Playtech offers to partner with UK-facing operators
Supplier hopes to offer smaller operators the chance to remain in UK market under its own B2C licence
Playtech is prepared to “share the pain” of Britain’s imminent Point of Consumption tax with its licensees and is in talks with major operators to renegotiate supplier terms, while also offering smaller brands an alternative to withdrawing from the market entirely.
Speaking after the firm’s Q3 results last week Playtech CFO Ron Hoffman said the company was in the midst of negotiating potential amendments to contracts with its blue chip licensees, and claimed it is offering to absorb some of the 15% hit to operators’ bottom lines when the tax comes into force on 1 December.
Playtech claimed it will also offer other licensees, with some set to struggle to make a profit in the market post-PoC, an alternative to withdrawing from the market entirely.
CEO Mor Weizer said Playtech had identified a number of licensees with UK revenues that, while “not insignificant” were not enough to warrant a full licence application under the new regime.
Rather than withdraw from the UK market completely, a decision some operators have already made in the build-up to the new regime, some brands have been offered the chance to continue to operate under Playtech’s B2C licence.
“We offered them an alternative, which is a full turnkey solution. We obviously need to hold the licence ourselves, [but] this is a model that we have been doing for many years since we acquired the Virtue Fusion bingo business,” Weizer said.
Referring to it as a “very valid and solid business model” for the UK, Weizer said the firm had extended the strategy of allowing B2C brands to operate under its licence into other verticals, thought to include sports betting.
He said that three undisclosed licensees have made the migration so far, and inferred that each has passed on all operating responsibility to Playtech but retained control over their own marketing activities.
Weizer also denied that by taking operational decisions for some licensees it was effectively competing with its other larger clients and did not present any conflict, arguing that it was “mainly protecting the business that we have in the UK”.