The UK’s gambling regulator has announced a raft of strict measures aimed at the online slot machine industry after a jump in activity during the pandemic.
The closure of high street betting shops for large parts of the pandemic has driven more people online.
Online casino revenues had already been surging before the pandemic, rising from £2.36 billion in the year to March 2016 to £3.17 billion in the year March 2020.
Online slot machines represented around 69% of this income.
The latest clampdown is expected to reduce the online slot machine industry’s £2.2 billion annual revenues by slowing games down and removing features which can cause players to lose track of their spending.
Here we examine some key questions about how the sector has changed.
– How has use of online slots changed during the pandemic?
The number of players at the start of the pandemic in March was significantly higher than a year earlier, rising 25% to 2.61 million people following a period of sustained growth.
As restrictions were put in place in response to coronavirus, consumer habits shifted as people spent more time at home.
Nevertheless, the number of active players decreased to 2.55 million in April and to 2.44 million in May, with a marginal increase the following month, according to Gambling Commission figures.
However, as the pandemic rumbled on, player numbers rebounded and had jumped to 2.8 million by November, in a month when nearly £177 million was spent on slots.
Despite the initial decrease in player numbers, total bets soared over the same period as people spent more time on platforms.
The number of bets on online slot machines rose by 15.5% to 5.16 billion in April from the previous month as the first national lockdown continued.
Bets increased by 2.5% to 5.3 billion in May month-on-month.
Gambling Commission figures showed a rise in the number of gambling sessions that lasted more than an hour, rising from 1.92 million in March to 2.27 million in April.
– Did the suspension of sport impact gambling habits?
As online activity gathered pace at the start of the pandemic, betting on sporting events nosedived.
The number of bets plunged from 191 million in March to 78.1 million in April, with a slight improvement the following month.
Gambling firms blamed the dearth of sporting events, with horse racing, football and most other sports suspended in the major markets.
This rebounded rapidly in June, which saw the return of Premier League football and UK horse racing, with total bets jumping to 255.4 million for the month.
Politicians suggested the decrease in events and closure of entertainment venues caused some people to use online casinos for the first time.
“Many will turn to the mini casino on their mobile phone for entertainment.”
However, Fintan Costello, chief executive of BonusFinder, told trade title IGBusiness: “Only a small percentage of sports bettors will have moved to online casino with the closure.
“We are probably seeing the impact of land-based closures encouraging people to try online, so basically an acceleration of an existing trend.”
– What is the justification for making these changes now?
The new measures will be enforced from the end of October but had been touted over the past year amid increased scrutiny of online casinos.
The Gambling Commission said it was “monitoring online operators closely” throughout the pandemic and would step in with action if necessary.
In June, the APPG called for a major legal shake-up, with demands for changes to online casinos.
It called for a £2 stake limit for online slots and said “spin speed” on casinos should be reduced.
Some of these demands have been addressed in the Gambling Commission’s announcement.
The new measures come with the Government’s long-awaited review of UK gambling laws firmly under way.
Campaigners have said more stringent reform is overdue, although there is no timescale for when the review is expected to finish.
The review, which started in December, is understood to consider banning sports sponsorship and limiting online casino stakes.
UK gambling industry lobby group the Betting and Gaming Council has repeatedly said tightening the regulations could drive more people towards unregulated black-market operators.