Bookies hit by online gambling crackdown
CLOSE to £ 800m was wiped off gambling stocks yesterday after the regulator announced it would settle the issue of stake limits for online games within six months.
MPs have called for the maximum stake to be reduced to £2-per-spin, in line with fixedodds betting terminals (FOBTs) in shops.
Shares in William Hill fell 7.7pc, wiping £131m off its value, and 888 Holdings fell 3.4pc, taking £18m from its market capitalisation. 888 Holdings shares are now worth 134.9p, almost 25pc down from the start of November and close to a six-year low of 130p.
GVC – which owns Foxy Bingo, whose ads feature American actress Heather Graham ( pictured) – lost 7pc, wiping £380m off its value, and Flutter, which is more focused on betting on sports, saw its share price fall 2.5pc, taking £172m off its market cap. Shares in games designer Playtech also suffered, falling 7.4pc, wiping £82m off its valuation.
The £783m fall in the value of Britain’s gambling groups highlights the threat tighter regulation poses to the industry.
When MPs first suggested the £2 maximum stake online in November, £1.2bn was wiped off the shares of the UK’s biggest bookmakers in a single day.
Carolyn Harris MP, chairman of the all-party parliamentary group for gambling, said: ‘The evidence suggests that online slot games are just as addictive as fixed-odds betting terminals. The regulator should not hesitate to act to protect the vulnerable as set out in its licensing objectives.’
Conservative MP Richard Holden said: ‘It’s absurd that we’ve stopped mini-casino level gambling on high streets but allow it via smartphone.’
Politicians and health professionals are worried ‘high intensity’ games put gamblers at a higher risk of developing addictions and losing more than they can afford.
At the moment there are no maximum stakes on online slot games. In April last year the maximum stakes on FOBTs in shops were reduced from £100 to £2 per 20- second spin. However, the industry is fighting back. A newly formed lobby group, the Betting and Gaming Council (BGC), has claimed limiting what gamblers can spend online will drive those at risk of addiction to the black market. The BGC said: ‘We want to have a betting and gaming industry in this country which is not just the best in class, but which also ensures we don’t drive people towards betting on harmful unregulated black markets.’
Last month the NHS’s mental health chief Claire Murdoch said the link between betting and mental illness is ‘increasingly clear’ as she savaged the predatory tactics that ‘turn the occasional flutter into a dangerous habit’. The Gambling Commission has already announced a ban on using credit cards on all gambling except the National Lottery, which will come into force in April. The Government is preparing to review the 2005 Gambling Act, with the aim of making it fit for the digital age.
Companies have implemented a ‘whistle-to-whistle’ ban on television advertising during live sport, and last week they said they would consider curbs on sponsorship in football.
The tightening regulatory environment has contributed to the UK gambling industry coming under strain after booming for many years. Firms have looked abroad for growth, with GVC using a tie-up with MGM Resorts as a way into the newly liberalised American market.
Flutter, which owns PaddyPower Betfair, is seeking to push a £10bn mega-merger with Canadian rival The Stars Group past the UK competition authorities.
And this week William Hill announced a deal with US TV network CBS, making it the exclusive provider of betting odds on the group’s channels.