It was inevitable: the everyday practices of recreational wagering and betting have made their way online to comprise the world of iGaming. iGaming has transformed rapidly over the past few years, evolving from simple online card games (anyone remember the early days of digital solitaire?) to a vast, multifaceted industry that attracts millions of players around the world.
But what counts as iGaming, exactly, and what direction is the current landscape heading in? In this guide, we’ll cover how iGaming as we know it came to be, different types, the regulatory environment, and how this dynamic industry is evolving.
Table of contents
What is iGaming? Understanding the Basics
The Evolution of iGaming: From Land-Based to Digital
Current State of the iGaming Industry
The Future of iGaming
Legal Aspects and Regulations of iGaming
The Role of Software Providers in iGaming
Conclusion
What is iGaming? Understanding the Basics
You have likely heard the term floating around the internet before, but what is iGaming, exactly?
iGaming, also known as interactive gaming, refers to digital and online games that include any kind of betting, whether it be for real monetary gain or in-app points.
Let’s clarify the important difference between iGaming and general gaming first (which you may have also heard referred to as “eGaming”). You can think of the former as games of skill and chance – roll the dice, see who wins, play the right card, etc. The latter includes classic RPG games you’re undoubtedly familiar with, such as World of Warcraft or Mortal Kombat. It could also include mobile games like Candy Crush: no betting involved, just simple, almost-mindless fun.
As such, iGaming is a broad-ranging term that encompasses many activities. Some examples include:
Sports betting
Placing wagers on sporting events such as football, basketball, horse racing, and eSports. If you’ve ever used an app to place a bet during March Madness, you’ve participated in iGaming.
Online Casinos
Virtual platforms that offer traditional casino games like slots, blackjack, poker, and roulette. You can play with other people or against a virtual “dealer.”
Online lotteries
Online lotteries allow players to purchase tickets and participate in draws, all without taking a trip to the nearest convenience store.
The Evolution of iGaming: From Land-Based to Digital
One day our great-great grandchildren may balk at the idea of going to a brick-and-mortar casino to gamble, but fortunately for us, iGaming history doesn’t go quite that far back yet. Aside from casinos, recreational betting was previously confined to betting shops, stadiums, and other physical locations, but the advent of the internet in the late 20th century catapulted betting toward online spaces.
Key Milestones in iGaming History
1994: The first-ever online lottery website launched in 1994, which allowed the public to buy tickets for the International Lottery based in Liechtenstein. The Free Trade and Processing Act passed in the Caribbean country Antigua and Barbuda that same year, allowing licenses for online casinos.
1996: The first real-money online casino, InterCasino, launched this year. 1996 also marked the beginning for iGaming regulatory practices, such as through organizations like the Canadian Kahnawake Gaming Commission, making online betting more secure.
2003: Chris Moneymaker won the World Series of Poker and sparked a poker boom, naturally leading to a surge in popularity for the online version of the game. 888.com launched this year and was the first online casino licensed in the United States.
The early 2000s is also when the Internet as we know it really started to take off. Technological advancements made it faster and household computers became increasingly commonplace.
2010s: Mobile apps revolutionized the iGaming industry, making it more accessible than ever. iGaming trends evolve as the field becomes its own independent sector.
2018: The US passes the Professional and Amateur Sports Protection Act, regulating sports betting and speeding up the growth of legal gambling.
2020s: iGaming continues to grow. The ability to place bets from the comfort of your home, or even out in public from a mobile device, makes online betting more convenient than at any point in history, allowing for more people to participate with wagers big and small.
Current State of the iGaming Industry
The iGaming business has experienced exponential growth in recent years, with the global iGaming market expected to be worth at least $100 billion by 2025. Technological advancements, the ubiquity of the Internet, and changing consumer preferences drive this growth, especially the pervasiveness of smartphones and high-speed internet that make it accessible and convenient.
The expansion of regulated markets in different regions also provides a legal framework that boosts consumer confidence and attracts investment. Are you likelier to place a wager in an area that offers legal protections, or one that opens the doors for scams, even if the possibility of winning bigger is higher? Though risk is inherent in iGaming, consumers don’t want too much risk, so government regulation helps the iGaming market flourish.
European markets offer particularly strong protections and many parts of the US are catching up. In fact, Vixio predicts that the US portion of the iGaming business will reach $8.2 billion by the end of this year, surpassing the UK’s $7.5 billion, which is currently home to the world’s largest iGaming market.
iGaming providers are also investing heavily in new technology that enhances the user experience. Live dealer games along with virtual and augmented reality are becoming more prevalent, attracting new players who aren’t typical bettors and retaining existing ones.
The Impact of COVID-19 on the iGaming Market
There is much to be said about COVID-19’s influence on iGaming. Physical casinos, betting shops, and sports stadiums closed during the pandemic (or limited attendance), pushing fans to online spaces where they could place bets safely from home. The convenience of remote gambling, along with the pressure on brick-and-mortar businesses to offer online options, dramatically accelerated the growth of iGaming.
iGaming experienced a great deal of player diversification during the pandemic, too. Betting enthusiasts were searching for new ways to indulge in their hobby, but people who typically avoided casinos and live sports betting had more incentive to try it due to its convenience, more exposure and proximity (such as if loved ones or quarantine partners were engaging with it), or the opportunity to win cash. Increased security and the adoption of digital payment methods made newcomers more confident — not to mention the continuous entertainment value iGaming provides.
The Future of iGaming
The same factors responsible for iGaming’s recent boom will also propel the industry into the future. Innovations in iGaming technology will or could include advancements like:
Mobile technology
Mobile gaming apps make iGaming even more accessible, allowing players to place bets on the go. Even apps in industries not normally associated with betting may include related functionality to amplify fan engagement.
VR and AR
These technologies enable immersive gaming experiences and transform how players interact with games. Which is cooler: playing virtual poker on a phone, or wearing a headset that makes it look like you’re in Vegas?
Blockchain
Blockchain technology ensures security and transparency in transactions that boosts trust. Plus, blockchain is necessary for exchanging cryptocurrency, which betting enthusiasts are progressively betting with in lieu of real cash.
5G Technology
The impact of 5G on online casinos and other wagering spaces will be significant, providing faster and more reliable connections. Speed and reliability are essential for smoother gameplay and real-time betting — no one wants a lag that could mean the difference between winning and losing!
You can learn more about the future of iGaming and iGaming technology — including live dealer casinos — at our blog post on the future of iGaming.
Legal Aspects and Regulations of iGaming
Like with brick-and-mortar gambling, the legal aspects of virtual betting vary significantly around the world, but understanding iGaming regulations is crucial for operators and players alike.
Global iGaming Regulations
Different countries enforce different rules. The UK is one of the most well-regulated markets thanks to the UK Gambling Commission (UKGC). This organization ensures that all operators adhere to strict fairness and security standards.
Malta is another country famous for its robust regulatory framework. The Malta Gaming Authority (MGA) enforces stringent licensing requirements, making the island nation a trusted hub for iGaming providers and players.
Some Asian markets like China and Japan, however, have more restrictive laws that limit iGaming operations. On the other hand, the Philippines have established regulatory organizations like the Philippine Amusement and Gaming Corporation (PAGCOR) to oversee and license online gambling activities.
The US’s legal landscape is complicated because the federal government largely leaves iGaming regulations to individual states, and only seven have legalized online casinos (namely, New Jersey, Delaware, West Virginia, Pennsylvania, Michigan, Connecticut, and Rhode Island). To obtain a license in these states, operators must meet rigorous requirements, including financial stability, security measures, fair gaming practices, and responsible gaming initiatives. 30 states permit online sports betting.
The Role of Software Providers in iGaming
Software providers play a critical role in the iGaming industry. iGaming is built on their work; they maintain the platforms and apps that attract and retain players. For example, if you’re looking to build an iGaming platform, we at Dolby Millicast can provide real-time video streaming that optimizes the betting experience and makes it as engaging as possible.
Some popular iGaming services include:
Bet365, one of the world’s leading online betting organizations
888 Holdings, the owner of 888casino that we mentioned above
PokerStars, the largest online poker site in the world
Microgaming, a leading software provider in the industry that creates high-quality casino games
Playtech, which offers both casino games and sports betting software
DraftKings, known for fantasy sports
FanDuel, also known for fantasy sports betting
Conclusion
iGaming has come a long way from its traditional roots, evolving into a sophisticated and expansive industry. Understanding what iGaming is, its history, current state, and future trends is beneficial for anyone who wants to participate in this field as a player or platform builder. With continuous technological advancements in experience, payment, and video — not to mention a growing global market — iGaming’s future is promising.
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