For the past seven months, lawmakers in the United Kingdom have been increasing regulations on the land-based and online gambling industry. Increased rates of problem gambling are pushing the government to ramp up restrictions for gambling operators. This UK gambling crackdown is now starting to seriously affect two major betting shop companies.
Ladbrokes and Coral are both experiencing major revenue drops due to these new restrictions. Today, we’re looking at what restrictions the UK government is setting on the gambling industry. We’ll also talk about how these new laws are impacting gambling companies spread around the country. Let’s get into it!
The UK has the biggest internet gambling markets in the world. Many of the top gambling companies are based here, most of which rack up millions of dollars in revenue every single month. Unfortunately, this country is experiencing an unprecedented rise in gambling addiction.
According to numerous reports, there are more than 500,000 problem gamblers in the UK. Lawmakers here want this to change. For months now, government officials have begun to implement new measures to lower gambling additional rates. The first major step was to limit advertising for gambling operators.
Under new laws set in February, companies can no longer target young people in ads. That same month, the government announced that it was considering a ban on credit cards for gambling. In April, the government found five different companies were not abiding by the new regulations.
Things began to ramp up even more. On April 25th, the UK government announced a “National Strategy” to combat gambling addiction. Several new restrictions were placed on gambling companies, and multiple gambling addiction treatment centers began opening in different cities.
Let’s look at how these regulations are hurting gambling operators.
There is some debate as to how effective these new UK gambling laws really are. It’s great to see the government take a proactive stance to lower gambling addiction, yet many of the honest, trustworthy gambling companies here are being seriously affected. New reports indicate that Ladbrokes and Coral are experiencing massive revenue drops.
Most of this is due to the government’s new laws on fixed-odds betting terminals, or FOBT’s. Not long ago, lawmakers here announced they were lowering the maximum stake for these machines to just £2. In the past, gamblers playing these machines could make wagers up to £100.
FOBT’s are some of the most popular land-based gambling games in the UK. Many of the betting shops in this country rely on these machines to stay in business. GVC, the parent company of Ladbrokes Coral, has seen it’s retail earnings drop by more than 19% over the past three months.
Company officials warn that the UK gambling crackdown may force more than 1,000 shops to close down. They also state that GVC could lose upwards of £130 million by 2020. Of course, many feel these new FOBT regulations will benefit the UK in the long run.
John Eckles, a gambler located in the United Kingdom, gave his opinion on the matter to the media this week.
“They should have capped stakes long ago, nipping it in the bud before it started. A lot of men lost their wives, families, homes – they even rob their own children. I’ve met a couple of guys who’ve fallen into debt,” he said.
It doesn’t look like it. Many of the land-based betting shops that this company operates are seeing revenue dips. Fortunately, many people are simply choosing to bet online. GVC runs some of the biggest online gambling sites in the UK, which have actually grown in the wake up the new gaming regulations.
In the past three months, GVC’s overall gaming sales increased by 3%. This popular gambling company reports a significant increase in internet gambling. It also helps that GVC is expanding in the US market.
Back in May of 2018, the US Supreme Court opened the doors for legalized sports betting. Today, several states have outright legalized this industry and nearly half have pending legislation to allow it. GVC has teamed up with a number of states to offer legal, regulated sports betting odds online.
Concerns for the future of GVC are unwarranted. More people are choosing to gamble online every single year. The fact that betting shops are earning less money right now is par for the course.
The UK gambling crackdown is happening, whether we like it or not. Gaming operators here will need to adapt in order to stay afloat. Make sure to stay tuned for more updates to the UK’s gaming regulations in the future!
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