Fixed Odds Betting Terminals will soon face a UK government crackdown that could shake up the entire land-based gambling industry, according to numerous mainstream media reports.
A story published by Bloomerberg on May 15th informs readers that wagering limits on United Kingdom FOBT machines will be lowered from a maximum bet amount of £100 every 20 seconds to £2 — a move that some gambling industry representatives claim will cost Her Majesty’s Treasury £1 billion along with the loss of 21,000 jobs.
The popular brick & mortar Fixed Odds Betting Terminals — often referred to as the “crack cocaine” of the gambling industry — are spread out across 8,500 betting shops and are as lucrative as they are controversial.
UK customers lose an estimated £2 billion per year placing real money wagers on the machines, which has caused a surge in “problem gambling” cases, says UK Gambling Minister Tracy Crouch.
The imminent restrictions are the result of a government-backed consultation which began last October, and will “reduce the potential for large losses on the machines and the risk of harm to both the player and wider communities in which these machines are located, such as the increased health costs associated with problem gambling,” Crouch insists.
Are Fixed Odds Betting Terminals A “Stupid Gamble” and Evil?
Former Team PokerStars celebrity pro Victoria Coren Mitchell — who ended a sponsorship deal with the company in 2014 when it introduced casino games — called Fixed Odds Betting Terminals a “stupid gamble” and “evil” in a blistering editorial published by The Guardian.
“Punters lose and lose and lose. And when they disappear, or kill themselves, or their child is taken into care and they start self-medicating with drugs instead, someone else steps blindly up to feed the monster,” wrote Coren.
William Hill CEO Concerned About Foreign Corporate Takeover
On the other side of the argument is executive Roger Devlin, who leads Britain’s largest bookmaker William Hill.
“Sadly, I fear that your government is about to make a decision that is unnecessary and lacking in evidence – a decision that will also be catastrophic for a retail betting industry employing over 40,000 people,” Devlin warned in a letter to UK government officials which was reported Sunday by Sky News.
“Consolidation within our sector continues and I would…not want to see the impact of a disproportionate triennial (review) outcome being a factor in the name of William Hill being added to the list of companies now in foreign ownership.”
Fixed Odds Betting Terminals Crackdown (Analysis)
The reported decision by UK officials to significantly reduce betting amounts on FOBT machines shows the difficult task regulators have in balancing service provider interests with addressing the growing threat of problem gambling issues, and could very well spark a new round of Mergers & Acquisitions across the industry.
The machines generally offer a variety of house-edge digital casino games such as roulette and craps, and can be conveniently placed in small businesses that are located outside traditional ring-fenced live casino districts — making them available to a much larger percentage of the public. However, that convenience also makes the machines one of the biggest revenue generators in the gambling industry that supports roughly 40,000 jobs in the United Kingdom alone.
Although the precise effect these measures will have on reducing problem gambling activity is uncertain, it is very clear that the restrictions will negatively impact land-based operators who depend on the machines as a consistent source of revenue.
The incoming guidelines demonstrate the broad influence lawmakers can have on a regulated gambling marketplace, and also come just a month after the United Kingdom Gambling Commission (UKGC) updated its Licensing Conditions and Codes of Practice to include new “social responsibility” rules that restrict how gambling products are marketed to vulnerable individuals.
Such machines are also commonplace within the United States, but have yet to grab the market share of their UK counterparts — although Video Gaming Terminals (also known as VGTs) are now allowed at select Pennsylvania truck stops that meet certain requirements.
We will keep a close watch on this story as it continues to develop, and inform our readers if there are any changes before a final decision is handed down by UK officials.
Read More Gambling Regulation News from Part Time Poker:
Lee-Ann Johnstone Discusses UK Advertising and Marketing Guidelines (May 6, 2018)
Big Fish Casino Play-Money Games Deemed “Illegal Gambling” (Mar 30, 2018)
Loot Boxes Are “Gambling,” Say Belgian Regulators (Apr 26, 2018)
Pennsylvania Online Gambling Bill Signed by Gov. Tom Wolf (Oct 30, 2017)
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