The past couple of years have been incredibly difficult for betting operators from a regulatory perspective, and conditions look set to get even worse.
The UK Gambling Commission, the industry’s regulator, has announced that they are considering the implementation of a new law that would bring in a £2 maximum stake on online casino games.
It’s a ploy they have already rolled out on fixed odds betting terminals in betting shops, with the aim of reducing the number of problem gamblers. It has cost the bookies millions of pounds, and led to unemployment and shop closures.
The news was met with disdain by the stock market, with the stock of UK gambling firms falling a staggering £500 million in just a couple of days as investors looked to sell up and get out.
That comes after more than a billion pounds disappeared from the sector after the Gambling Related Harm All-Party Parliamentary Group (APPG) filed a report calling for the stake reduction for online gaming. The government has also confirmed it plans to take a fresh look at the 2005 Gambling Act to ensure ‘it is fit for the modern age.’
The APPG played a key role in lobbying the government to bring in the £2 maximum stake on FOBTs, getting a number of senior politicians on board and securing rare cross-party support.
Bookies Hit Hard Once More
It should be noted at this stage that the UKGC are simply considering the possibility of imposing the new limit, with a six-month period of consultation likely to follow.
However, the chief executive of the Gambling Commission, Neil McArthur, told MPs at a meeting of the APPG this week that he would ensure that the matter is properly and thoroughly investigated.
And a Gambling Commission spokesperson commented:
“We said last October that we would be looking at online stake limits as part of our work to reduce the risks of gambling-related harm.
“This work is in addition to us focusing on VIP practices, advertising technology and game design. We will publish our assessment and next steps for online stakes and further protections later this year.”
Bookmakers rely on their online casino platforms to pump up their revenue, particularly at a time when betting firms on the high street are facing such challenging conditions.
William Hill saw early 8% of their share price wiped out in the blink of an eye, while GVC Holdings – the owner of Ladbrokes and Coral – were down 7% as was Playtech, a software firm that makes many of the leading slot games. Paddy Power Betfair were the least badly hit with a loss of around 2.5%.
Coming out in support of UK bookies, the Betting and Gaming Council – which is the industry’s trade body – released a statement, part of which read:
“We want to have a betting and gaming industry in this country which is not just the best in class, but which also ensures we don’t drive people towards betting on harmful unregulated black markets.
“We’re working hard with the Gambling Commission and with the government on their review to ensure effective regulation.”