Q & A: Bruce Merati, Virtgame

Legalized online gambling in the First World has become a reality and with it comes the dilemma of meeting strict demands by policy makers and gaming regulators. One of the pivotal issues in Nevada, for example, is the necessity of adequate player-blocking software, and a handful of companies are touting products that they believe hold the key to satisfying the Gaming Commission's requirements. One of those companies is Virtgame, and CTO Bruce Merati offers a short rundown of what the company does.

IGN: What is border control technology and why is it so important to the Net betting industry?

Bruce Merati: Gaming is highly regulated and needs to be done on a state-by-state basis. The Internet, on the other hand, is not regulated and is available on a worldwide basis, causing border control solution to be a critical element.

We have come up with a border control technology to block out some jurisdictions or restrict access only to certain jurisdictions depending on the legal rules. The border control is a supplement to our Internet gaming suite of products, but is also available to others to use a service. Our technology positively identifies the user's physical location through a proprietary solution, which is geared around the idea that, "If in doubt, send the user to a customer service for further validation." This is to provide admission accuracy and to catch users trying to falsify their geo-location.

IGN: How does your particular border control product work? Is it currently being used by anyone in the online gambling industry?

BM: Our border control product is designed around the client's needs, which is in multi-layers and can be as restrictive as our client needs it to be. For example, we have one system already approved in Nevada for Coast Resorts that is only available to Nevada residents through our proprietary browser.

We currently have a couple of international clients that are in beta testing and will go live in the near future; they are also using our border control technology to provide jurisdiction-by-jurisdiction gaming.

IGN: Who are your competitors and how does your product differ from theirs?

BM: We provide Internet gaming software as well as the jurisdictional screening solution. I am not aware of any one company offering both of these products. We are also unique in the sense that we discontinued our Internet gaming operation in favor of being an enabler and not a competitor of our customers. Our competitors however, compete with their own licensees, which should make their licensee very uncomfortable.

As far as geo-location companies go, they only provide a mapping of IP addresses, mostly for marketing and advertising purposes, and are not 100 percent accurate either. Also, they are not set up to catch those users falsifying their locations. They provide a one-layer solution, which doesn't satisfy the needs of a regulator.

IGN: Virtgame's name is frequently mentioned in news about what's happening in Nevada. Has the Nevada Gaming Board brought in Virtgame personnel in some advisory capacity?

BM: We have been in compliance with the U.S. laws from the start of the company's operation five years ago, law obedience is very important to Nevada. We were the first company to introduce a statewide Web system to Nevada for Coast Resorts. We want to be a service provider to all Nevada operators whether it is for Internet casino, Internet sportsbook or just the border control.

We have created a statewide checkpoint system we would like to introduce to the Gaming Board. Through our checkpoint system regulators have only one border control to regulate for all operators, plus it helps to create a player control limit at a state level.

IGN: What's happening now that Virtgame and eLOT have formed a relationship? How is that going?

BM:Similar to our strategy, eLOT also respects the U.S. laws. We both believe it is critical to follow the rules and regulations of each jurisdiction. Our main focus is on legal Internet gaming and theirs is on lotteries. eLOT will be using our border control technology for their Jamaica lottery system.

IGN: Can you further explain the relationship Virtgame has with Coast Resorts?

BM: Our core business is providing Internet gaming applications to land-based and licensed gaming and lottery operators. Coast Resorts was our first customer, and the system we did for them was the first Internet-based gaming system ever approved by one of the states.

IGN: What's in the future for Virtgame?

BM: We will be building an "e-Gaming Network" using our border control jurisdictional screening technology for legal Internet gaming and lottery operators to provide their services frictionless on a state-by-state basis. We will be a gaming portal company where the players will come in knowing they are secure and all the operators are legal.

IGN: Virtgame's stock price has been pretty low lately, like many other Internet companies. What steps is the company taking to increase value?

BM: We believe we have the right approach to e-gaming, i.e. the legal side of Internet gaming, and are on track to take advantage of the business opportunities becoming available. We believe taking care of business will take care of the stock price, our goal is to provide increased values for our shareholders.