When Ontario‘s regulated iGaming market launches on April 4, ensuring that players accessing online iGaming and sports betting platforms are located within provincial borders at the time will be a serious issue.
Guidelines outlined by the Alcohol and Gaming Commission of Ontario and iGaming Ontario, the two government entities responsible for reviewing and approving gaming licenses in the province, require private operators to have player location validation technology in place. The same requirement is in place in U.S. markets.
Sports Handle previously spoke with the gaming industry leader in the geolocation field, GeoComply, about the challenges of geofencing Ontario. The company nearly has a monopoly in the third-party location services realm, but there’s another competitor hungry to capitalize on the burgeoning gaming market in the U.S., Ontario and the rest of Canada.
LocationSmart, based in Carlsbad, California, also offers services in gaming geolocation compliance. It was the first provider to launch mobile and iGaming in Nevada and Delaware and is a geolocation service provider in New Jersey. The company serves clients ranging from startups to Fortune 500 customers and has a global reach of more than 200 countries. Like GeoComply, LocationSmart uses a cloud-based location platform to help gaming companies confirm users are in a geographic area that is approved for gambling transactions.
“We’ve run into [GeoComply], obviously. They are very well known in the industry, they’ve really honed in on the gaming sector since their founding. We’ve focused on it as a sector among other sectors. We’re broader in terms of our market focus,” said Mario Proietti, CEO and co-founder of LocationSmart.
In addition to geolocation gaming services, LocationSmart’s technology is also being used for asset tracking, 911 call location, trucking/shipping logistics, roadside assistance, and fleet management. Proietti, who hails from Troy, New York, was initially recruited into defense government work in the early 1980s to establish a location fleet management system to help forces on the battlefield coordinate activities and communications.
How the technology works
LocationSmart uses an array of verification capabilities to ensure a layered approach to device location, which includes determining the IP address, browser and app location technology, and device profiling. All of these verification methods are explained in detail on the company’s YouTube page.
Essentially, an IP address can pinpoint down into a ZIP code and city level. It’s typically accurate to within a few miles, according to Proietti, who cautions IP addresses on mobile networks don’t really give an accurate location on their own, because the IPs are assigned on a very broad regional basis and are frequently reused by someone else. The user can be pinpointed more accurately down to a GPS level by using browser and app technology and/or device profiling.
How do location services power Online Sports Betting in Ontario? https://t.co/jZPR3cbzqo #iGaming #sportsbetting
— LocationSmart (@locationsmart) January 26, 2022
Most online sports bettors need to download a complementary GeoComply location app along with whatever sportsbook app they’re using. That’s not the case with LocationSmart’s browser location technology.
“Our users don’t have to download anything,” Proietti said. “It can be done through a browser implementation with appropriate precautions. Then that helps reduce the adoption for the user and it may be a more seamless experience.”
LocationSmart also has a multi-layered defense mechanism in place to catch users attempting to spoof their locations and wager illegally from unauthorized regions. Proietti said a common tactic is for users to go through a VPN, or spoof their location through an app that they downloaded to fake a location. Sports bettors have been known to travel just a mile or two across borders into legal states/provinces to place wagers, so these areas are particularly challenging for geolocation and require pinpoint accuracy of users.
LocationSmart was named in a reported data breach back in 2018, but Prioetti said in a news article on the company’s website that a third-party review confirmed no user or customer data was compromised.
Opportunities in Canada
LocationSmart is keeping a close eye on the developing iGaming market in Ontario and the rest of Canada. Some of the company’s previous customers are International Game Technology and the Ontario Lottery and Gaming Corporation.
“Our focus has been around new entrants into the marketplace. Our focus is on new entrants who are looking for an alternative and have a choice to make at the early stage. Because the solutions require regulatory review — in some cases, a test process. Some of those that have previously made a selection might not want to go through that process again. But we do have some customers looking into that option,” Proietti said.
Roughly half of LocationSmart’s customers are U.S.-based, but Proietti says his business is ramping up internationally and in Canada.
”Sports betting and gaming are now broadly allowed across the U.S. Internationally, that’s become more and more of a focus [for LocationSmart]. Asset tracking and logistics are also important for us. Both sectors are hypercritical in terms of people’s enjoyment or being able to get what they need recreationally or for essential items,” Proietti concluded.
