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FRENCH ONLINE GAMBLING MARKET SLOWS
02/08/2012 : FRENCH ONLINE GAMBLING MARKET SLOWS
French regulator ARJEL releases latest stats
The argument that high taxes are strangling the French regulated gambling market received some support when the French regulator ARJEL released its Q4 2011 numbers this week, showcasing a decline in sports betting wagers of 23 percent, and a slide of 10 percent in gross win to Euro 28 million.
Poker similarly slipped, with cash games down 3 percent, and 10 percent less players being recorded.
There was better news from the horse racing and tournament poker sectors, where tournament action provided some relief with a 16 percent rise in active players, whilst the ponies attracted 38 percent more punters, boosting gross win by 29 percent.
The slow business was reflected in slashed advertising and marketing budgets, which were more than 50 percent down on the previous year at Euro 46 million.
In a statement in French published at http://www.arjel.fr/Communique-du-7-fevrier.html ARJEL chief Jean-Francois Vilotte again recommended that some revision to the way in which the market is taxed may be necessary.
Taking an overview of online gambling in France, Vilotte said there were 2.3 million active player accounts in 2011, and that almost Euro 600 million was bet on sports; another billion on the horses; Euro 7.6 billion on cash game poker and Euro 1.2 billion on poker tournaments.
Whilst sports betting in quarter 4 had been the best for 2011, it had not produced the hoped for growth, and the sector recorded a net decline in activity on all fronts, with a decrease of 23 percent of stakes, 10 percent of its product gross gaming revenue and 17 percent in the number of active player accounts when compared with Q4-2010.
Betting on football and tennis, both popular sports with the punters, declined by 18 percent and 36 percent respectively, and showed a lower rate of return to players - from 84 percent in Q4 2010 to 82 percent in Q4 2011. Vilotte said the decrease in sports betting is a concern for the regulator, amid worries that players may leave the regulated French sites in favour of a return to illegal offshore sites still accepting French business.
Interestingly, Vilotte considered the impact of live betting, which was spread unevenly among different sports: tennis fans (72 percent); volleyball (81 percent) and only 41 percent in football.
Horse racing remained the star of the French show in 2011, according to the regulator's statement. In 2011 there were 502,000 active player accounts compared with the previous year's 365,000. These generated a 29 percent rise in gross gaming win for operators, but the payout rate was 4 percent less.
The ARJEL statement shows that a total of 1.2 million player accounts were active in cash game and tournament internet poker in 2011. Both activities have evolved very differently, revealing a French preference for tournaments.
The French regulator provides some interesting demographics: in all sectors, the French online player is male (88 percent), fairly young (57 percent of players are under 35 years) and lives near betting shops and in the southeast quarter of France - the region Nord-Pas de Calais or Corsica.
He spends on average Euro 250 per year on online gambling sites, replenishing his gambling account via credit card somewhat less than once a week (89 percent).
Breaking those demographics down more specifically:
* Sports bettors are by far the youngest (38 percent are between 18 and 24 years) and male (92 percent),
* Horse racing fans are typically older (76 percent are over 35 years) and there is a larger female demographic (20 percent of player accounts).
* Most players favour online poker (52 percent) and nearly half of them (46 percent) put less than Euro 30 a month in cash games, and less than Euro 10 per month on tournaments. This is similar to the typical sports gambler, where 43 percent bet less than Euro 10 a month. By contrast, the horseracing punter plays more regularly and 36 percent lay down well over Euro 100 per month.
There have been massive changes in the manner in which operators in the French market promote their services, with an overall reduction in marketing spend of 50 percent since last year (Euro 46 million euros in the fourth quarter 2011 against Euro 93 million in the fourth quarter of 2010).
Operators have significantly shifted buying space in the mainstream media (56 percent decrease in advertising expenditure in press, television and radio) to more targeted operations on the internet, such as affiliate marketing, where operators have spent nearly a quarter of marketing budgets in the last quarter of the year.
The mobile gambling phenomenon has also had an impact, it appears. Approximately 12 percent of online gamers are also "mobile users", connecting via their mobile phones or digital tablets. This represents a rise of 2 percent over the same time last year.
ARJEL notes that as at February 7 2012, 46 licenses were issued to 34 licensed operators:
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