Can online gambling be the saviour for the gambling industry?

The Covid-19 outbreak has affected normal life across the world, with entire industries coming to a screeching halt

The COVID-19 outbreak has affected normal life across the world, with every facet of life being hit by this pandemic. Entire industries and sectors have come to a screeching halt, as multiple countries around the world enforce strict measures to keep their citizens inside and try to contain the spread of this disease.

This has resulted in any business, which relies on people getting out of their houses has been hit hard, with hotels, restaurants, cab services and airlines just a few of those struggling with the shutdown. Casinos are in the same boat, with venues across gambling hubs like Las Vegas, Atlantic City, Macau and elsewhere in the world being shut down.

In such a scenario, there will have to be alternative sources of revenue for these venues to avoid large-scale layoffs and job losses.

The Canadian Gaming Association (CGA) will soon be launching a survey to help it understand the needs and requirements of the industry in the face of the current shutdown. It released data to show the scale of the potential problem, with nearly all of Canada’s 114 land-based casinos, and 200 permanent bingo halls and community centres being shut down in the space of 72 hours.

This could affect up to 183,000 jobs, with the industry generating $1.2 billion worth of goods and services, and more than $765 million in revenue for the government and various charities, on a monthly basis. Such venues also account for a further $1 billion in non-gaming revenue, from restaurant meals, theatre shows, room bookings, conferences and so on.

Those are truly staggering numbers, and paints a very grim picture for the industry as well as the people working in supporting services. This current shutdown could cause many small and medium gambling operators to go out of business, while the big fish will also take a heavy blow.

In such a unique scenario, the industry will be forced to turn to new sources, formats and solutions in a bid to try and make up as much as it can. One of the potential avenues that could help bridge some of the lost revenue, is online gambling. While land-based casinos continue to be the leader in the space, online real money casinos have been steadily growing in popularity over the last few years.

With the current situation, online gambling is suddenly the only viable option for customers and service providers alike. What’s more, this is unlikely to be a one-time thing, as the recent rise of pandemic diseases such as SARS, MERS, ebola, zika, swine flu and now COVID-19 have shown that the world is extremely vulnerable to a new pathogen being spread all over.

Investing in online gambling resources would help operators adjust to such potential outbreaks in the future and help maintain some cashflow.

Online gambling was always expected to be the future of the industry, but nobody could have predicted the way in which it has soared in importance at the moment. But because nobody was really prepared for this, there remain some challenges before online gaming can become a predominant force.

The most important of these are legal issues, where there needs to be a standardized set of rules and definitions regarding online gaming. With betting regulations differing across countries, and even states in the USA, this will be extremely difficult to enforce at the moment. Issues like taxation and jurisdiction are likely to crop up almost immediately.

There is no common set of definitions either - there are 17 states in the USA which do not even define ‘gambling’, to give you an idea of the scale of the challenge. Further, the differences in regulations across borders will make it extremely difficult to decide jurisdiction and primacy of law. For example, what laws would govern the bets placed by a resident of New York City on a website whose server is in California? How would the pricing and taxation models be determined?

These are just some of the issues facing the gaming industry if they are looking for online gambling to be their saviour.

Online gambling has the potential to paper over some of the cracks developing in the gaming industry due to the current crisis. With the number of people being forced to stay in their homes, the demand is probably there. But, the aforementioned issues need to be sorted out before this can be rolled out and sought as the saviour for the industry.