The igaming sector generated €25bn gross win in 2012 and is set for €26.7bn in 2013, Europe leads the way at the moment

27 September 2013

The interactive betting and gaming sector is set to generate a global gross win of €26.7bn in 2013, an increase of 8,3% on 2012, which compares with 5.8% growth recorded by the land-based gambling sector during the same period, industry figures published by iGaming Business’s new and exclusive data partner H2 Gambling Capital reveal.

The igaming sector is set to account for 8.1% of all global gross gaming revenues generated by the gambling sector in 2013, a figure that is set to reach 11.3% by 2018, H2’s figures showed. That percentage is currently generated mainly by European markets, where interactive gambling has a penetration rate of 13.6% compared with just 4.1% for North America, although that differential between the two blocs is expected to narrow over the next few years as US regulation in particular could be set to deliver growth and new revenues for the sector.

The industry-wide figures also coincide with H2 data showing that Americans continued to spend US$2.6bn on offshore gaming sites in 2012, a figure picked up by the American Gaming Association at this week’s G2E event in Las Vegas to highlight the need for effective regulation of the iGaming sector stateside.

The release of the feature film ‘Runner, Runner’, a fictional account of how a bright maths student falls into the world of online poker complete with tails of super user accounts which will be familiar to many in the sector, coincides with the release of the H2 figures and the call from the AGA.

Geoff Freeman, president and chief executive of the AGA, commented: ‘'Runner, Runner' is a fictional account of a lawless online poker world ruled by shady and unethical characters that sadly is not far from reality for millions of Americans who simply want to enjoy one of our favorite pastimes in a safe online environment. "Americans account for nearly 10% of the global online gaming marketplace at a time when the business is illegal in all but three American states. It is past time for policymakers to put necessary safeguards in place."

Returning to the industry figures, H2 said it expected the industry to grow at a compound average growth rate of 9.7% to reach €42.3bn by 2018. Europe, the UK especially, and its regulated or regulating markets are expected to accounted for 48% of the sector’s gross win in the current year, followed  by Asia a 27% and North America in third at 16%.

As long there is no prohibitory bolt ons to a Federal bill in the current session North America is expected to “regain its position as the largest interactive region with an expected wave of regulation crossing the region” H2 said.

North America will be a very different market to Europe with land based licensees being at the forefront of development, with the product verticals limited to gaming. In contrast globally sports betting continues to be the most important product for operators, as it is expected to account for 46% of gross win in 2013, with in play and mobile betting driving most of that growth.

Online casinos are expected to generate 21% of the sector’s gross win, live dealer acting as the spur there, while poker continues to decline as it is expected to produce just 13% of the sector’s gross win in 2013. Although much will be expected of a regulated US market once it is finally up and running.

Finally 2013 will see 39.5% of interactive activity taking place with a regulated onshore operator in a dot country market and within that figure includes the element of gross win from unregulated markets where there is a licensed monopoly or similar. With more onshore regulation H2 believe that this rate could increase to 55% by 2018. At present the rate varies from 53% in Oceania where onshore sports betting is very significant in Oceania and 44% in Asia where the horserace betting monopolies have very large interactive operations to just 7.1% in the relatively untapped Latin American region.

Mobile gaming and betting figures were not included in this latest release as H2 will compile them in its forthcoming Mobile Gambling Report, with the headline data from this report forming the next iGB H2 piece. Going forward the data summarised is this article will be updated each month and published as the ‘iGaming Dashboard” exclusively on iGB’s website.

To gain access to all of H2’s sector datasets or gain permission to reproduce any their data points  email data@h2gc.com