UK based bet365, one of the largest online gambling operators in the world, got a little bit larger during the last financial year thanks to an increase in mobile betting activity.
Following a review of the company’s financials during the 12 months between March 31, 2014, and March 31, 2015, bet365 has reported a 26.5 percent growth figure.
According to the balance sheet, bet365’s profit before exceptional items hit £409.3 million while year-on-year revenue was able to peak at just under £1.5 billion.
More Mobile Bettors
Much of the recent growth is down to an increased sports betting customer base that grew by 41 percent to 4.1 million to a total of 18.5 million.
Many of these new accounts were activated during the 2014 FIFA World Cup.
During this period thousands of first depositors were drawn in by a variety of betting offers; many of which involved in-game and mobile betting.
In fact, thanks to an increased focused on live betting via iOS and Android devices, bet365 was able to achieve 66 percent revenue growth in this area and make mobile betting its largest asset.
“The four weeks of the FIFA Football World Cup generated a significant number of new customers, increased amounts wagered and strong revenue performance during the traditionally slower betting period of June and July,” said bet365 chief executive, Denise Coates.
In addition to paying out £75 million in dividends to its owners, bet365 also gave away £10 million to its charitable offshoot, the bet365 Foundation.
Big Plans for 2016
Heading in 2016, the company is planning a move to a new headquarters in the UK which will give it the ability to increase staffing levels to more than 3,000.
Moreover, the gambling operator also plans to invest in new technology and improved services heading into the New Year.
Such improvements may be necessary for bet365, however, as many of its main rivals are now consolidating their assets in a bid to dominate the market.
This convergence of forces is bound to alter the iGaming landscape in 2016 and if bet365 is to continue thriving then it may need to consider a similar move at some point in the future.
However, as it stands, it looks as though the company is still a major force in the industry and one that will pose a real threat to the newly formed coalitions in the coming months.
Could the GVC acquisition of bwin.party be under threat? The Independent newspaper seems to think it could, as GVC’s lately tumbling share price has suddenly made it a less palatable prospect.
As we reported several weeks ago, GVC won the battle to acquire bwin following an all-out raising war with competing bidder 888 Holdings. The bwin board chose to accept a higher offer from GVC, of £1.1 billion made up of cash and shares, except that the “share” part of the deal has been decreasing in value ever since.
As the Independent notes, GVC’s offer valued bwin at around 130p per share, while 888’s rejected offer valued the company at around 115p to 116p per share. But GVC’s plummeting stocks mean that its offer now also lies around the 116p mark, very similar to that of 888’s.
Bwin Chairman Philip Yea said at the time that a poll of shareholders taken just before the deal was sealed, revealed that opinion was very much evenly split between the two offers, but the board plumped for GVC anyway.
They may now be regretting that decision.
Meanwhile, the UK Gambling Commission (UKGC) has warned the industry that it is standing at a crossroads where it must either choose to embrace responsible gambling or face a stringent government clampdown.
Speaking at the WRB Responsible Gambling conference in London, Matthew Hill, director of regulatory risks and analysis at the UK Gambling Commission, warned operators that the industry was becoming deeply unpopular in this country because of the proliferation of those in-play betting advertisements around prime time football matches, not to mention the controversy surrounding fixed odds betting terminals in the nation’s high streets.
“It’s important to persuade the public that the gambling industry can be trusted on responsible gambling,” he said, “The fairness, openness and transparency of the product…suppliers have a major role to play on that. You should ask, ‘how are the products I am selling to retailers contributing to these overall efforts to build public confidence?’ ”
A lack of social conscience within the gambling industry would ultimately lead to stricter regulatory controls and “constraints on the freedom of responsible adults to make their own decisions,” he warned.
Right on cue, the UKGC brought out the second edition of its Gambling Industry Code for Socially Responsible Gambling, an update of the original code, published in 2007.
New regulations include a ban on the offering of sign-up bonuses aimed at new customers before the 9pm watershed and the directive that a social responsibility message must be included at the end of all TV adverts.
The gambleaware.co.uk must also be displayed prominently “for at least 10 per cent of the advert’s length.”
PaddyPower has survived its latest inquisition from the Advertising Standards Authority (ASA) into a recent ad that exhorted FIFA’s Sep Blatter to “just f***” off already.”
Amusingly, the authority upheld the ad, which was placed in the Guardian newspaper, because it chimed with the public mood, reflecting, in the words of the ASA, fans’ “overwhelming sentiment” that the embattled FIFA chairman should, in fact, just eff-off already.
The ASA was responding to a complaint from a member of the public that the use of the expletive, which featured in PaddyPower’s campaign to advertise odds on the next FIFA chairman, would be likely to cause offense.
The ASA disagreed: “We considered that readers of that section were likely to understand that the ad was intended to be a lighthearted comment on the ongoing allegations of corruption within FIFA, and in particular the controversy surrounding Sepp Blatter’s tenure as FIFA president,” it ruled.
“In that context, we considered the use of “f***” was unlikely to cause offence to readers,” it concluded.
Pistorius Money-Back Brouhaha
Context, of course is everything, a fact that has often eluded the Irish bookmaker’s marketing department, which will go to great lengths to illicit a controversial reaction.
The company was recently censured by the ASA for an advertisement that offered bets on the Oscar Pistorius murder trial. The offending ad, which went to press on Oscar night last year, stated:
“IT’S OSCAR TIME. MONEY BACK IF HE WALKS. WE WILL REFUND ALL LOSING BETS ON THE OSCAR PISTORIUS TRIAL IF HE IS FOUND NOT GUILTY.”
Naturally, this was deemed to be a bridge too far, but not for the first time. The company was once forced to pull billboard posters that showed Jesus and the Apostles gambling at the Last Supper.
And in 2010, a TV ad that showed a blind footballer kicking a cat into a tree was the most complained about of the year.
Shearer Signs for Coral
When it comes to football/sports betting marketing crossovers, Coral seems to have the right idea.
The company announced this week that it had signed-up former England ace Alan Shearer as its first ever football ambassador.
That nice, safe Mr Shearer will be providing frequent blogs and betting tips to the Coral website with not a hint of controversy in sight. All of these blogs, naturally, must be read in a flat, Geordie monotone.
This is, of course, the correct way to use footballers in your marketing campaigns.
As opposed to PaddyPower, which is currently being sued by ex-Manchester United star and Republic of Ireland assistant manager Roy Keane for the unlicensed use of his image in a recent billboard campaign.
Advertising for sports books like PaddyPower and William Hill are always pushing the envelope, but….
Will they ever learn where the line is drawn?
Posted In: Online Casino By: Megan Hall
The UK Gambling Commission (UKGC) is urging all UK gambling operators to ensure they have effective measures in place to combat money-laundering and problem gambling.
The commission warned its licensees to learn from the shortcomings recently exposed at the Rank Group, which was censured following the conviction of one of its best customers on money-laundering charges.
Da Feng Ding was a frequent visitor to the Rank Group’s Grosvenor chain of casinos, where he blew a reported six-figure sum over a period of three years before his arrest.
Casinos have, in the past, provided a full dry cleaning service for money launderers, who have been able to visit a casino, turn large sums of money into chips, and gamble “minimally” before changing it back into cash, fully pressed, folded and smelling “Alpine-fresh.”
Despite the watchful eye of the UKGC, it can still happen it seems, although “minimal gambling” does not have appeared to be Ding’s problem.
Nor was it the problem of a Meccabingo.com customer known only as Customer B, who embezzled a six-figure sum from her employees to blow at the site, which is also owned by Rank.
Online gambling sites are required by the regulator to have sophisticated “Know Your Customer” (KYC) processes integrated into their systems, which should provide data on whether a customer behaviour suggests they may have a problem.
However, when Customer B suddenly went from spending small sums at MeccaBingo.com to burning through $5,000 a week, instead of being flagged up as a possible problem gambler, she was identified as a “commercially valuable” customer by Rank and sent on a trip to Las Vegas.
Rank has said it will address the failures of due diligence, and has recently announced an overhaul of its digital arm, to be spearheaded by a new platform provider, Bede Gaming.
Meanwhile, it has said it will pay £950,000 towards “socially responsible” initiatives by way of apology.
Paddy Power and Betfair Get Creative
Meanwhile, in other news, Paddy Power and Betfair have announced that they have agreed the terms of a £5 billion merger that is set to create a true online gambling behemoth. The new name of the combined company?
Well, it’s not “Betty Power,” as many of us had hoped; in fact, it’s nowhere near as catchy.
The official name of the new combined company, then, of one of the world’s biggest, if not the biggest online gambling company in the world, with projected sales of £1.2 billion, will be… wait for it … Paddy Power Betfair.
Well, at least Betfair Chief Breon Corcoran was pleased; pleased enough, that is, to accept a £10 million bonus. Must be nice!
It’s early September and the football transfer window is over once again, which means we can all stop stressing about Arsenal’s habitual paralysis around this time of year and whether or not David De Gea has missed his flight to Madrid. Newsflash: he has!
Of course, the best signings over the last year or so have been made not by Chelsea, or even Manchester City, but by online poker giants PokerStars.
Two of the world’s top footballing superstars, Cristiano Ronaldo and Neymar Jr, have both signed up to become ambassadors in recent months.
Even the “old Ronaldo” has hopped on board, and yes, we know he’s retired but he was once upon a time the greatest, so that’s still more exciting than, say, Micah Richards’ free transfer to Aston Villa.
PokerStars’ superstars have been part of the site’s new advertising campaign, its biggest of all time, and it seems to be paying off in spades.
The company has reported a big increase in sign-ups in the countries where the campaign has been running, as the appeal of these global football mega-lords is clearly planting poker into the consciousness of the great football-adoring public.
It may also have something to do with the fact that (Cristiano) Ronaldo is the most widely followed human being on Facebook, with, at the time of writing, 106,278,973 “friends.” We suspect he employs someone full time simply to hit the “accept” button.
However, PokerStars’ apparently unstoppable ad campaign has hit a snag in the UK, where it seems that Neymar Junior is a little too, well, junior, for the liking of the UK Gambling Commission.
UK gambling law stipulates that no one who is, or looks, under the age of 25 may appear prominently on gambling marketing
“No one who is, or seems to be, under 25 years old may be featured gambling or playing a significant role,” state the regulations, and Neymar, a diminutive, baby-faced 23-year-old, falls ankle-clutchingly into this category.
Neymar’s Stunt Double
It’s not all lost, however; UK law does state that players who are under 25 may be used to advertise sports betting provided that their image is tied to the opportunity to bet on a game in which they are playing. This could prove handy for the site’s new online sports betting operation, which has been rolled out on the PokerStars client in the UK.
In the meantime, though, they’ve opted to replace the image of Neymar in the UK ads with that of a legal 40-year-old, Canadian poker player Daniel Negreanu.
The UK Gambling Commission is satisfied, apparently, which is just as well, because it has had enough on its mind recently with the news that Paddy Power and Betfair, two prime exponents of mischievous and risqué guerilla gambling advertising, are planning a merger, as reported here last week.
Now there’s an ad campaign we’re itching to see.
Posted In: Sports Betting By: Jack Thompson
The latest pair of iGaming operators to agree to a merger was revealed today when Betfair and Paddy Power announced a deal worth £5 billion.
Traditionally two of the largest online bookmakers in Europe, Betfair and Paddy Power have seen their fortunes increase in recent years thanks to flourishing casino and poker platforms.
Rising Fortunes for Betfair and Paddy Power
In fact, according to the latest financial reports, both companies have seen impressive revenue increases in the first half of 2015.
For Betfair, the opening six months of 2015 have resulted in £135.4 million in total revenue.
Thanks to impressive results in the sports betting sector, Betfair managed to post a 15 percent year-on-year increase in the first half of 2015; despite the new UK Point of Consumption tax which hit the company for £12.8 million.
Like Betfair, Paddy Power also saw its revenue improve year-on-year at the start of 2015 thanks to a strong performance in the Australian market.
Total net revenue hit £386 million in the first of the year; a figure which represents a 33 percent increase on 2014’s total.
However, despite growing fortunes for both companies, the decision to combine their assets and operate under the new name, Paddy Power Betfair, seems to be one that’s be prompted by the changing dynamics of the iGaming market.
With speculation as to which company will take control of bwin.party (888 Holdings or GVC Holdings), other companies have moved to consolidate their assets and form new businesses.
Back in July Gala Coral and Ladbrokes agreed to a merger worth £2.3 billion and it looks as though Paddy Power and Betfair will now be doing the same.
A Sign of the Times
Although the finer details of the deal are still being ironed out, it’s believed that Paddy Power’s shareholders will own a 52 percent stake in the new entity, while Betfair’s investors will have control of 48 percent.
If these terms are firmly agreed, then Paddy Power Betfair would become one of the largest gambling operators in the world and give it a 16 percent share of the UK iGaming market.
As well as moving ahead in the UK market, the new deal will allow the newly formed company to explore more opportunities in foreign markets, including Australia and the US.
Following the announcement of a deal between the two companies, share prices in Betfair increased by 17 percent to £30.60. Similarly, Paddy Power’s stock increased by more than 18 percent after the £5 billion deal was made official.
At this stage it’s not clear how the merger will affect the day-to-day operations of each company, but it’s likely the new entity will look to solidify its market position with a range of new deals and features in the coming months.
One of the leading daily fantasy sports (DFS) operators, DraftKings, has been granted a licence to operate in the UK.
Having established itself in the US as the go-to place for fantasy betting on American football, the company is now setting its sights on the UK market and has opened up a new office in London to mark the occasion.
Application Sought, Permission Granted
DraftKings initially applied for a UK gambling licence back in June.
Following an initial report by TotallyGaming, documents submitted to the UK Gambling Commission (UKGC) revealed that the company listed its Boston address as its main office along with the proposed domain: Draftkings.co.uk.
Assisting with the application was London-based law firm Jeffrey Green Russell; a partnership that appears to have been a successful one given that it took just a few weeks for the company to receive the green light to offer sports and pool betting in the UK.
Helping fund the move into the UK is a $300 million cash injection raised through a recent round of funding from companies such as Fox Sports.
Using this money, DraftKings will now be focusing some of its resources on the UK market which has an established reputation as one of the leading sports betting hubs in the world.
“Our expansion into the United Kingdom marks a milestone moment in the growth of DraftKings as we introduce our world-class product to new audiences,” read a statement from DraftKings’ CEO, Jason Robins.
Haas Lending a Helping Hand
Helping guide the new enterprise in an otherwise foreign market is former Director of bwin.party, Jeffrey Haas. Having worked at the head of bwin.party, as well as PokerStars, Haas appears to be more than qualified to lead DraftKings in its latest venture.
“Daily Fantasy Sports is a growing category outside North America, and we have a tremendous opportunity to engage sports fans around the world,” explained Haas.
In addition to offering service to UK sports fans, DraftKings is also looking at additional international markets. According to Robins, parts of Europe, Latin America and Asia are all on the agenda for 2016.
Naturally, the movement of DraftKings into the UK is bound to bring more daily fantasy sports sites into the country. Moreover, it could prompt existing iGaming operators to set up new ventures in the DFS arena.
Amaya, the parent company of PokerStars, recently announced a deal with US operator, Victiv, to launch its own DFS site. Set to take on the name, StarsDraft, the new platform could be ready in time for the new NFL season according to recent reports.
If this launch goes well then it could prompt Amaya to launch another platform in the UK alongside PokerStars. If this were to happen, then it would undoubtedly spawn a number of similar sites from Amaya’s gaming peers such as William Hill, Ladbrokes and Paddy Power.
William Hill and Ladbrokes, Britain’s two biggest bookmakers, have reported sliding financial results this week, as increased online gambling taxes begin to kick in. Both William Hill and Ladbrokes have said the UK’s new “point of consumption tax” has hit them hard, along with a bigger duty on fixed-odds betting terminals (FOBTs).
The new tax regime was established at the beginning of this year, following the implementation of the UK Gambling Act, and requires online operators with exposure to the UK market to be licensed and regulated within the UK, and to pay a 15 percent levy on gross gaming revenues.
Under the regulations of the previous regime, online operators were able to target UK customers while being licensed by a series of overseas jurisdictions that had been “whitelisted” by the UK government and offered big tax breaks.
Some operators chose to quit the UK in the wake of the new laws, but most stayed, believing that the pros of operating in a highly lucrative market outweighed the cons of the new tax, but all are now feeling the pinch.
Tax Bill £44 Million Higher than Last Year
Meanwhile, following pressure from anti-gambling groups, the government raised the tax duty on controversial FOBTs terminals in high-street bookies from 20 to 25 per cent, hitting the bookies even harder.
FOBTs allow customers to wager up to £100 per spin on virtual casino games like roulette. Detractors argue that the stakes are simply too high and they have promoted a resurgence in problem gambling since their introduction to Britain’s bookmakers’ shops in 2005.
William Hill said its operating profits fell by around £21 million in the first half of the year, and that the new fiscal laws had left it with a tax bill that was £44 million higher than last year.
Ladbrokes, meanwhile, which a few weeks ago announced a £2.3 billion merger with Gala Coral that will see it overtake William Hill as Britain’s biggest High Street bookmaker, reported a £51.4 million loss for the first half of 2015, following dozens of shop closures in the UK and Ireland.
Ladbrokes’ chief executive, Jim Mullen, who was poached from William Hill to shore up the company’s online operations, said “short-term thinking” which had “come to dominate Ladbrokes’ actions” was to blame for the losses.
Mobile Now UK Favourite Internet Device
There were, however, reasons to be optimistic beyond the upcoming merger. Ladbrokes’ online operations, which had fallen way behind William Hill’s over the past few years, enjoyed a 6.9 per cent rise for the period, suggesting Mullen has been well-appointed.
Both operators may also take heart from news this week of a study by Ofcom, which suggests mobile phones are now the number one method of accessing the internet for Brits.
Thirty-three percent of us now prefer to use our phones to access the internet, with 30 percent favouring laptops. That’s a change from last year, when laptops were favoured by 40 percent of people and phones by just 22 percent.
With mobile being the most significant driver of growth in the online gambling industry over the last few years, particularly the rise of mobile in-play sports betting, it may well be that the bookies are on the road to offsetting that nasty point of consumption tax.
A newly licensed PokerStars sportsbook has landed on the company’s Irish platform. The online poker giant, whose head offices are based in Dublin, recently rolled out sports betting in beta phase in selected jurisdictions, including the UK, and now Irish punters will also be able to have a sporting flutter via their favourite poker site.
The move follows the highly successful introduction of casino gaming to the previously poker-only site, part of a string of changes that have been introduced by PokerStars’ new Canadian owners, Amaya Inc.
Amaya recently announced that its online casino revenues have exceeded expectation since the introduction of that capability at the beginning of the year, almost doubling in the second quarter of 2015 when compared to the first quarter.
The signing of Ireland’s Betting (Amendment) Act 2015 into law in March means that all online sports book operators wishing to engage with the Irish betting community must now seek a license from the Irish regulator.
PokerStars, whose new watchword is “compliance”, was keen to wait out the protracted regulatory process before launching its new product on the Emerald Isle.
Manchester United New Signing
Meanwhile, online sports betting site Marathonbet has announced a deal with Manchester United that will see it take over from bwin.party as the club’s new global betting partner.
Bwin signed a £2.4 million for a three-season deal starting with the 2012-13 season, and launched a bwin powered Manchester United online casino in March.
Still, at least bwin lasted longer than Angel Di Maria and Ramadel Falco.
Marathonbet, of course, is hoping to tap into the 659 million fans that Man Utd claim to have globally.
That’s 10 percent of the world’s population, by the way, which would seem like a leap of the imagination by the Man Utd PR team. If several hundred million of those switch to Chelsea mid-way through the season, as we predict, we may be facing a tsunami.
On the payments side, Optimal Payments, which operates NETELLER, says it expects its €1.1 billion takeover of Skrill will be completed next Monday. This will create a digital payments powerhouse, uniting two of the biggest online gambling e-wallets in the world.
The online payment service industry is facing a period of consolidation, as it fights off increased competition from mainstream companies looking to invade its space.
Apple’s launch of the “wave and pay” system on iPhone is a case in point. The Apple technology allows customers to upload credit and debit card details to their handsets, like an e-wallet in your pocket.
It’s enough to keep the traditional payments service providers awake at night.
Posted In: Online Casino By: bwright
GVC Holdings is in it to win it: bwin.party, that is.
A battle between online gambling superpowers is raging over the future of sports betting and poker giant bwin.party, with GVC tabling a hefty £1 billion offer this week in an effort to drive 888 Holdings out of the picture.
It’s a shocker because a bid from 888, for £898 million, had looked to be a done deal. The bwin board had recommended the 888 offer to its shareholders, and announced that it was ready to move forward to finalize the deal.
The board had favored 888’s offer over a previous bid from GVC, backed by PokerStars’ owner Amaya Inc, that had been worth £10 million more. But bwin.party rejected the joint bid because its proposal to split the company in two, with GVC taking control of the sports book and Amaya the poker operations, was the riskier option.
Meanwhile, it was clear that the board was keen on an 888 acquisition. It cited various synergies with 888, such as overlaps in regulated markets that would save a merged group millions in duplicated costs, technology integration and licensing fees.
Whispers were coming out of the City last week, however, suggesting that GVC, which owns Sportingbet.com, was plotting a solo coup, and preparing a monster reraise, this time without Amaya’s capital.
Insiders in the financial quarter said that GVC representatives were testing the appetite of several financial institutions for a large fund-raise to trump 888.
Many analysts believed that the firm would struggle to raise the kind of capital that would make bwin.party’s shareholder’s sit up and take notice. GVC has a market cap that’s about one-third of bwin.party’s, and thus any takeover would be significantly debt-financed.
But, seemingly within a matter of days, GVC had procured a loan from Cerberus Capital Management, a US private equity group, for around £282 million in order to finance their new bid.
Observers expect 888 to come back with a new proposal, so watch this space.
Full Tilt Bans Heads-up Cash and Game-selection
Meanwhile, in online poker news, PokerStars’ sister site Full Tilt has announced a dramatic shake up to its cash games, removing its heads-up tables completely, as well as its game selection facilities.
This is part of a move designed to attract more recreational players to the tables and frustrate so-called “bum hunters.”
A bum hunter (which sounds far ruder in the UK than America where the phrase originated) is an accomplished player who will actively seek out “bad” players, refusing to play anyone else.
For too long, online poker has struggled to attract new players to the game, for the simple fact that the skill gap between good and bad players is greater than ever. That means life has become tougher at the bottom of the fish tank, meaning that less-skilled players are finding poker less fun, and the lack of casual players, who are essentially the cornerstone of the poker economy, is hurting online poker.
Now, visitors to the Full Tilt lobby will be permitted to select their chosen stakes before being whisked to a seat at a table of the software’s choosing, making it impossible to seek out soft targets.
Heads-up games, meanwhile, are notorious feeding grounds for bum-hunters who will lie in wait hoping an unwitting innocent strays inside.
It’s a bold experiment from Full Tilt, and any move that aims to bring the fun back to poker gets our thumbs up.