Evolution of Live Dealer Studios and Their Prospects in the Casino Industry

Author: Matthew Haynes

The dawn of the century brought with it a significant shift in the technology sector, along with opportunities in the gambling industry, following major advancements in the development of internet, that essentially helped to facilitate great increase in the number of online casinos.

As a result, software providers that launched in the early noughties represented superb timing and there was substantial demand for their products (slots and casino games). In the years that followed, the number of software companies catering to the online gambling industry exploded, though most realized that if they were going to be successful, they would need some sort of niche.

While the vast majority of software providers did well regardless, due to the high demand from client customers, who like a wide variety of options, often those that found a way of differentiating tended to be more memorable. Indeed, this was the case with Evolution Gaming, which turned the casino game market on its head, becoming the undisputed specialist in live dealer games while also innovating its own exclusive products based on a gameshow style, such as Monopoly Live and Dreamcatcher Live.

It effectively paved the way for other software providers to develop their own unique focus; some would concentrate on developing slots that had a particular theme or technology stack, for example. As mobile technology took swift steps forward, every software provider in the industry shifted focus to make sure that all of their products provided a seamless user experience. Not long after, we saw the software provider business model evolve, embracing a more boutique approach to this niche of the industry.

The Rise of Boutique Live Dealer Studios

In the years that followed, more and more new names in the industry were in the form of boutique entities that effectively utilized live dealer games, and there were numerous advantages to this. Live studio development businesses were small, independent and, most importantly, agile, which meant that they could make decisions quickly without needing to wait for board approval.

More often than not, live studios were invariably cheaper when it came to start-up costs because they were much smaller and easier to get off the ground - especially if you had already designed your first product.

These really appealed to online casino brands because they could also invariably deliver a much quicker turnaround time for the development of slot games due to having a small, dedicated team with effective communication. Very quickly, they became popular in the industry, and it wasn’t long before the big software providers started to notice this, with many of them deciding to take action – so began the rise of live dealer casinos.

A number of the bigger software providers began to partner up with studios that made live casino games, essentially taking a percentage of each product that was developed in exchange for more resources up front to help with the development of products.

Revolutionizing the Gaming Industry

Indeed, a gambling giant now, Yggdrasil, had a lot of luck with this model, taking things a step further, and eventually developed its own partner accelerator program called the YGG Masters, powered by the Yggdrasil Global Publishing Network. This was created with one thing in mind: to essentially leverage relationships with the best new studios out there, giving them a platform to create and publish their products and utilizing Yggdrasil’s extensive network to help get them to market.

This is a business asset that has proved to be invaluable to both parties for the best part of a decade, and there are many partners in play. Over the last four years, especially, following the global pandemic, Yggdrasil has witnessed considerable growth, with many studios realizing the major benefits that this program brings.

Upon joining, every Masters partner (studio), is subsequently given access to the pre-configured, regulation-ready development Game Adaptation Tools and Interfaces (GATI) toolkit; an asset that Yggdrasil owns. Furthermore, the network consists of some of the biggest casino operators in the world and in addition, speed and efficiency to market is guaranteed, which acts as a significant selling point for studios.

Also, being part of the Yggdrasil Masters program means that the company takes care of all issues related to compliance and regulation, plus anything related to infrastructure, which means that studios can solely focus on the creation of games.

Just recently, major operator Betsson extended their Masters program agreement, underlining how much draw there is to games created by live studios and the effectiveness of what Yggdrasil built in order to leverage this. The news was met with enthusiasm by both parties who clearly saw how much potential that this model had.

The Yggdrasil model, is undoubtedly highly effective - some might say ingenious, with the company demonstrating an ability to analyse the market trends and build an asset that took advantage of this, while making it easier for both studios and operators.

It will be intriguing to see how this continues to be developed over the next few years, especially as the industry continues to grow significantly, particularly in new markets.

Potential for Live Studio Expansion in the US

With the US becoming the biggest gambling market in the world, it is certainly one to watch when it comes to live dealer casino games and how it might look to capitalise.

Already, there has been traction in regards to some US operators making use of live studios, indeed, FanDuel are currently doing this in certain states, partnering with Evolution branded live studios in Michigan and Pennsylvania, which have subsequently been met with optimism. The live dealer niche is still relatively new in the US and, as a result of this, every operator explored a wide array of different options to bring the products to their customers and independent live studios have proven to be successful so far.

In the online gambling industry, the best operators have come to realize that customers like choice and variety - this is something that has definitely been concluded in the UK market and, as a result, it wasn’t long before the US understood this as well.

Furthermore, the potential for studios creating live casino game to become big business in the US is certainly substantial, especially when considering that there are many states that boast a lot of advantages, such as access to technology and talent, cheap land an encouragingly growing market.

Will Traditional Software Providers Decline?

Despite the surge in the number of live studios, it is highly unlikely that we will see more orthodox software providers disappear - ultimately, it just means that they will probably adjust their business model.

Also, many of the big software providers have carved out a reputation in the industry over the last couple of decades and, as a result, some of them have a large number of fans - particularly those software providers that have the rights to develop slots based on movie franchises and the like.

There is a great incentive for new studios to launch due to the fact that they know there is a great chance of an established software provider taking an interest, either acquiring them or coming to some kind of revenue share agreement.

Without a doubt, Yggdrasil have proven to be almost evangelical in their approach with the development and launch of its Masters concept. Kudos even have to awarded in how it was initially marketed in order to gain the amount of traction that it did in such a short space of time.

Ultimately, the progression in popularity of live studios would more than likely mean collaboration rather than eradication of traditional software providers and, it could also mean, even more exciting things are in store for the near future.