Month: April 2024

Hillside (UK Gaming) ENC, which holds a licence for Bet365 bingo and casino products, will pay £343,035. Hillside (UK Sports) ENC, which has a licence to offer betting, will pay £239,085.

As part of the regulatory settlement with Great Britain’s Gambling Commission (GC), the payments will be directed to socially responsible causes.

Social responsibility failings for Bet365

The failings were uncovered during a compliance assessment of Bet365 by the Commission in March 2022.

The regulator listed three social responsibility failings by Bet365.

According to the GC, customer interactions were “not meaningful”. This was because the interactions were frequently not tailored to the specific customer journey or spectrum of harm.

Additionally, an Early Risk Detection System was “not demonstrably effective in understanding the impact of individual interactions” on a customer. This meant it could not understand whether further action was required.

Furthermore, the operator did not ascertain whether a customer had read and understood the information or advice provided.

Anti-money laundering

Four anti-money laundering failings were highlighted. Bet365’s enhanced due diligence and Know Your Customer (KYC) triggers were “ineffective at managing money laundering risk”.

There was a failure to undertake financial sanction checks on new customers before their first deposits. Additionally, there were shortcomings with independent verification checks, with an over-reliance on customers’ annual self-verification of KYC information.

Finally, the procedure document contained inadequate detail about who would be deemed “at risk” for customer risk profiling.

Expectations for Bet365

“The policy and procedural failings may not have been as severe as those at other gambling businesses in recent years. But they were failings nonetheless,” the GC’s executive director of operations, Kay Roberts, said.

“We expect high standards from operators in terms of keeping gambling safe, fair and crime-free. We will always take action to correct any failings. This operator is very aware that a repeat of these failings will result in escalating regulatory action.”

The sanction fell well below some other punishments handed down by the GC in recent times. In January, the Commission fined Gamesys £6.0m over a series of social responsibility and anti-money laundering failings.

Kaizen said the collaboration combines Betano’s global brand recognition with BetVictor owner BVGroup’s proprietary technology and experience as a UK operator. Betano’s entry into the UK market follows its establishment in Europe, Africa and the Americas.

Betano’s move into the UK comes during a year in which it has become an official sponsor of both Uefa Euro 2024 and the CONMEBOL Copa America 2024. The UK site features the Euro 2024 logo, indicating the brand will launch in time for this summer’s European Championships in Germany.

“It is a challenge to enter one of the largest regulated online gaming markets in the world,” said Julio Iglesias Hernando, Kaizen’s chief commercial officer.

“To ensure a successful entry, you need excellent partners. A bit like competing in the Premier League. Finding the right partner has been a top priority for us. This is exactly what we did with the well-established and reputable BVGroup. We are confident that our partnership in the UK will be a success.”

What will Betano bring to the UK market?

Kaizen’s brands – Betano and Stoiximan – operate in 14 nations. Kaizen debuted its Stoiximan brand in Greece in 2012.

Kaizen said its UK platform will offer in-play betting, enhanced accas, bet boosts and a bet builder product. It added that the partnership also means that Betano customers will be supported with BV Group’s suite of safer gambling tools.

BVGroup owns licences in the UK, Republic of Ireland, Gibraltar and Ontario. It services multiple brands across sports betting, casino and bingo.

“Kaizen, with its Betano brand, has cemented its status as a leading operator,” said Brent Almeida, CCO of BVGroup.

“We are honoured to partner with Kaizen Gaming in bringing its Betano brand to the UK market. We are confident that our technology and operating capabilities will give sports fans the safe and entertaining experience they expect.”

Of those surveyed, 59 percent said they favor a total ban on wagering advertising. Most also believe that operators are not acting responsibly, and that there should be more government regulation.

While polls are often designed and taken to get a certain result, and a significant percentage of those polled by Maru were in the over-55 category, the sentiment matches the hew and cry that has been echoing through Canada since wagering went live 4 April 2022. Since its launch, televised hockey games were flooded with advertisements for sportsbooks, and have been since.

There is similar sentiment in some parts of the US. In 2023, for example, Senator Paul Tonko proposed a federal wagering advertising ban. To date, no US state legislature has voted for a complete ban on wagering advertising on TV. There have, however, been some have very strict regulations around it.

Two years in, Ontario regulators continue to evolve and respond to what consumers want. The market is vibrant, but has required some massaging of rules. The regulator has also elevated problem gambling and responsible gaming issues.

‘No celebrity’ rule in gambling in place from February

The Maru poll was taken about three weeks before the latest Alcohol and Gaming Commission of Ontario advertising regulations went into place. The new regulations ban sportsbooks from using celebrities for promotional activities. They also ban sportsbook billboard advertising near schools, or other places where youth or vulnerable populations congregate.

The regulations do not dictate how much advertising can be done on television however. Nor do they call for a ban on wagering advertising. The only exception to the celebrity rule is the use of influencers in responsible gambling messages.

Since its launch, Ontario has systematically clamped down on advertising. This makes it one, if not the toughest, jurisdiction for betting advertising in North America. The newest advertising guidelines went into effect 28 Feburary.

“There has been very public pushback and the regulator has acted on it,” Covers’ Geoff Zochodne said on a Gaming News Canada podcast of the advertising change. “The advertising piece was something that regulators heard and tried to strike a balance.”

McDavid now the face of responsible gaming

In the US, Maine and Massachusetts have tough advertising rules that all but ban sportsbook ads at sports venues. They also keep sportsbooks from partnering with local colleges. It is also prohibited to target anyone underage or in an at-risk group.

The Massachusetts Gaming Commission at one point considered banning sports betting advertising during live-event broadcasts. However, it soon discovered that it wasn’t practical. In short, because as companies like ESPN or Fox either weren’t likely to honor the ban, or would not be able to during national games.

Multiple major operators used well-known celebrities in sportsbook advertising in Ontario prior to 28 February. Zochodne said those advertisements “served a purpose” and were to “alert people to the presence” of new operators. BetMGM country’s two of the country’s most recognizable sports faces — Wayne Gretzky and Connor McDavid as ambassadors.

Now, neither can be used to pitch for the sportsbook. Although, McDavid has pivoted to be the face of BetMGM’s responsible gaming television campaigns.

While a McDavid representative told CBC that responsible gaming is a “priority” for McDavid, others say the change is a bit ironic.

“I go back to something that (Sharp Edge Picks founder) Harley Redlick told me awhile back about celebrities representing sportsooks. His take was that anyone who is gambling even just a little isn’t going to be attracted to a sportsbook just by Connor McDavid,” David Briggs of PlayCanada said on a Gaming News Canada podcast.

“That’s clearly an attempt by sportsbooks to groom kids to one day to pick their sportsbook brand based on who they might have had a poster of up on the wall of their bedroom.”

McDavid’s new role: ‘It doesn’t look right’

For Briggs, “I was a little surprised that BetMGM spent the money to have him be a responsible gaming representative. But kudos to them.

“There probably is a positive, like Geoff said, that at the end there is probably more RG messaging. But that’s within the rules.” He finished.

Others in Canada say the swap from straight-up pitchman to responsible gambling spokesman isn’t right.

“You associate Connor McDavid with their site,” Andrew Kim, assistant professor in the psychology department at the University of Calgary told CBC.

The new McDavid ads have been airing on television and on social media since the beginning of March. These include live fixtures during sporting events.

Ontario increases investment in PG/RG

Beyond the new advertising guidelines, the Ontario Gaming and Lottery in late March announced that it increased its contribution the Community Investment Program that supports problem and responsible gaming initiatives, according to CDC Gaming. It is seeking to create a centralized self-exclusion “solution” that will not only help players to easily self-exclude, but make it so that the regulator and every operator have access to the same information across Ontario. The current deadline for submission is 8 May.

The Community Investment Program has received a two-year total of CA$760,000 (US$559,000). In FY2022-23, CA$22 million (US$16 million) that was sent to problem and responsible gambling programs around the province.

In the two years since launch, Ontario regulators continue to evolve and respond to calls for consumer protection, in a province slightly bigger by population than Illinois or Pennsylvania that has 45+ wagering platforms and 70+ online gambling platforms. No US state has that number of operators.

Vibrant sports scene drives handle

Ontario is the is the biggest province in Canada, and its 14 million people include those in the country’s biggest city, Toronto, which is home to seven professional sports teams, including three CFL teams, and borders Michigan, Minnesota, and New York.

In its first full year, iGaming Ontario reported total online gambling handle of CA$35.5bn (US$26.3bn) and CA$1.26bn (US$93.4m) in total gaming revenue. According to the report, online gambling brought in CA$230m (US$170.5m) in new revenue to the province.

There are seven professional sports teams, including three CFL teams, in ToronTo, the biggest city in ontario. Single-event wagering has been live in the province for two years.

For the first three quarters of FY 2023-24, iGO has reported that CA$45.4bn (US$33.7bn) in total gambling wagers have been placed.

“When talking about Ontario’s igaming market, the numbers tell us a lot,” Heidi Reinhart, iGaming Ontario Board Chair said via press release Thursday. “But what I’m most proud of are the countless ways that our government partners, operators, responsible gambling experts, players and employees have worked together to help us create a world-class market that is Ontario-made for Ontarians.”

Data collected by Truist Securities analysts in their 2024 Interactive Gaming Survey shows that Penn Entertainment’s ESPN Bet gaming brand has the potential to take on the big two.

According to Truist, it is ESPN’s position as the primary app for bettors to check scores that could help its branded sports betting platform rival DraftKings and FanDuel.

Some 44% of sports fans surveyed said they checked scores on ESPN and 64% of those said they would have interest in betting integration beyond listed lines.

Of the respondents who both frequent ESPN and showed an interest in betting integration, a majority (52%) stated it was likely that ESPN Bet will become their primary wagering platform. Nearly all others (45%) stated it was possible.

Penn’s prospects of overhauling DraftKings and FanDuel

Reflecting on the results, Truist managing director Barry Jonas tells iGamingBusiness the onus is on Penn to create a compelling technology solution for the ESPN Bet brand, which launched in Q4 2023.

“I think their stated goal is to be a podium player, in the top three. Our sense is if they can execute and offer strong technology, we think ESPN as a lead generator will be very strong,” Jonas says. “The issue becomes when people migrate from checking scores on ESPN to bet mode, and if they can keep folks using it as their primary app.

“The challenge of overtaking DraftKings and FanDuel is that you can’t assume those incumbents are staying still.”

While Penn has been in the online sports betting business for several years prior to the ESPN Bet launch with its Barstool Sportsbook, the company pivoted in November and may be a little behind the pack.

“ESPN Bet will be playing catch up to where they are today, when DraftKings and FanDuel are evolving,” Jonas adds. “It’d be a challenge to tackle market leaders, but ESPN Bet can become top three and a podium player.”

BetMGM’s omnichannel potential over ESPN Bet

While Truist has a positive outlook regarding ESPN Bet, it currently believes that DraftKings and FanDuel will continue coexist at the top.

The survey puts DraftKings ahead of FanDuel as players’ primary sports betting app by 29% to 22%.

For users who frequent both platforms, 61% stated they favour DraftKings when asked directly. This, Truist notes, goes against state-reported data. Looking at the New Jersey Division of Gaming Enforcement’s figures for February, for example, FanDuel’s partner Meadowlands makes up $35.1m of GGR, compared to $24.2m for DraftKings partner Resorts Digital.

Similarly in Michigan, FanDuel’s mobile handle came to $152.4m in February, compared to $109.9m for DraftKings.

“Reasons for that preference were generally mixed, leading us to believe the consumer generally views the two as largely equal today,” the report says.

Can BetMGM stay in the race?

BetMGM is favoured by 12% of users, but Jonas remains unconvinced as to whether it can catch up the two leaders, or indeed outpace ESPN Bet.

“BetMGM still has strong omnichannel potential and igaming advantages that others don’t have,” Jonas says. “The question is, can they take the investment year and use it on technology and improve their offering?

“It boils down to execution. It’s hard to say yes or no. It has a very strong brand, and the ownership structure is complex, which has likely at times been both beneficial and detrimental. That’s something to look at to see if it starts to lean towards more beneficial.”

BetMGM, as a joint venture between Entain and MGM Resorts, is reliant on funding and resources from each partner. While this provides access to specialist trading solutions from Entain’s Angstrom and MGM’s partnership with Marriott Bonvoy, there’s ongoing speculation that the casino operator may be angling to buy out its online partner.

Entain’s interim CEO Stella David said during a recent earnings call that the company didn’t realise how high maintenance BetMGM would be.

“In the U.S., we’re very proud of the successes that we’ve had with BetMGM, and its performance quite rightly is a key focus for us,” David said. “And where I like to think of MGM and ourselves, Entain, that we are the co-parents of BetMGM. But being fully transparent, it took us, and that is Entain, some time to realize just how quickly we needed to feed BetMGM with better product, better customer experiences and better, more focused U.S. tailored products.”

Regulatory risks for the US

The survey covered a wide range of questions around online sports betting and igaming to glean insights around consumer preferences, betting behaviour and overall health.

Truist says consumer health responses were predictable, as a more expensive cost of living seems to be having a moderate impact. The largest percentage of respondents (40%) say their gambling behaviour has not changed amid the cost of living crisis.

Truist received 554 eligible responses, 76% from online sports bettors and 77% from online casino players. Some 23% of respondents only bet on sports, 24% only play icasino, and 54% do both.

Overall, Truist says the survey reinforces its positive view on US digital gaming. However, there’s a growing backlash against the industry, with attacks targeting advertising and perceived increases in problem gambling. Other markets at least offer an indication of what – or what not – to do, Jonas points out.

“It’s clearly incumbent on US operators to learn lessons from across the Pond, the continent and Australia,” he says.

“Companies understand the risks and are actively working to prevent any irresponsible gaming and prevent improprieties. In many cases, DraftKings is taking the lead in spotting fraud.

“As long as they focus on responsible gambling, then they’re doing everything they can. In terms of federal regulation, gaming historically is under the state’s domain.”

The spectre of offshore gambling

The report also uncovered a sizeable percentage of players who admitted to betting offshore. It’s prevalent in states where online betting is not yet legal, Truist’s Patrick Keough notes, though in regulated states higher promotional bonuses and no limits on play entice players.

“It’s not in anyone’s best interests for players to turn to illegal markets,” Keough adds. “There is player protection onshore that isn’t available offshore. I think longer term, it could be a tailwind if players bet exclusively onshore, but the path there is a little murky.”

Chang became interim CFO at GAN in November 2022 when Karen Flores stepped down from the position. He will now continue in the role in a full-time capacity.

Prior to taking on the interim role, Chang worked as senior vice-president and corporate controller at GAN. He has been with the business since September 2021.

Before joining GAN, Chang worked across various senior finance roles at diversified services provider Alorica. He also had a spell with medical company Edwards Lifesciences and spent almost seven years working for Deloitte.

“I’d like to congratulate Brian on his appointment to permanently lead our finance team,” GAN chairman David Goldberg said. “Brian has proven his financial acumen having served as our interim CFO and he has the full backing of the board of directors.”

Chang taking on the role represents the latest senior management change at GAN. Last year, long-serving Dermot Smurfit stepped down as CEO. Seamus McGill, a non-executive director since 2014, was appointed as interim CEO before taking the role on a permanent basis last month.

Sega Sammy acquisition edges closer for GAN

Smurfit left shortly before gaming heavyweight Sega Sammy agreed to purchase GAN for $107.6m (£85.6m/€99.9m). Incidentally, Chang will support GAN with the acquisition as permanent CFO.

The deal was given the green light by GAN shareholders in February. Sega Sammy is seeking to use GAN to support its online gambling expansion plans in the US.

Should the deal go ahead as expected, GAN would merge with the Sega Sammy Creation arm of Sega Sammy and form a new special purpose company. GAN would be the surviving corporation after this merger.

“Brian’s proven leadership among the financial team and strong knowledge of accounting and financial controls leave us confident that he is the right person to guide us to a successful close of our merger with Sega Sammy.”

Chang added: “I look forward to the opportunity to continue to lead our finance team toward a successful closing of our merger with Sega Sammy.”

Net loss down for GAN in 2023

In other recent news from GAN, the business last month published its full-year results for 2023. These revealed a decline in revenue but a reduced net loss.

Group revenue for the 12 months to 31 December 2023 was $129.4m, down 8.6% from the $141.5m posted in the previous year.

B2C remains the primary source of revenue at $86.2m, but this was 1.5% down from the previous year. B2B revenue also fell 20.2% to $43.2m. 

However, there was some good news for GAN, with no impairment costs reducing its overall spending. As such, net loss was cut from $197.5m to $34.4m, although adjusted EBITDA fell from a positive of $6.0m to an $8.4m loss.

Last month, Gambling.com Group brokered a deal to buy Freebets.com for between $37.5m (£29.8m/€34.8m) and $42.5m. The final purchase price will depend on future revenue performance.

The affiliate group will pay an initial $20.0m plus an additional $10.0m after six months of owning the business. Between $7.5m and $12.5m is due one year after completion, subject to revenue performance in 2024.

Gambling.com Group expects Freebets.com to generate an additional $10.0m in revenue during the current year, as well as $5.0m in incremental adjusted EBITDA.

It is funding the deal with existing cash, borrowings under its new credit facility and future cash flow.

Acquisition will “fundamentally” change power balance in Europe’s affiliate market

Charles Gillespie, CEO and co-founder of Gambling.com Group, said the deal demonstrates commitment to Europe, alongside its US expansion efforts. He also said it will significantly impact the European affiliate market as a whole.

“While expansion of gambling in the US grabs all the headlines these days, many of the industry’s most attractive markets remain in Europe, the historical home of the industry,” Gillespie said. 

“I expect this acquisition to fundamentally change the balance of power within the European online gambling affiliate market. It will provide Gambling.com Group with a clear path to drive further growth in both our existing European markets as well as new ones.

“As part of the transaction, we are gaining a number of new colleagues in the region. I look forward to sharing our leading technology platform and high-performance culture with our new team members.”

Gambling.com Group revels in 2023 growth

The acquisition was announced alongside Gambling.com Group publishing full-year results for 2023. The year proved a successful one, with revenue rising 42.1% to $108.7m.

Stand-out highlights for the group in 2023 included the launch of the Casinos.com domain. It also struck up a new partnership with UK media publisher The Independent. All of this, the group said, contributed to revenue growth.

Accompanying a rise in revenue was net profit of $21.1m, in contrast to a $2.4m loss in 2022. In addition, adjusted EBITDA for the year was 52.3% higher at $36.7m.

High hopes for 2024

Given its positive performance in 2023 and the new acquisition, Gambling.com Group is optimistic about its prospects for 2024.

Revenue is set to be between $129.0m and $133.0m, the midpoint of which would be 20.5% ahead of 2023. As for adjusted EBITDA, the forecast range is $44.0m to $48.0m, with the midpoint 25.3% higher year-on-year.

This guidance, the group said, assumes no other US markets will open in 2024. It also said it makes the assumption it will not benefit from new acquisitions besides Freebets.com. This suggests Gambling.com Group will be quiet on the M&A front for the rest of the year.

Victoria-licensed MintBet was found to have violated measures related to extended periods of gambling by a customer.

The player in question gambled through their MintBet online account for 35 hours over a period of approximately 50 hours. During this time, the player placed 327 bets and lost a total of $31,149.

Ruling on the case, the VGCCC said MintBet did not stop accepting bets despite the player showing signs of distress related to problem gambling. Such action is required of all Victoria licensees under the state’s Responsible Gambling Code of Conduct. 

The VGCCC added that MintBet only closed the customer’s account when the user actively identified they were experiencing gambling harm.  

While the regulator said MintBet had some systems in place to ensure vulnerable individuals do not experience a loss of control from their gambling, they were inadequate. This, it said, also breached the code.  

MintBet ordered to take action

As such, MintBet was fined and ordered to inform the VGCCC of the improvements it will be making to its systems and processes. The regulator said it will consider this response and determine whether further action may be necessary.    

“Victoria gambling providers must comply with their responsible gambling codes of conduct,” VGCCC deputy CEO Scott May said. “They exist to protect people from gambling harm. 

“Even if accepting bets online, providers must monitor for and intervene when customers are displaying indicators of distress. Gambling for an extended period is a key indicator of distress that may indicate problem gambling. 

“There are serious consequences for any gambling provider that fails to comply with their own responsible gambling code of conduct. We won’t tolerate it.”

Crown retains Victoria licence

The ruling comes after the VGCCC last week reached a major decision on Crown Resorts’ future in Victoria. Crown was deemed suitable to hold a licence and therefore continue operating its Melbourne property.

According to the VGCCC, it is in the “public interest” that Crown retains the licence. Crown Melbourne is the largest single-site employer in Victoria. 

The decision followed major changes at the casino in the wake of the Royal Commission into casino licences. The Commission was scathing in its criticism of what it deemed “illegal, dishonest, unethical and exploitative” behaviour.

Having taken into account Crown’s efforts, with the operator saying it spent over AU$200.0m on its transformation, the operator will hold on to its licence.

During the meeting, committee chairman David Blount said that he had been told that “people have been talking” about the Mississippi sports betting bill HB 774 in an effort to reach consensus. He added that “if people are talking, that is a good thing and we want to let them continue to do that.”

The committee adopted a strike-all bill, which in this case updates the bill with codes used in the house. While it does not change any of the text, it does keep the online sports betting bill alive. The state legislature is scheduled to be in session until 5 May and HB 774 passed the house on 1 February. It was transmitted to the senate on 5 February and then assigned to the gaming committee on 27 February.

Tuesday was the final day for a committee to pass out a bill that did not originate in its chamber. Next Thursday, 11 April, is the deadline for the full senate to act on any non-revenue bills that originated in the house.

Mississippi sports betting was a first mover

Mississippi lawmakers were among the first to allow sports betting after the Professional and Amateur Sports Protection Act was struck down in May 2018. However, they have been at an impasse regarding digital sports betting since then. Currently, bettors can wager at brick-and-mortar sportsbooks. Some facilities have set up on-site mobile wagering, meaning that consumers can bet from just about anywhere on a casino resort property. This includes the pool area, restaurants or their rooms.

Blount said he was not privy to the specifics of negotiations on the bill. This is despite them having bipartisan support in the house. Mississippi lawmakers have tried several times to expand legalisation to include online betting, but have failed.

The latest version of a wagering proposal would allow for 26 licences. Each of these would be tethered to the state’s commercial casinos. Tax will also be set at a maximum of 12%. There is a sliding scale for tax revenue, so sportsbooks doing less business would pay at a lower rate.

But now the state is lagging

When the first wagers were being taken in Mississippi on 1 August 2018, the state was the only one in its region that had live legal sports betting. Since then, lawmakers in Arkansas, Louisiana and Tennessee have all made betting legal. All three states also offer statewide digital platforms.

Alabama is the only Mississippi border state that does not have legal sports betting and, despite efforts by the legislature there to pass a comprehensive package of gambling bills, it appears that the state might legalise lottery but nothing else.

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