Has Gambling Peaked in the UK?
The United Kingdom has had a liberal gambling industry since the start of the Gambling Act 2005. Laws became official on April 7, 2005, and the entire act became active by September 2007.
Since that time, gambling in the country has gone from strength to strength. Both land-based and online gambling brands have experienced ever rising numbers. And this has meant that revenues have also gone up in tandem. Of course, in the initial years, there was a lot less concern over gambling, too. Things have changed a lot in more recent years, though.
Gambling now faces more regulation and has more restrictions than in the past while at the same time public attitudes to gambling are changing. This is coupled with the market becoming more and more saturated while at the top multi-billion mega super-groups like Entain and Flutter dominate more and more of the market in a never ending growth cycle.
In addition to social and market changes people have had less disposable income since the covid pandemic and the cost of living crisis and recession forecasts that followed shortly after. The industry faces mixed problems all of which could spell a period of decline. This begs the question, therefore, as to whether we have seen the peak of gambling or whether, as in the past, new innovations appear that will rejuvenate interest?
The Rise Of Gambling
It has been an arduous trek for the gambling industry in the United Kingdom. Gambling itself was legal under English common law back in history. Yet the government also feared that it interfered with military training. Thus, in 1541, the Unlawful Games Act made gambling illegal across the country.
Introduced by King Henry VIII, it was more of a written law rather than an enforced one. Yet it did mean that gambling debts were not collectable via court action. Further acts came into law in 1710, 1728, 1738, 1739 and 1744. These placed more of a focus on financial security, illegal lotteries and more.
Games of skill became legal with The Gaming Act 1845, while cheating became an official crime. Betting establishments became very popular, even with news laws introduced years later.
Betting on horse races became a legal activity in 1928. Greyhound race betting also became legal a few years later. Football pools also grew in popularity, and tax from these came from the Pool Betting Duty of 1947. Years later, a decline in politicians with heavy morals came about. This led to the creation of the Betting and Gaming Act 1960. Private casinos became legal through this act. With the introduction of that, turnover increased by 154%. Betting shops owned over 13,000 licences thanks to this, and bingo was also legalised.
The industry continued to grow in strength and popularity over the decades. Even greyhound racing saw a brief resurgence in the 80s. And more and more betting shops were popping up as the years advanced.
In 1994, the UK launched its own National Lottery as well, which proved popular with players. Yet by the start of the new millennium, the industry needed stronger regulation. This led to Tony Blair’s Labour government introducing the Gambling Act 2005.
Through that act, the UK Gambling Commission came to fruition. The aim of this was to break links with crime, ensure gambling is fair and protect vulnerable people. All forms of gambling in the country come under its control.
An amendment in 2014 required that all offshore brands apply for a UK licence. A 15% Point of Consumption tax (later raised to 21%) became law at the same time. Then at the end of 2020, a further review of the gambling laws was undertaken. The white paper for the new legislation is something still awaiting publication at the time of writing.
Restrictions Place Limits On The Market
There is little doubt that interest in gambling has risen through the years. Otherwise, there would be little need for the acts and legislation mentioned. Even the recent review of the Gambling Act 2005 came about to ensure laws are fit for the digital age. This, some people hope, will tighten the restrictions on the industry. That’s not something that gambling operators are particularly happy about, of course.
Tighter restrictions will make it harder for operators to provide gambling. The Commission has already been fining brands for failures in various areas. In August, the massive Entain company received a £17 million fine from the body. Spreadex was aslo on the receiving end of a £1.36 million penalty more recently.
Could more limitations than those in the current legislation see more companies leave? We have already seen many brands based abroad leave the UK market this year in advance of new affordability and responsible gambling restrictions that are expected. Recently Energy and LVBET left for those exact reasons.
Other Factors to Consider
It would be good to take a look at another industry and compare it with the gambling industry. Smoking was commonplace throughout the UK in the 70s, 80s and onwards. Cafes would welcome guests and ask if they wanted a smoking or non-smoking table. The same was true in restaurants and other places. But in 2007, the government brought a law into effect which banned smoking indoors.
In the months before the law became official, smokers caused a fair bit of uproar. How could the government expect them to stand outside and smoke their cigarettes? Even in the few days before, smokers were still complaining. Yet now, smoking indoors is quite the distant memory. No longer do people have to suffer hazy pubs, bars and restaurants. Anyone who wants to smoke is unable to make others suffer for their vices.
People may have complained about the new law at first. But they soon fell in line with it, and it has doubtless had a positive impact. The British Heart Foundation (BHF) made a report on it 10 years after the law’s introduction. Before the ban, research had shown that passive smoking had a link to health problems. Breathing in second-hand smoke increases a person’s risk of cancer and heart disease. This is especially true when it comes to children.
“Directly after the legislation, more people were trying to quit smoking, and more people succeeded because it’s much easier to avoid those situations”,
said the Director of Policy at Action on Smoking and Health, Hazel Cheeseman.
One year after the ban, there were 1,200 fewer hospital admissions for heart attacks. In 2006, 22% of adults smoked. By 2015, a reduced figure of 18% admitted to smoking. That served as part of a gradual decline in smokers since 1974. It was in that year that the government began collecting such data. Air pollution from cigarette smoke was also much higher before the ban on smoking. And three months after that ban, cigarette sales dropped by 6.3%.
It took various campaigns and advertisements against the negative effects of smoking, though. Consistent campaigns on healthy living and the ill-health that smoking can bring worked. Doubtless, that helped across the country, as more people quit smoking. This led to cleaner health levels in general.
By 2020, the number of people across the UK who smoke stood at 13.8%. A slight increase occurred during the COVID-19 pandemic, but this fell again after August.
In March of 2022, at least 43% of British people admitted to gambling at least once this year. Over a quarter of people have partaken in the National Lottery in 2022. Estimates say that gambling addiction costs the NHS £1.27 billion per year. And players have £838 million in online gambling accounts.
The National Lottery, scratch cards and sports betting are the nation’s favourites. But if you were to take a look at gambling participation levels, these have declined. In the year to March 2015, 45% of Brits said they gambled. This has fluctuated, with the year to March 2016 registering a 48% figure. But the 43% to March 2022 is lower. Could this symbolise a general decline?
And it’s not only a decline in general participation to take note of. A drop in problem gambling rates was also recorded in the year to March 2022. Of course, that stands out as being a positive outcome. Due to the fact that it costs the NHS so much every year, any reduction is welcome. Has the gambling scene in the UK has experienced its peak?
The Gambling Industry Does What It Can
More people may be rejecting gambling today, but this isn’t about to stop the industry. The cost of living is likely to have an impact on the amount people spend on gambling for the future. Yet those operators and developers in the sphere are always coming up with new options. This type of activity takes place to try and rejuvenate the industry. Through it, the hope is that more people will come back to the betting world.
People can deposit and play in cryptocurrencies today, which is a novel experience. This takes out the necessity of using private banking or card details at such sites. Security of these platforms is something that many people question but providing an anonymous way to pay appeals to younger demographics.
New things to bet on keep coming to light, too. Take eSports betting, for example. This is not something that was available 10 years ago. South Korea first recognised eSports in 2000, but it took longer for other countries. Video game competitions had taken place many decades before, as it happens. But betting on these tournaments started in the late 2010s. Today, it serves as one of the biggest gambling sectors in the world.
Live dealer games remain a very positive casino gaming sector. They offer the chance to experience a land-based gaming session from home. Virtual reality gambling is also on the rise, which stands to be the next thing that takes off. Through it, players can visit virtual casinos in the metaverse and the like by using a headset. It could be the case that such innovations will offset the decline in gambling activity, who knows.
What gambling used to be is something that may have experienced its peak. Bingo halls and other land-based establishments have suffered, thanks to online gambling. A decline in players to those venues is clear. Gambling opportunities are so much easier to access today. Yet the fact is that the gambling industry is ever-changing. It moves with the times, which is why the laws also need to go through reviews.
Regulation of the industry may threaten to disrupt it as the upcoming white paper may do. But the industry will likely always find a new route to take. And this will see it once again prosper in new areas.
Alongside the various popular options of today, the future already looks bright. Gambling on smartwatches is something that people will get involved in. We also spoke of virtual reality gaming before. At the moment, this can be quite costly. But like anything, its price will come down and more people will be able to afford it. There is little doubt that its popularity will then increase.
More and more cryptocurrency casinos are likely to spring up in the coming years, too. Plus, mobile gambling remains on the up and up. Predictions suggest it will grow at a compound annual growth rate of 11.24% between 2020 and 2025. Has gambling reached its peak? We’d say that it has a lot more to give. Whether people take it up in such numbers remains a question for answering.
The question that might be better to ask, therefore, is whether gambling has peaked for now. It is likely, in the UK at least, that we will see a period of stagnation or even a decrease for a period while new laws settle, peoples incomes improve and the industry onboards the new tech they hope will entice us in the future.
