Part 1 – The UK market - November 2014 - September 2015
Part 1
The UK market November 2014 - September 2015
If there was a degree of consternation when the figures for the online market in the 11 months to September 2015 were released by the UK Gambling Commission earlier this year , it wasn ’ t because there was any disappointment in the rate of growth .
Rather , the surprise was over the extent of the growth witnessed over the period . The growth was across-theboard and occurred when there wasn ’ t a major summer football tournament . It appeared to all intents and purposes that the UK market was defying gravity and if it had been occurring in other areas of economic activity it would almost certainly have been described as a bubble . The market total for the 11 months to September came in at £ 3.64bn and making an assumption about revenues in October 2015 , we can estimate the market was worth over £ 4bn for the 12 months November 2014 to October 2015 .
Casino ( including poker ) accounted for £ 2.13bn of the total , betting was worth £ 1.23bn , bingo chipped
Total UK market GGY % shares - Nov 2014-Sept 2015
Bingo 3 %
Betting 34 %
Source : UK Gambling Commission
Betting exchange 3 %
Pool betting 14.7 %
Casino 59 % in £ 128.6m , betting exchange was worth £ 125.7m and finally pool betting contributed £ 23.2m .
Is the growth rate sustainable ?
As we wrote in our first market monitor published earlier this year , increasingly the guesswork is being taken out of our understanding of the UK market . But it is being replaced by scepticism over the pace of growth . The five-month figures to March 2015 showed a gross gaming yield ( GGY ) of £ 1.45bn , and at the time we suggested that a crude extrapolation would suggest the market was worth circa £ 3.38bn for the 12 months to October . That this figure was clearly overtaken with the 11-month period shows the degree of acceleration in the market .
With just the 11-month figures from the Gambling Commission to go on , we cannot make any claims of knowing for certain the rate of growth being enjoyed in the UK in the past few years . In our March Market Monitor we looked at some evidence provided by analysts at Morgan Stanley and suggested that their estimate for a 12 % year-on-year growth rate in recent years was more than plausible ; and that there was a strong case for suggesting it was more than that . We then suggested that the exit rate for the size of the UK market in 2015 was likely around £ 3.7bn- £ 3.8bn . However , we now know that this probably underestimated the growth in the market and the exit rate for 2015 was likely in excess of £ 4bn . With this summer ’ s European Championships and with the evidence of growth from some of the main market contenders from the first-half results , it is a fair assumption that the growth has continued into 2016 .
For further evidence of this , we can look at bet365 ’ s most recent annual results released at the end of September . Though growth overall for the company slowed to 5 %, the suggestion in
iGaming Business Market Monitor – UK , Australia and Spain • September 2016 3