The problem with gambling in the UK

Does the UK online gambling industry have a problem with problem gambling? The results of the latest major piece of research into the area from the Gambling Commission doesn’t immediately seem to suggest so, but they raise some challenging issues for the industry to confront. And there is every reason to suspect there could be some problems waiting in the wings.

The headline findings from the survey, which was the result of some 15,000 self-reporting respondents, showed a total problem gambling rate of 0.8% of the population (or 1.4% among those who gamble) was broadly stable against the previous 2012 study. This equates to around two million adults in the UK and includes all forms of gambling activity including The National Lottery.

When looking more specifically at online gambling the proportion of respondents deemed to be at-risk from problem gambling issues rises to 5.1% for any form of online gambling, up from 4.2% in the previous 2012 study and up to 10.5% from 6.3% for online slots. Bearing in mind the nature of the research we should be wary of drawing too strong a conclusion from changes of this magnitude, but in a period of increasing regulatory and media scrutiny for the sector it would be reckless to ignore them.

Online gambling usage

Online remained a relatively minority betting activity based on the survey data, despite being around 40% of total gambling revenue in the UK, with 10% of respondents saying they had gambled online, with that skewing dramatically in favour of men with 15% saying they gambled online compared to just 5% of women. This does appear to conflict with data from some of the major gambling operators although the wider demographic data in terms of age distribution seems more in line with conventional wisdom.

But while online gambling remained far less popular than more traditional forms of gambling in the population of the whole it was outperforming in terms of problem gambling risk. And in particular online slots, the sector that has become the largest single vertical in the UK market over the past two years, may find itself under the microscope sooner rather than later.

Spinning the wheels

The report notes: “The highest prevalence of moderate risk gambling was observed among those who participated in online gambling on slots, casino or bingo games (13.4%), followed by offline betting on events other than horseracing, dog racing and other sports (10.9%) and then betting exchanges as well as offline casino table games (both 10.2%).” So online slots can reasonably be viewed as a higher risk product than FOBTs or land-based casino games.

Using the PGSi method to assess problem gambling then the numbers for online slots make stark reading. The total number of at-risk gamblers was 34.9%, higher than FOBTs at 31.7% and spread betting at 28.7%. In other words more than one third of slots players are deemed to be at risk of problem gambling. This is actually down on the previous study, where online slots was 37.1%, but the proportion of moderate risk gamblers rose from 11.2% to 13.4% and the number of low risk fell from 26% to 21.6%.

These numbers change significantly depending on the method used to assess problem gambling. When adopting a mix of the two main diagnostic methods (PGSI and DMS-IV) online slots falls to a 10.5% incidence rate, some way below betting exchanges at 16.2% and below FOBTs at 11.5%. But this was up sharply on the 2012 number of 6.3% and when removing the more minority pastimes of playing poker in pubs, spread betting and betting on non-sporting events it is third behind only betting exchanges and FOBTs.

That is, by any measure, a pretty alarming finding and one the industry needs to look long and hard at. Taking no action to limit or minimise risk to online casino players would seem to not be a viable option for the long-term health of the sector.

Assessing the risk

That said there are no reasons for the online gambling sector to be unduly alarmed. The report itself didn’t focus on slots to any meaningful degree, and presented FOBTs, poker in pubs and other land-based gambling as areas that needed the most focus and attention in spotting and preventing problem gambling.

Also while the survey has a reasonable base with just under 15,000 respondents, the relative numbers making up the responses to questions on specific online gambling verticals, with just 4% participating in online slots for example, raise some issues with drawing conclusions too readily from a few hundred people. The self-reporting nature of the survey also creates its own inherent flaws and issues in the accuracy of the data.

But while this is not an issue for today, it can become an issue tomorrow. Online gambling looks like an easy target to take on and in some ways it seems to be an easy target to shoot at. The core findings show that young males who partake in a number of gambling activities are most vulnerable to problem gambling and it’s fair to say this demographic and this behaviour is the target of most mainstream gambling advertising in 2017.

What happens next?

Should the large and highly visible target of FOBTs be reduced in some way then the equally sized and, to-date, low-key sector of online slots could reasonably come more into the view of the media, anti-gambling campaigners and those with a reason to try and attack this part of the online gambling sector. To play devil’s advocate, there is even some possible benefit in the sports betting giants giving way to measures that more significantly impair some of the more aggressive casino operators currently taking market share from them.

“While overall problem gambling rates in Britain have remained statistically stable, our research suggests that in excess of two million people are at-risk or classed as problem gamblers, with very many more impacted by the wider consequences of gambling-related harm,” Tim Miller, Commission executive director, said. But it was the additional context that operators should be paying attention to.

“We have a clear commitment to make gambling fairer and safer and these figures show that this is a significant challenge. Success will depend upon us, the industry, government and others, all working together with a shared purpose to protect consumers. The pace of change to date simply hasn’t been fast enough – more needs to be done to address problem gambling.” The question is how much of this work the industry is willing to do without further legislation.