50 PUBLIC GAMING INTERNATIONAL • NOVEMBER/DECEMBER 2023 needs, and therefore technical functionality, applies across all the verticals, and all the game categories. It’s just the nature of the engineering. There are the components that need to do all the same things that are required by everyone: like login, confirm the identity of the customer, verify age and location and that they are allowed to play, and then authorize the person to enter and play. Players all need to deposit funds to bet with. Operators all need the geolocation and transactionprocessing systems as well as an effective KYC (Know Your Customer) system. All these and much more need to operate together and that is true for all types of digital gaming, be it iGaming, i-Lottery, sports betting, or any other game-of-chance vertical. Well, doesn’t sports betting and online poker have areas of security and integrity exposures that an RNG (Random Number Generator) game like a slot machine or a lottery game would not have. J. Bunevith: That’s true. Monitoring betting activity to identify betting anomalies and irregular betting patterns and such does add a layer of complexity to sports betting and poker that does not exist with RNG games. In addition to the need to monitor integrity, sports betting in particular is all about risk management in a way that does not apply to RNG games. RNG games can simply be set to pay out a certain percentage to the player, to the operator to cover expenses and profits, and to the state in the form of taxes or funding for good causes from lotteries. Sports betting margins fluctuate depending on the seasons, the sports, the content that’s available, the type of bets that are being placed, what key players may be hurt or impaired without it becoming public information, and the ultimate outcome of the match, which is not known beforehand. In fact, to your point, preventing corruption and managing risk are really what define and differentiate sports betting from most other game categories. The user-facing app, the games themselves, and promotional strategies and branding and other business activities that comprise the bulk of RNG games are a minor part of the sports betting world compared to the importance of risk management and integrity monitoring. But the core of digital gaming - registration, transaction processing, PAM and KYC, and so many other IT processes - are all the same across all game categories, including sports betting. Sidebar comment … AI is playing an invaluable role in the performance of risk management and fraud prevention. AI offers the ability to power through trillions of transactions to identify betting activities that are outside the norm; and assess all the factors that influence the outcome of a sporting match so you can set the odds so precisely that the aggregate result is both fair to the punters, while enabling the operator to make money. One more clarification … AI is a tool. Even if it does 99% of the heavy lifting, the information is at some point delivered to a human being. A key part of the AI picture is that a human will always be involved. The degree and capacities may vary, but human engagement will always be required for AI to be effectively integrated into the business of adding value and solving problems. How will AI contribute to the goals of cyber-security? J. Bunevith: Cyber-attacks have been happening ever since the dawn of the digital age. Black-Hat hackers started writing scripts to attack and break through firewall systems, and the never-ending race of updating operating systems began. Update the operating system, and Black-Hat hackers would find another vulnerability in a vicious cycle. Now, most major companies employ or contract White-Hat hackers to find those vulnerabilities before the Black-Hats do so the vulnerabilities can be fixed. Now we are moving up to where AI is scouring the system; running countless cyber-attacks to find out where the vulnerabilities exist. By the way, Black-Hats are applying AI in their own efforts to continue to implement their own attacks. That is one reason why the power of AI must be harnessed and applied by the law-abiding regulated world. AI is a tool, and if it is being used as a weapon by those who would harm us, our defenses would be outgunned if AI were not applied by White-Hats to fight against cyber-attacks. The power of AI is incalculable when it comes to preserving security, protecting consumers and players, identifying and preventing fraud. AI needs to be applied to its fullest capacity to secure the long-term health and success of this industry. Some people are concerned that the role of AI in building profiles on consumers that include buying habits and such is an invasion of privacy. J. Bunevith: Thankfully, there are procedural tools that enable multiple levels of opt-in and opt-out, effectively giving decision-making control over to the consumer. For instance, I opt-in to receive discounts on the things that I want to buy. And I opt-out to not receive promos on games I don’t play and discounts on products I don’t buy or services I don’t use. I want merchants to know this innocuous information about my buying habits so they know what I want to buy and when I might want to buy it. Tracking my purchasing interests can only help me more than it can hurt. Likewise, players are likely to opt-in to receive promotions and discounts as long as they are relevant to them personally. The more information the operators have about what games I like to play, or what kinds of other products or services I like to buy, the better they will be at tailoring their communications in ways that are relevant to me. Call me crazy, but I want them to have the information that enables them to focus their promos on things that are relevant to me, and spare me from more info that I am not interested in. The evidence clearly shows many consumers agree with me on this, and that the next generation of consumers is even more open to this practical trading of information for discounts and other benefits. Airlines, coffee shops, and casinos are just a few who have demonstrated the value of loyalty programs and clubs. I know that lotteries have players’ clubs and loyalty programs and would encourage them to invest even more in the build-out of those initiatives that reinforce the lifetime value of your customer. AI will enable the operator to know the likes and dislikes of its players down to the Nth degree. That is already transforming the whole notion of KYC. I would submit this will be a decisive competitive differentiator going forward. The successful operators will excel at applying AI to their KYC initiatives, Loyalty Programs, and Players’ Clubs. Of course, everyone is already using AI. Not just data and predictive analytics. Your Mobile’s spell-check auto-correct is an AI application. The functionality of Siri, Alexa, and Google Assistant is all powered by AI. Perhaps we should think of forward-looking technology and innovation not as a disrupter but as the pathway toward a better world. We just need to be OK with the never-ending learning curve that keeps us young! n Tested. Proven. Trusted. GLI’s mission to support the integrity and security of lotteries continues to evolve. continued from page 29
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