Allwyn International, the firm that manages the biggest legal lottery games(EuroMillions) in the United Kingdom, invested in an online gambling site. Novibet, the recipient of the investment, must be pinching themselves. Gambling companies have been consolidated under UKGC rules. There are fewer independent gambling operations than there were five years ago.
Why Allwyn & Online Gambling Matter
Corporations, Hedge Funds, and Vegas Casinos have moved into regulated gambling regions. They have to; it’s about share price, branding, and keeping up with the competition. Competition is intense in regulated markets, such as the United Kingdom. Novibet, although a decent size, is a small operation. What Novibet has done wisely is offer games in regulated markets only.
That makes it attractive to companies looking to expand a footprint where it already runs a lottery monopoly. The Allwyn takeover of Novibet – where it purchased 51% of the holding company is an astute move. It provides an established lottery operation with a well-managed gambling operation.
The synergy and opportunity for both Allwyn & Novibet are almost too good to be true. From a player perspective, it adds a quality gambling brand to the thinned-out gambling brands available to UK players. Along with regulation, comes expense and taxation. The UK with other countries like Sweden, Portugal, Spain and France have implemented regulatory requirements. That means smaller more innovative players have been squeezed out. Big Corp can handle this, it’s a scramble for smaller operations with additional costs.
Why Allwyn & Online Gambling Matter
The company, which monopolises lottery in the United Kingdom and a few other countries, can now offer casino games to players. Lottery sites already have hugely popular scratchcards. What the lottery site does not have is slot & table games. In a regulated market, we have noted that consumer choice is disappearing fast under an avalanche of red tape and fines.
One thing that Allwyn can not do is contact or advertise its new gambling business on the lottery site due to restrictions and GDPR rules. That means if you are a user of the official UK EuroMillions and Lotto site, it is not permissible for Allwyn to market its new business to you.
What This Means for UK Players
In the short term, it means there is another reliable gambling operation that can accept play. It also means another giant of gambling in the form of Allwyn Entertainment will be able to accept UK players. In the long term, this is beneficial for player safety and responsible gambling, however, it leads to a further issue that has risen rapidly in prominence due to the strict rules and taxation imposed by the UKGC.
The Rise of Offshore Gambling in Regulated Markets
UKGC rules and taxes associated with running a regulated gambling business in the UK and indeed in other regulated markets have meant many operators withdrawing from the legal market. The rise of unregulated gambling businesses that can offer better bonuses to players from regulated regions is a growing market and one that both regulated operators and regulatory bodies are grappling with.
The mere fact that unregulated businesses are not allowed to market in regulated regions does not limit their ability to appear in Search results or accept players from regulated regions. Because they are not paying point of consumption taxes they can offer more and bigger bonuses, and in all probability better RTP on games.
That last factor is crucial. Every player wants to feel like they have a chance of being able to win, in regulated regions the cost of operating has meant a tightening of RTP to the detriment of players. This leads to player dissatisfaction with brands and is a reason why players seek out unregulated brands.
There are risks associated with playing at an unregulated brand. Safety and Security and getting any winnings are at the top of this list. Unregulated gambling and lottery play is a growing factor as it appears Governments are following a strategy where responsible gambling trumps all other considerations including entertainment.
This in our opinion is the sole reason why unregulated gambling is a growing issue and will continue to be an issue until such time that a balance is struck between regulatory bodies and operators.
That is a highly unlikely scenario so it seems unregulated gambling will be a constant factor. This is why it is so vital that new operators, in the form of Allwyn and other companies can bring and maintain new gambling brands in the UK.
