Online gambling for a few and powerful
VANGELIS MANDRAVELIS - Daily
Following the example of France, the Greek government intends to promote the liberalization of online gambling.
Both the draft law, presented by the Ministry of Finance (YPOIK) last October, and the draft regulation on online gambling, presented last month by the regulatory authority (EEEP), show that the country is seeking market opening, but this should be done with a very small number of players. As happened in France a decade ago, the current Greek government is shaping a rather oligopolistic market, in which very few and strong companies will have a future.
This is approximately the case in the current market landscape. There are 24 companies that have a temporary license, but those that have voluntarily complied with the rules of the Ministry of Finance and the EEEP are counted on the fingers of one hand. Three of them last year controlled 89% of turnover and 91% of gross revenue. "I do not see more than two or three players in the market," admits an experienced gambler. The parameters that will determine the number of players will be mainly two: First, the one-time license price and, second, the type of assets that will be allowed to take place in the new context.
Regarding the one-time cost of entering the market, the government has undoubtedly set it very high. The cost of the 5-year type A license (pre-determined betting) has been set at € 4 million and € 1 million for type B licenses (other games).
The amounts are considered high at a time when in other countries, more populous than Greece, the cost of these licenses is in the order of tens of thousands of euros or a few hundred thousand euros. The average in the above countries is in the range of 70 to 100.000 euros per year, ie 350 to 500.000 euros in five years. The bar for entering the domestic market was therefore set very high by the Greek government.
A similar policy was implemented by France in 2010, when it opened the online market. At the time, the country's regulatory authority (ARJEL) had set the cost of each license at 8 million.
The same is expected to happen here. Due to the nature of the Internet, online gambling operators compete globally.
As a result, the profit margins are low, both for the casinos and for OPAP. It is worth mentioning that out of the 7 billion that Greek players bet on the Internet last year, their gross income (gross gaming revenue or GGR) did not exceed 400 million or 6% of the turnover.
Of these 140 million or 35% of the GGR will be received by the Greek state in the form of game tax (GGR Tax). On the other hand, online operators have lower operating costs as they do not utilize strong fixed assets.
However, the barriers of the Greek government do not stop here. Like the French government in the past, the Greek government wants to limit online games that are based entirely on luck. These are games based on random number generators (RNG) and are known as "slots". France banned them for addiction. According to psychologists, games based on completely random contingencies are more addictive than others, such as e.g. is sports betting.
The Greek government, however, has one more reason to seek a ban on these games via RNG. It wants to prevent any legal action by OPAP, which in 2011 paid 560 million euros to obtain the license of VLTs, whose operation is based on RNGs. Market participants say that in case the Greek government would like to offer such licenses, it should expect an appeal to the arbitration from OPAP. The latter, in fact, during the consultation that took place a few days ago, asked for further clarification on this issue.
However, unlike OPAP, all providers opposed this ban on these games. Intralot, PokerStars, the association of online gambling providers RGA, bet365 etc. They consider that this ban will leave the liberalization of the specific market incomplete, while at the same time it will push the market to illegal providers. Even Regency Casino Administrator said the ban was wrong. "We believe that blocking the existence of gambling with a random number generator (RNG) on the Internet, which is very popular, can create problems in the smooth regulation of the market, affecting competition and reducing revenue for the State, as many will choose illegal gambling ", it is mentioned in the relevant consultation.
The prohibition
Internet service providers estimate that the ban will cost the market 25% of its size. This loss corresponds to approximately € 1,7 billion in bets and € 100 million in gross revenue (GGR). Also, as it is underlined, the Greek State will lose annual taxes of the order of 35 million euros.
However, there are many who believe that it will be difficult for the government to "comply" with a market that has learned to operate RNG-based games for years. This will be a gamble for many, including OPAP and its competitors.
Who is interested in licenses
The number of people interested in online gambling licenses will depend on the final decisions of the government and especially on whether gambling based on completely random events (RNG) will be allowed.
What is certain is that both OPAP and its 70% GML subsidiary, which operates under the Stoiximan brand, will claim at least one betting license. It is not excluded that the second of the two may also claim the type B license that includes the "other games" related to live casino gambling. Greek casino companies, which theoretically have the infrastructure to offer the games, may also be interested in these licenses.
The third license is expected to be claimed by the Cypriot interests B2B Gaming Services Malta, which is the second most important provider in our country.
Beyond that, participation remains fluid. Big names abroad such as GVC Holdings, The Stars Group etc. seem to balance the situation, but keep the door open for a possible entry into the market.
The final decisions, however, will be made based on the final conditions that will make the market liberalization in our country. It is reminded that GVC Holdings operates under various brands such as Bwin, Sportingbet etc. The Stars Group controls the PokerStars, Betstars and other brands.
Most of the above services currently operate under the temporary licensing regime, through their subsidiaries or through their contracts with third parties holding the temporary licenses and are normally based in Malta. Very few took part in the consultation (The Stars Group, bet365) although the majority of stakeholders were theoretically represented by the Remote Gambling Association (RGA).
VANGELIS MANDRAVELIS - Daily
Following the example of France, the Greek government intends to promote the liberalization of online gambling.
Both the draft law, presented by the Ministry of Finance (YPOIK) last October, and the draft regulation on online gambling, presented last month by the regulatory authority (EEEP), show that the country is seeking market opening, but this should be done with a very small number of players. As happened in France a decade ago, the current Greek government is shaping a rather oligopolistic market, in which very few and strong companies will have a future.
This is approximately the case in the current market landscape. There are 24 companies that have a temporary license, but those that have voluntarily complied with the rules of the Ministry of Finance and the EEEP are counted on the fingers of one hand. Three of them last year controlled 89% of turnover and 91% of gross revenue. "I do not see more than two or three players in the market," admits an experienced gambler. The parameters that will determine the number of players will be mainly two: First, the one-time license price and, second, the type of assets that will be allowed to take place in the new context.
Regarding the one-time cost of entering the market, the government has undoubtedly set it very high. The cost of the 5-year type A license (pre-determined betting) has been set at € 4 million and € 1 million for type B licenses (other games).
The amounts are considered high at a time when in other countries, more populous than Greece, the cost of these licenses is in the order of tens of thousands of euros or a few hundred thousand euros. The average in the above countries is in the range of 70 to 100.000 euros per year, ie 350 to 500.000 euros in five years. The bar for entering the domestic market was therefore set very high by the Greek government.
A similar policy was implemented by France in 2010, when it opened the online market. At the time, the country's regulatory authority (ARJEL) had set the cost of each license at 8 million.
The same is expected to happen here. Due to the nature of the Internet, online gambling operators compete globally.
As a result, the profit margins are low, both for the casinos and for OPAP. It is worth mentioning that out of the 7 billion that Greek players bet on the Internet last year, their gross income (gross gaming revenue or GGR) did not exceed 400 million or 6% of the turnover.
Of these 140 million or 35% of the GGR will be received by the Greek state in the form of game tax (GGR Tax). On the other hand, online operators have lower operating costs as they do not utilize strong fixed assets.
However, the barriers of the Greek government do not stop here. Like the French government in the past, the Greek government wants to limit online games that are based entirely on luck. These are games based on random number generators (RNG) and are known as "slots". France banned them for addiction. According to psychologists, games based on completely random contingencies are more addictive than others, such as e.g. is sports betting.
The Greek government, however, has one more reason to seek a ban on these games via RNG. It wants to prevent any legal action by OPAP, which in 2011 paid 560 million euros to obtain the license of VLTs, whose operation is based on RNGs. Market participants say that in case the Greek government would like to offer such licenses, it should expect an appeal to the arbitration from OPAP. The latter, in fact, during the consultation that took place a few days ago, asked for further clarification on this issue.
However, unlike OPAP, all providers opposed this ban on these games. Intralot, PokerStars, the association of online gambling providers RGA, bet365 etc. They consider that this ban will leave the liberalization of the specific market incomplete, while at the same time it will push the market to illegal providers. Even Regency Casino Administrator said the ban was wrong. "We believe that blocking the existence of gambling with a random number generator (RNG) on the Internet, which is very popular, can create problems in the smooth regulation of the market, affecting competition and reducing revenue for the State, as many will choose illegal gambling ", it is mentioned in the relevant consultation.
The prohibition
Internet service providers estimate that the ban will cost the market 25% of its size. This loss corresponds to approximately € 1,7 billion in bets and € 100 million in gross revenue (GGR). Also, as it is underlined, the Greek State will lose annual taxes of the order of 35 million euros.
However, there are many who believe that it will be difficult for the government to "comply" with a market that has learned to operate RNG-based games for years. This will be a gamble for many, including OPAP and its competitors.
Who is interested in licenses
The number of people interested in online gambling licenses will depend on the final decisions of the government and especially on whether gambling based on completely random events (RNG) will be allowed.
What is certain is that both OPAP and its 70% GML subsidiary, which operates under the Stoiximan brand, will claim at least one betting license. It is not excluded that the second of the two may also claim the type B license that includes the "other games" related to live casino gambling. Greek casino companies, which theoretically have the infrastructure to offer the games, may also be interested in these licenses.
The third license is expected to be claimed by the Cypriot interests B2B Gaming Services Malta, which is the second most important provider in our country.
Beyond that, participation remains fluid. Big names abroad such as GVC Holdings, The Stars Group etc. seem to balance the situation, but keep the door open for a possible entry into the market.
The final decisions, however, will be made based on the final conditions that will make the market liberalization in our country. It is reminded that GVC Holdings operates under various brands such as Bwin, Sportingbet etc. The Stars Group controls the PokerStars, Betstars and other brands.
Most of the above services currently operate under the temporary licensing regime, through their subsidiaries or through their contracts with third parties holding the temporary licenses and are normally based in Malta. Very few took part in the consultation (The Stars Group, bet365) although the majority of stakeholders were theoretically represented by the Remote Gambling Association (RGA).