Online casinos are the next big thing in gambling. Since online gaming has been available, it has only grown in size, revenue, and popularity so that it now makes up a significant portion of all revenue earned from gambling.
As more people become more comfortable with online gambling and as more countries begin to accept it, more gaming options are becoming available.
One high demand option that is legal in only a few places is sports betting.
Currently, most countries don’t allow sports betting, or allow it within some very specific restrictions.
Bringing sports betting to online casinos will not only continue to fuel an already financially productive industry, but will also provide an option for those who are currently seeking out the form illegally.
Should more countries offer sports betting with fewer restrictions? Should sports betting be incorporated in online casinos?
To answer these questions, we need to start by looking at the online gambling industry as a whole and then evaluate countries where online gambling is popular.
This will help discern whether sports betting would be beneficial for these countries and their citizens.
The Industry as a Whole
As stated earlier, the online casino industry is booming. People all over the world are able to engage with casino games.
For many, it is no longer necessary to travel to a land-based casino to get the gaming experience; almost anyone can play in the comfort of home.
This is especially convenient for people who live in countries where gambling is not legal.
People who have difficulty traveling to different countries or states where gambling is legal also benefit from the ease of access that online casinos offer.
Currently, the online gambling market is valued at $46 billion USD and is projected to reach $94 billion USD by 2024.
That is more than double the value in only five years. It’s become clear that consumers are quite interested in online gaming.
People are not only playing at home on their computers; a majority of online gambling is done on mobile devices.
This form of entertainment has become such a big part of some peoples’ lives that they want to have that ability in their pocket, available at all times.
61% of online casino revenues come from online bets; 72% of those bets are placed on a mobile device. That’s a pretty big piece of the pie.
With strong proof that online casinos are an unequivocal success, it’s time to start expanding.
Sports betting is one form many individuals would like to see legalized, but government entities and professional sports leagues tend to stand in opposition to this trend.
To further understand the industry and whether legalization of sports betting is a worthwhile pursuit, let’s look at a few countries that are responding well to online gaming.
We’ll take a look at how they interact with online casinos and whether their citizens would be interested in the more widespread availability of sports betting.
Online Casino Market in the UK
The UK was a groundbreaker for online gambling.
These countries were among the first to allow it and quickly showed that consumers were interested.
In 2015, reports showed that online gambling accounted for a third of all gambling in the UK.
Interest in online casinos–and the resulting revenue–continue to grow. From 2016 to 2017, revenue increased by almost 10%.
In 2018, the UK Gambling Commission reported revenue of £5.6 billion in online gaming.
This impressive number makes up the largest portion of the gross gaming yield (38.8%) and a 2.9% revenue increase from the previous year’s reporting.
The world’s first sports betting exchange was created in the UK.
These countries hold some of the longest standing sportsbooks in the world, so of course, they are more than ready to place bets online. Participants set wagers in a betting pool instead of fixed-odds.
Citizens of the UK can legally bet on sporting events as long as the online casino taking the bets is properly licensed by the UK Gambling Commission.
The law requiring online casinos to be licensed was passed in 2014.
Between 2014 and 2015, 162 online casinos were newly licensed in response to this requirement.
The popularity of online gambling (and specifically sports betting) in the UK, made online casinos were more than willing to become licensed if that meant that they would be accessible to UK citizens.
Around the same time that the licensing requirement was put into place, parliament also imposed a 15% tax on foreign sports booking sites.
This extra tax did not much seem to dampen the gamblers’ spirits.
Even with these restrictions, sports betting from the UK is thriving. The most popular sports for betting are football (or soccer, if you’re in the US), tennis, and horse racing.
Football (soccer) alone has brought in almost £450 million. Overall, sports betting revenue makes up almost half of all online casino revenue. Last year, the UK Gambling Commission reported betting totals of £2.5 billion.
Popular sports betting sites include 888sports, Betway, Paddy Power, and BetOnline.
There are hundreds of different sites available to UK players, but these are some of the most trafficked. Land-based casinos like William Hill and Ladbrokes have also created online platforms for placing bets.
The restrictions on online casinos and sports betting are thorough in the UK. Some operators and gamers alike may find this stifling.
However, the UK has one of the safest, most secure online gaming platforms in the world because of it.
Online Casino Market in the US
When it comes to legal online gambling in the US, things can get a little confusing.
It is legal for all citizens of the US to play online casino games, but because the federal government allows states to make their own laws regarding online gambling, only some states allow online casinos to set up shop within their borders.
Currently, Nevada, Delaware, Pennsylvania, and New Jersey can legally host online casino websites.
Many other states are in the process of making it legal or are waiting to see the success or failure of online gambling in the states where it is currently legal before making their own laws on the matter.
In 2021, the online gambling market reached a total valuation of US$ 72.3 Billion and it is expected to almost double by 2027 to US$ 131.4 Billion by 2027.
As we start to see online gambling grow and become more successful, it is likely that more state governments will allow online gambling sites to be created in their state.
Sports betting is an entirely different matter.
The U.S. allows only specific bets in specific locations.
Similar to online gambling as a whole, the U.S. is tentative and restrictive.
Though 8 in 10 Americans support legal sports betting in their state, only the following states allow for sports betting wagers: Arizona, Colorado, Connecticut, Illinois, Indiana, Iowa, Louisiana, Michigan, New Hampshire, New York, Oregon, Pennsylvania, Tennessee, Virginia, West Virginia, and Wyoming.
Currently, the American Gaming Association estimates that Americans illegally wager $150 billion every year.
The United States also restricts sports betting by prohibiting the placing of wagers on single games. Nevada is the only state where this is allowed.
Many professional sports leagues and associations support this restriction because it protects players from intentionally throwing games to affect the outcome of a wager.
The law that prohibited sports betting nationwide, the Professional and Amateur Sports Protection Act (PAPSA), was repealed in 2018, which allows individual states to make their own laws regarding sports betting, both online and offline.
Many apps have since been developed to cater to the states that allow online and mobile sports betting.
However, they use your phone’s location to determine whether you are in a state that will legally allow you to place online bets on sporting events.
Online Casino Market in Canada
Similar to the U.S., companies are not allowed to base online casinos in Canada, but Canadians are allowed to play on foreign online casinos.
The exception to this rule is native reserve lands.
These lands are territories of Canada, but they govern themselves, allowing them to sidestep laws about the location in which an online casino is based.
Revenue gained from gambling by Canadian citizens continues to grow from year to year. Popular games include classics like roulette, baccarat, blackjack, poker, and slots, among others.
Sports betting is also very popular in Canada, with a focus on the National Hockey League.
Because of restrictive laws, sports betting is only allowed in the form of parlay bets or accumulator bets.
Accumulator bets are when wagers are placed on at least three things. In order for a player to win, all three bets must be successful
For instance, a bettor may pick the outcome of three different games. If they are wrong about the outcome of even one game, they do not win the bet.
This format makes the chances of winning much smaller but the rewards for winning are typically much higher.
Accumulator bets are popular both in the US and Canada because they help protect the integrity of professional games.
Players and coaches are less likely to become corrupt or influence the outcome of the game.
This may change soon, as Canada makes an effort to stay relevant to its competitors when it comes to online gambling. As of August 27th 2021, single-event sports betting is legal in Canada, following years of lobbying for Bill C-218.
Some places in the US, like Las Vegas, currently have an exclusive right to offer single-event sports betting. Because of this exclusivity, 90% of sports bets placed in Nevada are placed on single events.
In fact, it is estimated that illegal single-event sports bets create $110 million CAD in revenue. In 2022, the illegal sports betting market is expected to considerably shrink as a result of last year’s legislative updates.
The demand is certainly there. If Canada wants to stay up to speed on gambling laws, they need to be more serious about considering a change.
In recent years, Macau has overpowered Las Vegas as the source for the highest annual revenue from casino games.
The extreme success of land-based casinos in Macau and other areas in Southeast Asia has encouraged keeping online gambling illegal in many areas.
Some countries where online gambling is legal, such as Malaysia, still don’t fight to protect players from scams or fraud. If a bettor is owed money or cheated out of winnings, the Malaysian government will not intercede for them.
Despite the less-than-favorable laws around online gambling, there is still a significant market for it. For instance, the Philippines has started to encourage its citizens to pursue online gambling.
However, the Chinese government discourages this because they say it would target Chinese customers. They estimate that Chinese citizens already spend hundreds of millions of yuan on gambling each year. And, as of November 2021, China has considerably cracked down on illegal gambling.
Because of this rebuke from the Chinese government, the Philippines stopped taking applications for new online gaming operations.
Similarly, Cambodia has stopped issuing new licenses for online gambling platforms based in the country and has said that as current licenses expire, they will not be renewed.
Even though governments continue to crack down on online gambling in these countries, citizens are still drawn to it.
The ease of access and 24/7 availability make it extremely convenient for people all over Southeast Asia to play.
The state of sports betting in Southeast Asia is reflective of the restrictive laws in online gambling. There are situations in which sports betting is legal, but it does not allow single-event sports betting.
One example that shows the desire for single-event sports betting is the last World Cup competition.
Sports betting is legal in Hong Kong. Taxes from legal sports bets make up 5% of the city’s budget, so the amount of money being spent on illegal gambling is money that they lose.
As you might expect, the revenue from illegal bets far outweighs the revenue from legal ones.
Countries in Southeast Asia need to consider whether the money going towards illegal bets is worth it. It may be time to change the laws to allow such betting when the demand is so high.
Online Casino Market in Australia
The Australian market for online casinos has been growing for years. According to a recent 2021 study around 17.5% of Australians gamble online.
Australia’s gambling laws are just as murky as other countries discussed in this article.
It is illegal for unlicensed online casinos to offer games to Australians, but it is legal for Australians to play online games in casinos that are based in foreign countries.
Sports betting in Australia is enormously popular, but it is not always done legally. Many online bettors are not even of legal age when they first place a bet on a sporting event.
People who participate in online sports betting use four different online betting platforms on average and place bets on about six sporting events a year.
Popular sports include the Australian Football League (AFL) events, horse racing, soccer, and NBA basketball.
About half of all bets are now placed online.
Sports betting in Australia has become increasingly popular over the last twenty years.
It is the only form of gambling that has seen an increase in participants in recent years.
With wider availability, it is likely that it will only become more popular.
Regardless of the legality of online gambling and sports betting all over the world, it is clear that the citizens of these countries are interested in more freedom in gambling.
Many governments seem to recognize this and are now beginning to cater to this tendency.
As we continue to become more comfortable with online gambling, it is likely that more options will become available.
Online gambling and sports betting will be offered in more places and with fewer restrictions.
Once governments embrace this form of betting and begin to tax it, sports betting could become a major source of revenue for that country.