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26 percent of all gambling in Sweden takes place over the Internet
Posted 3/21/11 : 26 percent of all gambling in Sweden takes place over the Internet
A key element in Sweden's busy gambling industry is the online sector, which accounts for 26 percent of all gambling in the wealthy Scandinavian country, according to new research by the Stockholm-based Research Institute of Industrial Economics.
That ranks it among the highest in Europe, say the report’s author, Professor Henrik Jordahl of Rent Spel in recommending to the government last week that it should formally recognise the activity as an important contributor to the nation's successful business development.
Founded by former Unibet chief executive Petter Nylander, Rent Spel (Fair Play) is a trade association of parties interested in the gaming industry.
Sweden's state-owned gambling monopoly Svenska Spel has only comparatively recently started to make tentative moves that could liberalise its industry, under some pressure from the European Commission.
Swedish companies are among the most successful in the internet gambling space, a fact acknowledged and applauded in the Jordahl assessment of the industry, which notes that companies outside the state monopoly have a market valuation in excess of SEK19 billion and employ almost 2 000 skilled people.
The employment numbers rise to 4 500 when government workers in gaming operations are added - the majority in Sweden.
Jordahl gives those numbers perspective by pointing out that the gambling industry employs as many Swedes as national car manufacturer Saab - and is more successful.
Another example he gives is the video gaming entertainment industry, often held up as a shining example of Swedish technological competence and success, when the online gambling sector is actually worth more, performs better with greater numbers of highly educated employees, and is more profitable.
These and other industry contributions to Swedish success align the online gambling sector positively with the wider EU "Digital Agenda for Europe," Jordahl points out.
The report urges Swedish parliamentarians to recognise the success of the internet gambling industry in order to ensure that the nation does not lose ground in the wider European arena, where there is a growing trend toward recognition and regulation.
Jordahl again uses examples to illustrate the point, noting that Malta is attracting increasing numbers of highly skilled Swedish specialists through Swedish companies like Betsson and Net Entertainment operating in that jurisdiction.
There are also advertising opportunities that are being passed up by Sweden's present restrictive position on the industry, he opines.
Interestingly, the Research Institute of Industrial Economics assessment also reveals that despite ministerial statements to the contrary, investigations by the domestic newspaper Dagbladet recently found that the government, operating through the National Pension Fund, has share holdings in major online gambling companies such as Unibet, Betsson, Net Entertainment or Ladbrokes - companies that have not been granted licensing by the Swedes despite being prepared to pay for the privilege.
These holdings could be worth as much as SEK972 million, a significant percentage of pensions assets invested in internet gambling and therefore the continued successful performance of the companies concerned.
Jordahl concludes by recommending that the gambling market in Sweden is in need of an extensive regulatory revamp that will bring it into line with current European regulatory trends and maintain its leading position in the new market environment that is evolving.
“Given the challenges to existing regulations in the form of EC law and technological developments, which were clearly described in the Lotteries Commission report of eleven years ago, it is no longer acceptable that the government remain passive in this matter,” the report urges.
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