Out With The Old, In With The New For Hard Rock
This week, announcements from Hard Rock International signaled changes for the company: extending one preexisting partnership, and ending another. Based on the nature of these partnerships, it sounds as though Hard Rock International has opted to terminate its contract with Gaming Innovation Group, which previously provided online gaming and a sportsbook for the international hospitality chain. In its place, Hard Rock International has announced it will be growing its relationship with Scientific Games.
No More GIG For Hard Rock
For two and a half years, Hard Rock International and Gaming Innovation Group (GIG) collaborated to realize several ambitious new ventures for the international hospitality chain, including a sportsbook and an online gaming platform. This week, Hard Rock International and GIG announced that this partnership is coming to a close.
According to statements made from both companies, Hard Rock did not contribute more than 2% to GIG’s revenue in the last twelve months. When reviewing its annual EBITDA, Hard Rock efforts found negative marginal contributions for the last fiscal year. Both companies maintain that they shared positive working relationships, but could not profit.
While the public statements have been released now, the companies will likely part ways formally in the first quarter of 2021 first quarter of 2021, but retail sports betting will transition from GIG oversight in the final quarter of 2020. Last year, the two companies collaborated to introduce a mobile online sportsbook for sports bettors in Iowa and New Jersey.
Hard Rock Partnership Meant GIG’s Introduction To The US
When Hard Rock International partnered with Gaming Innovation Group, it marked the company’s first time moving into the US gambling market. It was firsts on the part of both companies, as Hard Rock had not yet branched onto online gaming or sportsbook management due to ongoing federal opposition to legal gambling in the US until 2018.
Gaming Innovation Group higher-ups are optimistic, still, even as the companies part ways. According to a spokesperson on behalf of the company speaking about the dissolution of GIG’s contract with Hard Rock, the company plans to remain involved in the US gambling industry, which only seems to continue heating up.
What Is GIG?
GIG, or Gaming Innovation Group, is an iGaming company based on Saint Julian’s, in Malta. It was founded in 2008 and, as of a 2017 estimate, makes 39.9 million euros (about $46.8 million USD) annually. Despite being based in Malta, GIG has an impressive international presence.
In addition to its partnership with Hard Rock International, signifying the company’s first move into the US, GIG has been consistently growing in Latin America. In August, GIG announced a partnership with Argentina-based slots provider Group Slots, signifying a game-changing shift toward legal iGaming for the country.
Hard Rock’s New Partner: Scientific Games
As news broke about the end of Hard Rock International’s collaboration with Gaming Innovation Group, the company released another announcement that it would be partnering with US gambling industry leader Scientific Games to continue maintenance of Hard Rock’s burgeoning online gambling options.
This partnership means that Scientific Games will specifically oversee Hard Rock’s OpenSports and OpenGamingTM Solutions for the areas in which legal gambling is permitted in the United States. As of now, the states in which Hard Rock is active in the US remains at a low number.
As of September 2020, Hard Rock is licensed to operate mobile and online gaming in just two states, Iowa and New Jersey. As Scientific Games overtakes GIG’s responsibilities, it will become Hard Rock’s sole provider of these exciting online options, plus management of HardRockCasino.com and Hard Rock apps in New Jersey.
Scientific Games: Perseverance In 2020
Scientific Games has been an established presence in US gambling for a long time, and, perhaps most impressively, has managed to stay strong during a time of tremendous difficulty in the gambling industry. Throughout this year, Scientific Games has renewed its contract for providing the Iowa lottery, and launched a new racetrack betting app.
In July, a spokesperson from the company announced that Scientific Games was not immune to the economic impact of the coronavirus. Due to declining lottery ticket sales and the mandatory closure of casinos around the country, Scientific Games earned $539 million in revenue for the second quarter of this year.
For scale, Scientific Games earned $845 million during the same period of time in 2019. Still, representatives from Scientific Games put a positive spin on this ongoing challenge, saying that they had feared the income during the second quarter of this year would be even worse.