Sports-betting ads problem goes mainstream
US sports leagues’ new coalition, BetVictor’s ASA loss, PlayUp out of Ohio, Finland ends gambling monopoly +More
Good morning. On today’s agenda:
Responsible betting ads coalition formed by major leagues and networks.
BetVictor loses ASA case on sports star advertising.
PlayUp admits guilt in Ohio, gives up license application.
Finland ends gambling monopoly, introduces new regime.
Sports/media coalition
US sports betting officially has an advertising problem that is no longer confined to responsible gambling circles.
This is the end: US sports betting officially has an advertising problem, as it is no longer confined to responsible gambling circles. As reported by ESPN’s David Purdum, faced with increased attention around sports-betting advertisements, professional sports leagues and media outlets have formed the Coalition for Responsible Sports Betting Advertising.
The coalition consists of the NFL, NBA, NHL, Major League Baseball, WNBA, NASCAR, MLS and media outlets NBCUniversal and Fox.
“As the legalization of sports betting spreads nationwide, we feel it is critical to establish guardrails around how sports betting should be advertised to consumers across the United States,” a statement from the coalition reads.
The group listed six core principles, mostly aligned with the responsible gambling policies put forth by the NCPG and AGA.
One exception that is very league and media specific is “sports-betting advertising should not… degrade the consumer experience”.
The real issue: Sports are seen as PG content that parents can watch with their children. Sports provide families with shared experiences, whether it’s the joys of winning or the sadness of losing. Sports also offer a chance to broach life lessons from hard work and perseverance to humility and sportsmanship.
But for many, the escapism of sports is being hijacked by betting.
Going viral: The industry can argue that Chris Hayes’ take is missing the big picture and based on emotions rather than reason. But it resonates and is a good barometer for where the general public stands on the issue.
The tweet has 3.4 million views, 25,000 likes, 2,100 retweets and nearly 1,000 comments, most of which are from non-bettors.
As Hayes later pointed out, it’s not so much the commercials (which can be tuned out like other annoying ads); it’s the inability to avoid the marketing before, during and after the game.
Further reading: Sports-betting ads are awful and they’re not going away.
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BetVictor’s red card
BetVictor has been branded “irresponsible” after running a Facebook advert featuring two Spanish soccer stars that breached rules against targeting under-18s.
Who are ya: The Gibraltar-headquartered firm ran a campaign in January asking fans who was the most underrated player in their team, using images of Barcelona legends Jordi Alba and Sergio Busquets.
The Advertising Standards Authority (ASA) said the stars, having won multiple trophies at domestic and international level, are high-profile names for one of the most widely supported teams in sport.
Under the Committee of Advertising Practice (CAP) Code, Alba and Busquets would be considered elite level talents with a “strong appeal” to children.
The regulator said BetVictor’s choice of platform weighed into its conclusion “that the ad was irresponsible” and must be taken down.
Facebook doesn’t have “robust age-verification” to ensure guardrails against anyone under 18 viewing the promotion, the ASA said.
Strong armed: New rules on the use of sports stars in gambling adverts came into effect in October 2022, and legal experts say the ASA is using the updated interpretation of what constitutes “strong appeal to children” as basis for increased enforcement.
Operators can still run ads featuring activities that youngsters enjoy, like sport, but they must ensure the content isn’t too alluring for under-18s.
There is a particular danger involved in using active football players, lawyers told C+M, given the sport’s enduring popularity, high profile and dedicated media for children.
In February, Sky Bet and Paddy Power escaped censure for using ex-England internationals Peter Crouch and Micah Richards in social media promotions, as the retired pros were deemed not in the ‘high-risk’ category.
Ban intentions: The new office is also ‘strict liability’, which means, even with no evidence that a child has viewed an ad, the regulator can still dish out a punishment.
“If a marketer is relying on ad-targeting to exempt the ad from the new rules, the age-verification of the audience must be validated by additional means, such as payment data or credit checking,” said Jack Wood, IP lawyer at Squire Patton Boggs.
Sites that rely on self-verification of ages, like Facebook, are considered particularly risky.
PlayUp out of Ohio
PlayUp withdraws Ohio license application, pays restitution over illegal online slots transgression.
Out of play: The Australian firm has withdrawn its application for a sports-betting license in Ohio and will pay a $90k fine after having been found to offer illegal online slots games where the outcome was based on current race results.
PlayUp will have to wait four years before it can resubmit.
The product, called Slots+, saw $30k wagered before it was shut down late last year. PlayUp will pay that money back as restitution.
PlayUp is live in four states currently, including Colorado and New Jersey, but is yet to trouble the scorers in any of them.
To a Finnish
Finland ends its gambling monopoly, decides to roll dice on a licensing system.
Thank u, next: Finland has called time on its gambling monopoly regime. Legal experts say it comes down to cold hard numbers, with previously excluded operators already scrambling for market share.
As previously reported in C+M, a government study into gambling reform has advised ending the present exclusive-rights model of the Veikkaus monopoly and launching an open licensing system instead.
Lawmakers have been presented with two paths: first, the Norway model (which has its own monopoly) of stronger regulation, enforcement, ad bans and payment blocking.
The second is a more orthodox licensing approach taken in other Nordic states, which the study said would “significantly improve” the chances of keeping tax-paying punters within reach.
Regardless of the final decision taken, the new law enters into force on January 1, 2024, said Antti Koivula, legal advisor at Legal Gaming Attorneys at Law, in Finland.
While that date signals the end of the monopoly (and all the lobbying it generated), the race to fill the vacuum has begun in earnest.
“The fight for market share is already underway, while enforcement activities are at an all-time high and the study has proposed a cooling-off period to be included in the upcoming licensing system,” Koivula told C+M.
Three became one: A trio of previous monopoly operators, Veikkaus Oy, RAY (the Finnish Slot Machine Association) and Fintoto, were merged in 2017 because the government wanted a single state-owned body to govern the sector, but the results didn’t go to plan.
GGR for the ‘New Veikkaus’ plunged from €1.8bn to below €1.1bn, while the gray market – which doesn’t pay tax – more than doubled from roughly €200m to €500m in that time.
Veikkaus’ online market share is significantly down and hovering around 50% as unlicensed offshore operators continue to make hay.
The growing anti-monopoly sentiment within the EU and the fallout from Covid-19 hastened its demise as Veikkaus became an albatross, said Koivula.
See the danger: “The political atmosphere towards Veikkaus’ monopoly has changed,” said Koivula, noting that the government was forced to compensate the beneficiaries for the funding shortfall during the pandemic when takings dropped and the public purse took a big hit.
“When the channelization rate drops too low, it is not even theoretically possible for Finland to achieve the aim of effective gambling harm prevention that has been used to justify the monopoly in the first place,” he said.
The big questions now are: When will it be ready? And what will the new system look like? Koivula said.
“It is definitely advantageous to be on top of things when changes start to take place.”
The way old friends do: The eventual new system may bear a striking resemblance to that of Sweden’s, which Finland follows closely on legislative matters, Koivula said.
“Responsible gambling and the prevention of gambling harm have been emphasized in the study and in every relevant discussion regarding the system change,” he added.
However, the report noted that an overly strict approach may continue to depress the channelization rate.
“It will be interesting to see how they will try to achieve both of these aims, not to mention an increase in state income, at the same time,” Koivula said.
“Personally, I do not believe that advertising will be banned altogether, but it will certainly be subject to limitations.”
More ads wrath
Sports-streaming service Kayo has caught the wrath of Australian regulators for showing gambling advertisements during a game.
Not OKayo: The Australian Communications and Media Authority said Kayo had breached rules forbidding broadcasters from running gambling marketing during live sport events between 5am and 8.30pm, including the five minutes before and after the event.
ACMA investigators said promotions were streamed on the Kayo service within five minutes before play began and during scheduled breaks.
“Streaming services need to comply with the rules in the same way traditional television broadcasters do,” said ACMA chair Nerida O’Loughlin.
“Gambling advertising during live sport is a major concern for Australians. Families want to watch live sport without needing to worry that children may come to think of gambling as a part of the game.”
Kayo subsequently implemented live production testing and technical improvements to the processes and software used to schedule advertising.
The firm’s senior management must review and sign off all future system changes to ensure compliance.
Malta’s defaulters
Two firms are in hot water with Malta’s gambling regulator for not paying their debts.
Comin’ up with lint: Austrian developer 4tune-Software GmbH had its license yanked on Tuesday (18) for failing to pay its bills to the Malta Gaming Authority, the regulator said.
4tune no longer has authorisation to carry out operational activities and has been ordered to pay the outstanding fees immediately.
On Tuesday, Maltese pools-betting operator Totup System Limited was warned it must stump up €50,000 to cover its license fees for 2022 and 2023 or risk a similar fate.
Totup has also ignored requests to pay its compliance contribution bill within an acceptable timeline, the regulator said.
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European notebook
The Netherlands: The Dutch gambling authority has issued a €400k fine to BetEnt, the sports-betting site operated by the Entain-owned BetCity, for advertising that was improperly directed to young adults.
Norway: The Norwegian Lottery Authority has confirmed it now has powers to perform domain name blocking against unlicensed online casinos. Lottstift said it will launch a campaign in 2024.
US notebook
Nevada: The State Assembly has approved a resolution to legalize a state lottery, passing the motion by 26-15 and sending it to the Nevada Senate. The casino industry in Nevada remains implacably opposed to a lottery.
Calendar
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