The gambling industry has taken a beating from COVID-19.
In March, Macau’s Government halved its expectations for the jurisdiction’s gross gaming revenue to MOP130bn (US$16.3bn), while the European Gaming and Betting Association reported an estimated 11% drop in global gaming revenue as a direct result of the outbreak – which actually seems slightly optimistic.
As stock prices fall and with no real idea of when the situation will improve, these are uncertain and worrying months for the industry. But, at times like this, it’s beneficial to live by the words of the great Eric Idle: “Always look on the bright side of life.”
So what positives can the industry salvage from the remnants of this coronavirus-shaped crater?
One solace a lot of operators can take from the closure of land based betting shops and casinos is the inevitable migration of players to online.
Speaking with Gambling Insider shortly after the Italian lockdown was first enacted, Newgioco CEO Michele Ciavarella outlined the migration to online as a positive for the gaming company’s operations in Italy, and this was a sentiment mirrored across the gambling world as the coronavirus trading updates rolled in.
888 Holdings reported that, while delays to the sporting calendar had caused damage to its sports betting vertical, a rise in casino and poker activity had allowed the operator to trade above expectations. As a result, up to March 18, the operator’s daily revenue was up 18% year-on-year.
In fact, while the pandemic caused stock prices to tumble across the globe, at press time, online gaming companies have begun to see significant share price growth as 888Holdings has seen a 62% rise, while NetEnt has seen stock rise 42% and Playtech 28% - perhaps representing a shift of investor interest towards online gaming businesses.
If operators are able to capitalise on a growth in online activity, then it won’t only see them through the tough months ahead, but could also prove to be vital in acquiring permanent online customers. This will be particularly significant in those markets traditionally reluctant to make the shift to online, such as Italy.
Growth in esports
In an aim to combat fan disappointment after the indefinite postponement of the Australian Grand Prix, Lando Norris, a young Formula 1 driver for Mclaren, took to Twitch to stream his own online version of the race with the help of a number of ex-racers, professional athletes and celebrities. The race was a major hit with Twitch users, accumulating more than 70,000 viewers - smashing the previous record held by F1 esports.
As more races are cancelled and virtual races organised for the rest of the season, it seems this situation could provide a glimpse into the future. Esports is already experiencing a growth in viewership as homebound sports fans look towards the online world for entertainment. As the situation continues, could we see mass numbers of football fans turn to FIFA competitions for their weekend entertainment; or basketball fans tuning in to Counter Strike for a daily dose of competition?
Speaking with Gambling Insider in March, Quentin Martin, CEO of esports betting site Luckbox, explained that esports is “more resilient because matches can be played online, without players needing to be in the same place.” As a result, he said there had been a 54% increase in new player registration figures since the English Premier League was postponed.
While undoubtedly the COVID-19 postponements have caused much heartache to operators hoping for a profitable sport-laden summer, the increased interest in esports provides an opportunity for operators to build on what is fast becoming the future of betting.
This too shall pass
There is hope for the future of gaming.
While the COVID-19 situation in Europe seems to be worsening by the day; the gradual recovery of Wuhan indicates that it does have a time limit. Over months the situation will undoubtedly improve. Betting shops will once again open their doors; our screens will be graced with more sport than we know what to do with; and bettors will return to their favourite bookies with a new vivacity fostered in these solitary months.
The future is bright.