Opinion: Denmark - so far so good but what about mobile?
Danish regulators may have introduced workable legislation, however Emma Lindley argues that licensees could missing out on valuable custom as technology at the heart of the regulatory process does not match today's player needs.
In January, Denmark introduced new legislation to open, licence and regulate its online gambling industry.
Since legislation came into effect, the move has been welcomed by a number of industry bodies and commercial figureheads “ firstly because it signals the country’s commitment to open trade, but also because it presents a number of economic opportunities. Customers will be able to play on sites deemed safe, reputable and accountable by the Danish government, while other European gambling operators will be able to apply for an online gambling licence and legally offer their services there. At the same time, the government will be able to accrue additional revenue from fees and taxes.
But where Denmark deserves real praise is for the approach it has taken to legislation. The European Commission has introduced EU-wide minimum standards, but it is up to individual member states to determine the details of regulation within their own countries. Denmark took the decision early on to tax gross profits instead of turnover and in doing so, stands a strong chance of creating a healthy level of competition within the market. Indeed, the fact the government received online gambling licences from more than 40 operators “ three times the number they had expected “ reflects the way in which they got the approach right.
One area regulators need to pay closer attention to in the coming years is the rise of mobile gambling, a trend that is set to have a significant impact on the gaming sector as tablets and smartphones become ubiquitous.
According to analyst firm Canalys, the number of smartphones shipped last year surpassed the number of client PCs. The number of smartphones shipped for the year as a whole, meanwhile was up 63% compared to the 300m in 2010. In comparison, the global PC market grew by just 15% in 2011. At the same time, the tablet market has taken off with sales set to rise by 56% in the next three years.
This rise in smartphone and tablet use is largely responsible for the increase in mobile and online gaming. While this has caused a boom in many sectors of the industry some countries “ including the UK “ have struggled to effectively understand the risks associated with gamers using multiple devices. This has left both operators and gamers confused over how registration processes can be flexible enough to adapt to new technologies and manage risk, while not compromising the customer process.
At the moment this confusion has meant that many organisations are missing out on customers because the technology at the heart of the regulatory process doesn’t map to modern visitor trends. For instance, in Denmark, NEMID, the gambling security verification service, cannot currently be accessed or deployed on mobile platforms. This means players have to register on the internet before they can play on their mobile: they can’t register and play on the same device “ but in an increasingly consumerised, mobile world, that’s what punters expect to be able to do.
The danger here is that gamers look to circumvent the process to get around complex registration procedures, possibly accessing sites which fall outside of their region’s legislation. This then leaves gamers exposed, while the industry loses out on vital profits.
It’s essential that technological considerations now and in the future are placed at the heart of regulation “ both to ensure the industry is adequately protected, but also to allow expansion, growth and success. Technical standards should be set by the regulators on the advice of industry professionals with future proofing in mind.