April finally saw the publication of the UK Government’s White Paper on the reform of the current gambling laws. While many believe that the proposed measures could have been much tougher, gambling companies believe the new rules could severely affect their revenues.
Flutter owns gambling companies such as Paddy Power Betfair and Sky Bet. They have claimed that the proposed measures may lead to them losing up to £100 million a year.
The UK Government already recognises that their plans will hit the finances of the gambling industry. Their view is that overall, £812 million will be lost by companies.
One of the planned measures in the White Paper is stricter affordability checks on gamblers. This has the aim of checking that players are able to afford the amounts they are gambling and losing. The Department for Culture. Media and Sport have commented that this measure could produce costs of between £380 million and £710 million.
“The plans to reduce stake limits at online casinos could cost between £125 and £185 million. This would see total losses of at least half a billion pounds and possibly as high as £895 million. At a time when the UK economy continues to struggle, it’s not good news for the UK gambling industry and is likely to result in job losses” – said expert of British Gambler, one of the leading websites about online gambling in the UK.
Flutter says that some of the proposed measures in the White Paper are similar to moves they have already taken. This includes placing a £10 cap on the stakes made on online slot games. The White Paper is suggesting that the maximum stake be between £2 and £15.
Flutter added that they have also been carrying out checks on high roller customers to see if they can afford that level of gambling.
Implementing those changes has already cost the company around £150 million a year in revenue. If the new measures are put in place, then the losses would continue to mount and could be between £200 million and £250 million.
The UK Government has already said that there will be a lot more consultation before the measures come into force. Peter Jackson is the CEO of Flutter and says they will discuss the proposals with the Government.
The CEO said: “We will constructively engage with the Government and Gambling Commission as part of the subsequent industry consultation process.” When doing so they will focus on “providing support to the minority at risk of gambling harm.” In doing so though, they will not wish to interfere “disproportionately” with the “enjoyment of the vast majority.”
That’s a view also held by the British Gaming Council who do not wish to see gamblers who do not have problems being targeted by new measures.
They also want to see more focus put on dealing with the problem of the increasing number of unlicensed and unregulated online casinos in the UK. Flutter believes that these sites are “targeting at-risk gamblers across the country.”
The CEO added that if there is to be new regulation of online casinos and betting sites, it has to “be right from the start.” Doing so will “ultimately provide the certainty our industry needs to continue investing in jobs and in further growing the UK’s lead in digital innovation in our rapidly evolving market.” Whether that can happen with such losses being made by online casinos.
Entain, who own Ladbrokes, believe that the new measures may cost them less than 1% of their online revenue. Their share of the UK gambling market is less than that of Flutter and the loss is expected to be around £30 million.
Entain’s view is that the White Paper is “an important step towards having a robust regulatory framework that is fit for the digital age.” It must also create a framework that creates a level playing field for all operators. Their CEO is Jette Nygaard-Andersen and he says that Entain will work with both the government and the UK Gambling Commission in the coming months.
He added that the company is “firmly in favour of regulation that preserves the market for the vast majority of customers who enjoy recreational betting.” It must also ensure “appropriate protection to all players.”
However, there has been criticism of Entain after the Guardian newspaper carried out an investigation. They found that emails were being sent under the name of a group called Players; Panel asking customers to ask their MP to speak out against the proposed measures and even sending templates for the emails and letters that are sent out. These addressed certain measures such as affordability checks and stake limits.
These are worrying times for the UK gambling industry. It’s recognised that online casinos in particular need more regulation. The problem is that such regulation will cause a drop in revenue and possibly more gamblers heading for the unregulated market.
OTS News on Social Media