The International Betting Integrity Association combined with data business H2 Gambling Capital to release a study assessing and ranking the 20 strongest regulatory markets in the world. The report ranked the markets based on regulation, product availability, tax, marketing, and integrity, and it showed Nevada and New Jersey to be among the highest regulated markets. The two US online betting powerhouses ranked 4th and 6th, respectively, with three points separating them.
The study, a first-of-its-kind, also covered sporting integrity and match-fixing and included an overview of the global market. Speaking after the release, the chief executive of the IBIA, Khalid Ali, said, “The contents of this study can rightly be justified as unprecedented. H2 has conducted a detailed examination of product data that covered $137 billion in turnover, as well as its market data.” The study used data from almost 50% of the world’s online betting market (International Betting Integrity Association, 2021).
How the IBIA-H2 Study Was Carried Out
The world’s prominent trade associations were involved in the recent study by the IBIA and H2, including The European Gaming and Betting Association, NOGA, Jdigital, Branscheforenigen for Onlinespel, and the Betting and Gaming Council.
According to Ali, “This report provides a real, never-seen-before insight into global consumer demand, regulatory practices, and integrity risks. At IBIA, we hope that these evidence-based findings – which reveal the core facets of a successful betting regulatory framework – will help the important ongoing debate surrounding global betting and integrity.”
The study also reviewed the commercial progress made by the global betting market, predicting that by 2025, turnover will exceed $750bn while revenue will surpass the $100bn mark. In the section assessing market integrity, it was revealed that betting operators lost $25m every year to match-fixing. Another notable insight was that online betting has now surpassed land-based betting on the revenue scale, with it expected to continue to hold down that spot moving forward.
Speaking about the key factors that drive an optimum betting market, director of H2 David Henwood said, “Our assessment of various regulatory models operating around the world has determined that the key factors that are likely to create a successful betting market are: competitive GGR tax, unlimited licensing, wide product offering, integrity protocols, and balanced advertising rules. Our betting product and integrity evaluation are based on the most detailed market data collection ever assembled, and that is what makes our findings unique and illuminating.”
Breakdown of New Jersey and Nevada’s Assessment
The top three spots in the IBIA-H2 ranking were taken by Great Britain (91 points), Malta (88 points), and Denmark (86 points). They were closely followed by two of America’s biggest online betting markets – Nevada (85 points) and New Jersey (82 points).
Nevada
Nevada’s regulatory framework, which existed even before the PASPA bill was repealed, gave the state an edge in the regulation rankings, even though online betting is only licensed through links with land-based operators in the state. According to the IBIA, Nevada’s GGR and overall tax percentage is enticing, granting it the joint-top spot on the tax rankings.
The state’s restrictions on non-college amateur sports and political betting counted against its product offering score but it still ranked comfortably ahead on that front, relative to other US markets. Nevada’s regulation, which insists that advertising must be carried out with decency and should not be aimed at self-excluded players, gave the state a relatively modest advertising score.
New Jersey
New Jersey’s regulatory system only came to the fore after the PASPA bill was struck down in 2018, but the state still received some commendation on that front. On the tax front, the state’s online tax rate was reported as being better than average. The 14.25% rate for online betting, though higher than land-based 9.25% tax, was lauded for being competitive and remaining close to Britain’s long-standing 15%. (Tax Foundation, 2020)
New Jersey’s product score was average primarily because of the restrictions placed on in-state college sports betting. However, because operators within the state must be part of betting monitoring systems, New Jersey compensated for its product ranking with an impressive integrity ranking.
The dynamic nature of online betting regulations and popularity within these two states means that we shouldn’t expect their rankings to remain the same for too long. All eyes are now firmly trained on these North American betting stakeholders as we anticipate the next moves from their legislation and operators.
Sources:
- International Betting Integrity Association, 2021 – https://ibia.bet/an-optimum-betting-market
- Tax Foundation, 2020 – https://taxfoundation.org/legal-sports-betting-states/
