Amaya Gaming cashes in on African cell phone boom

David Baazov, President and CEO of Amaya Gaming. — David Baazov, President and CEO of Amaya Gaming

The pivotal role that social networking sites like Twitter and Facebook played in the Egyptian uprising may have surprised some in the west, but it shouldn’t have. Egypt, Africa’s most populous country, with nearly 80 million people, boasts a cell phone ownership rate of 80%.

The UN now estimates that two-thirds of the world’s cell phone subscriptions are in developing nations and the highest growth rate is in Africa, where a quarter of the population now has a mobile phone. Using your cellphone to usher in democracy in your native country might be among the most noble uses of technology, but what happens to all those smartphones when life settles back to normal?

Pointe-Claire Quebec’s Amaya Gaming (TSXV:AYA) was founded in 2004 and IPO’d on the TSX Venture Exchange this past summer. The company designs electronic table games that allow players to remotely play Majong, bingo or horse racing. But it’s what the company does for cell phone users that is exciting investors.

Shares of Amaya were up 11% today after the company announced earlier this week that it had secured a license from the Betting Control and Licensing Board of Kenya to operate on-line gaming. Amaya’s SMS Lotteries allow users to purchase lottery tickets from their phones and charge directly to the users mobile account. The Kenyan license comes on the heels of similar agreements in Uganda and the Dominican Republic. Amaya which earned $274,462 on revenue of $ 1,464,817 in it recently reported Q3 2010, estimates the revenue potential from the Kenyan license alone could be worth $14-million to $18-million per year.

The adoption of Amaya’s technologies may be aided by a larger move from governments across parts of Africa to regulate and tax online gaming. As Lucas Maitha, Chairman of the Betting Control and Licensing Board of Kenya, noted in commenting on Amaya “Many on-line gaming sites were operating in our country without our knowledge and approval. Amaya’s first SMS Lotto in Kenya took place on Feb. 17, 2011, but just days before the Kenyan government actually temporarily banned all Short Message Service-based lotteries, as they examined the revenue split and transparency of mobile service providers. The Kenya Anti-Corruption Commission, in the press release announcing the temporary ban, described SMS lottery as a “…craze…which has taken the country by storm.”

Below: Amaya’s KwachuMamilli SMS lottery explained on local Kenyan television.

About The Author / Nick Waddell

Cantech Letter founder and editor Nick Waddell has lived in five Canadian provinces and is proud of his country's often overlooked contributions to the world of science and technology. Waddell takes a regular shift on the Canadian media circuit, making appearances on CTV, CBC and BNN, and contributing to publications such as Canadian Business and Business Insider.

Comment

One thought on “Amaya Gaming cashes in on African cell phone boom”

Mwenekabu says:

March 29, 2012 at 6:28 am

Egypt is not the most populous country in Africa but Nigeria! Before amaya pops the Champagne on e-gaming in Africa,it should bear in mind the consequences of an ignorant public who will be swayed by the get rich quick public and the unintended legal tussles for breach of the license requirements on advertisement messages etc