Take a tour of any NJ online gambling site, and chances are you’ll come across slot and table games manufactured by NetEnt. A leading provider of digital casino solutions dating back to 1996, NetEnt has become a mainstay of New Jersey’s Internet gaming industry, with upward of 70 titles from the developer adorning online casino lobbies.
Abundance isn’t all NetEnt offers. Whether a branded slot title like Planet of the Apes, a progressive machine like the screamingly popular Divine Fortune, or just good old fashioned single zero roulette, NetEnt consistently dazzles with its sharp graphics and sound, layered and exhilarating gameplay, and high returns. Suffice to say, it’s little wonder why NetEnt titles consistently rank in the top 10 most popular on sites like Play SugarHouse.
Yet the company, which provides services to over 200 online casino operators worldwide, appears to just be getting started in the U.S. NJ Online Gambling recently spoke with Managing Director Erik Nyman of NetEnt Americas LLC — a U.S. subsidiary of NetEnt based in Hoboken, NJ — about the secrets behind the company’s success so far, and its future plans in the states.
Experience = results
With more than two decades experience in the digital space, NetEnt has learned a thing or two about gaming. As stated by Nyman, “We have a long heritage within slot games. I think the years of experience has put us in a good position to create games that people enjoy and come back to.”
While some online developers, like Konami, have found success in the NJ online casino market in part because their games are also found on Atlantic City casino floors, NetEnt believes that offering online-only games also has merit, creating “a new dimension in the U.S. where players are typically used to land-based slots.”
“NetEnt was also the first supplier in the world to deliver free spins,” Nyman says, “which allows our customers to create appealing offers to the players. This unique feature has clearly been appreciated by players who can, for example, enjoy free spins as a welcome offer or as a promotion to a returning player.” Certainly one NJ operator that has taken advantage of free spins is Hard Rock online casino, which not only enables players to exchange loyalty points for free spins on NetEnt titles, but also offers new players 50 free spins as part of its no-deposit bonus package.
Isn’t it divine?
Any discussion of NetEnt wouldn’t be complete without mentioning Divine Fortune. The progressive slot hit the mainstream last month, when a New Jersey woman juggling a conference call and gambling on the mobile Play SugarHouse app (shame, shame) hit for $287,945, all on a $2 wager. At the time, it was the largest Divine Fortune jackpot in NJ history.
The NJ online casino industry features its fair share of progressive slots, with some offering seven-figure top prizes. Yet, Divine Fortune (launched in early 2017) and its comparatively trifling jackpots is by far the most favored. We asked Nyman what draws players to the title, to which he responded: “NetEnt has a long tradition of providing great jackpot games. As always there is look and feel, mechanics, but also our genuine understanding of critical mass and liquidity are parameters critical to create an appealing and exciting jackpot game.”
To elaborate, Divine Fortune accomplishes what few other progressives do — it strikes a delicate balance between jackpot size and hit frequency.
Not to mention, the base game, where players trigger respins every time a wild appears on a reel, slows down the burn rate on player bankrolls, and even grants gamblers the opportunity to win some pretty hefty prizes. This is generally unheard of for progressives, where it’s generally accepted that the base game will be tight, acting more as a means to an end, with the end being a chance at the progressive.
Returns, returns, returns
Land-based casinos absolutely adore slot players, and it’s not due to their winning personalities. Generally speaking, slots return less to the player than all but the worst table game side bets and the Big Wheel.
The prevailing trend of late has been for land-based casinos to tighten their slot machines even further, yet NetEnt has taken a different approach, offering returns-to-player (RTP) on its slots that hover in the 96-97% range, with a select few climbing as high as 98%. Compare this to the return of an average Atlantic City slot, which is barely above 90%.
So why offer games with such high returns, when so much more money can be made per spin by tightening the machines? For NetEnt, it’s all about engagement. “[High returns are] simply a way for us to optimize player experience and excitement. We also see that players around the world have long playing sessions with our games and that they return to their favorite slots,” says Nyman.
In other words, whereas slots with high holds will often dissuade players from returning, NetEnt slots promote player loyalty. For the online casino operator, regular players that grind 97% machines are more valuable than those who get destroyed playing a 90% machine, never to return. For players, they have a much better playing experience on the 97%, and enjoy a significantly greater chance of having a winning session.
Pennsylvania, slated to launch its first online casinos in the coming months, will prove a challenging market for operators, due primarily to an onerous 54% tax rate on slot revenue.
However, NetEnt remains enthusiastic about the opportunity. As per Nyman, “We are very excited to enter the Pennsylvania market despite the taxation legislators have set. With a mix of table games which are taxed around 17.5%, we get an effective tax rate significantly lower than 54%. We also have hopes that the taxation will be reduced over time and our ambition is to provide our games to Pennsylvania players from day one.”
There’s a common misconception in the industry that online casino operators can simply ask their slot providers to adjust the RTPs of their games and the provider will instantly oblige. And while some developers do offer a couple of different tiers to their clients, NetEnt stays the course with fixed RTPs. Nyman verified this: “NetEnt games are developed through a thorough R&D process and games are designed for a specific RTP model that we believe is optimal for the player experience and excitement. So, no, we don’t offer variations of RTP.”
Assuming Pennsylvania operators will adapt NetEnt games (they will), this means that they’re going to have to seek other ways to increase their margins, as, unfortunately, a 54% tax rate on slots that return in the 96-98% vicinity may prove unsustainable without cuts in other areas.
An eye to the future
NetEnt’s short-term plans involve regular new releases in the New Jersey market. When asked what we should expect to see in the coming months, Nyman responded: “NetEnt offers 1-2 new games per month and we indeed have some very exciting game launches ahead of us. I would specifically like to mention the September release of Jumanji as a coming blockbuster game. Jumanji has been very well received in Europe and it could very well be the game of the year in the U.S.”
That’s a pretty big statement, given that the NJ online casino industry sees dozens, if not hundreds, of new releases each calendar year. But given that NetEnt games have regularly topped the charts in the Garden State, we wouldn’t be surprised if Jumanji, or another new title, does the same.