Industry predictions for 2023: The rise of stats-based betting and the UKGC to build bridges

Mattias Wedar, chief product and technology officer at LeoVegas Group  

Real-time is a no-brainer 

2023 may be the year in which real-time takes off; the industry can move away from nightly batch jobs to real-time actions. From a technical perspective, real-time is a result of applying an event-driven design pattern across the technical platform. This pattern is fundamental to support our growth journey since it simplifies regulatory integrations and enables scalability and reliability.  

Real-time responsible gaming, real-time AML measures and real-time scoring of players can significantly reduce the risk exposure for online operators. ‘Old school’ open-time windows allow for glitches and gaps of devastating impact. In addition, more and more of the regulatory reporting to gaming authorities will require real-time capabilities. 

Opportunities are endless from a business perspective. Increasing the engagement of casino players with appropriate real-time interactions, enhancing the thrill for sports bettors during live events or even combining newly acquired personalisation capabilities with real-time actions will form part of the winning formula for 2023. 

Sports, stats, shifts 

The interest in superstar athletes in the sporting world continues to be high. Many people today support individual stars rather than teams. In the football betting world, this translates into a high interest in stats-based markets such as the number of passes, shots on target and fouls. These markets have grown in popularity in recent years, especially in the men’s game, but there has been a huge interest in recent international women’s football tournaments for traditional betting markets. Will 2023 be the year when the stats-based markets also become really popular in the women’s game? We think so! 

The appetite for stats and data could also translate into new betting markets – could 2023 be the year when operators start to take bets on expected goals (xG)?  

Several big tournaments have served as great player acquisition opportunities in the past 18 months. Perhaps it is natural for operators to shift their focus to retention. As the competition for attention from customers will continue to increase, we think it will be more important than ever to offer a fast experience with the right balance between a personalised and relevant experience across all touchpoints. 

It’s tough out there – more pain for some, gain for others 

The year 2022 saw a significant number of small and mid-sized operators struggling and making the decision to close their doors, leave certain markets or downsize their operations. We anticipate this trend will continue to escalate in 2023, as the combination of stricter local regulations, higher taxes and more demanding compliance requirements make it difficult for all but the largest, most efficient or uniquely positioned companies to thrive.

Major operators will also be motivated to expand their businesses through acquisitions in promising regions such as Latin America and Africa. The US, already a graveyard for a number of brands, is likely to see even more exits as the top four companies continue to dominate, the marketing tap gets turned off and commercial reality sets in. 

Bahar Alaeddini, partner at Harris Hagan 

Publication of the white paper

More than two years has passed since the Gambling Act 2005 review launched. The white paper is the next step in the review and will set out the government’s vision for change and proposals for reform, having reviewed the 16,000 responses received to its call for evidence, which closed in March 2021. 

The white paper is not expected to have a clear recommended course of action but is likely to set out options for reform, which can be achieved in several ways including new legislation, changes to the LCCP or UK Gambling Commission (UKGC) guidance or self-regulation. It was promised “in the coming weeks” for much of last year, so it seems like the easiest prediction to rollover into 2023 thanks to government instability during 2022. 

Until publication, and despite the July 2022 leaks, the gambling industry remains in limbo, and we can only hope that the proposals will be based on evidence and be balanced, proportionate, reasonable and fair. Of course, as the current de facto Gambling Minister Paul Scully reminded us recently, the white paper “is not the end of our discussions on these matters”.  What this means will depend on how much rope the Department for Digital, Culture, Media and Sport give to the UKGC and how it interprets its work and statutory objectives. 

Collaboration with industry and building bridges?

In a recent 12-page speech to industry CEOs, UKGC CEO Andrew Rhodes appeared to take a notable shift from the approach adopted by his predecessor, Neil McArthur. Most markedly, Rhodes acknowledged it is not the UKGC’s role to make “moral judgement on how much money is spent on gambling” and, secondly, he recognised the UKGC is not liked and is not perfect, which, he noted, was “perhaps something everyone will actually agree on”.  There is much to unpick from Rhodes’ speech and the true test will be when the white paper is finally published.

However, at a surface level, it appears to be an attempt by the UKGC to turn over a new leaf with the industry through engagement, which I very much hope flows throughout 2023 and beyond. In recent weeks, I have seen glimmers of hope that suggest change (even if limited) is on the horizon.  To borrow another industry commentator’s analogy, which I very much liked, the tanker needs to be turned around.  To achieve this, the Gambling Commission needs to improve and build bridges. So far, it has been relentlessly unwilling to engage with industry or its lawyers. Here’s hoping that 2023 will be a different story.

Increased M&A activity

The increasing cost of regulation and diminishing profits in Great Britain, combined with the liberalisation of gambling laws in other jurisdictions, in particular the US, is resulting in increased M&A activity involving businesses licensed to provide gambling facilities in Great Britain, with greater investment now being seen in the US compared with the UK. A continued weak pound against the dollar will further fuel M&A activity, particularly as US operators seek to acquire technology and expertise for deployment in their home market.