UK experts fear a rise in online gambling harm

EXETER, ENGLAND – MARCH 18: A sign is displayed in the window of a high street bookmaker listing the canceled sporting events on March 18, 2020 in Exeter, England.

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LONDON – Since the outbreak of the coronavirus pandemic, UK gaming companies have increasingly tried to strengthen and expand their online offerings.

The closure of commercial and social venues and the persistent cancellation of major sporting events have fundamentally changed the gambling landscape around the world.

For example, although its physical stores were largely closed for the past 12 months, FTSE 100-listed Ladbrokes owner Entain’s core earnings rose 11% to £ 843.1 million ($ 1.19 billion) for 2020 , of which £ 803.5 million a accounted for 50% more online gambling offerings.

The company’s stock hit a record high at £ 17.25 per share in late April, up more than 36% year-to-date as of Monday’s close. Compared to the recent low during the first Covid-induced crash in March 2020, it is currently up around 124%. 888 Holdings, Rank Group and Gamesys have seen strong growth since last March. Meanwhile, Bet365 CEO Denise Coates posted an annual salary package of £ 469million last year, one of the highest in the UK’s corporate history.

However, given the increased isolation, boredom, stress, anxiety or financial worries many people experienced during the pandemic, concerns about a possible spike in addiction and harmful gambling have also emerged.

The Gambling Commission, the UK’s regulator, found that during the pandemic, fewer people gambled, many already committed online gambling consumers moved into new activities and spent more time and money betting.

The Commission noted that engaging in a wider range of gambling activities may correlate with higher levels of “medium risk and problems gambling” and expressed particular concern about the increased prevalence of online slot machines.

Dependence on the vulnerable

Matt Zarb-cousin, co-founder of Gamban, a software provider that blocks access to gambling sites, told CNBC that the cancellation of sporting events and the tripling of digital advertising since the UK was first blocked in March last year has attracted many casual gamers more intense activities such as slots and casino games.

“By and large, the business model is to get people to bet on football, racing, or sports in general, do so with a very small margin – sometimes not at all, sometimes even with a loss leader – and so many of them to get people to the slots and casino games as possible, where there is a significantly higher margin and these are addicting products, “explained Zarb-cousin.

He also noted that while gambling companies allow customers to exclude themselves from their services if they are concerned about the extent of their gambling, they actually depend on a very small proportion of customers who are most responsible for a significant percentage of sales are at risk.

LONDON, ENGLAND – JUNE 16: A general view inside the Ladbrokes betting shop on Putney High Street as betting shops reopen in front of Royal Ascot on June 16, 2020

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A study carried out last year by researchers at the University of Liverpool found that across all UK gambling companies, the 5% of the highest annual spending accounts that Zarb-cousin identified as those at the highest risk for damage from gambling generated 86% of the accounts GGY of the companies (gross gaming return).

Slot machines and casino games accounted for 93% of the GGY from online gambling among the operators participating in the study, while gambling products were also more likely to be used by people from areas with higher levels of deprivation. According to the study, players from the UK’s most deprived areas had disproportionately high spending on GGY.

Meanwhile, most account holders have either made money or lost a modest amount over the year, with 84.5% of account holders spending less than £ 200 over the year. The study found that 1.4% of accounts had more than 20 separate bets placed on an average betting day.

No disruption, little regulation

The UK government is currently conducting a review of the Gambling Act 2005, the basis of all gambling regulations, to test its suitability for the digital age.

Gambling companies in the UK have grown exponentially over the past decade as smartphones made online gambling ubiquitous. Zarb-Cousin, who himself had overcome an addiction to betting terminals with fixed odds, said the previous lax regulation had allowed these firms to become “giant monoliths” in the UK economy.

“That says a lot about our economy and our approach to regulation, and usually when you make huge profits you inevitably have more regulation or disruption,” he said.

“There has been no innovation or disruption to gambling at all, and regulation has been pretty bad in every way.”

However, he suggested that tighter regulation was inevitable in the coming years as the government scrutinized the industry further.

LONDON, ENGLAND – JUNE 1: A general view of a closed betting shop on Putney High Street as horse racing resumes competition action on June 1, 2020 in London, England

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Industry association Betting and Gaming Council has highlighted that its members support 119,000 jobs in the UK and generate £ 4.5 billion in taxes for the UK Treasury and £ 7.7 billion for the UK economy in terms of gross value added.

In addition to substantial contributions to sports sponsorship, BGC members have allocated £ 10 million to the Youth Gambling Damage Prevention Program and £ 100 million to address problem gambling by 2024.

A BGC spokesman told CNBC that the agency welcomes the review of the Gambling Act and the government’s assurance that it is an “evidence-based process”, noting that the overall rate of problem gambling has been stable at 0.5 for 20 years % lies. according to the latest government data.

“During the pandemic, the number of safer gambling messages on betting websites has more than doubled, while the number of direct interventions, where customers spent more time and money than before, has increased by 25%,” the spokesman said.

“We hope the Gambling Review does not safely strike a balance between properly protecting the vulnerable and jeopardizing the enjoyment of the millions of Britons who enjoy fluttering.”

Help calls become “more difficult”

Anna Hemmings, CEO of GamCare, a charity that supports gambling addiction, told CNBC that after an initial abandonment at the start of the pandemic when people were grappling with a range of other issues, the number of people calling for help has now grown steadily above the stand. Pandemic level.

“What is important is that the nature of the calls has become more difficult so that we see more mental health issues, more protection concerns, more domestic violence, etc.,” she added.

Independently of the Gambling Commission review, the Department of Health and Welfare has vowed to expand and improve the treatment of damage related to gambling to reconcile the problem of drug and alcohol addiction.

“There is a serious problem with the levels of funding for research, education and treatment. They are very, very low compared to drugs and alcohol, and they themselves have seen huge cuts in recent years,” Hemmings said, noting that further investment has been made GamCare has been a top priority in treatment programs as it awaits government review.

Along with Gamban and GamStop, a free self-exclusion program that allows players to limit their online activities, GamCare has a partnership called TalkBanStop, a program that combines advice with practical tools to help those at risk begin their recovery.

“People tend to let things get pretty bad before they seek help, and a lot of our work is trying to encourage people to get in touch earlier because the sooner you get help, the sooner you can do the damage “said Hemmings, noting that help – overall search has decreased during the pandemic due to NHS residues and reluctance to weigh on health services.

“We have to get the entire population back into the mode of seeking help, in which it is legitimate and positive to seek help at an early stage.”

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