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Anne Lindner

Q & A: Mike Aymong, World Gaming

7 March 2002

Mike Aymong is chief executive officer of World Gaming, which despite being one of the industry's largest software providers, was not profitable until recently. Last month the company posted results from its first profitable quarter, which consisted of the three months leading up to Dec. 31, 2001. IGN spoke with Aymong this week to find out how World Gaming achieved this success and where it plans to go from here.

IGN: World Gaming's most recent results reflect the first profitable quarter the company has had. You are quoted in the press release as saying it represents a turning point. What has it taken to get to that turning point?

Mike Aymong: I think, first of all, focus. We've focused on our infrastructure and our backend office. We feel that there's a tremendous amount of value for our customers in things that don't immediately meet the eye when you look at a screen or when you look at a game. It's our opinion that games are becoming more and more prevalent; it's becoming easier and easier to develop games but harder and harder to add value to the back end. Things like fraud and surveillance, processing, building gateways, customer service, all the software and infrastructure and all the hardware and systems that are required to support this model, and we feel there's a tremendous amount of value in the back end and the infrastructure for our organization. It took a real focus of moving the company from less and less dependence on manual processes to more electronic or non-manual processes and making sure that we do everything electronically.

IGN: By manual processes what do you mean?

MA: Processing of paper. Some of our fraud surveillances were taking too much time. We've sped up our fraud surveillance, we've introduced new software programs to our back office that enable us to quickly and decisively make decisions. We've added new security software, those types of activities. We've really focused on improving our back-end infrastructure. Better reporting. We have much better reporting internally, we can benchmark ourselves against our competitors and benchmark ourselves against ourselves, making sure that we consistently improve month over month and start measuring the right things. I'm a big believer in over measurement, and we're measuring ourselves on everything now. Thoroughly setting key performance indicators that we can measure ourselves against. Trying to set some industry standards as far as what's important to measure--capture rates, deposit rates, the number of customers--all those things that are key performance indicators and help you measure the success of your organization internally.

IGN: You also said in the press release that you're not finished yet. Where does the company go from here?

MA: We're going to strengthen our infrastructure; we're going to continue to strengthen our database management. We've gone from one major database to several databases. We've gone from one main server to three servers. We now have a rep server, which is a reporting server; we now have a production server; we now have a test environment so that we are able to test all of our products before they are released so that when products are released they've been tested and they work. We've been introducing things in the last quarter such as multi-language, multi-currency, tier-one support.

We have a big focus in the company on security, both physical and Internet security, so we have to continue to improve our compliance issues. Our software is in the process of undergoing compliance itself, so that's some of the things that we need to do. The bottom line is we need to become the foremost software services company in the Internet gaming industry, period. That's our mission, that's our vision, that's our goal--to become the best software services company in the Internet gaming business. That not only requires fantastic games and products and services, but it really requires a solid infrastructure that enables us to scale and adopt to the growth. This is the only business I've been involved with where the actual demand for the product sometimes outweighs the ability to supply the product, so we're really focusing on our ability to capture business, to transact business and process business and make sure that we gain the trust and credibility of our customers and the ability to service those customers in an efficient and effective manner.

IGN: I also wanted to ask you about last week's announcement that World Gaming is releasing 16 instant Java games in traditional Chinese, simplified Chinese and Japanese. How important is it right now to really be on top of going after the Asian market?

MA: I think, as you know, the market in North America is still growing, but it's not growing as fast as the market in Asia, Europe and South America, and those are our major growth areas. We've opened an office in London, which handles Europe and Asia, and we believe that there's going to be a lot of growth in those particular markets, not only in the traditional casino and sports book products but as well in the pari-mutuel products and other culturally specific--basically regional customization games. We feel that it's an important market to address, but we really wanted to make sure that what we have today is the best product available. Before we went around inventing a whole bunch of different games, we wanted to make sure we have the best sports book, the best casino and the best pari-mutuel product, and we feel that if we do that we'll gain a lot of credibility in the marketplace. And if we're able to do that and support it in the back end, it's going to be much easier to go out and justify going in to a new game or a new marketplace. It doesn't mean we're ignoring those markets--we're definitely going to address them. In the meantime there's a real focus on making sure what we have today--focusing on our current customer base is really important. We manage the largest sports book in North America, that's just a huge growth opportunity. And we have more Web sites than any of our competitors, we have 750 Web sites. That's a huge distribution opportunity for us.

IGN: Given the credit card processing problems of certain issuing banks in the United States, do you think the Asian markets could start to make up for some of the losses from the States, not just for World Gaming, but for the industry in general?

MA: I think so. We've been fortunate, because compared to our competition we offer three distinctive product groups, and that is casino--while most of our competition is focused on the casino markets--but we also offer sports book, and those customers are less finicky. They'll find a way to send in the money because they're interested in having fun on a game, and if you go to a casino and can't place a bet you'll just go to another casino that you can place a bet on, where with the sports books there's much more loyalty from the customer. There's the pari-mutuel product as well, and you know we just launched our NASCAR product a couple weeks ago. So we think we have a more balanced portfolio. Also, too, as part of the focus on the infrastructure, we've been paying a lot of attention to alternate payment methods. Some of the items that we're looking at are checking, like ClearChex; a debit card; and the possibility of looking at our own payment methods. Nine months ago, 100 percent of our payments came from MasterCard and Visa. Today less than 50 percent come from MasterCard and Visa. So customers are pretty adoptive in this industry, and they look at alternate payments. But that's part of the infrastructure that we need to build. We need to build multiple gateways, and we need to build multiple payment methods, and we expect to take the lead in that race to build alternate payments. But there's much more, as well in the Asian and European markets, there's much more flexibility for payment. People are more used to using different kinds of products to pay their bills, and I think those will slowly come over to North America.

IGN: What types of products to you mean?

MA: Debit cards. We have Pay Pal, we have Western Union, we have ClearChex, we have a ton of stuff. I also think that as companies improve their own international compliance, as companies become more and more professional with their policies, with their procedures, their infrastructures, and as they bring in professional management--I think our company's brought in professional management. I think our company's successfully cleaned up the balance statement and the income sheet, and our company is poised to take a strong leadership position in the industry, with a real focus on the infrastructure. And as our company explores compliance issues, including the compliance of the software and of our customers, and becoming more and more professional so to speak, or more mainstream, I think you're going to find that the U.S. credit card companies are going to search for those companies that they can work more closely with on compliance and the jurisdictional issues. We're interested in having dialogs with the MasterCards and the Visas on those types of issues.

IGN: Do you think a common ground will be reached with MasterCard and Visa?

MA: I do think there's some common ground. The Internet is certainly not going away. As the industry matures you're finding there are more and more legitimate operators, and there are legitimate players that want to be entertained, and I think we have to find a way to manage the tax issues. I think it's more of a question of, is there a common formula worldwide that we can adopt to enable governments to properly regulate and tax the industry, and I think that over time the leaders in the industry, such as ourselves and some of our competitors, with work with the organizations to do that. I do, I do think so.

Q & A: Mike Aymong, World Gaming is republished from
Anne Lindner
Anne Lindner