UK casino reform: Sports betting & machine expansion coming

The Department for Digital, Culture, Media and Sport (DCMS) has drafted plans to transform the gambling industry. They aim to modernise the industry with the most recent technological developments for land-based casinos, including sports betting options across all on-site locations.

Wholesale changes are expected across the regulatory framework in light of the ever-evolving consumer demands. This could allow casinos to increase the number of gaming machines as early as the 22nd of July.

The United Kingdom Gambling Commission (UKGC) has already announced that operators won’t be able to offer mixed product promotions and set a wagering cap of 10x on all bonuses by December 2025.

However, further reforms, particularly affecting land-based casinos, are expected. Take a look at the proposals below.

What are the key changes?

Since the 2005 Gambling Act is now 20 years old, there have been calls for new reforms to match current industry standards, especially since the 1968 Gambling Act underpins a lot of the provisions in the 2005 Act.

Here is a list of some of the key legislative changes expected in the DCMS plans:

• Streamlined licence applications and processes.

• A broader range of electronic games.

• Widened betting market choices, including sports betting options.

• A greater number of gaming machines.

• Updated machine-to-table ratios.

• Eradicating the need for membership at operators.

• More freedom in venue offerings.

The Betting and Gaming Council (BGC) believes that the reforms will be good for casinos, with a spokesperson stating:

“Much-needed reforms on gaming machine allocations and allowing all casinos to offer sports betting should strengthen the sector to better meet the needs and expectations of their customers. Implementing these policy changes will unlock millions of pounds in investment into city centres and high streets.”

“The BGC is delighted to welcome these modest, mission-critical modernisation reforms, so our members can better meet customer expectations and thrive.”

Why is there a need for change?

As stated above, the current Gambling Act is considered outdated and does not meet current industry standards for digital gaming and land-based casinos.

Casino operators have been vocal about the need for a change that would allow them more freedom within the regulated market to respond to consumer demands and preferences. For example, by providing greater choice in terms of gaming machines and by allowing all casinos the opportunity to provide sports betting.

Due to the growing online gambling market, land-based casinos must keep up with the digital transformation. This would allow them to continue to attract and retain players.

The impact of sports betting

Sports betting plays a pivotal role within the casino industry. If we look at data from across the Atlantic, research shows that onsite sports betting increases casino revenues, while online sports betting negatively correlates with land-based casino revenues.

By the end of 2023, over 38 states in the US had legalised sports betting, which generated new tax revenues.

While the two markets differ in location, the same principle can apply to the UK market. This is because one of the main reasons for increased revenues from land-based sports wagering in the US was due to the need to visit a casino, while you do not have to visit a physical location for online sports betting.

The latest UK government proposals allow sports betting across all casinos. The hope is that this will increase casino revenues, emulating the US market.

However, because the US regulations surrounding gambling at casinos are much stricter, the impact of allowing sports betting at casinos may not be as big in the UK market.

What the future holds

These proposed reforms could provide ample opportunities for operators to increase their revenues. It will also better meet consumer demands that are suited to modern times and match the digital age at online platforms.

Variety and choice are fundamental to player needs, and that diversification will better replicate the thousands of options that online casinos offer.

The US market has already demonstrated the positive impact of allowing sports betting at casinos. The UK industry could follow suit, facilitating further revenue increases at land-based casinos.