At the end of June 2016, the UK Gambling Commission released some figures in order to reveal the current situation of the gambling industry in the UK as well as the latest trends associated with it.
The information released by the UKGC offers the institutions and British gambling authorities almost a year’s worth of data gathered from all online gambling and sports betting operators in the country plus analysis of the latest trends in the business. The UKGC report comes and update of the last set of industry statistic which was released by the gambling regulatory watchdog in November last year.
In addition, the UKGC has analysed the customers’ gambling behaviour in the UK, especially following a release of some figures revealed on February 23rd, 2016. The research made was aimed not only at the industry trends and fluctuations over the last year, but also at the customers’ behaviour when using casino and sports betting gaming options offered on the Internet. This includes information about the preferred devices used for wagering, which were the most preferred placed to gamble, as well as the number of accounts used.
Online Gambling Industry Impact on the UK Economy
Although some events over the last few years have made some analysts unwilling to accept both the size and the increasing popularity of the online gambling market in the UK, there could hardly be any doubt as far as this industry’s contribution to the country’s economy.
As mentioned above, the British Internet gambling market has an estimated impact of £5 billion on the country’s economy. Moreover, this value is expected to increase even more in the upcoming years, while some market analysts say it could even double its size by 2020.
The truth is that social attitude towards gaming operations and online gambling options has been changing lately. As a result, players have been looking for reputable brands online, making the popularity of such platforms increase and turning them into massive economic engines.
Massive changes in the industry followed the implementation of the UK Gambling Bill which came into effect in 2014. Last year, the already registered online casinos were imposed a point of consumption tax estimated to 15% before they were allowed to apply for getting a full operational license from the UK Gambling Commission (UKGC).
This step came as part of the Government’s strategy to make sure that all casino, betting and gaming companies on the territory of the country run their operations in compliance with the existing law and their activities are fully approved by the regulatory authorities there. In addition, it provided the Government with the chance to further exploit the industry and take advantage of its attractiveness to players in order to generate a new revenue stream.
Of course, these measured had their supporters and opponents. While some experts claimed that such a reform make perfect sense in terms of economics, other market analysts have explained that any tax rate over 10% would be a severe burden for online gambling operators in the country. But that is not all. Fixed odds betting terminals (FOBTs) which have raised serious public concerns lately are required to pay a tax rate estimated to 25%. The popularity of these machines is constantly growing among local punters over the last years, but the 25% tax is estimated to could cost the industry £335 million in half a decade.
The increased taxes over the last couple of years are considered one of the main reasons why gambling operators in the country are expected to increase the costs to their customers. This, in combination with the tighter regulation is said to be able to provoke a certain downturn in the online gambling market’s activities in the short term, within the upcoming year and a half.
Still, no matter if this happens, the online casino, gaming and betting industry in the UK will be expected to reconfirm its strength and massive influence on the country’s economy in the following five years. The flow generated by this business segment to the UK Gross Domestic Product (GDP) has been estimated to £2.3 billion. It is also considered to be currently maintaining around 40,000 jobs within the country.
Of course, at this point it is a bit hard to be precise when it comes to the contribution of the online gambling industry to the UK economy over a five-year period and so. The private casino and betting providers would have to be creative in their marketing approach and product offerings, especially considering the fact that the gambling industry in the country is still considered the only market segment from the UK economy that generates smaller annual profit in comparison to the taxes it pays to date.
Still, if the online casino, gaming and sports betting industry is able to handle the negative impact of tighter regulation and increased taxes, and the customers’ demand for web-based gambling operations continues to increase over the upcoming years, the business sector will probably continue to flourish.
Data Presented by the UKGC
The Programme Director of the UKGC James Green commented on the figures presented by the Commission at the end of June, saying that was the first time when clear authoritative data on the online gambling operators in the UK had been presented. He explained that the online casino, bingo and sports betting overall market share amounted to 29% and the Gambling Commission would be interested to see its fluctuations and major trends over the upcoming years.
In terms of land-based operations, however, Mr. Green shared that a reduction in the total number of sports betting outlets, bingo and arcade games halls had been reported over the last two years. The UKGC Programme Director also shared that it was exactly market trends and consumer engagement research that were the key factors on which the overall regulatory policy of the Commission was built.
The UK Gambling Commission publishes the industry statistics details twice a year, but this was actually the first time when gambling trends and behaviours in the country were revealed. The UK regulatory watchdog offers extensive information on each of the gambling industry in the UK, including casino and sports betting operations, bingo and arcade games, lotteries, gaming machine manufacturers, and of course, remote gambling operations.
According to the data provided by the UK Gambling Commission, the Gross Gaming Yield for the gambling industry for the country in the period from October 2014 to September 2015 amounted to £12.6 billion. In comparison, the figures posted in April 2014 amounted to £11.2 billion.
The UKGC revealed that the market share of the online gambling market, including casino, sports betting and bingo operations is estimated to 29%, or £3.6 billion. There was little change in the fluctuations of the online gambling market share. However, the number of land-based betting shops declined by 1.9% and reached 8,809 compared to the 8,975 that existed in March 2015.
Trends Regarding the Players
Apart from exploring the latest and most important trends in the online gambling and sports betting trends on the territory of the country, the UK Gambling Commission has been focused on gathering and analysing consumers’ participation, too.
As revealed by the statistics issued by the UK Gambling Commission, about 45% of the total number of 8,000 participants in the research were involved in regular gambling activities. In addition, the British regulatory body revealed that 27% of these players had placed their wagers on web-based casino and sports betting venues, while 18% had participated in activities of the National Lottery only.
The Gambling Commission also takes into account gamblers’ age as one of the major factors that determines British citizens’ predisposition to gamble. According to the data released in the latest report of the watchdog, the least likely to gamble were the young people aged 18 to 24. Such people accounted for 33% of the gamblers only. The middle-aged people in the age span from 45 to 54 years, on the other hand, were reported as the ones who were most likely to gamble, as they accounted for 54% of the gamblers.
One third of the group’s total gamblers revealed they preferred to place their wagers online. Most of them shared they preferred to gamble in mobile casinos.
Problem gambling behaviour was also among the points of interest of the UK Gambling Commission over the watchdog’s latest study. According to the data presented by the Commission, there was a paradox in the trends of problem gambling behaviour. Regardless of the fact that young people in the age span from 18 to 24 years were the ones who were the least likely to gamble on a regular basis, they actually accounted for the group of people who were the most likely to face such behaviour problems. A total of 1.1% of them revealed that they had actually faced such problems.
The information that was tightly related to the trends regarding the players has always been of paramount importance to the UK Gambling Commission when it comes to some future measures to encourage some activities and reduce others. For example, with the group of young gamblers being the ones who were the most likely to place their wagers on the Internet, the regulatory body is very likely to take up specific regulation concerning problem gambling behaviour, especially when it comes to online casinos and sports betting operations.
Trends Regarding the Devices
The latest survey of the UK Gambling Commission has shown some trends in the devices used by the players to place their bets.
What became clear by the information revealed by the UK regulatory watchdog is the fact that the mobile gambling operations increased over the period, although they were not the most popular. When it comes to the popularity of the devices that were used the most over the period, laptops were on top of the list.
According to the results of the research, the UK Gambling Commission revealed that laptops were the most used devices – a total of 61% of the players who chose to place their bets on the Internet. Mobile phones were used by 23% of the customers, while tablets were the least preferred device, as only 16% of the users who took part in the Commission’s research.
Of course, when it came to the type of devices preferred by the different players, the younger participants, of course, were the ones who mostly preferred mobile devices to gamble. According to the data presented by the Commission, a total of 50% of the players in the age span from 25 to 34 placed their wagers on various casino, gaming and sports betting activities primarily through their mobile phones or tablets.
There was some data provided in regards to the place where the devices were used. What was found interesting about that was the fact that even though the younger players preferred using their mobile phones and tablets, most of them actually gambled primarily in their homes.
The percentage of users who gambled on their mobile devices while at home amounted to 97%. On the other hand, 10% of the customers who participated in the UK Gambling Commission’s research revealed that they had places their wagers while commuting, and only 7% shared they had gambled while they were at a pub.
Trends Regarding the National Lottery
The trend displayed in the latest research of the UK Gambling Commission in terms of the National Lottery was no surprise to anyone. As a matter of fact, the National Lottery was the gambling activity that was most preferred by customers.
Last year there was a slight decrease in the participation percentage to 45%, but it can be attributed mostly to the reduced number of players who have played the lottery. In comparison, the percentage of players participated in the National Lottery in 2012 was estimated to 57%.
However, another trend has been reported in the figures published by the UK Gambling Commission. The National Lottery was the only area of gambling in the country that had not reported an increase, but is still on top of the list as the most preferred gambling activity, which only comes as a proof of the massive impact it actually has to date on the territory of the UK.
Trends Regarding the Online Sports Betting Operations
With its latest statistics covering regulating gambling operations, the UK Gambling Commission has revealed some trends related to the sports betting operations in the country. The sports betting wagers until September 30th 2015 accounted for £9.518 billion. The gross gaming revenue generated from such activities amounted to £1.499 billion, with a margin of a bit more than 15.7%.
As revealed by the UK Gambling Commission in its latest statistics, there was little change in comparison to the results posted by the watchdog for the first five months of the period, with the results announced in November 2015. However, the data was not broken down by months, which made the comparison with the earlier results hard.
According to the data provided, betting on football events was the activity that accounted for the largest part of the remote gross gaming revenues generated over the period. The revenue generated by football betting amounted to £449.44 million. Horse racing betting occupied the second position, with a portion of the gross gaming revenues estimated to £315.56 million. Betting on tennis events was left third, followed by betting on dog racing, golf and cricket events.
What is interesting, is the fact that betting on “other” events, which include e-sports betting, virtual sports betting and betting on fantasy sports, accounted for a pretty big chunk of the gross gaming revenues of sports betting activities as a whole – £177.33 million. These were the activities that have experienced massive growth over the last few years.
Still, in a certain sense, the statistics provided by the UK Gambling Commission was a bit disappointing, since the information provided was not enough to make certain trends in the industry clear enough. Still, this was the first year when the Britain’s regulatory watchdog has provided statistics for online and mobile sports betting, so it is very likely for the upcoming years to provide clearer trends.
Conclusion
As the UK Gambling Commission’s Programme Director himself shared, monitoring the gambling trends and customers’ behaviour across the country is a matter of paramount importance. Such reports are usually essential for both the regulatory authorities and the companies themselves, as the first ones develop the regulation, while the second ones need to be aware of the public attitude towards gambling and gambling-related products.
On the other hand, the companies themselves could use such surveys in order to keep a close eye on the trends that are related to problem gambling behaviour. Some casino, sports betting and bingo options providers have already provided information on responsible gambling and good practices related to it to their customers in order to make them easier to identify such behaviour and fight it.
- Author
Daniel Williams
