Is Playtech’s First Live Dealer Studio in Michigan a Blow to Evolution?

Playtech rocked the live casino world recently by announcing a launch of a live dealer studio in Michigan. The studio will match their flagship Riga studio in both technology and video capabilities. In fact, it will be one of the largest live entertainment studios in all of Michigan! This is a major step forward for Playtech and their plans to expand in the United States.

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However, Playtech’s Southfield-based live casino studio is more than just their first step in the US market. The company has beaten Evolution to the punch, possibly blocking them from growing there. It may seem confusing, especially if you are used to the otherwise global nature of live dealer games. However, it all comes down to the Unites States and their unique way of handling things.

Legal Details

The United States can seem like one large country from afar. However, as its name implies, it is composed of several states – fifty, to be exact. Some laws apply federally, while others are regulated on the state level. As you can imagine, gaming laws are set on a state level. Michigan, like all other states, is a story for itself. It sets regulations that apply to its population.

This kind of approach makes the US market much more difficult to conquer. Software providers cannot open one studio in Michigan and then serve the rest of the United States. Instead, every state requires its own studio. Furthermore, only citizens of that state can play games streamed from that studio. If you live in Pennsylvania, you would still not be able to play Playtech live casino releases.

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Taking the Lead

With that context, the prospect of Evolution missing out becomes obvious. The software provider already had a foothold in the United States. Evolution and their subsidiary Ezugi already had studios in New Jersey and Pennsylvania. These two studios allowed Evolution to create partnerships with several US operators based in those states. 

Evolution did signal their interest in expanding into Michigan at some point. However, seeing as each state requires its own studio, it was likely they did not wish to overextend. However, in playing it safe, they left the door open for Playtech to swoop in and grab the state. That means Evolution is missing 13 million potential customers. 

One Studio per State?

Because studios only operate in the state they are in, this raises a question of viability. Most of the time, live dealer studios offer games to a massive audience. Even though they are a large upfront investment, they can make it back thanks to serving a global audience. That is not the case in the United States though. Each state sets its own laws, meaning studios are bound to serve one state at a time.

This means software providers may choose not to expand in a state if another developer is already there. After crunching the numbers, they may decide it is not worth their time and move on. As such, we could see an awkward future. One where people from Michigan can only play Playtech and Pennsylvanians can only play Evolution.

We can even see this becoming a bigger problem in the future. Not only does this limit player choice, it can also leave less populated states locked out. States like Delaware or West Virginia may be left out entirely due to their lower populations. If any future battlegrounds will appear, it will most likely be in Illinois or New York. States with larger populations that have already legalized sports betting.

What Comes Next?

Playtech has no doubt gotten ahead of Evolution when it comes to Michigan. Given the current state of the US market, we doubt Evolution will open a studio to try to rival them in that state. However, it would not surprise us to see the two software providers try to snatch other states. That would also be discounting other developers who are trying to enter the market as well. Pragmatic Play and their recent push in Latin America come to mind.

No matter what happens, rest assured will keep you in the loop. In the meantime – congratulations Michiganers! You are in for a fun time.