Android focus for Betfair
Betfair has launched a native Android App that features a completely revamped user experience cus- tomised to the Android operating system. Betfair for Android v2.0 builds on the recent intuitive inter- faces launched on Betfair’s iPhone and iPad Apps and includes a highly responsive look and feel, a superior visual home screen, Betfair’s ‘Cash Out’ tool, price graphs and market view enhancements.
POC tax could cost industry over £250m
Scott Longley, managing editor at GamblingData, discusses the findings in his firm’s recent UK Online Gambling Report and the potential impact of the proposed new POC tax. TAXES
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The next couple of years will be a vital time for the UK’s online
gambling industry.
Against a backdrop of a Europe which is seeing the piecemeal introduction of regulatory regimes, the UK is set once more to attempt a re-fashioning of its home market via the introduction of a point of consumption (POC) tax.
What this will eventually mean for the industry is still unclear, but a new report we have produced by GamblingData suggests that the UK government - on current reck- onings - could hope to gain over £242m in tax revenues from the proposed 15 per cent POC rate. “According our UK Online Gam- bling Report, the UK market was worth at least £1.71bn in net gaming revenues in 2011. We cal- culate that if 100 per cent of the market paid the tax at the pro- posed rate of 15 per cent the gov- ernment could generate £257m. As many have warned, it is likely that some element of the current UK market will opt to remain outside of the new regime. But
GamblingData estimates that the actual rate of avoidance will be somewhat lower than many of the doomsayers would suggest. In fact, we think that only between 5.25-7.25 per cent of the total UK online gambling market would end up avoiding the tax, meaning that on 2011 estimates the govern- ment would generate between £239m-£242m.
Breaking down the results from the report, we found that in terms of UK-derived net gaming revenue, William Hill is the largest operator overall at £252.9m, giving it a market share of 15 per cent. The next biggest company in UK NGR terms is Betfair with a total of £183.7m or 11 per cent of the market.
But one of the biggest surprises
is the degree to which recent growth at Bet365 has propelled the high-profile Stoke-based company into the upper echelons of UK-facing operators. Accord- ing to data supplied to the UK Treasury consultancy process on the introduction of the POC tax and seen by GamblingData, Bet365
achieved total UK-derived net gaming revenues of £162m in the year to March 2012. Of that, £122m came from sports betting, making Bet365 the largest fixed-odds sportsbook operator and placing the company second overall in sports betting behind betting exchange Betfair. GamblingData estimates UK- listed Betfair achieved UK-derived revenues of £142.2m according to its results statement from June. Ireland-based Paddy Power is fourth on the list of total UK- derived revenues with £135.2m or 9 per cent of the total market. Looking at the market on a
THE POC TAX COULD NET GEORGE OSBORNE £257M A YEAR, IF HE’S STILL CHANCELLOR BY THE TIME IT’S INTRODUCED
sector-by-sector basis, our report suggests that sports betting is the largest online sub-sector with UK- derived NGR of £650m, represent- ing 38 per cent of the total. Not all that far behind, however, was online casino which achieved UK- derived NGR of £547m or 32 per cent of the total.
Online casino is the sub-sector that GamblingData predicts will see the biggest slice of tax avoid- ance at between 10-12 per cent,
more than double the predicted avoidance rate in sports betting of between 4-6 per cent.
The report suggests that bingo and poker are worth almost the same amount in UK-derived NGR at £259m and £256m respectively or 15 per cent of the total market each. William Hill aside, the report shows the extent to which online- only operators such as Betfair (2nd in the overall list), Bet365, (3rd in the list), and PokerStars (6th) have eclipsed the established names in UK gaming such as Ladbrokes (5th), Rank (11th) and Gala Coral (12th). This situation might change
again. Certainly, with that Decem- ber 2014 date approaching, it is likely the market will yet see more transformations, including the rise of new products and new market entrants.
But as the report also makes
clear, there is at least one certainty should the POC plans come to fruition. The UK government will be markedly better off from the introduction of the tax - and the operators will be the ones count- ing the cost.”
ww@bgt.ag BettingBusinessInteractive • AUGUST 2012 11
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