Social Casino Gaming Acquisitions Prove To Be Solid Investment For IGT and Caesars

It was only about a year ago when many were in shock at the $500 million price tag paid by IGT for Double Down in early 2012.  This astronomical amount paid by a traditional gambling company for what many considered at the time to be social gaming at best was a gamble that has paid off.

While luck always favors the brave, many critics are now being forced to admit that the exorbitant prices paid by gaming entities like Caesars and IGT are making economical sense.

Some of the major deals we covered were that of Caesars Entertainment Group with their purchase of Playtika for $180 million.

The topic of the success of social casino acquisitions was addresses at the Casual Connect Europe conference where many industry experts explained the phenomenon of social casino gaming success. Chief Executive at casino game maker Playsino Brock Pierce pointed out one of the reasons why social casino games are so hot at the moment. They are able to outperform their casual gaming partners by as much as double when it comes to monetizing. Pierce summed up the angle of the casinos when it comes to getting involved in casino games,” The casino businesses have come to recognize that and want to know how to get in on that business.”

As we mentioned Playtika was purchased for what seemed at the time an overpriced $180 million in 2011.They also purchased Bingo Blitz from Buffalo Studios for $100 million in December 2012. Currently Caesars is reportedly generating about $350 million in revenue from their Playtika acquisition.
IGT’s acquisition of Double Down is also paying off better than expected with over $80 million generated in revenues.

While these two deals are just a sampling of what we have covered in the last year, it is no wonder that major gaming companies like William Hill in the U.K. are feeling the pressure. They have raised their objections to the fact that social casino games are unregulated which gives them an unfair advantage against real money gambling. These claims seem to the outsider as pretty lame as the only reason established bookmakers do not welcome their social casino cousins is the fact that they take away potential paying customers from their core business.

The more progressive gaming companies like IGT and Caesars have realized that they need to embrace social casino games as part of their overall suite of gambling options. Instead of opposing it they have adopted an approach which looks to attract social casino gamers with the hope of converting them to real money gamblers in the future.

With the U.S. online gambling market opening up by the day the meteoric rise of social casino games is set to continue by the looks of it.  It is also become an undeniable reality that the worlds of social casino gambling and real money gambling are becoming if not already one entity.

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