What does the future hold for high street bookmakers?
September 12, 2018
The size of the online gambling market continues to rise each year with Statista predicting it to reach almost £46 billion by 2020. You would expect the rise in popularity of punters placing bets to be a good thing for workers in the industry but there is a sector which is heading in the opposite direction – High Street Bookmakers.
High street betting shops have been in the news a lot recently, voicing their concerns of financial losses due to the decline in revenue, mainly due to government clampdowns on fixed-odds betting terminals.
Earlier this year, the UK government proposed a maximum bet regulation on fixed odds betting terminals (FOBT) at UK bookmakers. Previously, punters in retail betting shops could stake up to £100 at a time but this will be slashed by 98% to just £2. FOBT make up a large percentage of revenue generated by high street bookmakers and the new regulation has hit them hard. It was reported last month that popular UK bookmaker William Hill reported a 7% decline in share prices and losses of £820m and blamed the hit on the governments FOBT restrictions, proving just how much of a money-spinning the machines are for gambling firms.
The reason behind the UK governments decision is to reduce gambling-related harm. Fixed-odds betting terminals are commonly referred to as the ‘crack cocaine of gambling’ and have been gaining attention due to gamblers having the potential to lose thousands of pounds within a matter of minutes.
However, although the UK government is making a step forward to helping problem gamblers, they may also be putting thousands of jobs at risk if the high street betting shops are unable to find a way to recoup their losses. Despite the gambling industry being bigger than ever, a lot of the trade has moved online and with the cost of business rates along with the fees of streaming sports in shops, betting retailers are being hit hard before they have taken any bets.
Upon the announcement of the proposed regulations, William Hill predicted costs of up to £60,000 per shop closure and stated that they could be forced to close 900 shops, putting 4,500 jobs at risk.
William Hill currently offer new customers who sign up online a £30 fre bet when placing their first bet of £10 or more. You can read more about the William Hill free bet offer here. Over 18’s only. T&C’s apply.
The new regulations are not set to be imposed until 2020 after they were delayed by the Treasury, stating that bookmakers needed time to make changes to the machines. The Treasury expects to make up any tax shortfall by increasing duty on online gambling from April 2019.
Could there be more clampdowns in the pipeline?
A large amount of top-tier football clubs are sponsored by betting brands and recently a number of club including Wolves, Aston Villa and Celtic were criticised after links to betting sites were found on sections of their websites aimed at juniors.
With the popularity of gambling increasing at such a high rate, it wouldn’t be surprising to see more regulations imposed, most likely around top-tier football where juniors are currently exposed to multiple advertisements during matches at stadiums and on television.