What is iGaming?

What is iGaming?

All animals play games. Humans, specifically, have dedicated a large portion of their cognitive power to this culturally universal pursuit. Games are fundamental building blocks of society. Archaeologists have even found six-sided dice amongst the rubble of ancient Paleolithic remains. Betting on the outcome of games is in our DNA. Risk-taking for reward lies at the heart of our culture, ingrained within our hearts. This core social driver has enabled the global gambling industry today to be worth $449 billion with a very attractive and sustainable long-term compound annual growth rate (CAGR) of 5.9%.

The information age has brought this well-established industry online. Whether it's on a smartphone, desktop, laptop or tablet, the Pavlovian call and response of well-designed games are always within instantly gratifying reach of players' monied fingertips. This burgeoning digital revolution of the world of betting is aptly coined iGaming.

The established gaming industry sees iGaming as a threat to its monopoly status. Collusion between regulators and existing gaming stalwarts has led to an unwillingness to push boundaries, stifling innovation and leaving a generation of potential gamers sitting on the sidelines bored with the same old slots and table games of the 1950s. Some land-based casino moguls have spent millions in lobbying efforts to counteract the growing global acceptance of iGaming. Bigger gaming companies often buy startup companies just to acquire their intellectual property (IP) and remove it from use. As a result, the established brands in the offline betting industry have made it exceedingly difficult for newer entrants to obtain enough financing or even player recognition to grow their business. And yet, despite this catalog of efforts, growth in iGaming continues to far outpace growth of the non-virtual variety.

Owners of land-based gaming concerns should rather see iGaming as a vital avenue to the continued growth and expansion of the gaming industry as a whole. A key consideration for industry veterans is that iGaming serves as a starting point for new entrants to gain a foothold into an exciting and seemingly ever-expanding global market showing the classic early signs of disruption. As the smartphone became a constant companion in our daily lives, software developers innovated new ways to enable gambling from our phones. The result is the iGaming market, or online gambling market, which encompasses all online gambling activity. Examples of popular apps in this space are ones that allow users to bet on live sport events or ones that allow players to compete in online poker tournaments where prize pools can reach $27.5 million. In the next decade, we expect iGaming to take market share away from the traditional gaming industry. Royale aims to play a critical part in that transformation.

Market Snapshot

The fastest growing niche of the gambling industry is iGaming. According to Global Market Insights, the iGaming market is expected to reach $160 billion by 2026. That figure represents a compound annual growth rate (CAGR) of 16.5%, which almost doubles the already attractive rate of the gambling industry as a whole. Even before the global pandemic, the total market valuation for iGaming was expected to exhibit attractive characteristics. Now that most of the world has been forced inside and restricted primarily to online activity, those expectations are now even higher. While brick and mortar casinos and betting houses have seen a contraction due to COVID-safe restrictions and social distancing measures, the internet gaming industry is one of the very rare sectors that can make it through a pandemic situation with little financial damage. According to European Gaming, 2020 has seen massive changes in consumer behavior due to the restrictive impacts of the pandemic. Like eCommerce, the transition to iGaming from traditional gaming has accelerated an already ubiquitous trend toward digitalization and globalization.