Gambling industry in the UK, as well as globally, is undergoing a shift towards online gambling, as land-based casinos attendance continues to drop. The main reason for this is that online casinos are more accessible: you can gamble whenever and wherever you are, provided you have a PC, tablet, or a phone and an internet connection. The staggering growth of online gambling in the UK was enabled by the liberalization of gambling laws in the Gambling Act 2005, which legalized online gambling.
Gross gambling yield in the UK reached £13.8bn in September 2016, a 65% increase compared to £8.36bn in April 2008, mostly thanks to online gambling, FOBTs and National Lottery.
Currently, online gambling makes up for more than a third of the industry’s income in the UK and has reached £4.5 billion last year. In comparison, the income from remote betting was only £817m in 2009. The most popular type of online gambling are online slots, amounting to around £1.8 billion of total income.
The most immediate positive effect on the economy is through taxes: as online gambling is growing, so is the amount the companies are paying to the Treasury. Also, the gambling industry is creating more and more jobs, as new startups continue to pop up.
The main negative effect on the economy is an overall increase in risky gambling behaviour, leading to more people losing money and suffering consequences of gambling addiction. This might also lead to a bigger demand for state-funded gambling rehab programs since people with lower levels of income are generally those most exposed to risk. Also, the demographics of gamblers is shifting to include more young people and there has been a 5% increase in gambling among 16- to 24-year-olds and a 10% increase among 25- to 34 year-olds.
This, together with the bad reputation of gambling as problematic behaviour, might lead UK authorities to turn against the online gambling, but bookmakers’ associations are warning that restricting the industry would cause thousands of jobs to be lost, in a move that would cost the Treasury billions of pounds.
With so many online startups, the competition is fierce, making the market riskier for investments. More than ever, casinos must stand out and offer fair deals to customers. The awareness is increasing about the importance of responsible gambling, and casinos often advocate for it themselves. Thus, the effects of gambling liberalization might not be as catastrophic as gambling opponents are predicting.
Although there are some downsides to it, the online gambling industry is expected to keep growing. Teaching people how to gamble responsibly should be the top priority of both the gambling companies and the government.