David Snook: Analysis of Bell-Fruit Games dongle
Britain’s 200,000-plus AWP market (Category C machines) is about to undergo the biggest sea-change in its history.
Its principal manufacturer, Bell-Fruit Games, has announced a technological key to switching some of the proceeds of successful games away from the site-owner and back into the pockets of the manufacturing sector.
The revolutionary move will be unpopular with the retailers (pub owning companies) who take the lion’s share of the proceeds from cashboxes, but BFG sees it as essential to save the sector from crisis.
From October of this year the company will introduce ‘dongle’ technology which is already used in skill games with prizes (SWPs). Effectively it is a small electronic device without which a machine will not work. The dongle will last one year, after which a replacement may be bought at a lower price, reducing again for the third year.
The move, says BFG Managing Director John Austin in a press release, is to create a healthier market and ‘provide a foundation for the future development of gaming in pubs’. He flagged up the decreasing sales of Category C machines and said: “We have been facing escalating costs of brand licensing, development and testing and continued erosion of margins, which has led to the withdrawal from the market and in some cases the demise, of once-famous manufacturing brands.”
His own company, he said, had continued to develop new and successful games within this negative climate and had succeeded in delivering even better performing models. “Our aim is to preserve employment prospects, not just at Bell-Fruit Games but throughout the supply chain, which includes component and peripheral device suppliers, transport companies, operators and many others spread throughout the country.”
Austin compared the manufacturing sector of the industry with Britain’s beleaguered dairy farmers, who are being forced by major retailers to sell their milk at prices below the cost of production, a current scandal in the UK press. “I believe that it would be both cowardly and dangerous not to act now.”
He said the changes would mean that BFG would be able to continue to invest in new technology, continue to employ the best developers, secure top brand licenses, produce the most effective security and provide for operators top-earning gaming machines
“The change is not just about us. The new business model, which we have considered at great length, is being introduced to create a healthier market for everyone involved in the sector.”
Bell-Fruit Games has in recent years emerged as by far Britain’s biggest producer of AWP machines. It licensed the Deal or No Deal game and launched the first of which was to become a series of DoND machines in mid-2006, eventually building over 40,000 in the series.
John Austin and his colleagues at Bell-Fruit Games must be taking refuge in bomb-proof shelters right now….The decision to force change on an eroding British Category C market is, however, incredibly brave and while it may not make me popular with the big pub owners, it is bluntly time that the fat cats gave something back to the industry.
Introducing the dongle to ensure that a bigger slice of the revenues from AWPs goes back to those who develop them cannot be underestimated as an evolutionary move in the British market.
Let’s face it, the number of manufacturers has eroded over the years to the pitch where serious makers of front-line AWPs can be counted on the fingers of one hand. No….make that half a hand. Something had to be done.
The pub-owner has always come off best with AWP machines. Create a pie chart to illustrate the point. The second-thinnest slice of the AWP market’s earnings go to the manufacturer who takes all of the risks. The thinnest of all goes to the operator, who does all the work once the machine has left the factory. What’s left is nearly all of the cake and goes to the site-owner….who does, well, nothing….
The reduction in the sector is symptomatic mainly of the reduction in the number of outlets. The pubs have reduced in number in the UK, so the opportunities to site machines has similarly reduced. But that does not mean that incomes are reduced. A good quality AWP will still earn somewhere around £250 a week. With 80% of that going to the retailer, the British market has become hopelessly skewed; indecently and unfairly skewed.
But there was nothing the manufacturing and supply sector could do to redress this while the power remained totally in the hands of the retailers; and they themselves were under financial pressures. However something had to give or the retailers would find themselves left with nothing to control.
What Bell-Fruit Games should be receiving now is plaudits, not brickbats. They should take off the tin hats and take a bow.
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