iGB Market Monitor: UK market likely to reach £4bn in 2016, Australia set for growth

Date: 
23 March 2016

iGaming Business is pleased to publish its first ever Market Monitor report covering the UK and Australia markets for the first quarter of 2016.

The report, written by long time iGB contributor and writer Scott Longley, has analysed the results of the major operators in both markets, taking into consideration the key concerns affecting them such as the introduction of Point of Consumption in the UK and the lack of regulated online casino and poker Down Under.

This Market Monitor is the first in a regular series that will delve into key markets across the world, further repots on Italy and Spain are on their way, by assessing regulators’ reports and listed companies’ financial statements and detailing the issues they have to deal with, how they address them and evaluating the overall value of the markets they work in.

iGB Market Monitor UK-Australia Q1 2016 key points:

  • The UK market was worth £3.7bn to £3.8bn as of the end of 2015,
  • Growth in the UK is still very much on the cards, with a top 3 made up of Paddy Power Betfair, William Hill and Bet365,
  • With the football European Championships sure to boost revenues, the iGB Market Monitor suggests that by the end of 2016 the market could worth circa £4bn in GGR,
  • There is little sign the smaller operators are being squeezed out by top operators’ marketing spend.

However, a note of caution must be sounded for the UK in the wake of William Hill’s profit warning this morning (Wednesday 23 March) which cited recent responsible gaming measures instituted at the behest of the Gambling Commission, suggesting stronger-than-expected headwinds being encountered by the sector.

Alongside possible margin deterioration in sports and the yet-to-assessed potential impact from the taxation treatment of player bonuses announced in the budget, it is likely that there are some dampening pressures on growth in the rest of this year.

Australia focus
The first in the iGaming Business Market Monitor series also looks at the Australian market and concludes that despite the mixed fortunes of the UK and Ireland-based operators, there are signs that the recent growth in the sports betting market is set to continue, even without further regulatory loosening of in-play betting.

The report suggests that Paddy Power Betfair’s Sportsbet operation is the big winner in the online market in Australia, though it still trails behind the various Tabcorp brands in terms of market share.

However, with revenues growing 43% and stakes up by 39% in 2015, it is clear the business is growing faster than the market overall. It is estimated the total market is worth circa A$2.25bn-A$2.3bn (c. £1.2bn).

Please click on the e-magazine link below to read the report: