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New Zealand Vs. Australian Gambling Market

Wednesday, September 2, 2020 4:35

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New Zealand Vs. Australian Gambling Market

When operators are looking for potential target audience they already have in mind what traits their ideal customer must possess:

● Significant disposable income

● Propensity to risk

● Interested in exploring new forms of social entertainment

If we transfer these desirable traits in a potential market to make business, the big picture can be resumed in two words: gambling culture.

Australia and New Zealand are countries that possess the influence of the Brits and their love for gambling. But is that passion what puts them in a separate category.

Each year, Aussies and Kiwis have nearly 80% of their citizens actively gambling and sustaining average spending of $1290 and $648 respectively.

While spending habits and gambling favoritism are game-changers other features must be weighed before entering a market. New Zealand and Australia might be neighbors that are fond of betting, but when it comes to business, they are different just as night from day.

New Zealand

Famously known for its breathtaking landscape portrayed in epic films, also captures some dramatic moments regarding its bittersweet relation with gambling.

With technological advances infusing the industry significant growth New Zealanders could now have access to more services in a time that only offshore providers were the ones dominating the market.

However, one of the bigger changes experienced was the wider protection of its most vulnerable inhabitants.

Consuming Figures

It is estimated that 80% of all New Zealanders (about 3.6 million people) gamble in some form or another. The 2018/2019 report figures a global expense decrease of $ 2,430.98 billions to 2,402,12 billions (a 1.19% decrease) as Kiwis started joining several minimum deposit online casinos available in New Zealand.

● NZ Racing Board (TAB) decreased from $356.87 million to $332.00 million (a 6.97% decrease)

● NZ Lotteries Commision decreased from $571,82 millions to $530.27 millions (a 7.27% decrease)

● Gaming Machines (Outside Casinos) increased from $ 912.83 millions to 923.88 millions(1,21% increase)

● Casinos increased from $589.46 millions to 615.,97 millions(a 4.50% increase)

Pokies and casinos as the most popular forms of gambling, with lotteries and horse racing attracting its fair share of followers but with lesser participation

Average gambling spending per adult decreased from $646.98 to $631.01 (a 2.47)% decrease).

While the industry on all continues experiencing a steady growth, the decrease in average per capita spending shows a shift towards more addictive forms of gambling usually pokies found inside and outside casinos, which are the areas that experience major growth in the report.

Regulations

The New Zealand Gambling Act 2003 aims for a protectionist approach. The Act heavily regulates all gambling forms with several of them under state control.

Providing a wider coverage to protect people from gambling harm is also a priority. While issuing participation of communities regarding the facilitation of responsible gambling, the Act also promoted their participation to help to address gambling tax revenues to those areas and sectors in need.

iGaming

Except for the TAB and Lottery promotion and sales, all remote gambling operations from New Zealand addressed to its residents are unlawful, operators can only target other jurisdictions.

Interestingly, offshore operators are allowed to provide services to New Zealanders but are expressly banned from advertising them.

Remote Interactive Gambling is prohibited. Fines can be imposed of up to $50,000 for organizations and up to $10,000 for individuals participating in unauthorized gambling

Advertising Overseas Gambling is prohibited with fines up to $10,000.

Land-Based Gambling

Pokies are extremely popular. The betting machines are located everywhere with an estimated presence of at least 18,553 of them. Laws have enforced its removal from non-gambling venues slowly reducing its figure from the previous +19000 since past years, but still represent a worldwide presence of 0.25%

The casino sector is represented by only 6 casinos with SKYCITY Entertainment Group, owning 5 of them. These venues attract not only locals but also a significant number of international visitors from Asia, who compose the majority of their customers.

The racing sector is popular among bettors but from the industry perspective, it was considered a neglected one. However, the task to revive the industry is being undertaken by the TAB in conjunction with the Ministry.

The bountifulness of resources in New Zealand for the equestrian sector, alongside better broadcast licensing programs, is a golden opportunity to make New Zealand stand out. The bountifulness of resources in New Zealand for the equestrian sector, alongside better broadcast licensing programs, is a golden opportunity to make New Zealand stand out.

Lotteries in the country are managed by the New Zealand Lottery Commission. The Commission is the sole responsibility of controlling and promoting popular games such as Powerball, keno, lotto, and bullseye. Lotteries are also the few online options New Zealand can access in their home country.

Problem Gambling

Problem gambling is the collateral of holding a gambling business. an is a serious health issue for the Auckland Ministry.

In New Zealand, a prevalent rate of problem gambling and at-risk gambling of 1.9%, currently represents 50,300 of the population. Triggers for problem gambling are:

● Being aged 25–34
● Being of Maori or Pacific ethnicity
● Being employed
● Living alone
● Having lower educational attainment.

Levy on gambling operators is imposed by The Ministry to fund problem gambling services.

Responsible gambling is demanded among all venues with gaming machines. Licensees have a legal duty to minimize gambling harm with venue staff also having certain responsibilities to keep gamblers safe.

Multi-site self-exclusion is a condition that all operators must comply with to protect customers aware of its problem gambling risk/condition.

Australia

Australia is the biggest island in the pacific and is also the biggest gambling nation in the world.

Since 1980 when the Victorian government legalized gambling, the industry skyrocketed and after the enforcement of The Interactive Gambling Act 2001, the sky was no longer the limit.

By 2025 it is expected that the gaming industry reaches its revenue peak with Australia being its major contributor.

This overgrowth of the industry attracted its worst part, problem gambling. The issue has become a national concern and several regulations were imposed to curb down its moniker of the world’s biggest losers.

Consuming Figures

According to the latest edition of Australian Gambling Statistics, there was a total gambling expenditure increased from $23,694 billions to $24,887 billions (a 5.0% increase)

● Total electronic gaming machine expenditure increased from $12.136 billion to $12.520 billion (a 3.2% increase)
● Total casino expenditure increased from $4,790 billions to $5,101 billions (a 6.5% increase)
● Total race betting expenditure increased from $3,313 billions to $3,547 billions (a 7.1% increase)
● Total sports betting expenditure increased from $1,062 billions to $1,235 billions (a 16.3% increase).
● Total Lottery expenditure increased from $2,165.60 billions to $2,254.23 billions (a 4,09% increase)
● Total other gaming forms (betting pools, minor gambling) expenditure also increased from $40,12 millions to $442,515 millions (a 3.25% increase)

Per adult gambling expenditure in Australia increased from $1,251.39 to $1,292.25 (a 3.3 % increase)

In general, all gambling sectors keep growing with no exception. Even with higher expenditures over sports betting followed by race betting and casino expenditures as the highest growing sectors, electronic gaming machines are stil by large, industry leaders with 2 thirds of it.

Regulations

Current regulation of the industry is conducted under the Interactive Gambling Law 2001 and its amendment bills (most recently the 2016 IGB) interestingly gambling laws in Australia are enforced in two levels:

● Central government supervising and creating/amending the industry’s laws,
● Provincial governments issuing gambling licenses under their own legislation and supervising operations as well

Penalties for violating the IGA was a fine up to $220,000 per day for individuals or $1.1 million per day for a company.

iGaming

Under the Interactive Act, 2001 Australian residents are not permitted to access interactive gaming sites under the Commonwealth Interactive Gambling Act 2001, which came into effect in August 2001. Interactive gaming exists in the Northern Territory but is available only to overseas visitors.

However, mobile gambling apps were recently allowed since 2015 with the 5 most popular bookies holding 41,7% of the market share

1. Tabcorp Holdings, 17,4%
2. Sportbets.com.au 12,9%
3. Crown Bet 6,3%
4. Ladbrokes Coral 3,5%
5. Bet365 1,6%

Land-Based Gambling

Pokies Are Australia’s favorite game. Nothing to surprise considering that the country is the birthplace of slot machines. In 2018, 196,301 were still operating in Australia representing a total worldwide 2.65%. Lobbyists encouraging its reduction have managed to decrease their number at a .,4% rate per year.

The Casino sector is represented by more than 20 full-scale operations in Australia spread over all eight states, With Crown Resorts Limited, The Star Entertainment Group Limited, and SKYCITY Entertainment Group Limited the major market holders.

Among all games offered in casino poker is such a popular game that has incentivized the creation of major events such as Aussie Millions and several chapters of the Poker Tour.

There are also other much smaller venues and clubs that are licensed to offer casino games along with pokies.

The Racing sector is second in popularity among Aussies. Government-regulated by the TAB, it also holds private operations in the majority of states. The sector also has more racing clubs & courses, and more race horses per capita, than any other country.

All Australian Bookmakers are permitted to accept bets on course, off-course, & online, with Thoroughbred, Harness & Greyhound racing done seven days a week, except on Good Friday and Christmas Day.

Sports bets have always been popular among punters. The sector experienced a major growth thanks to mobile gaming, although already was a self-driven part of the gambling consumer trends.

The industry has undergone some high profile match-fixing cases, but stricter regulations helped to address taxing revenues on the sector to improve its transparency and maintenance of the national infrastructure.

All Lotteries are under the TABCORP government operation. Lotteries are among the most favorite forms of gambling for Australians over 50 years old, even when the sector face strong external competition from alternative forms of gambling.

Problem Gambling

Problem gambling is an issue that currently golds 80,000 – 160,000 (0.5% – 1%) adults in this country are experiencing serious problem gambling, and additional 250,000 – 350,000 (1.4% – 2.1%) adults are experiencing moderate risks that can lead to problem gambling.

Rates of the problem and at-risk gambling are more likely to be raised if the person checks the following conditions:

● Indigenous Australians
● Males
● Lives in groups residence
● Possess lower than university education

Gambling harm encompasses everything from the loss of homes and relationships to the loss of lives. problem gamblers are 15 times more likely to take their own life, through deaths by suicide associated with gambling harm encompass 1 in 5 suicide attempts only from pokie gambling this had induced the imposition of stricter laws and regulations Such as:

● Bans on gambling ads during broadcasts of the live sport were introduced between 5 am and 8.30 pm (watershed)
● All gambling operators are banned from providing lines of credit
● Reduction of betting limits to $2 on all electronic gaming machines.

However, the gambling industry is powerful enough to mitigate these rulings thanks to its lobbying representatives.

Conclusión

Australia is by far one of the most profitable gambling markets to invest, once they manage to overcome all the requirements to operate. Lobbying and a very friendly operator legal framework allowed the sector to reach the size it currently has, but the social cost of problem gambling effect has damaged its reputation and another wave of regulations s to expect thanks to the influence of COVID-19.

The New Zealand market has been polarized to a more protective approach that has allowed to reduce the numbers problem gambling figures but has bound the industry to very few options.

If both countries manage to significantly reduce the market presence of electronic gambling machines, problem gambling levels will plump and allow the migration to other sectors where expenditure can even be better regulated and allowing major investment opportunities for land-based and online ventures.

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