The SkyCity Entertainment Group Limited (ASX: SKC) share price will be on watch on Friday following the release of an update on its online gaming site.
What did SkyCity announce?
This morning SkyCity announced that its Maltese subsidiary, SkyCity Malta, has launched its offshore online gaming site skycitycasino.
The skycitycasino website is a partnership between SKYCITY and international iGaming company Gaming Innovation Group (GiG) aimed at providing New Zealanders with an offshore online casino platform.
GiG will provide SkyCity Malta with a full-suite online casino solution which includes a technical platform, gaming content, managed services, and frontend development. The skycitycasino online gaming business will be managed by an online director who is based in Europe.
SkyCity's chief executive officer, Graeme Stephens, explained the rationale for the website launch.
He said: "This is an exciting day for SkyCity and one we have been working towards for some time alongside SkyCity Malta and our partners at GiG. While ultimately a regulated online gaming market remains the preferred solution, the site launch is another step on our journey of pursuing opportunities to grow and diversify our earnings, addressing a new, fast growing industry which is highly complementary to our land-based activities and offering customers a multi-channel gaming experience."
What is the market opportunity?
The release explains that the existing online casino market in New Zealand is well established and a number of sites are already in operation. An estimated NZ$160 million a year is spent by New Zealanders on these platforms.
Whilst this is still only small in comparison to the offline casino market, it has significant growth potential. So if SkyCity can carve out a leadership position early on, it could be a key driver of growth over the long term.
SkyCity isn't the only casino operator in the news today. The Crown Resorts Ltd (ASX: CWN) share price will be on watch today after NSW regulators advised that they are looking into James Packer's recent share sale to Melco Resorts.
