Swedish Gambling Monopoly Now Seeking Online Casino License

Home » Poker News » Swedish Gambling Monopoly Now Seeking Online Casino License

Thursday, February 5th, 2015 | Written by Adam Brown

Concerned that another company may seek to claim a part of its online gambling market, Swedish state-run monopoly Svenska Spel has announced it would now be applying for an online casino license to complement its other games, which include sports betting, poker, bingo, and lotteries. The decision comes despite online casino games accounting for just 7% of the country’s total gambling market, with the only options available to gamblers being those sites prepared to dispute Svenska Spel’s current stranglehold on Sweden’s gambling market.

Svenska Spel’s Q2 Revenue Fall 6%

Influencing Svenska Spel’s decision to add casino games to its product verticals was the company’s Q2 results, which contracted by 6% to SEK 2.2b ($316 million) in 2014, whilst earnings were also down by 6.5% to SEK 1.1b ($161.5 million). Accounting for the bulk of Svenska Spel’s gambling revenues last year was retail betting (54%), while in second spot was online and mobile wagering (17%), followed by restaurant gaming (15%), gambling venues Casino Cosmopol (12%) and bingo halls (2%).

Putting Social Protection Above Profit

Svenska Spel CEO Lennart Käll has tried to justify the company’s decision to branch out into casino games by claiming that 20% of Swedish problem gamblers in the country can be found playing on sites other than Svenska Spel. Käll has suggested this situation could be mitigated by steering these gamblers towards “an operator where social protection interests are put over profit.”

Svenska Spel’s statistics are based upon a survey of gambling habits in Sweden undertaken by the country’s regulator Lotteriinspektionen. The study also showed that 59% of gamblers shunned offshore sites in favor of the state-owned gambling site, despite Svenska Spel not marketing itself with the generous promotions and bonuses offered by unregulated operators.

Claims Disputed By Critics

Despite Svenska Spel’s stated priority of protecting the vulnerable in order to guard against the dangers of problem gambling, the company’s claims have attracted derision from detractors, who point to the fact its marketing budget has doubled since 2006, and that 41% of the country’s online gamblers still continue to play elsewhere.

Such figures contradict Sweden’s justification for monopolizing its gambling market, a situation opposed by the European Union which recently launched proceedings against Sweden for violating European legislation on the free movement of services. Furthermore, a separate internet gambling study revealed that 33% of Swedes gambling at unregulated sites believed those sites actually held licenses issued by the Swedish government, while 80% of respondents said they wouldn’t know where to turn if they thought they had developed a gambling habit.

Only 1% Gamblers Play At PokerStars

Another surprise reveal by the Lotteriinspektionen survey was that PokerStars is currently the seventh most popular site to play on in Sweden, attracting just 1% of the respondents surveyed, rising to 4% for players between the ages of 18 and 29. Unibet accounted for a further 4%, and Bet 365 around 2%, with Svenska Spel way out on top with a 59% share of the market. However, as Sean Gibson from Cardchat.com, point out:

“What’s important to note is that the survey is not exclusive to poker, and also includes casino games and the lottery. Only 4 percent of the surveyed players had participated in online poker, which is a decrease of 5 percent from the figures seen in the 2013 survey. So as small as PokerStars’ one percent sounds, it has a nearly 25 percent market share of Sweden’s online poker market.”

PokerStars Poses A Possible Threat

Therefore, PokerStars still represents a potential threat to Sweden’s gambling market, not just in terms of poker, but also casino games as the site’s owner Amaya Gaming recently introduced a number of such games, including blackjack, roulette, and slots, alongside its regular poker activities. As of yet, PokerStars casino games are not available to Swedish players although the site does still have a foot in the door that could payoff handsomely if they are ever eventually introduced.

PokerStars decision to branch into casino games has caused both excitement and controversy in equal measure, and while sponsored pro Victoria Coren Mitchell felt compelled to leave PokerStars recently after more than 8 years of service, the site’s chief sponsored pro Daniel Negreanu has subsequently been promoting his view that at its core poker is still a gambling game not much different than other casino games.