Svenska Spel CEO criticises lottery betting
The CEO of Swedish company Svenska Spel has urged the prohibition on lottery betting in the country and called it “incomprehensible.”
Sweden.- Svenska Spel has released a statement in which it discusses “shadow play” in Sweden. The CEO of Svenska Spel, Patrik Hofbauer, urged the gambling authority in Sweden to investigate companies that offer betting on other companies’ products.
Hofbauer said that he hopes that the local regulator Spelinspektionen investigates the phenomenon of “shadow play,” where a gambling company offers betting on other companies’ products.
“It is incomprehensible that this may continue. I can’t think of any other industry where it’s okay to use competing companies’ products as drawbacks for their own business. The shadow gaming companies cannibalise on well-known lotteries without owning the brands themselves that they market and sell.”
The CEO said that it isn’t clear whether customers understand what kind of game they are participating in. “You should be a game technology expert to understand what “betting on outcome in lotteries” means,” he said.
“The Swedish Gaming Act clearly states that the lottery market should be reserved for public benefit and the state. In practice, the shadow gaming companies put this out of play. They are licensed for betting, but use this to cash in on lottery revenue. That was hardly the purpose of the new gaming team. This loophole competition removes important lottery revenue from public utility – and it is a development that can accelerate quickly.”
Svenska Spel’s revenues affected by increased competition
In the third quarter of the year, increased competition and gaming responsibility had a negative effect on the company’s revenues. The Swedish operator posted a 5% decrease in net gaming revenue to €188.9 million.
Svenska Spel said that net operating margin of 32% was significantly lower than the one from the previous year due to the new gaming tax. With adjustment for game tax, it amounted to 50%.
The operator said that during the third quarter, Svenska Spel saw further stabilising of its business, which registers a continued growth in the digital vertical. Revenues were affected by an increase in competition and responsible gaming measures taken by the company.
