Like the majority of markets in Europe, Denmark has had to contend with a fall in gaming revenue due to the impact the coronavirus pandemic has had, particularly on its land-based venues. Of course, the suspension of live sport in March severely hurt the industry and as a result, the gambling market in Denmark saw its gross gaming revenue (GGR) fall by 5% year-on-year for Q3 2020, down to DKK 1.53bn ($249.5m).
Sports betting was impacted, with GGR dropping 11% from the same period a year prior to DKK 558m, while online casino GGR saw a 2% decrease down to DKK 555m. However, land-based casinos saw a rise in revenue, up 6% to DKK 87m.
The Danish Gambling Authority, Spillemyndigheden, released the figures, and said at the time: “Betting was significantly affected by the coronavirus in Q2 2020 because many sports events were cancelled or postponed. However, in Q3 2020 the market has increased again. The reason why the most recent quarter still represents the second-lowest GGR since Q2 2017 may be that the autumn football season started later than previously due to the coronavirus crisis.”
To get more on the impact Covid-19 has had on the Danish market, we caught up with the DGA’s gaming machines and systems chief adviser Anders Basbøll, who explains more.
How has the coronavirus pandemic impacted the online gambling industry in Denmark? Has there been a rise in online activity?
There has been a fall in betting, probably mostly due to cancelled sports events, as well as gambling on gaming machines and in other land-based gambling activities. But there has not been an increase in online gambling activities to compensate the fall. In fact, online casino saw the smallest increase in nominal terms since the liberalisation in 2012. Either the pandemic has not influenced the online casino market much, or there’s been a move from betting and land-based gambling to online casino, but this is compensating a decrease that would otherwise have been on online casino.
What measures have been put in place by the Danish Gambling Authority to help people to spend within their means in lockdown; and how has the industry in Denmark and the DGA helped support and stop problem gambling figures from rising?
While not instigated due to the Covid-19 pandemic, new requirements came into force on 1 January 2020. One of the new requirements meant that players must set a deposit limit for themselves. Prior to the adoption of this requirement, gambling operators only had to make the option available to players. In addition to this, bonuses have been restricted and a new duty of care took effect. This obliges licence holders to monitor the gambling pattern of each player to look out for problematic gambling behaviour. Thus, to the degree that more players have shown signs of problematic gambling, it means licence holders have had to help more often.
Has the sports betting industry showed signs of improvement after a Q3 revenue rise? How do you rate
the state and popularity of sports betting in Denmark right now and how can it grow?
In Q3, the GGR of betting was 11% lower than the Q3 GGR in 2019. However, it was an increase of nearly 50% compared to Q2 in 2020. So Q3 was a step towards normality, but still lower than usual. Some Q4 numbers are just in. Betting has had the all-time highest GGR in nominal terms. Part of the explanation is a decline in RTP [return-to-player], which might be due to arbitrary factors such as how Denmark and Danish teams have done in international competitions. But there is also an increase in stakes, which might be part of a general return to betting, while some of it might also be due to the very compact scheduling of football matches in Q4.
There has been a more general lockdown in Denmark in Q4 and later than in Q3 of 2020, so it’s hard to know if the lack of other entertainment has caused more people to gamble or if people are less willing to spend money, including on gambling. Before the pandemic, sports betting was relatively stable the last couple of years. Whether Covid-19 has a long-lasting impact, it’s too early to tell.
How would you describe regulation in Denmark compared to other big markets in Europe? Do you think it's strong or are there areas that need tightening?
That is a political question about what regulation is needed and I am therefore unable to give an answer. However, I can say that the Danish Gambling Authority is very proud of ROFUS, the service that allows Danes to self-exclude from all online gambling activities and land-based casinos at all licensed operators at once. Players may opt to exclude for one day or one, three, six months or permanently, which can be ended at any time after a year. At present, there are about 25,000 people registered with ROFUS.
Would you say the online market is thriving in Denmark and will continue to do so?
Online casino has grown over the last few years, also when adjusting for general inflation. This might partially be due to an increased channelisation to the regulated market. I am sorry, but we do not make forecasts for future years.
How do you view the proposed rise in gaming revenue tax in the market? Do you think it will lead to more black market operations?
We have no view on the tax as a regulator. But to answer your other question, on its own, the rise will increase the unregulated market. That is a basic economical principle, and calculations on this have been presented to Parliament when the legislation was introduced.
How would you sum up the role of the DGA in protecting and strengthening the Danish gambling market?
The Danish Gambling Authority’s role is to protect consumers by ensuring that licence holders comply with rules on protection of players. But also, just to come back to the earlier question, to make sure that “Licensed by the DGA” is a stamp of approval, which may also give the licence holders a competitive advantage, compared to the unregulated and untaxed competition they face.