Igaming Focus: The U.S. can learn plenty from UK industry drama By Jake Pollard, CDC Gaming Reports July 7, 2022 at 10:00 am Political events have overtaken the ongoing saga of the UK White Paper on gambling reform. But regardless of when the report is published, the gambling debate in the UK is an object lesson in how not to conduct industry lobbying and communications. Stakeholders in the U.S. should ensure they don’t make the same mistakes. Boris Johnson has resigned as Prime Minister of the UK, but his decision only came about as a result of more than 50 ministers and parliamentary aides resigning in the 24 hours prior, including Chris Philp, who as Minister for tech and digital economy also oversaw the UK White Paper on gambling reform. Philp’s resignation therefore casts further doubt on when the White Paper will be published, but more generally the debate around gambling reform in the UK and the atmosphere it has fostered between the industry and politicians and campaigners should provide U.S. stakeholders much food for thought. The White Paper is the first attempt at major reform of the gambling regulations that came into force in 2007. It is likely to recommend £2-£5 stake limits on online slots, “non-intrusive” affordability checks, and a ban on free bets and VIP packages for players that have incurred heavy losses. However the most eye-catching measure, or rather lack of one, is that the government may not recommend a ban on gambling sponsorship of sports teams or a statutory levy on operators to fund research in addiction and problem gambling. For this column we will focus on sponsorship, about which there has been such pushback that news emerged on Monday that the Premier League had asked its clubs to vote on whether they would back a gambling sponsorship ban. The original non-decision by the government is a strange one, however, for both industry and politicians. Commercial issues of course come into play, especially for the lower league clubs that are heavily reliant on the income. Maximum exposure But equally it is the huge visibility of shirt sponsorships and the fact that they are seen by so many youngsters and their parents that attracts so much criticism. An easy way to avoid this would be for the industry to voluntarily decide to stop shirt sponsorships, especially when many of the shirt sponsors are Asia-focused and don’t really take any business from the UK. Charles Gillespie, CEO of the affiliate operator Gambling.com, likely summed up the reaction of many when he tweeted: “It is inconceivable to me that after all this time they don’t reach the most obvious of conclusions which is to ban shirt sponsorships. These sponsorships are unavoidable, impact children and are a major source of blowback against the entire industry. Ban them already.” State of the debate The other notable aspect of the news was in the reaction of stakeholders, notably Michael Dugher, CEO of the UK trade body the Betting and Gaming Council. During an angry exchange on Twitter, he told Rob Davies, who reports on the gambling industry for the Guardian newspaper: “When it comes to gambling, you’re not a ‘reporter’ but “an anti-industry ‘campaigner’.” He then dismissed Davies’s response with more disparaging comments. It is true that Davies is broadly anti-gambling and his coverage generally doesn’t present the industry in a good light, but neither does he advocate for a complete ban of the industry. And in any case, Dugher’s personal attacks on a journalist who disagrees with him is never going to convince anyone of his arguments (whatever they are). The exchange also sums up the state of the debate around gambling reform in the UK and, unsurprisingly, the subsequent press coverage has been overwhelmingly negative. There is a huge chasm between pro and anti factions and very little room for meaningful discussion, never mind agreement. All things in moderation The UK industry has long baked in the financial impact of the measures likely to be included in the White Paper – for example, analysts at Jefferies recently forecast a £30m EBITDA hit for Flutter. But even if a sponsorship ban is avoided, the reputational damage caused by the practice could end up being more damaging in the long run than any loss of exposure a ban might have caused. The issue will also continue to provide further ammunition to anti-gambling campaigners, and we should expect more angry debate on the topic, especially as stadium advertising will carry on even if shirt sponsorship stops. How is this linked to the U.S.? UK-based groups such as Flutter and Entain have substantial operations there via FanDuel and BetMGM, but more generally the situation should be a warning to North American stakeholders about pushing too far with advertising and not heeding calls for moderation. Spotlight’s BetTech Report The second edition of Spotlight Sports Group’s BetTech Ecosystem Report was published at the end of June. The group said it published the report to illustrate how the different verticals and suppliers within the sports betting ecosystem interact to produce the myriad games and offers that millions of players enjoy around the world every day. With regard to regions, North America continues to be the major focus for many in the industry, but further state roll-outs are not certain, while in Canada questions are likely to focus on how regulatory models will evolve in the rest of Canada’s provinces. While the U.S. and Canada are top priorities for most global businesses, Latin America is shifting with Brazil taking tentative steps towards regulation and the likes of Mexico, Colombia and Argentina providing legal environments in which to operate. On the product front, sportsbooks and suppliers should be thinking about driving incremental loyalty and revenues from players by combining personalisation and content. “Those that can pull (those elements) together effectively can drive incremental growth,” says the report. FanDuel pushes on The news that FanDuel was pulling away from its main rivals with apparent ease was confirmed last week when New York’s sports betting data showed that it had generated 89% of the state’s gross revenue total of $13.8m. By comparison, DraftKings was second with $1.08m, followed by PointsBet with $773k and BetMGM with $352k. The key issue will be whether it can sustain these levels once the NFL season returns.