Attack of the Clones – Why the Dragonfish Network is Destroying Online Bingo

When you see a new bingo site launching, there’s a good chance that it’s powered by software from Dragonfish, the business-to-business online bingo brand that belongs to 888 Holdings.

It’s not unusual for online gambling sites to use third-party software – it helps members of new sites to trust their random number generators, while allowing website owners to leapfrog the regulations about testing and licensing.

But in online bingo in particular, Dragonfish has become the go-to solution since its launch in March 2009. And that’s troubling, especially because many of these new bingo sites are based around the same interface, with a branded ‘skin’ applied to it to make it look different.

The Dragonfish homepage, promising marketing expertise and ePayment support.

The Dragonfish Options 

When you launch a new Dragonfish-powered website, you’re given several options. The most obvious would be to create your own bingo website, simply powered by Dragonfish’s software as a third party – the Cashcade-owned Foxy Bingo is perhaps the best-known example of this.

However, this option costs roughly £40,000 – and of course, there’s no guarantee that you’ll receive a large number of members in your first days of operation, meaning it could take some considerable time to recoup this initial outlay.

This problem of needing to make enough money to survive immediately is known as ‘instant liquidity’, and can be a make-or-break issue for new standalone sites, who must not only cover the cost of licensing the Dragonfish software, but must also promote themselves in an already fiercely competitive online bingo market.

In contrast, if you launch a skinned site (e.g. Iceland Bingo), you become part of the Dragonfish Network, at a cost of about £7,000 – that’s 17.5%, or about a sixth, of the cost of launching a truly unique, standalone Dragonfish-powered site.

Within the Dragonfish Network, there are further options to choose from. You can tailor your special offers, the page layout, bonuses, promotions and so on to suit your own needs, and a small minority of these sites have their own chat rooms too, that are kept separate from the rest of the network.

Iceland Bingo – even big brands are now opting for skinned rather than standalone sites.

The Problem

The most obvious problem this raises is that of transparency – do most members of Dragonfish Network sites know they are playing bingo against members of over 100 other websites?

Games played on the Dragonfish Network pool players from all participating sites, so if you signed up with a 50% deposit bonus, and you’re playing against members of sites that offer 100% deposit bonuses, you’re effectively paying twice as much for your tickets – which is why an entire culture of ‘bonus-hunters’ has arisen where people hop from one site to another, trying to find the cheapest way to play for real money.

Even if you take the various offers, promos and bonuses out of the equation, the Dragonfish Network is still effectively one huge online bingo monopoly, as no matter which member site you log into, you’re still playing the same games, against the same people.

Take these screenshots of Bingo Cove and Bingo-Lottery.co.uk as examples – the same game, the same layout and colour scheme, even the same banner ads, and the same chat room, all on what are supposed to be two entirely separate bingo sites (the owners of which presumably paid £7,000 each for their licences).

The lingering question is, is it worth £7,000 for a site that is almost identical to 100 others that already exist online? There certainly, in this example, seems to be little of the ‘unique layout’ and ‘customised skin’ offered by the Dragonfish Network in principle.

Dragonfish in Numbers

Perhaps it’s wise to look at the raw numbers of how many Dragonfish-powered sites exist of each type.

Our research suggests that there are a handful of truly unique, standalone sites powered by Dragonfish software – but this is a very small number, maybe ten sites in total.

Among them are some of the biggest brands in UK online bingo at present, including Foxy Bingo, which is licensed and regulated through Cassava Enterprises – another subsidiary of 888 Holdings.

These are the sites that can cost around £40,000 to develop, and you might not see the Dragonfish logo anywhere on them.

That’s because the software is provided to these sites by Brigend, a Cassava-owned company that distributes the bingo software, along with banking services.

On the Dragonfish Network, meanwhile, there are around 120 sites, with new ones launching every month (just check the Dragonfish news page for proof of that).

While Dragonfish say it’s possible to have unique bingo rooms on Network sites, in general we’ve found the vast majority of these websites simply add their logged-in users to the Network pool to play against one another.

Around 10% have dedicated rooms of their own, although whether this means bingo rooms, chat rooms or both is unclear.

The Wiser Investment

In pure investment terms, it’s easy to see why the skinned option does so well among those launching online bingo sites of their own.

Even if you had a spare £40,000 to invest, you could get 5-6 Dragonfish Network skins built and launched for the cost of a single standalone site – and the skins come with built-in special offers, promotions, bonuses and so on.

Launching six sites now would give you a 4-5% share in the total number of Dragonfish Network sites, and while there’s no guarantee that you would receive that proportion of the network’s total membership, you’d be in with as much chance as anybody else of successfully marketing one or more of your sites as the best option.

In contrast, it’s hard to see a business case for the significantly higher cost – and the higher associated risk – of launching a standalone site powered by Dragonfish software.

Standalone vs. Networked – the Pros and Cons

Back in 2009, when the Dragonfish brand was launched, the company set out three potential sources for new customers¹:Where Do Dragonfish Investors Come From?

– existing operators brought over to the Dragonfish brand in order to strengthen their offering

– media companies seeking to monetise their brands (e.g. the Brigend-powered ITV Bingo)

– land-based casinos and lotteries looking to launch successful online operations

Nearly four years on, this business plan seems to have morphed into an endless stream of ‘good-enough’ sites for private investors, often with no tie-in to an existing brand in online bingo, lotteries, real-world casinos or the wider media industry.

One major surge came from an unlikely source – bingo portal operators who made the move from reviewing bingo sites, to running Dragonfish Network skins of their own, at a share of between 45% and 60% of revenue depending on the number of players they manage to get to sign up to their site.

This in turn leads to the curious situation where bingo portals are effectively now promoting other bingo portals, by featuring their former competitors’ skinned Dragonfish Network sites among their review pages.

Look for the Dragonfish logo at the bottom of bingo sites’ homepages.

 Coming to a Phone Near You…

 If Dragonfish’s cannibalisation of the online bingo industry isn’t enough, then you should look out for the same thing happening on your mobile phone or tablet.

Yes, Dragonfish is now going mobile – in September 2012, mobile gaming operator Probability revealed that it was in the testing stage of a collaboration to offer its mobile gambling games as a B2B service for Dragonfish customers².

Probability, for their part, also have B2B interests in Paddy Power and William Hill, and said they were continuing with integration into Ladbrokes too.

For the Player

One thing seems obvious about the Dragonfish Network – it’s in no way designed to deliver anything new to the player, or to the market as a whole (although it gave birth to the phenomenon of bonus-hunting, as members flit from one site to the next making full use of sign-up offers).

More than 100 websites, all with basically the same layout, graphics, chat rooms and games, with slightly different sign-up offers and bonuses, and no particular reason to choose one over any of the others.

You could sign up to a new Dragonfish Network site each weekend, use up your free sign-up credit and move on, and at the current launch rate you’d probably never run out of new websites – and new bonuses – to register for.

It’s a structure that does little to encourage customer loyalty – which means that, for investors, the real-terms value of your £7,000 is diluted further each time another new site launches with credentials almost identical to your own.

Gaudy animated graphics leave Kingsway Bingo feeling trapped in the 1990s.

Player Problems

Online bingo offers plenty of benefits that have allowed it to perform strongly in recent years, particularly in comparison to real-world bricks-and-mortar venues.

Since smoking in public places was banned in the UK, many smokers prefer to play online from home than to visit their local bingo hall.

Playing online is more immediate, and means there’s no need to dress up or to travel to a real-world venue – leaving some players feeling safer in their own homes than they might on the streets.

Research published by the Journal of Gambling Issues in July 2010 revealed the social aspects of online bingo – the ability to log on and chat to other players – also spur some women into taking up the hobby, while sign-up bonuses that allow them to play for free often serve as a gateway to playing for real money³.

However, several problem areas were identified – including using credit cards as a way to continue playing with ‘virtual’ money, with no clear plan of how to pay this off later.

Notably, some of those interviewed in the research said they would play several games at once, and in some instances believed that this increased their chances of winning.

With several rooms on each Dragonfish Network site, and over 100 sites in the network as a whole, it’s easy to imagine a single player being active on several sites, or in several rooms at a time – again, good news for the network, but not so good for the player.

A Better Bet

In principle, a lot of the problems raised above are matters of personal preference. But they leave the question of why the Dragonfish Network isn’t better.

The fundamental software that powers the games is the same – there are only so many ways to build a random number generator – but why must every site host the exact same games, with the exact same numbers drawn in each game?

Players – even the least interested among them – are not stupid, and you only have to browse to three or four online bingo sites before you begin to realise that they’re all the same.

Look at online poker, with its wealth of unique sites, three-dimensional graphics and celebrity endorsements, and you can see the potential of a single form of online gambling.

Look at bingo, and you’ve got carbon-copy websites with little to no variation in design, operation and bonuses.

The industry as a whole would benefit from some genuine variety – truly original skins with their own graphics, unique colour schemes, and so on.

But these sites should go further. Games should be unique too, with their own numbers drawn, and if there is not enough demand to support an unpopular site, then the nature of business is that it should be allowed to fail.

Pooling players across 120 versions of the exact same game does not deliver success; it delivers the illusion of success, both to the investors and to the players.

We Want Bingo is a good example of a Dragonfish Network skinned site done well, with strong branding.

Conclusion

For first-time entrants into the online bingo industry, the Dragonfish Network holds plenty of allure. It’s relatively cheap, and lets you hit the ground running.

For 888 Holdings, their B2B arm is clearly performing well, and has posted strong increases in revenue regularly even during the UK’s economic turbulence – even when revenues drop, they only tend to do so very marginally.

For players though, it’s hard to see what the Dragonfish Network offers. Generic ‘just-good-enough’ games, with a handful of equally generic promotions, do little to inspire the imagination of the casual gamer.

What’s worse, the more Dragonfish Network sites are launched, the harder it is for a legitimate independent site to rank in the search results and online review pages.

When the first ten or more pages of Google’s search results are already occupied by cookie-cutter sites, your chances of making the front page as a newly launched independent are all but nil – and that’s killing off genuine innovation in the online bingo industry.

Poker remains at the forefront of truly unique ideas and presentation styles, and has managed to make high-resolution and three-dimensional graphics into a core feature of many sites.

Online casino operators have several software providers to choose from, many of whom will truly tailor their selection of table games and slots to suit whatever theme you have selected for your site.

But increasingly in bingo, Dragonfish are the only obvious choice for new sites, and the figures stack up in favour of a skinned Dragonfish Network site over anything innovative.

Investors’ hands are tied, and that’s a shame both for them, and for their players.

References:

1. Dragonfish news

2. Investigate.co.uk

3. Journal of Gambling Issues

Dragonfish Sites

This is by no means an exhaustive list of standalone Dragonfish sites, nor is it intended to be a full list of sites on the Dragonfish Network – new skins are launching all the time, and old ones are vanishing from the web.

However, at the time of writing, this is the most comprehensive list we were able to compile of Dragonfish sites – both standalone and networked – that are currently active.