Forecasts concerning the total value of the Dutch remote gambling market: “strong catch-up”

On 16 February, the Netherlands Gambling Authority (“NGA”) published a report with projections for the size of the Dutch remote gambling market following the entry into force of Remote Gambling Act (“RGA”). The report provides an analysis of the expected economic developments after the opening of the licensed remote gambling market.

In short: ‘Modest growth so far, strong catch-up after entry into force RGA‘

The report still refers to the entry into force of the RGA on 1 March 2021, followed by the opening of the market on 1 September 2021. As previously reported, both dates have moved by 1 month and the licensed remote gambling market is expected to open on 1 October 2021 – for the first batch of operators.

The full report can be found on the website of the NGA (only in Dutch). The estimates and projections are based upon research conducted by H2 Gambling Capital (“H2”) and Regulus Partners (“RP”). The forecasts are in part based upon developments in Denmark and Sweden following the liberalisation of these markets.

Overall projection

The NGA expects the overall remote gambling market to present strong growth after licensed operators enter the market. In recent years, the growth of the Dutch remote gambling market fell behind in comparison to other European countries. According to the NGA, this situation has two main causes:

1. Remote gambling operators are reluctant in offering gambling products, in anticipation of the opening of the Dutch licensed market. Offering games of chance to Dutch consumers can jeopardise the prospects of a future licence.
2. In recent years, the NGA intensified its enforcement efforts in relation to the unlicensed market.

The NGA provides an important comment on the figures mentioned in the report: “It is and remains difficult to measure the size of the unlicensed market. Consequently, all figures in this report contain a margin of uncertainty. Above all, these figures provide an impression of the overall developments.” In Sweden, H2’s estimate of the legal market was found to be 16% lower in comparison to the actual market realisation.

Numbers

H2 estimates the total Dutch remote gambling mark at 1.1 billion euros in 2024. This number includes the Gross Gaming Revenue (“GGR”, stakes minus prizes paid) including bonuses.

RP estimates the total Dutch remote gambling market at 827 million euros in 2024. This number includes the GGR (stakes minus prizes paid) excluding bonuses.

Please click the relevant links below for the graphs and figures.

Land based v. remote

Figure 1 H2 18 June and 31 August 2020 (including bonusses).*Bruto spelresultaat (BSR) refers to GGR.

Licensed market v. unlicensed market

Figure 2 H2 31 August 2020 (including bonusses). *Bruto spelresultaat (BSR) refers to GGR.

Annual market value Dutch remote gambling

Figure 3 H2 31 August 2020 (including bonusses) and RP 13 March 2020 (excluding bonusses).

Market value Dutch remote gambling per vertical

Figure 4 H2 31 August 2020 (including bonusses) and RP 13 March 2020 (excluding bonusses). *Bruto spelresultaat (BSR) refers to GGR.

Annual market value Dutch remote gambling per vertical

Figure 5 H2 31 August 2020 (including bonusses) and RP 13 March 2020 (excluding bonusses). *Note: this table only includes sportsbetting as betting category. ‘Sportweddenschappen’ refers to sports betting.

Channelisation

The Dutch government has presented itself with a goal of moving eighty percent of players to a Dutch licensed offer, within three years after the entry into force of the RGA (i.e. on 1 April 2024).

Based on the report, the channelisation rate is expected to be more than 90 percent by 2024, in relation to the player base. Channelisation in terms of GGR is expected to reach around 70 percent in 2024. The gambling tax – which is set at 29 percent GGR after the opening of the remote market (plus a levy of 1.75 percent GGR) – plays an important role in the channelisation of GGR, according to H2.

Netherlands Gambling Authority enforcement

Finally, the NGA notes that it is already mapping out the remote gambling offer that will remain unlicensed after the opening of the licensed market. In its regulatory policy regarding future licence holders, the NGA will focus on whether operators pay sufficient attention to addiction prevention.