Why do big companies like Microgaming casinos make deals with competitors?

The gambling industry is a large and highly-profitable market that engages millions of customers all over the world. This industry involves different types of participants that usually compete with each other for the players’ attention. In a traditional lifecycle of gambling processes, software developers create various projects like table games, video poker or video slots, then the best online casinos list these games, and gamblers enjoy them.

roulette casino

Credit: Sashkin

Typically, a regular casino software provider wants to acquire as many clients as possible and promote their own unique services. Other developers are rivals, in this case. However, sometimes, large brands like Microgaming software company set strategic partnership agreements with market opponents. At first glance, this looks absurd. But the world of online gambling follows traditional business rules and corporations know it.

If you want to know why teams like Microgaming casinos decide to work together, just read on! We will talk about various market games, casino specifications, unique features of Microgaming casino operators, customer preferences, advertising tricks, casino bonuses, and, surely, about real money that is the main goal of any business. Let’s go!

The Current State of the iGaming Market

Long story short, the gambling industry features three major types of the involved parties that must set various links to maintain the entire ecosystem:

  1. Software developers: NetEnt, Microgaming, Playtech, and others. They design all the games you play and office casino systems you use.
  2. Online casino sites: Casumo casino, Palace casino, Gaming Club, Betway casino, Spin casino, Guts casino, Roxy Palace, Vegas casino, Jackpot City, and more. They place the games on their websites and allow users to play them.
  3. Players: you and me. Folks that open Microgaming sites and other platforms to enjoy the listed casino games.

As you may know, developers create games and other apps for casinos, then operators purchase or rent these software pieces, and users access the favorite games via desktop or mobile casinos. This is a typical scenario.

As well, it’s natural that businesses compete with other companies in their niche, i.e. developers ‘fight’ with other devs, while casinos ‘confront’ other gambling sites. The best online casinos get the maximum profit, obviously.

Still, there are more nuances than just market fights. They are described in the next section where we explain why best Microgaming casinos online also work with other providers. Simply put, in this case, they can get more games, including blackjack, roulette, and baccarat.

Basic Types of Relations

Similarly to any other business environment, the online gaming sector is centered around three major forms of business interactions. Most often, teams compete with each other. Sometimes, large brands like the king of the gaming – Microgaming acquire small indie groups. Also, teams can cooperate under equal conditions to get valuable benefits. To fully understand why one or another type appears at any given moment, you can explore the next three points.

Competition

It’s the most typical and traditional market condition for popular online casinos. They aim at significant growth so always fight for two crucial resources: money and customers. Top Microgaming casinos and other venues feature hundreds of thousands of clients and get insane profits because they deliver top-notch slot games with or without progressive jackpots, online roulettes, craps, baccarat, blackjack, poker, and many other titles. They even include casinos with Live Games broadcast from real studios.

In a nutshell, competition is well-known for all market players. But big fish can barely reach success in this game without other forms of interaction.

Acquisition

The second approach is all about consuming and eliminating. Following our analogy, the acquisition is a situation when bigger-fish companies eat smaller ones. Then, these minor independent studios continue functioning in the large system under the name of a famous brand such as Microgaming. Games they create are listed as the products of this new parent company but, at least, developers can enjoy their work and get decent compensation.

Proceeding to examples, let’s just look at the official list of teams that work with Microgaming online casinos. Right now, there are six names:

  • All41 Studios
  • Fortune Factory Studios
  • Slingshot Studios
  • Stormcraft Studios
  • Switch Studios
  • Triple Edge Studios

The latest brand’s acquisition was Fortune Factory Studios in 2018. Other famous companies also follow this path because big-name corporations are always in search of new creative ideas and relevant skills. These independent studios can still deliver cool online casino games but their projects will boost the market presence of a large fish, and not their own. This approach isn’t fully fair for both parties so developers often look for a pure partnership.

Partnership

Here, we have two different forms of a strategic partnership between gambling companies. Let’s briefly look at both of them to get a clearer picture. Since we are talking about one famous company, here are two bright examples:

  1. Microgaming + Mansion (developer + operator). The team from the Isle of Man has partnered with the Gibraltar-based company to deliver shiny casino slots and other games to gambling websites. Thus, the first brand can promote its famous creations like Mega Moolah and Thunderstruck II while the second team gets more clients.
  2. Microgaming + Evolution Gaming (developer + developer). This example illustrates that rivals can easily become partners. Long story short, it means that casinos from Microgaming should list Live Dealer games by Evolution exclusively. Thus, two parties cooperate to deliver the best live experience to a large audience.

As you can see, the first form isn’t about competitors, actually. It features cooperation between best casinos and software providers so this partnership is vital for the market overall. Without interaction between operators and developers, the gamblers couldn’t access the selection of games by Microgaming or other top-rated devs.

On the other hand, the second form is the most unusual. It stands for cooperation between two software companies that, usually, confront each other. The cooperation between such parties is pretty rare and is dictated by market conditions. When both companies realize that they can get profit from this partnership, they accept the terms and conditions of the ‘game’.

Key Reasons to Cooperate with Market Rivals

While the most traditional form of the market co-existence for gambling companies is competition, they also can benefit from cooperation with opponents. These benefits can include high financial profits and the expansion of customer base. Without diving into marketing depths, let’s check the most popular reasons for cooperation between award-winning casinos, top providers, and other related parties.

  • Avoiding takeovers. Sometimes, smaller companies with unique features can initiate a partnership agreement to protect themselves from acquisition by larger brands. Often, this scenario is commonplace for the mobile gaming sector where indie developers can share their experience with desktop-oriented teams.
  • Boosting games’ quality. It’s obvious that competition leads to better results for clients as companies try to beat each other offering better options. However, cooperation can also boost the user experience. For instance, the mentioned partnership between Evolution and Microgaming leads to bonuses for players as they now have smoother and better casinos live.
  • Exchanging experience. As we have mentioned, teams that deliver projects for mobile devices can share their knowledge with desktop companies and vice versa. Cooperation helps to create better slot machines and other cool stuff so, for instance, you can play your favourite Jurassic Park using any gadget.
  • Getting better casino reviews. Finally, the listed benefits lead to the increasing clients’ loyalty. People tend to appreciate all-in-one services as they can enjoy various games in one place. Thus, a casino room with apps from different providers have more chances to succeed and engage new users.
  • Solving global issues. Last but not least, there are some gambling problems that businesses should deal with. Say, violation of responsible gambling principles may lead to casino bans and penalties. Hence, when devs accept the privacy policy and agree to protect fair gaming, they have more chances to work together with other industry’s bright minds.

Overall, these reasons aren’t enough to force companies to cooperate instead of competing. But partnerships are quite popular now so we can expect even better results from devs’ common work. Probably, we will see innovative mobile games, unique payment methods or cool deposit bonuses without WR, who knows…

Potential Consequences

The gambling market experiences significant transformations right now. Blockchain-based casinos and online slots enter the game, governments introduce new regulations, and NGOs fight addictions by imposing strict gambling rules. All over the world, from the United Kingdom to Australia, casinos (mobile and desktop ones) try to retain their customers. The power of cooperation is undeniable now. It’s possible that the market will consolidate and we will see a new monopoly. Still, it’s even more possible that the competition will become more aggressive and disruptive. We will see.

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