Q.& A. | Alberto Eljarrat

27 February 2009

By Jeanette Kozlowski

Foreign partnerships can be a tricky endeavor, but if it's something truly meant to be, Alberto Eljarrat believes two companies that compliment each other certainly can make it happen. Mr. Eljarrat should know, since he has spent the past three years hammering away at a partnership between Cirsa Group, one of Spain's largest gambling companies, and Ladbrokes, the London-listed bookmaker.

Now the chief executive for Sportium, the land-based betting brand established through the Cirsa-Ladbrokes venture, he sees more possibilities and growth for sports betting around the world and especially in Spain.

There's been a lot of talk about I-gaming legislation in Spain. What are your thoughts on that?

That's a big topic to discuss, and I'm not a lawyer. But online is a reality. There are many online operators at this moment. There is a significant turnover that the online business is generating within the country. Spain definitely has an interest in getting this activity regulated -- from the customers' perspective as well as from the authorities' perspective -- with a relevant stream of taxes that can be generated.

What happens is that there are 17 regions in Spain -- we call it in Spain "Comunidad Autónoma" -- and they have full capacity in terms of regulating gambling. And so they do -- slots, bingo, casinos are regulated region-by-region. But online is something that requires a national framework.

Is there a remote element in your business regarding sports betting?

Sportium, at this moment, is a land-based bookmaker. We would like to go online, but the legal framework in Spain is complicated. In Spain every region regulates gambling, and so far, only the Madrid region has regulated online betting. There is no national law that regulates online gambling and betting.

You are discussing foreign partnerships at BetMarkets. Can you tell me about your experience in this area?

Ladbrokes and Cirsa is a partnership that started in January 2007 with a very clear objective: developing land-based sports betting in Spain. Sports betting in Spain is a brand new industry; aside from the football pools organized by the public lottery, it didn't exist. Now it's starting, and it's developing from scratch in the whole country.

How did the partnership come about? Did you see a need for land-based sports betting in Spain?

Cirsa, the Spanish company, did not have any know-how or experience when it came to sports betting activities. Since Cirsa is a leader of gambling in Spain , they wanted to find a leader in sports betting to put together their efforts and strengths and provide the best and most competitive product.

On the other hand, Ladbrokes was also looking for a partner at that moment, which was strong locally and would guarantee the success of the activity in the market. So, both Cirsa and Ladbrokes are complimentary on that level.

Why are foreign partnerships important?

It is important because every market is different. Sports betting requires a specific approach in every market. You cannot just cut and paste from one market to another and expect to be successful. The legal frameworks also are different.

If you think that there are 17 different rules, 17 different administrations or 17 different gambling commissions -- any way you look at it, it is very difficult to tackle the Spanish market.

With consumers spending less worldwide, what are some things that betting operators should keep in mind in the coming months?

In Spain, there will be other regions opening up and other opportunities coming soon to develop land-based sports betting. Currently sports betting is only allowed in two regions -- in Madrid and the Basque Country -- so, there are still 15 others in different stages of developing legislations and regulations to open up to sports betting.

Let's say Spain has 50 million inhabitants, and now (sports betting) very recently has been allowed to 8 million. In addition to that, a national regulation for online betting will happen one day or another.

Are foreign partnerships more likely or less likely during global downturns?

New partnerships spring from two companies that are complementary and need each other. This will happen regardless of the economic environment at any moment. This is a reality. From one side comes the knowledge of the market, the channels and the consumers. On the other side is the product, the contents and the know how of the business. It's a natural partnership.

The economical environment must be faced together, but it doesn't affect the relationship between two partners that compliment each other.

What changes have you experienced in your region since the economic trouble began?

Spain is quite affected. It's probably one of the countries that is suffering more in the economic environment like the U.K.

However, Sportium, which is the brand we are developing, is growing and growing. Somehow we are going against the flow. We opened our first shop in May 2008, and today we have almost 50. We expect to close 2009 with 100. While other industries and retail companies are in a difficult situation with having to close stores and reducing work staff, we are hiring people every week. The demand for betting is growing, and that is how we keep on expanding.

Q.& A. | Alberto Eljarrat is republished from iGamingNews.com.