Australian iSports Betting Soars As Gambling Market Shrinks

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Thursday, November 12th, 2015 | Written by Shane Larson

Gambling is a costly industry for Australians, and not just for those people who are actively involved in gambling. Australian taxpayers pay $4.7 billion each year to provide financial counseling, income support and other services to people who suffer from gambling addiction within the country. Despite the high cost, studies have shown that fewer people in Australia are gambling than ever before. Still, even as fewer people are gambling overall, incidents of sports betting has increased by more than 200 percent over the last 20 years.

It’s really no surprise that sports betting is booming in Australia when you consider how well the industry is marketed. Online sports betting is advertised everywhere, with its higher stakes leading to much higher participation rates than other forms of iGaming. However, the growing number of people who are now wagering on sports is starting to concern some lawmakers.

Government Reevaluating Gambling Act

In September, the Australian government issued a statement that the Interactive Gambling Act of 2001 was going to be reevaluated in regards to illegal online betting. There is also talk that legislators, including South Australian Senator Nick Xenophon, are planning to introduce legislation to restrict the sports betting industry. The increased scrutiny on iSports betting is due primarily to reports from financial counselors across the country who are seeing more people entering financial hardship due to losses related to sports betting.

Across Australia, there are people calling for a complete ban of sports betting. On the other side of the issue is, of course, the providers of iSports betting sites. The interests of these operators are represented by the Australian Wagering Council, which is made up of the William Hill Group, Unibet, Bet365, Sportsbet and Betfair. The council has fired back at opponents, stating that there is no evidence that legal online sports betting has actually caused an increase in gambling addiction or hardships due to addiction. The council has stated that only 2.3 percent of what’s spent on gambling goes to iSports betting.

iSports Betting Booming

Despite what the Australian Wagering Council has stated, some researchers say that such evidence does exist. These people say that the percentage of people who use gaming machines has shrunk from 40 to 20 percent, while a larger percentage of people has begun to take up sports betting. The researchers state that the initial number of sports bettors was so low that despite the rapid growth in the industry, the overall percentage is still low. In other words, the growth is concerning, even if there is not a huge portion of the population currently participating.

Not everyone who is favor of regulation is calling for a complete ban on sports betting. Some groups and individuals prefer a more measured approach, such as placing restrictions on the way that sports betting sites are allowed to market to potential bettors and registered uses. There are also individuals calling for protections to be put in place to keep children and teenagers from being exposed to sports betting.

Dirty Tricks Used By iSports Companies

Some of the underhand tactics used by online sports betting companies to promote their products are coming under increased scrutiny by authorities. Many of these “dirty tricks” have been outlined in a study conducted by the Financial Counselling Australia (FCA), including such practices as delaying winning payouts so as to encourage further gambling; offering credit to indebted gamblers; and different companies exchanging customers account data.

While in the past the Australian government has bowed to pressure from gambling companies to curtail their promotional tactics, there are signs that a new drive to crackdown on internet betting advertisements is in the offing. This month, for instance, New South Wales Deputy Premier Troy Grant announced that live odds advertisements on TV and radio during games would be prohibited by March 2016, and as he explains:

“There is no doubt the sports betting market is becoming increasingly competitive as operators aggressively chase market share through promotions, so it’s important that regulation moves with the industry.”

Looking Ahead

New South Wales is set to become the first Australian state to prohibit live-betting ads, as well as limit the scope of alluring promotions offered by operators, including vouchers and extending lines of credit. However, other states are sure to follow in the future, and while only time will tell what will come of the desire to regulate iSports betting Down Under, most industry experts feel some major changes are in store for the industry.