The COVID-19 pandemic has forced large parts of the gambling industry into a deep freeze, and it is unclear when they will begin to thaw. Like so many other leisure activities, gambling, at least in its traditional form, relies on the free movement of people and their willingness to gather in large numbers at proximity. Furthermore, the cessation of sports events at both local and international level also cut one of the sector’s most lucrative revenue supplies practically overnight.
An Opportunity For Online Casinos?
But while bricks-and-mortar casinos in Vegas and beyond struggle and sports betting exists on life support, logic supports the supposition that other forms of gambling could thrive in such unprecedented times. The sector already benefits from a significant online presence, which has encouraged those who may once have gambled very occasionally if ever at all to become frequent participants over the last decade.
Much of this online activity is the preserve of sports betting and given there are precious few sports events happening; there is very little to bet on. However, online casinos – of which there are now hundreds, maybe thousands, in operation – are immune to such challenges. Indeed, as more people find themselves confined to their couch and bereft of their other usual leisure activities, it is plausible to assume that those who are so inclined may play readily available video slots, poker and table games all the more.
However, it is important to apply some caution to any theory which predicts that online casinos and related platforms will exponentially collect the business that suspended forms of gambling lose while the world remains in the grip of COVID-19. A 2018 Health for England Survey in the UK suggests that while 40% of adults gambled within 12 months (excluding those who only participate in the National Lottery), only 3% had done so online. It is a stretch to assume that casual gamblers who attend bingo halls, spin fruit machines in their local bar on a night out or attend one major horse racing event will suddenly look to online gaming to fill the void, even more, when the online options have narrowed in the absence of sports betting.
State Restrictions In The US
Here in the US, the industry is of course, tightly regulated at State-level and most US citizens are not permitted to gamble online anyway. Even in the wake of New Jersey’s Supreme Court victory in 2018, fewer than 20 states have legalised some form of sports betting, and you can halve that number when totting up those which permit their citizens to play at online casinos. This is a list of casinos in the United States and given the potential of the market; it remains small.
Ultimately, most gambling activity that is permitted in the USA is heavily reliant on the resumption of live horse racing, the NBA, NFL and MLB, as well as the reopening of the traditional casinos, not least in Las Vegas. So, while it’s eminently possible – perhaps even likely – that online casinos and related platforms will pick up additional business as a result of the COVID-19 pandemic, it’s unlikely to make a significant dent into the shortfall engendered by the complete cessation of other forms of gambling.
Increased Risk To ‘Problem Gamblers’
There are other consequences of an increase in online casino play too – and some may induce a different set of pressures for the industry. Regardless of any increase in participation, there is concern about how the pandemic could affect those most at risk of problem gambling. A British Gambling Prevalence Survey in 2010 found that 20% of gamblers would gamble when bored, with a further 22% citing stress relief as a motivator. With many of those people unable to work and seeking ways to occupy themselves, it is easy to see how COVID-19 has increased the risk for the most vulnerable.
In response, many jurisdictions have tightened restrictions on online gambling. In others, governments have called on the industry to do more to protect problem players, suggesting that companies should impose maximum daily spends and stake amounts. As is the case in so many other areas, the best way forward, however, remains unknown. Gambling companies have never seen times like this before, and it is unclear how they should best approach them.
Further Challenges Ahead
This is a pandemic that has had a scarcely believable impact on just about every aspect of human life and interaction, and its effect on the gambling industry is stark. While online casinos could thrive in these conditions, nobody knows yet for sure, and their success will only fill a small part of the gaping revenue chasm, which is developing elsewhere. Even as they do, the challenges that social isolation and boredom provide for risk management programmes threaten more draconian regulatory intervention for online bets.
The industry can only return to some semblance of normality at a time when people can freely move again, visit casinos and bars, fly into Vegas and other hotspots and begin gambling (both online and in-person) on a near-full programme of sports events. Even then, the prospect of a growing recession and increased travel anxiety is likely to extend any pressures beyond the period of lockdown. A fast recovery is by no means assured for a sector that that has previously enjoyed continued growth over recent decades. The current deep freeze may begin to thaw, but it could be a long time before the challenges COVID-19 has created melt away altogether.
