GPWA Times Magazine - Issue 13 - June 2010

by Ari Last, Right2bet T here’s no doubt that the EU’s current status quo with regards to online gamblingneedstochange. Theprotectionistbehavior of the governments of several member states flies in the face of an EU built upon the bedrock of fair competitionand free trade. People are no longer fooled by the false claims espoused by those seeking to protect state gambling monopolies, and excuses for banning the superior competition at the expense of the consumer are runningout. There are currently 17 cases involving member states before the European Court of Justice, and the current situation of inconsistent, unworkable and conflicting rules and regulations regarding the industry simply cannot be sustained. The tide toward regulation is creeping in,with severalmember states seemingly realizing that ignoring the fundamental EU principles of freedom of trade and services is not a viable option in the comingyears. The relative success of the Italian regulation model is encouraging others to follow suit, and while in principle right2betapplauds thisshift,weareat the sametimeextremelycautiousastohowfar this regulationwill go, andweworry that rather than strengthening competition and the power of consumer choice, it will in fact achieve theopposite. UnderpressurefromtheEUCommission, member states have been attempting, and will continue to attempt, to portray themselvesasworking to liberalize,when in reality theydonothingof the sort. The recently approved reform in France isanexampleof this,whereby theFrench nowclaimtohaveopeneduptheirmarket, when they have only strengthened the positionof the statemonopoly,Française des jeux (FDJ). They have done this by stating that the competition is welcome, while at the same time laying down rules regarding taxation, product offering and company location thatmake theprospectof setting up inFrance commerciallyunattractive. That is unless you are already a French supplier, like the FDJ, who will be able to increase advertising and offer more services toa customerbase that in reality won’t be faced with much other choice, particularly in the short-term. If the Commission fails to challenge so- called gambling reform such as that in France, theywill inessencebepaving the way for other member states to follow suit, and this isworrying forbothprivate operators and consumers alike. Should private operators deem it too costly and risky to enter heavily fortified marketswewouldexpect them toembark onaconsolidationstrategy, inanattempt to become players in certain regions throughalreadyestablished, local service providers.Whilethiswouldbebetterthan there being just one provider available, the benefits in terms of competition would fallwell short ofwhat a trulyopen market couldoffer the consumer. Right2bet has been running a betting challenge for the past few months in which we’ve compared the odds and potential winnings offered by state monopolies andprivateoperators. Theresultsare trulystartling.Consumers forced to bet with the state provider in Sweden and Germany make 35 percent less in winnings than an EU neighbor who can bet with an array of private providers. In France, the odds offered by FDJ have resulted in 30 percent less winnings. This lack of value is scandalous, and should member states be allowed to continuecurbing thecompetition, it isan offense that will be perpetrated over and over again. It’s not only inferior odds that a lack of competitionbrings; it’sa lowerstandard all round in terms of usability, products and customer service. Crucially, the risk to consumers is also increased when players in search of the best value and service are ushered into the realms of black-market betting by local authorities attempting to push them RIGHT2BET’SCAUTIOUS OPTIMISMATTHEPROSPECT OFMUCH-NEEDEDCHANGE “It’snotonly inferiorodds that a lackof competition brings; it’sa lower standardall round in termsofusability, productsand customer service.” Gazing into the Crystal Ball