A new challenge and an ongoing threat
The betting industry is renown for being a technologically advanced beast, but it faces an unprecedented challenge and an uncertain future. The impact of novel coronavirus (Covid-19) on operators’ businesses is being revised daily, and whilst the ever-present financial threat of corruption remains, there are reasons to be optimistic, writes International Betting Integrity Association (IBIA) chief executive Khalid Ali.
This year looked like being another year of exciting opportunities and growth for the betting industry, with the opening of the US and South American markets of particular interest.
These two markets sit within a global industry worth in the region of $73bn in 2019, according to leading market data analysts H2 Gambling Capital, and where the interactive sports betting segment had been predicted to nearly double over the next five years.
All of these figures are of course now being revised daily, if not hourly, as sports around the world are suspended or postponed, and in some cases cancelled. At the time of writing, H2 forecasts a 12.1% year-on-year decline in global gambling revenue to $415bn, below 2016 levels.
The industry has the tools to bounce back
From what appeared to be a potentially rosy year ahead packed with major sporting events and business opportunities, we now face a world where share prices have plummeted and operators are under financial strain.
Filling previously abundant sportsbook catalogues is understandably proving challenging at present. The world, and the betting industry, will very likely look somewhat different when we come out of this, and come out of it we will. Sport will return and operators will be ready to meet the consumer demand that global digitalisation and product innovation has helped nurture.
When that happens, I’m confident that many responsible regulated operators will be well-placed to bounce back. They’re aware that customer appetite is there once the product returns and that demand has grown.
Sports betting has widened in scope, with operators responding to customer demand for betting on more lower-level local sporting events, which is helping to fill some of the present product void. And it’s not just traditional sports; we could well see betting on the US Presidential election breaking previous records. This product diversification has helped operators promote their brand and engage new audiences, and it will help to drive the inevitable recovery.
Suspicious alerts surge before sports shut-down
Whilst the current internal sector focus is quite rightly on product and business viability concerns, the vulnerability of sports and betting to corruption remains an ever-present threat to operator finances.
IBIA saw a surge of suspicious betting alerts in the week leading to the global sports shutdown, highlighting the continuing business threat, ingenuity and opportunism of match-fixers. Even losing half of March has not stopped the first quarter of the year being a new record for IBIA alerts. Whilst there has since been a lull, we fully expect the business threat to rise as sport returns.
The need to safeguard the industry from malign influences is of course the central reason for IBIA’s existence. Under its banner, many of the largest and most reputable sports betting operators have joined forces, forming a united front to protect the integrity of sport and the betting product, which even in these days of limited product remain under attack.
With a growing international membership base covering around 50 online and retail betting brands, IBIA has used its experience as the global leader in its field to protect its members’ businesses from fraud related to match-fixing. And that business threat seems more prevalent than ever in these most challenging of times.
Product integrity remains paramount for sector integrity
As and when the industry moves out of this global slump, and it will, we must remember that consumers desire a well-regulated product: they favour reputable operators offering fair betting on clean sport. Operators therefore have a vested interest in making sure that the activities people bet on are free from corruption.
They also have the hard data on threats to integrity that can be used to formulate effective policy to combat the problem. For responsible licensed operators, trust and reputation is everything and that remains the case even in these most challenging of times.
Indeed, it is clear that corrupters are still operating and seeking to exploit the current situation. For its part, IBIA will continue to utilise its unique customer data-led global monitoring platform to protect its members’ businesses and sports from fraud. We’ve worked hard to establish our credentials with sports and regulators around the world.
They know how valuable our members’ customer data is to advancing investigations, and they also know that we are committed to working in partnership and to exploring all practical and legal avenues to utilise the powerful tools at our disposal.
Meeting that challenge, and protecting sports and our members’ regulated betting products, is exactly why IBIA exists. Whilst there are quite understandably more immediately pressing business concerns for operators, maintaining the integrity of the product remains a critical and long-term requirement.
Without it there is no consumer trust and there will be no industry bounce back. But responsible operators know this and it is why IBIA members have invested so much in integrity over the years. It is that product integrity and consumer trust that will help to underpin the sector’s recovery.