France iCasino talks: the stage is set
France iCasino talks: the stage is set
France iCasino consultation, Better Collective job cuts, Caesars Digital and loads more.
Good morning, on Gaming &Co today:
France’s land-based casinos are ready to meet with government as iCasino consultations pencilled in for next week.
Better Collective has started cutting staff numbers following lowered forecasts announcement.
Caesars Entertainment hails early digital growth.
Kindred dot com exits to impact FY24 EBITDA target.
Malta unhappy at Italy’s new licensing system.
News shorts: Netherlands mental health body calls for total ad ban, Belgium OSB figures hit by poor Euro24.
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iCasino consultations in France: the stage is set
French casino operators are ready to consult with the government on all the key issues following withdrawal of online casino amendment.
Reset: Casinos de France, the trade body representing the country’s 200 French land-based casinos, has told Gaming&Co that it is looking forward to discussing online casino regulations when it meets with the government next week, and reiterated its call for the country's physical casinos to be given priority to operate the vertical digitally.
Open to debate: Philippe Bon, CEO of CdF, said that the organisation was also willing to study the different regulatory formats that could be proposed by members of AFJEL, the French online gaming association, but that there had been no contact between the two groups.
French exception: The regulation of online casino as part of an open market model has long been called for by AFJEL, but Bon said any such project must take into account France’s very specific land-based casino environment.
“People say France is the exception online, but it is also an exception offline with the number of (physical) casinos on its territory and the deep links they have with each department and commune they operate in. Within that context, it is not illogical that online casino is not regulated, or, if it is legalised, that it should be according to a particular model,” he said.
For its part, CDF has long called for its JADE model of iCasino regulation to be implemented and Bon added that it was “a precursor model, with the principle of tying a reasoned opening of online casinos to land-based establishments”.
Complex solutions take time: CdF is “open to dialogue with legislators as a first step”, but Bon notes that there are also “doubts as to how quickly an operational solution can be implemented in 2025” and that “technical solutions are complex and tax revenues will take time”.
Spin the wheel: Other revenue-raising options include the “possibility of operating roulette in the gaming clubs (cercles de jeux) that are based in Paris, which would create returns within the next 12 months”, he added.
With France withdrawing its amendment to regulate online casino on Sunday, the scene is set for a period of intense lobbying and discussions between stakeholders and the government. The withdrawal followed concerted pressure from Casinos de France and more than 100 mayors outlining their opposition to the measure in Le Figaro.
No disconnect: On Monday, Fabrice Paire, board member of France’s second casino operator Groupe Partouche and VP of CdF, told French media that “online casino regulation should not be disconnected from land-based casinos, we know it will be toxic or even fatal for some of them”.
Asked if CdF stood against change and modernisation, Paire said it was “safeguarding a physical business, not resistant to change”, and that the topic should be discussed calmly and without taking hasty decisions.
CdF’s JADE project has called for licences to only be issued to French land-based casinos and that online portals should replicate land-based offers. Paire said it has “promoted an intelligent model”, which was adopted by Belgium “more than 10 years ago and that Switzerland adopted five years ago”.
Dominant trio: He added that the country’s online sports betting and poker regulations of 2010 have led to an online “triopoly, with three operators sharing 90% of the online poker market and 80% of the sports betting market”. The triopoly’s “leader has 200 employees, do we want to favour 200 employees or a sector with 45,000?”, Paire said.
Nicolas Béraud, CEO of France’s leading online sportsbook Betclic and President of AFJEL, recently told France Info that regulating online casino was “a major issue of general interest” and bringing the estimated four million users said to be playing on illegal sites into a regulated orbit will protect them.
“Additional protection measures may be possible, but we need a legal framework to be able to act,” said Béraud. He added that “the impact (of regulation) will not be significant because the market already exists, in an illegal form.”
Responding to those comments, CdF’s Paire said: “We hear AFJEL and Mr Béraud tell us it is of general interest to open the market, no it is a private interest.”
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Better Collective cuts staff numbers
Affiliate giant has already cut 100 positions as it seeks €50m in savings.
Chop house: Better Collective has started reducing staff numbers and already cut 100 jobs following its announcement last week that with FY24 revenue and EBITDA guidance lowered by 25% to €355-€375m and €100-€110m respectively.
The company said it needed to cut costs by €50m, CEO Jesper Søgaard said in a post on Linkedin that “the decision was prompted by shifts in the US market as well as a continued slowdown in commercial activities in Brazil”.
Google’s ‘site reputation abuse’ update in May has also been a factor in traffic levels dropping from the content partnerships BC and other affiliate run with national newspapers.
The BC news follows last week’s sale of affiliate group XLMedia’s assets to Sportradar for $30m and mass layoffs by Catena Media over the past 18 months.
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Caesars’ Q3 digital haul
US giant praises digital turnaround but says it’s still early days.
Hail digital: Caesars Entertainment has hailed the $52m adj. EBITDA, “all-time quarterly record”, it booked during Q3 and said it was still “very early” in its journey to generate $500m digital EBITDA in 2025.
iGaming impactful: On the analyst call CEO Tom Reeg said he expected the group’s customer split per vertical to “be 50-50”, but if “there are additional iGaming states (that regulate) as we move forward, those would be more impactful than a new sports betting state for us”.
Late starter: Reeg added that Caesars are “very late to the game”. “Recall, William Hill didn't have any real iCasino business developed to speak of. So we had to build the app, the brand, actually two brands and roll them out into a market where our peers had already been operating for multiple years.”
Referring to the group taking over WynnBet’s licence in Michigan in February, Eric Hession, President of Caesars Sports and Online Gaming, said it will ramp up “advertising and marketing” in the next month.
“Customers like the app, they're staying on the app,” he added. “I would say that the average worth of the customer is slightly higher so far than on the Caesars app, but it is early to draw any conclusions”.
Curb your enthusiasm: In Florida, the Seminole tribe settled its dispute with West Flagler over mobile sports betting, but Reeg cautioned against getting too enthusiastic about Caesars partnering with the tribe.
“I'm not as optimistic that we or any of the other non-Seminole entities will enter Florida soon. I heard the same remarks from Jim Allen (CEO of the tribe’s Hard Rock brand) that you did at G2E that kind of cracked open the door, but I don't think that happens in the near term.”
At group level, net revenues and adj. EBITDA were flat YoY at $2.9bn and $1bn respectively in Q3.
Kindred rises in Q3, but market exits present challenges
Early challenges: Kindred Group revenues were up 4% YoY to £294.5m for Q3 with a number of dot com market exits on the horizon following its sale to Française des Jeux. With FDJ finalising its €2.5bn acquisition of Kindred this month, one of the group’s first tasks has been to organise exits from markets that do not present a clear path to regulation, including Norway.
This comes as several of Kindred’s core markets such as the Netherlands and potentially France and the UK are set to increase taxes or go through regulatory overhauls, such as Sweden.
Overall impact: Underlying EBITDA for Q3 went up 49% to £63.4m and YTD EBITDA was £196m, but Kindred CEO Nils Andén said the impending exits from grey markets are likely to “negatively impact” Kindred’s ability to reach its FY24 EBITDA target of £250m.
Malta complains of Italian duplication risks
Italy unlikely to change licensing requirements as part of new licence concessions.
Still standing: The European Commission (EC) has extended the ‘standstill period’ for Italy’s new tender for online gambling concessions until 18 November following a ‘detailed opinion’ submitted by the government of Malta that raises concerns over the technical and compliance requirements for B2B businesses in Italy’s new licensing framework for online gambling.
Barriers to entry: The MGA said Italy’s new licensing conditions, including nine-year licences costing €7m each, will impose “unnecessary barriers” on B2B platform and technology suppliers by enforcing “duplicate requirements” on technical procedures and compliance controls.
The MGA added that “B2B operators may already hold licences in other Member States” that “could easily be mutually recognised if a cooperation framework is set up for this purpose”.
Italian authorities will submit a response addressing Malta’s concerns and the regulatory body Agency of Customs and Monopolies will launch the new licensing regime once the ‘standstill period’ is over.
Around 50 operators are expected to apply for new licences that will generate €350m and annual fees of €100m for the Italian government.
News shorts
The average number of new Belgian online sports bettors fell during Euro 2024 to 1,031 compared with the 2022 World Cup’s 1,487 and Euro 2020\s 1,175, new data from the country’s gambling regulator Kansspelcommissie has revealed. The average total amount wagered online during the tournament was €8.6m with operators recording €1.1m in GGR.
The Dutch Association of Mental Health and Addiction Care has called on the government to impose a total ban on all forms of online gambling advertising as it poses a “major” threat to young people and those at risk of addiction.
The government has already passed a ban on gambling advertising in TV, radio and print media and in public places but allows targeted advertising in social media or direct mail, although it mustn't appeal to or target underage consumers.
The government has not agreed to the ban, but as part of a general clampdown on iGaming it has already set out plans to increase taxes on operators in the next two years.
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