Jenny Woo Talks Online Gambling Payment Solutions in US With CAMS CEO Matthew Katz
I had the chance to sit down with LA based CAMS CEO, Matthew Katz, who is now affiliated with European powerhouse bwin.party. Read my interview to find out what CAMS has to offer as well as other topics including the UIGEA and their affiliation with bwin.party.
JENNY: Tell our readers a little bit about CAMS (Central Account Management Systems). How did you get started and what sets you aside from others?
KATZ: I can take up an hour on that alone.
JENNY: Haha.
KATZ: What I’ve realized years ago before regulations and actually before UGIEA is that there are a number of challenges in any industry and online gambling is no different. Realistically the operators are in business to build a better game, a better player experience, better marketing loyalty programs, etc, and marketing. The functions that CAMS provides, all be it, are actually core and required by the operators in a regulated environment but they’re by no means what the operators and businesses specialize in.
As we’ve looked at a regulatory model and framework we wanted to make sure the industry was going to be very successful. What that means is you kind of have to start to break down peoples esxpertise and because of our background in payment familiar customer in traditional industries globally it just seems apparent to us that it provide a lot of value and a lot of experience in the gaming industry by creating CAMS.
CAMS is effectively a one stop shop. It’s a single solution that allows the operator to do what I said. They focus on what makes them unique in the market place and what makes them special and valuable. But having a partner in CAMS to focus on the payments related components on their business, familiar customer, the GO location, the device idea, etc really seemed like it would be a good opportunity for the industry and good value for the operators. So we decided to build CAMS to fill that hole with our expertise of experience to provide the services that again are mandatory but no one in the industry really specializes in per say.
We decided to take that off of our shoulders and by creating a single integration and a single contract really allows merchants to hand that over to us to insure they exceed the regulatory requirements but really allows them to focus on what makes them valuable in the market place.
JENNY: CAMS is the leader in providing online operators with payments connectivity. How do you intend to overcome banking regulations associated with the Unlawful Internet Gaming Enforcement Act (UIGEA)? Have you had any problem with that thus far and do you see it a big problem in the future?
KATZ: Both so far and in the future? Absolutely. As the industry state by state, there’s not a lot of financial motivation for a bank to participate in that. But what’s really important is that the industry even in it’s infancy is a regulated industry. It’s critically that it’s successful. We work with it very closely to explain not only the regulations in who the operators are but the practices that our customers push forward, the tools, the technology that we use to ensure UIGEA is not violated. We’ve basically demonstrated real world scenarios - whether that’s poker, lottery, and soon to be casino gaming - how technology allows the bank to comfortably enter into the space and allows their cards to be used at specific operators but remaining compliant with UIGEA.
JENNY: Your company is based out of LA. Has that in any way hindered your productivity in the online gaming industry seeing it’s in the U.S. whereas a lot of the only gaming is conducted outside of the U.S.?
KATZ: I pretty much live in the airport and the airplane. Other than that, no it really hasn’t been. This industry compared to any other industry that we service has more conferences around the world on a weekly basis than any other industry that we’ve ever seen. So there’s a lot of opportunity to get face time with European operators and with domestic operators. On a weekly basis you just have to be willing to fly to them.
JENNY: Going to bwin.party, you just recently signed on with them. What kind of impact has this partnership brought to CAMS since it began?
KATZ: It’s always great to be associated with some pretty incredible companies. I’ll say that bwin.party is obviously not only a bigger of space but the consolidated entities with PartyPoker has some really incredible people there. As much as we’ve helped educate them about our services and how we create value for them, they’ve been a great partner and a customer of ours educating us about the industry, the evolution of it, and really what we need to make sure we build as we go forward in the industry to sustain a valuable goal to that.
bwin.party is a great example of a company that we can align ourselves with that is highly regarded in the states. Between both individual entities, we consolidate between parties, and we have a huge amount of experience. That has really helped step up our game to the next level. We always love being associated with great companies and they’re absolutely one of them.
JENNY: We know what CAMS has to offer. Are there any other services that you’re offering clients of bwin.party?
KATZ: Yeah we offer a suite of services. A lot aren’t “sexy” to talk about.
JENNY: Haha.
KATZ: Our entire world is based in data, numbers and testing. So it’s not the most enjoyable package in the industry. As an example, on behalf of the state of Illinois for their lottery, we’ve maintained what we call our Central Clearing House. Part of our responsibility with the lottery is to actually affect daily, weekly, monthly, and annual loss limits.
Obviously, as we look at a lot of the states one of the biggest issues that we hear about are addiction, responsible gaming, excessive losses, loss limits, and things of that nature. Our Central Clearing House really facilitates that. There’s no doubt that every operator who is licensed or going through licensing is really going to bring their “A game”. They’re really going to do their best to ensure that people don’t demonstrate a higher risk of addiction or excessive losses.
The challenges unlike a land-based industry is that their competition is one click away. So I might lose $1000 at XYZ.com and that’s maybe all I can afford to lose per month but then I go to Casino123.com and I lose another $1000 and now I’ve put myself and my family in a negative position. The Central Clearing House has local operators to make sure that somebody doesn’t lose more than they can afford to across multiple disparate operators. It’s kind of a parent level control, which also I think leads to your other question, gives the banks a lot of comfort knowing that somebody has the ability at a higher level than one website or one operation. It can actually withstand multiple operators to really protect the integrity of this new industry.
We all know that online gambling has been available in America since the 90’s but the license and regulation is brand new and it’s really critical that all of the concerns from all the staples, the politicians, the regulators, the operators, the banks, the players, that every key staple is considered as part of an overall solution. That’s what Central Clearing House focuses on.
JENNY: It’s good to hear that you bring awareness to the addiction side of gaming because you just don’t hear that quite often. Was that one of your main concerns to have this controlled in that way along of course with other things?
KATZ: No, definitely not. We really focused on the payment and customer related components. As we were meeting with operators our last year and a half, this was something that has been expressed to us time and time again. It wasn’t until GTECH, which is our partner for Illinois, asked us to build it nobody really saw a market place for it. Once we built and launched it for Illinois, it just became clear through other discussions with operators, regulators, and a lot of the attorney generals that this type of solution actually neutralizes a lot of the political concerns related to the condition of the industry.
JENNY: We have New Jersey, Nevada and Delaware as the only states currently allowing online gambling. What other states do you see opening up and when? Do you see federal legislation still as a possibility?
KATZ: I think that last part is really the hard question for everybody. I never really thought of the gaming industry – I’m assuming casino and poker – lottery is obviously legal online in multiple states right now. There’s been really a great expansion for the lotteries from the revenue and customer reach perspective. It’s such a political hotbed right now.
Our view is that specifically New Jersey is really the critical state. The reason why, it has to do with how the population is spread throughout the state of New Jersey – and when you look at a city like Hoboken, which is Hoboken, New Jersey, but it overlooks New York. It’s right on the river and therefore a lot of the geolocation technology have to prove themselves as it relates to identifying customers who are a border of their densely populated area like Hoboken, New Jersey to Manhattan. If New Jersey goes, “Well, we believe we give the comfort and credibility to the industry for other states to adopt legislation then hopefully and ultimately federal legislation.”
Last year there was a lot of talk, there was a lot of, “Oh my God. These 10, 15, we heard 17 states are teaming up with the industry.” It seems to have quieted down a little bit right now from “who’s going to be next” kind of perspective. We think that part of that has to do with a lot of people are focused on New Jersey and the successes and failures that come out of New Jersey are ultimately going to lead to the expansion or the restriction of this merging industry.
JENNY: Thank you so much Matthew for taking the time out of your busy schedule to sit down with me. Any bit of your time is much appreciated.
KATZ: I appreciate the opportunity to talk to you.
- Jenny Woo, Gambling911.com Senior International Correspondent
