Is The Gambling Industry Saturated?

business life cycle map conceptThe gambling industry in the United Kingdom seems to show no signs of slowing its growth. Online betting sites and casinos seemingly spring up every other day, but also manage to forge themselves a path in a hugely popular market. Offers and promotions get people interested, then they stick around to see what else a site has to offer. The best new sites will have a niche, but not all of them need it considering the fact that they all tend to offer the same sort of coverage as each other, including what you can bet on and how you can do it.

Of course, the risk of such sites constantly springing up is that we run a risk of the market becoming saturated. That being said, we’ve been hearing such things for years and yet the market continues to grow. Will there come a point at which the world of online gambling eats itself? As the number of smaller sites grows and grows, mergers and acquisitions mean that there are fewer at the top. The more sites that exist, the more that there is a need to appeal to punters, which can only be a good thing for those of us that enjoy placing a bet or two.

The State Of The Market

financial charts laid on tableThere are numerous different ways that you can gamble legally in the UK, should you be so inclined. The United Kingdom Gambling Commission licences companies for the exact purposes of taking bets, ensuring that they do so in a manner that is fair and transparent for customers. Whether you enjoy using an online casino, playing the lottery or placing a bet on a sporting event, the option is there for you to do so in a safe and legal manner.

In other words, the gambling industry is in fine health with £14.12 billion GGY between 2019-20. In 2019, more than 85,000 people worked in the industry, most of whom were employed in the betting sector. Around 26.9% of people in the UK gamble on a weekly basis, with the Gross Gambling Yield for online betting in 2020 sitting at £3.1 billion. There were 30.6 million active online accounts in Great Britain, showing that there is a large customer base for the companies that want to operate online betting.

Between October 2017 and September 2018, Gambling Commission figures suggest that £14.5 billion was spent on betting. Of that, online gambling accounting for around 38.8% of the total, which was £5.6 billion. That includes everything from online casinos to sportsbook betting via bingo and lotteries. It is thought that the UK’s liberal approach to gambling is key to the success of the industry, with the Gross Gambling Yield for each online sector between October 2018 and September 2019 being as follows:

  • Online Casinos: £3.2 billion
  • Online Betting: £2.1 billion
  • Online bingo: £198 million

How Many Gambling Sites Operate For UK Markets?

online bookmakers comparisonIn order to get a sense of whether the industry is over-saturated, it helps to have a look at how many sites operate in the United Kingdom. In many ways, this question is akin to the one asking how long a piece of string is; the number will likely have changed between the point of writing this piece and uploading it. Europe dominates the online gambling market, taking a 54% share in 2018. 15% of that total came from the the UK, so it is fair to say that the country’s contribution to the global shape of the betting industry is a substantial one.

With about 44% of the UK population engaging in gambling on a monthly basis, there are plenty of customers out there looking to place a bet. According to the UKGC, there were 3,368 different gambling activity licences issued between April 2020 and March 2021, with 2,439 operates in the market. The figure actually resented a 5.4% drop in operators, showing the extent to which there seems to be a never-ending number of people and companies willing to engage in online betting in the United Kingdom.

Is The Market Saturated?

financial statistics concept

This bring us neatly to the premise of the article, which is is there actually a saturation of the gambling market in the United Kingdom? According to the Cambridge Dictionary, saturation is defined as follows; “the act or result of filling a thing or place completely so that no more can be added.” That doesn’t sound true of the world of UK gambling. The trend generally seems to be an upwards one, with the recent global health crisis seeing more people turn to online gambling than ever before. If those people stick around, there’s no reason to think that the marketplace isn’t a burgeoning one.

One thing that does help with the lack of market saturation is the Gambling Commission looking to crackdown on certain aspects of the online gambling industry. Companies are needing to comply with more and more regulation, which has seen numerous different sites shutdown on the back of an inability to comply with what the UKGC is asking of them. This means that many new sites that spring up are actually just replacing old ones, rather than adding to an already existing pile. It isn’t always the case of course, but it stops it from becoming completely untenable.

It might well depend on what people mean by ‘saturated’. It might be being used in a manner akin to how right-wing commentators have introduced the word ‘cancelled’, which they use when anything they don’t like happens to someone who has been offensive or committed a crime. That is to say, it is being used incorrectly in many instances. If the dictionary definition is one of a market to which no more can be added, then saturated definitely isn’t the right word for the world of online gambling in the United Kingdom, given that new sites open up all the time.

Given the fact that the UK gambling market is predicted to have a growth of around 5.25% by 2026, it doesn’t appear as if bettors are going anywhere. The phrase that might be more applicable is ‘quantity over quality’. Ultimately, the job of the UKGC is to issue licences to companies that meet the necessary requirements and then ensure that those companies comply with the licensing arrangements. It is not the Gambling Commission’s business to ensure that new companies offer a quality product, just a fair and legal one.

The UKGC is moving to do something about the practice of white label betting sites, in which a company can launch a site relatively easily that is as good as a copy and paste job of a template site with the company’s own brand on it. This move would likely reduce the number of active sites operating online as well as increase the quality. After all, if you’re using a site that is similar in many ways to any other site you could login to, what added value is it bringing? Quantity isn’t always a good thing, it is worth remembering.

The Big Companies Still Rule The Roost

stats group flutter mergerThe reality is that there are still a few big companies that rule the roost when it comes to gambling in the United Kingdom. Flutter Entertainment is responsible for Paddy Power, Betfair, FanDuel, Full Tilt Poker and Sky Bet, as well as many other gambling sites, for example. Meanwhile Entain PLC is the company behind Ladbrokes, Coral, PartyPoker and Sportingbet, with Kindred Group running Unibet, 32Red and more. Of the big players, it is only Bet365 that is its own entity,  but even then it tends to buy up smaller operators.

Whilst the bosses behind all of those companies would doubtless tell you that they’d love it if no other betting businesses opened online because it would give them a larger market share, the reality is that they are never going to be threatened by a newly-launched site. Instead, the moment that the site becomes popular, the big boys will in and try to buy it out, taking its customer database with them. They don’t mind the increasing saturation of the market for the simple reason that it proves that the world of gambling is an ever-growing one.

The development and growth of online betting in the United States of America is also a good thing for the most powerful companies. All of them have positioned themselves to take advantage of it, allowing them to even further supplement their income from UK bettors. It means that they are not going anywhere, allowing them to continue operating in the same way that they always have been. In one sense, that is a good thing for UK punters as it means that smaller operators will keep opening up and we’ll have plenty of choice. On the other, choice in itself isn’t necessarily good if it means there remains a lack of quality.

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