced frequent logins and pages would suddenly refresh for no reason.
Behind the scenes, things were even worse. According to testimony later given in a class action lawsuit, the site suffered from “defects including, but not limited to...A fundamental flaw or fault in the design of the application which caused content on the web pages to be deleted or lost.”
To put it another way, Blue Chip’s developers had neglected to implement proper backups. As a result, months’ worth of player data simply vanished into the ether.
Outrage ensued, lawsuits were filed and Blue Chip eventually settled with affected parties for an undisclosed sum. However, it gets worse.
In 2016 Blue Chip admitted that a third party had accessed the personal and financial information of over 369,000 players between 2007 and 2014. Social security numbers, birthdates and bank account details were all fair game, according to investigators.
Lesson Learned: Don’t be Blue. Just don’t.
Two words: Version control. That’s all you need to remember here.
Version control refers to keeping track of changes made to your codebase and enabling you to roll back to previous versions if something goes wrong.
Imagine version control is a giant digital time machine that lets you leap backwards in time to any previously saved iteration of your software. Need to fix a bug that crept in during version 2.3? Just hop back to 2.2 and enjoy the sweet, sweet feeling of certainty.
Blue Chip apparently didn’t use version control, which means every time a developer saved their changes, that new version became the new default. There was no going back, no safety net to break their falls.
It’s like attempting a quadruple backflip on a trampoline with no springs. Eventually you’re going to screw up, and when you do it’s gonna hurt. Really hurt.
best casinos in canadaBy using a version control system like Git or Mercurial, you can restore previous versions in mere seconds. Even better, these systems allow multiple developers to work on the same project simultaneously without stepping on each others’ toes.
Sure, you’ll need to spend some time learning how to use it properly, but the benefits far outweigh the costs. Trust me, it’s worth it.
Optimum Play
Online Counterpart: OptimumPlay.com
Publishing History: Written mostly by PokerListings.com founder Arved Klöhn
Launched: 2006
Shut Down: 2014
OptimumStrategy.com wasn’t a bad poker site per se. In fact, it was a pretty decent site offering solid poker tools, calculators and strategy articles.
No, the main problem with OptimumPlay was its sister site Opendeed.com, a social poker application built on top of Facebook’s waning fad. When the Zuck axed all gaming apps in 2014, Opendeeded was forced to shutter its doors, dragging OptimumPlay down with it.
However, that’s not the mistake these guys made. Diversifying your revenue streams is a good idea, kids. Relying on the whims of a single man with no discernible career goals seems like a bad plan, no matter how much power he currently wields.
Relying on a single income source is just as risky.
OptimumPlay generated almost all its revenue from affiliate commissions, a business model that left the company vulnerable to changes in the industry. When PokerStars clamped down on affiliate payments in 2008, OptimumPlay felt the pain.
“For us October 2008 was zero month,” OptimumPlay’s Christian Leviten told PokerListings at the time. “All the revenue came in September and in October it stopped—everywhere and from all affiliates.”
Levitin estimated that 95% of the company’s income came from PokerStars alone, a situation he acknowledged was “quite stupid.”
Unfortunately for Levitin and co-founder Klöhn, they never really diversified their income sources.
slots games freeLesson learned: Spread the wealth.
Even if PokerStars wasn’t your primary partner, OptimumPlay’s story should serve as a reminder that putting all your eggs in one basket is rarely a good idea.
Yes, it can be tempting to sign an exclusive deal with a major operator that promises untold riches. However, what happens when they change their affiliates program or get acquired by a competing brand? Suddenly all your hard work has been for naught.
That’s why you should always be looking to expand your portfolio of partners. Not only does this spread your risk—it gives you the chance to compare and contrast the various affiliate programs out there.
What works for PokerStars may not translate well to Unibet, for instance. By working with a variety of partners you’ll gain valuable insight into what motivates different demographics of players.
It’s sort of like speed dating for affiliate sites. You get a chance to get to know a bunch of potential suitors before settling down and starting a family. Except instead of diamond earrings, they want to see your Player Acquisition Costs.
Conclusion
In the world of iGaming there’s no second place, only first place and miserable failure. With hundreds of affiliates slugging it out for a handful of top spots, it can sometimes feel like you’re running a marathon with no finish line.
But if you keep your eye on the prize and avoid these common pitfalls, success is within your grasp. Well, that and coming up with an original name. Maybe avoid mafia-themed websites just the same as they did back in the day.
