U.K. Sportsbooks Exploring Self-Regulation To Stave Off Crippling Government Legislation

by 5 months ago

Editor’s Note: Welcome to a daily column we run here at BroBible breaking down the day’s biggest stories in sports business with commentary from the sports money and sports fanatic perspectives. It comes to us via our friends at JohnWallStreet. You can sign up here for their daily email newsletter.

U.K. Sportsbooks Exploring Self-Regulation to Stave Off Crippling Government Legislation

The board of the Remote Gambling Association (European trade organization) will meet later today to discuss self-regulation, a pre-emptive attempt to stave off industry crippling Government legislation within the U.K. The proliferation of mobile/digital gambling has spurred an onslaught of sports betting advertisements during sporting events, with bookmakers aggressively competing for market share. Bans on pre-watershed (see: prior to 9p) advertising and in-play ads, and a hard limit on the number of gambling ads permitted within a single commercial break (1) are amongst the most solutions that will be explored. The meeting is not expected to produce a consensus on recommended changes to the industry’s voluntary advertising code.

Howie Long-Short: The implementation of (or change to) any bylaw(s) restricting Remote Gambling Association member advertising would have widespread impact on the industry. Their membership base includes some of Europe’s largest gaming companies including; Bet365, Ladbrokes (GMVHF), Paddy Power (PDYPY) and William Hill (WIMHY).

While the focus of the annual meeting (i.e. this was not called as an emergency summit) indicates that European bookmakers understand what’s at stake (see: Italian ban on all gambling advertising), with membership divided on corporate social responsibility it’s likely that only Government regulation (or broadcaster intervention) can curb the volume and frequency of sports betting ads. That’s because unanimous participation (35 member companies) is unlikely and no one is willing to operate at a competitive disadvantage (i.e. if one continues as is, they all will). Expect this exact scenario to playout in the U.S. as the availability of sports betting expands, there’s far too much money at stake and far too little corporate restraint.

If the gaming companies won’t self-govern, perhaps the media companies selling the spots will follow Sky’s (SKYAY) lead and do it for them. SKYAY announced that beginning with the ’19-’20 season it will limit gambling ads per commercial break (1 spot/per) and as of June 2020, the company will offer technology that enables viewers to avoid gambling advertising all together. While it’s been estimated that the company earns +/- $262 million in advertising money from licensed sportsbooks and some suspect a “self-imposed limitation will cost it tens of millions in lost revenue”, I think the loss will be negligible; SKYAY will find another advertiser to take the valuable slot (remember: this is English soccer, no shortage of demand) and increase the price of their now more limited gambling inventory.

Fan Marino: Howie referenced the U.S. gambling market, so it would seem like an opportune time to mention that New Jersey issued its October sports betting report. The state’s gamblers bet 41% ($260 million) more last month than they did in September, but only took in half the revenue ($11.7 million). Why? The public side came in “at a heavier than average clip” (on NFL games) and both MLB and World Series futures were paid out during the month. DraftKings (+ Betstars NJ) once again took in more revenue ($5 million+) than any other licensee in the state, as online/mobile platforms outperformed retail sportsbooks; +/- 2/3 ($175 million) of the state’s October handle originated from a computer or handheld device.

Interested in Sports? Sports Business? Sports Finance? Sign-up for our free daily newsletter

What is JohnWallStreet?

JohnWallStreet, located at the intersection of sports and finance, is a destination for the educated sports fan.

While we won’t be publishing “hot takes” on LeBron’s relative greatness to Jordan, we will be offering up the most relevant sports related business news, in easily digestible bites, with commentary from both the sports money and sports fanatic perspectives.

We’ll cover publicly traded professional teams & stadiums (MSG, RCI, BATRA, MANU), television networks (DIS, FOXA, CMCSA, CBS, TWX, MSGN), apparel & footwear companies (NKE, UAA, ADDYY, FL, LULU), equipment companies (GOLFELY, FIT), ticketing companies (EBAY, LYV) content and facilities providers (CHDN, DVD, ISCA,TRK, LMCA).  If it trades on Wall Street, and has a sports angle, it’s in our wheel house.

Howie Long-Short and Fan Marino will be providing their expert opinions on each story. They have slightly different areas of expertise. Fan Marino is a firm believer that the SEC is the premier football conference. Howie Long-Short knows it as the Securities & Exchange Commission. Fan Marino lives and dies with the college selection of 5 star, blue chip recruits. Howie Long-Short spends his days analyzing blue chip stocks. Howie Long-Short knows that Black Monday occurred on October 19th, 1987. Fan Marino swears it happens every January after Week 17. You get the point.

Interested in Sports? Sports Business? Sports Finance? Sign-up for our free daily newsletter


TAGSsports bettingsports finance reportsports gamblingU.K.William Hill