How will the UK Gambling Act Review affect esports betting?
Published: Jan 19, 2021
The UK Government is currently reviewing their 2005 Gambling Act as the gambling and betting markets have grown and expanded beyond the bounds of what has been previously laid out in the 2005 act.
Technology and our access to betting services have increased tenfold in the 15 years since the act was put in place. One of the biggest changes has been the increase in esports betting. That’s not to say that esports was not around in 2005, but it had not reached the heights of interest that it maintains today.
The Department for Digital, Culture, Media, and Sport (DCMS) is the government department that is carrying out the review. They have set out several key points of discussion, many of which will apply to the esports betting scene.
Online Gambling
A major focus of the review is online gambling. Most esports betting, as we well know, is done online. The DCMS wants to examine the existing protections for online customers as well as how the current revenue generated online is distributed between higher and lower-spending customers.
This is important for anyone betting on esports. For many people, esports betting may be their first foray into the world of online betting and it would be a major boon to the customer as well as the industry if there was a greater focus on consumer protections.
In the same consumer protection vein, the DCMS is also looking at imposing additional controls on the industry. There could be limits on stakes, speed, and prizes potentially on a universal or account by account basis. Again, this is very important for protecting new customers. This may be seen as a hindrance to the betting operators, as they won’t be able to make their prizes or odds as attractive as possible, but it could go a long way to prevent the spread of problem gambling.
Marketing and sponsorships
One of the questions posed in the review is,
“What is the positive or negative impact of gambling sponsorship arrangements across sports, esports, and other areas?”
Of course, the major focus of this question is on large scale gambling operators sponsoring traditional football teams but, esports organisations and esports tournaments have also taken on betting or gambling sponsors.
There are many teams and individuals that are sponsored by betting companies. Ninjas in Pyjamas, for example, are just one of a number of teams that are sponsored by online betting site Betway. This is not a major issue for UK specific esports teams as not many local operators have invested in advertising with them. However, it may be an issue for events held in the UK. Teams may have to change their kit or tournaments may have to shift their branding to accommodate potential changes to the Gambling Act.
Ultimately this is a good faith attempt to reduce the level of esports betting marketing that is shown to groups that they would consider vulnerable. The downside of this change could be a lack of funding for the actual teams. If certain companies are prevented from becoming public sponsors or advertising with the teams, they could pull out completely.
Age limits and underage gambling
This is not the biggest issue for the esports betting scene. The major, legitimate operators in the sector are already doing a fantastic job combating underage gambling. There is already a strong safety net for these companies to deter and catch anyone trying to gamble under the age of 18.
The issue for esports betting in the UK is legitimate companies being tarred with the same brush as black or grey market operators from other regions that have a far laxer approach to underage gambling.
The focus of this section of the review seems to be on land-based gambling and category D gambling machines. They are also looking at upping protections to the age of 25.
New developments
The UK’s Betting and Gaming Council (BGC) launched a new campaign that warned that the Gambling Review could be a major boost for the unregulated sector, which it says already sees stakes upwards of £1.4 billion. They claim that the updated Gambling Act could hinder their current ability to attract customers and push more of them towards unregulated gambling sites.
This claim was quickly refuted by the UK Gambling Commission (UKGC) CEO Neil McArthur. In a letter to the All-Party Parliamentary Group (APPG) on Gambling Related Harm, he responded to the claims from the BGC.
“Whilst we are concerned about the issues described above and take action to protect consumers, we need to point out that our data indicates that scale of illegal market is stable. We know that licensed operators and their trade bodies are concerned about the impact of the illegal market, but our own evidence suggests that the impact may be being exaggerated. In any event, we are not convinced by the argument that suggests that raising standards in the licensed market will prompt consumers to gamble with illegal operators.”
This seems like a desperate attempt by the gambling operators to push back against further restrictions on their operations. While we here at EsportsBets are all for improving the output and quality of betting sites, it is hard to argue that fewer restrictions are a good thing. It is important that new and existing users feel comfortable and safe when they are betting online.
The UK government looks to be making the right decision to expand protections beyond what has been put in place by the 2005 Gambling Act. It is important for gambling operators, especially esports betting operators to realise that they should not focus on immediate profit but instead make sure they can maintain themselves by creating a safe and user-friendly space.
