Adjusted gross revenue for April amounted to $11.4m, down 17.4% from $13.8m in Marchand also 6.6% lower than $12.2m in February, the first month of full regulation in Virginia.
Player spending on sports betting slipped 22.3% month-on-month to $236.4m, though the Virginia Lottery noted that March’s figures were helped by betting on the NCAA ‘March Madness’ college basketball tournament.
The April handle was also 11.1% lower than the $265.8m wagered by players in February.
Consumers won $217.0m from betting on sports during April, while the state generated $1.7m in tax from sports wagering in. Virginia’s tax rate for sports betting is set at 15% of adjusted gross revenue – total bets minus winnings and other authorized deductions.
Revenue was 11,472.0% higher than the $27,381 generated in the same month last year, but the 2020 figures were severely impacted by novel coronavirus (Covid-19) with players only able to wager via mobile. Wagering options were also limited as the pandemic saw almost all sports events cancelled or postponed.
On a month-on-month basis, revenue was down 20.0% from the $4.0m collected in March this year.
Retail sportsbooks were responsible for $1.5m of all revenue for the month, compared to a $821,000 loss in 2020, while mobile betting was 5,927.9% higher at $1.7m.
In terms of player spending, the state handle was up 4,810.7% year-on-year to $29.0m, but 24.7% lower than the $38.6m wagered by players in March this year.
According to a statement from the MGA, Smart Operations breached regulation 9(1) of the Gaming Compliance and Enforcement Regulations. The breach outlines that Smart Operations failed to comply with mandatory terms obligated by Malta law, did not adhere to financial commitments made necessary by its operations or did not give payments to the MGA in an appropriate timeframe.
The MGA was able to cancel Smart Operations’ licence under regulation 10, which allows cancellation if regulation 9 is violated.
Due to the cancellation of its licence, Smart Operations can no longer carry out operations, allow new players to register or accept new deposits from customers.
However, it must allow existing players to have access to their accounts and must refund all necessary amounts.
Smart Operations was licensed to offer both casino games and fixed-odds betting, but its licence did not list any domain names.
The Bundesrat has sent a proposal to the legislature (Bundestag) for final approval, which is expected to be granted. The proposal is currently being examined by three different committees.
However, under this framework, online slots and poker would be taxes at 5.3% of turnover, a rate that many in the industry have argued would be unworkable. For example, a report from Goldmedia – commissioned by Entain, Flutter and Greentube – warned that half of all German slots players may end up playing with unregulated sites if turnover is taxed at 5.3%.
As a result, the DSWV confirmed to iGB that it has filed a complaint with the European Commission, arguing that the tax rates should be classed as illegal state aid in a move that may delay implementation of the treaty.
Under European law, a member state is not allowed to give an advantage to “specific companies or industry sectors, or to companies located in specific regions” in a way that affects trade through interventions such as tax rates. There are, however, certain exceptions, some of which may be granted on a case-by-case basis.
While land-based tax rates can vary by state, Goldmedia estimated the difference in tax bills between the land-based and online sectors in Bavaria would come to €293.9m, with slot halls seeing the largest advantage at €178.1m.
Currently, operators may offer online gambling in Germany through a transitional regime, where online casino is permitted but only under the terms of the new treaty. These terms include restricting slots to a €1 stake limit per spin, with an average spin speed of five seconds. Operators such as LeoVegas and Bet-at-Home said these restrictions have already hit revenue in Q1.
Traditional sports continue to dominate the betting world. But while sports betting has been a long-time staple for many, esports betting has grown in popularity along with the rise of video websites and streaming services.
In 2019, market research company Technavio reported that the sports betting market will expand by $144.4bn between 2020 and 2024.
Thomas Rosander
But as the ingrained culture of sports betting has ensured its longevity, the effects of the pandemic on sport forced many bettors to default to esports. According to Oddspedia.com, the number of esports betting events available grew from 3,000 in July 2019 to over 50,000 in July 2020.
It’s easy to attribute this solely to the worldwide novel coronavirus (Covid-19) lockdowns, when being online was a main source of entertainment. But the demand was high and rising pre-pandemic too, with market data company Newzoo reporting that esports enthusiasts and casual viewers totalled at 443 million in 2019.
With experience in video gaming with Electronic Arts, which produces popular esports game FIFA, Rosander sees esports as the next frontier of betting.
“I think you always have to evolve. Sports business has kind of stagnated a little bit,” says Rosander.
“On the product side, there is still innovation in live bets, but it’s still mainly made for the generation we’re not focusing on now – we’re focusing on gen-z and millennials.”
Twitch, a leading gaming livestream platform, reports that almost half of its users are between 18-34 years old.
Rosander added, “We’re trying to tailor it for the younger generations because those are the ones watching Twitch and playing video games.”
Rosander says it’s because he realises the value of evolution and acquisition tools when it comes to putting a product onto the market, something he illustrates with the example of online casino. He hopes to draw more consumers with such ideas in his new role as CEO.
“The reason why the online casino is so big and has been so successful is because it evolved into something. It’s easy to launch a casino without much money, but a lot of people tried and failed. Because it’s not just about setting something up, it’s about driving traffic and so on as well.”
Coincidently, Rosander also revealed that Luckbox plans to launch an online casino product later this year:
“That’s something I know from my background,” he explained. “And we’re going to do it in a different way than others. We’re still esports betting first, which is going to influence the casino.”
No matter which direction the company moves in, Rosander emphasises that its primary focus is on esports. Even in Luckbox’s largest development of the year, esports will continue to have an influence.
Role development
Rosander, who previously held the role of marketing director at EA and as chief customer officer for Luckbox before replacing Quentin Martin as CEO, sees the bigger picture in combining video gaming and gambling.
“Basically, I’ve always had one leg in igaming, or gambling if you like, and the other side is video gaming,” he says. “And I think ever since I left EA, I’ve been dreaming about combining the two. Because on the video game side of things, you have massive volumes and I love the product as well, and on the igaming side you have huge player values.”
The jump from video gaming to igaming was not a difficult one for Rosander, as he’d already had experience in both. And it seems as though the transition from chief customer officer to CEO was not a difficult one either.
“I joined out of shared passion, and as chief customer officer I was able to implement the idea of how to do it and utilise those opportunities. Then suddenly I find myself as the CEO, which is great, but it doesn’t really effect much because I was already executing my plans.”
Although Rosander took the offer of a wider reach, the process of creating fresh Luckbox content may have its adversities.
Title production implications
Offering markets on a wide range of titles is arguably one of the most important aspects of an esports betting platform. These titles keep customers engaged in what the platform has to offer, while allowing the developers to show their capabilities.
“I think we can always get better at adding titles, but it doesn’t just rely on us,” reveals Rosander. “We rely on creators.”
“Our philosophy is: we try to add everything we can as fast as we can. But it has to have a proper quality for us to add it.”
Rosander seems to propose that quality and quantity go hand-in-hand at Luckbox. But certain things must be in place for both to be taken into consideration- such as competitive functionality, which is at the core of customer engagement in titles. From a video game publisher’s perspective, it ensures a continued engagement from users while making a name for the publisher in the market.
“Of course I would love to add more titles, and that’s what we’re doing this year,” says Rosander.
“If you look at it from a video game publisher perspective, we can see that there is a lot of interest from them to build games that have that competitive functionality in them from the start.”
Marketing potential
Although Luckbox is live in 80 countries, the betting operator is looking for further marketing opportunities. Most recently, Luckbox launched its affiliate programme with Income Access.
“There are some markets that we see a lot of potential in,” says Rosander. “For now that is our focus, as we are building up our marketing capabilities and preparing us for accelerated growth.”
But where there are marketing opportunities, there are unique regulatory adherences. As the CEO of a company that seeks to expand, local regulations must be considered.
“To the igaming part of things, regulation is a huge pain. At the same time, it’s necessary, and we’re all for making it safer for players to bet.”
Ensuring that the regulation supports the player and the companies who wish to offer a regulated product can be challenging, says Rosander.
“We’ve been going through a phase where countries are trying to regulate, in some cases succeeding. But in many countries, the balance is difficult, which is harmful for players and for the companies.”
Looking forward
Luckbox has experienced undeniable growth since its inception. Through the difficulties of the pandemic, the operator’s revenue increased 18 times over year-on-year in 2020, but in absolute figures, revenue remain low as Luckbox focuses on building the platform. Meanwhile, Rosander’s appointment as the third CEO in recent years reflects Luckbox’s intentions to succeed.
“What me taking this role really indicates is that we’re shifting gears,” he says. “We have a growth strategy where we’re building our player acquisition capabilities and creating that network with affiliates.”
“There’s so much possibility [for acquiring customers] in the market we’re operating in now, and there is a massive amount of content being consumed in a way that’s never been done before.”
Rosander hopes his leadership will see Luckbox at the forefront of this new content consumption.
Led by director general of the Swedish Chamber of Commerce Gunnar Larsson, the investigation into match-fixing and unlicensed gaming began in December 2020 and has been extended until September 2021. Originally, it was set to close in June.
In addition to tackling those issues, the new extended investigation will also take into consideration the need for harsher penalties concerning violations of money laundering and terrorist financing.
Minister for social protection Ardalan Shekarabi said: “The current investigation will propose solutions to enable effective supervision of illegal gambling and strengthen the work against match-fixing. These issues are of great importance for a sustainable gaming market.
“It is therefore important that the investigator has enough time to develop well-elaborated proposals.”
Flutter Entertainment (Paddy Power, Betfair and Sky Bet), bet365, Entain (Ladbrokes and Coral), William Hill, Kindred (Unibet), BetVictor, Betway, Rank Group (Grosvenor Sport), the Tote and Fitzdares have signed up to the initiative.
Profits from win and each-way bets, after levy and duties are deducted, will go to charity, while if bookmakers do not make a profit on the race, they will make a donation to the charities themselves.
Proceeds will be split between Prostate Cancer UK, Marie Curie, Care Radio and the three Armed Forces charities – the Royal Navy & Royal Marines Charity, Army Benevolent Fund and the RAF Benevolent Fund.
The initiative follows a similar fundraising drive for the race last year, when £250,000 (€290,951/$355,654) was handed over to charities.
This year’s Britannia Stakes will take place at Ascot Racecourse on 17 June.
“I am absolutely delighted that the Betting and Gaming Council’s (BGC) largest members are once again leading this fantastic initiative, which will raise vital funds for some of the country’s top charities,” BGC chief executive Michael Dugher said.
“Millions of people enjoy a flutter and I’m proud that betting companies will donate their profits from one of Royal Ascot’s top races to go towards some brilliant causes that will help so many people from across the country.”
Ascot Racecourse managing director Alastair Warwick added: “We are thrilled that the betting industry will once again be donating profits from the Britannia Stakes to these very worthy charities.
“Run on Gold Cup day, the Britannia Stakes is always one of the biggest betting heats of the week and extremely popular with punters, so hopefully lots of money will be raised at a time when it is much needed in light of the impact Covid-19 has had on charity fundraising efforts.”
Under the arrangement, Novibet will be able to use GiG Comply to scan and check web pages for content including links and igaming “code red” words, links and regulatory requirements across multiple jurisdictions.
GiG Comply works by using a rules engine to analyse snapshots from affiliates’ campaigns and provides operators with the promotional content that is being used to promote their brands.
This, GiG said, will help Novibet ensure affiliates are aligned with its marketing message and that responsible gaming measures are visible on relevant pages.
“We are looking forward to working with the GiG Comply product to reinforce Novibet’s existing compliance processes,” Novibet international affiliate manager George Gerakanakis said.
“This partnership will help Novibet ensure that our affiliates can continue offering high quality experiences that are fully compliant with regional regulations and requirements.”
GiG Media managing director Jonas Warrer added: “It’s great to see an innovative operator like Novibet place marketing compliance at the forefront of their business strategy, we look forward to supporting them in creating a safer gaming environment for their players.”
Under the new strategic partnership, BT will advise on matters related to mobile operations within the National Lottery offering, as well as using new technologies to widen the appeal of games.
Sisal announced last month that it was competing in the tender for the licence, saying the move builds on its recent successes, having expanded beyond Italy in recent years.
In recent years, Sisal has won lottery tenders in Italy, Morocco and Turkey.
“As the UK’s leading telecommunications and networks provider, BT has unparalleled understanding of the UK market and its transformative digital expertise, customer focused approach and commitment to innovation will ensure that our bid will deliver the best possible solution for the UK National Lottery,” Sisal chief executive Francesco Durante said.
Dean Terry, managing director for the corporate and public sector at BT’s Enterprise unit, added: “BT’s technology solutions can ensure that the National Lottery maximises the amount of money raised for good causes, while better protecting those players most at risk from gambling harms.
“We are very pleased to be partnering with Sisal to support their bid with the aim of delivering a National Lottery which is fit for the future by putting technology innovation at its heart.”
The British Gambling Commission launched the fourth licence tender in August 2020, with the aim of announcing a preferred applicant by September 2021.
Pan-European lottery and gaming giant Sazka Group was the first to announce its intention to compete for the licence in October 2020, while Sugal & Damani, India’s largest lottery operator, joined the race later that month.
Incumbent licensee Camelot completed the Selection Questionnaire in October, though it refused to commit to bidding for the tender.
