How Much and How Do Online Casinos Pay Game Developers?

The gambling industry continues to evolve rapidly. More and more gambling enthusiasts are flocking to virtual casino sites, where they can enjoy the thrill and profitability of placing bets on slot machines. Worldwide renowned companies develop video slots and other entertainment for online clubs. Casinos and software providers collaborate under certain conditions, with companies receiving payment for providing slot machines to virtual establishments.

Categories of Slot Developers

Slot game developers create various content for the gambling industry. Some companies specialize in creating slots, while others focus on producing card games. The number of machines in providers’ portfolios varies greatly. Not all models of a specific manufacturer may be available on online casino sites. The most profitable companies are those whose slots are featured prominently on the main page of virtual clubs or are very popular brands. Software providers can be divided into four categories:

  1. AAA-class slot developers – the best of the best providers. They produce innovative games, use new mechanics, purchase licenses for movies, TV shows, and popular franchises. They receive a percentage of the casino’s profits for their software.
  2. Independent studios – small companies that strive to create original models with unique mechanics. Projects from studios are known for their impeccable quality and graphics. Studios are paid a percentage of the profits, but it is lower than for AAA companies.
  3. Hired developers – teams of programmers hired by major providers to create specific projects according to specified parameters of game mechanics, mathematics, and plot. They are paid upon completion of the work, sometimes receiving a percentage of the profits.
  4. Gambling conglomerates – corporations with a renowned name that own studios in different countries worldwide. They release the largest number of games and earn the highest profits in the gambling entertainment industry.

Virtual casinos pay software providers for the use of slot machines, not for game development. In rare cases, as part of marketing programs, casinos may commission providers to release branded games or purchase an online platform with a set of games included.

How Much Casinos Pay Developers

Payment for placing and using machines is mainly calculated as a percentage of the profits. For example, the return-to-player (RTP) coefficient of a slot is 96%. A casino makes a deal with the developer to split the profits at a ratio of 90:10. If a slot brings in $10,000 in bets in a month, the casino takes $9,000, and the provider takes $1,000.

More favorable contracts are made with popular major developers, while deals with small studios are less profitable. Much depends on the name and recognition of the brand, the number of games supplied, and the quality of the slots. Here are some pricing estimates for individual providers according to SoftSwiss:

  • NetEnt – 17-20% GGR;
  • Yggdrassil – 16-19% GGR;
  • BetSoft – 12% GGR;
  • Quickspin – 14% GGR;
  • iSoftBet – 13-16% GGR;
  • Bgaming – 9% GGR;
  • Wazdan – 12% GGR.

Developers charge lower fees for standard models compared to premium and branded games. Gross Gaming Revenue (GGR) – the total amount of bets minus the sum of winnings – is used in calculations. Lesser-known developers receive the lowest profit from placing slots on online casino sites.