With the anticipated growth in online gambling, casino operators are no longer content with licensing all their software requirements from third parties. Gaming software is the key to online casinos and the operators want more control over it. This week two leading online gambling operators have announced significant steps in this direction.

The Irish online casino operator Paddy Power has acquired Bulgarian games developer Cayetano. The consideration has not been disclosed and will depend on Cayetano’s performance over the next few years. Cayetano operates from the Isle of Man and specializes in games development for the online and mobile gaming markets with a Bulgaria situated team. Patrick Kennedy, chief executive of Paddy Power, explained that this acquisition will provide Paddy Power with a compelling range of online gaming products as well as a new internal source of gaming development expertise. Paddy Power has strong in-house capability in the sports betting arena and is seeking to replicate that model for casino games as well. Nick Maughan, chief executive officer of Cayetano, said, “This is a great step for Cayetano and its team. We’re all excited at the prospect of being part of Paddy Power, a business whose success in this market has been built on an exceptional understanding of online customers and product trends.”

Bet365 is taking a slightly different approach in strengthening its software capabilities. Instead of acquiring a ready business, Bet365 is recruiting a specialist team of software developers and network architects. The objective is to create the company’s next generation gambling platform using the new wave of networking technologies that offer greater scalability and efficiencies.

Martin Davies, Chief Technical Officer of Bet365, said that the online gambling operator has a culture of innovation. In order to maintain the momentum Bet365 is looking for people who have the right skills and are also enthusiastic and creative. Specifically the team will be responsible for testing existing platforms, developing new software architectures and fitting them all together. The aim is to reduce the resources required and make the technology more efficient and faster.

Davies explained, “As a system scales, the software becomes more complicated. We want to shield our core product development team from this complexity. The R and D team will focus exclusively on refreshing the network and solving the big issues that come with upgrading an infrastructure of our intricacy.”

Bet365 has a target of assembling a team of 20 experts by the end of the year and then continuing to grow it in 2012. The online gambling operator plans to undertake most of the recruitments from outside, but is also open to the possibility of offering a chance to existing employees who have shown an interest in research and development.