New research from BonusFinder has revealed cracks in Sweden’s attempts to channel players to regulated operators.
According to the presented figures, up to 30% of players have typed terms such as ‘casino utan licens’ (Swedish for unlicensed casino) into search engines.
BonusFinder’s research also found that some affiliates are encouraging unregulated gambling.
So, how big is Sweden’s black market?
According to statistics from Swedish regulator Spelinspektionen, 91% of gambling in Scandinavia’s largest nation is regulated. The licensed market here is estimated to be worth €1.2 billion.
In November 2019, H2 Gambling Capital released its own estimations. The gambling research firm estimated that channelisation figures were between 85% and 87%.
Since then, however, BonusFinder’s own statistics suggest that the actual figure is closer to 70%.
Player search terms and other problems caused
Searches for unregulated operators have actually risen since the online market re-regulated in January 2019.
BonusFinder also mentioned that some affiliates are encouraging this activity by optimising for key search terms. This behaviour has been branded as “highly irresponsible”.
The website referred to the growth in players looking for illegal operators as “huge”, while also saying the following.
“Using publicly available data from Google Trends, we found huge growth in searches taking place in Sweden for a basket of black-market terms. We included “casino utan Spelpaus”, “casino utan svensk licens” and “casino utan licens”. These mean “casino without Spelpaus”, “casino without Swedish license”, and “casino without license”.”
“We compared these to “Online Casino”. This data reinforces the theory that aggressive restrictions for licensed operators are driving players to search for, and convert to, playing on unlicensed brands.”
It was also noted that Sweden’s self-exclusion register, Spelpaus, only hides regulated operators. As such, individuals on the list still have access to unregulated brands.
A warning for Germany?
Key industry figureheads in Sweden haven’t shied away from criticising strict regulation in the past. One critic is Gustaf Hoffstedt, General Secretary of Branschföreningen för Onlinespel (BOS) – the country’s trade association for online gambling.
Last November, Hoffstedt accused authorities of “acting as the best friend of the black and grey market”. He also warned that tightened regulation, which has been proposed in the form of certain betting markets being banned, would just empower unregulated operators further.
Germany is set to introduce a unified gambling treaty next year. But current proposed rules are strict, which has been widely-criticised.
Some of these include the restriction of in-play betting markets to ‘next goalscorer’ and ‘final result’, plus monthly deposit limits and more.
BonusFinder Founder & Managing Director Fintan Costello urged lawmakers in the EU’s largest country to not repeat Sweden’s mistakes. He said the following.
“Instead of misguidedly declaring phase one of Swedish legislation a “success”, regulators should be focusing on the rising proportion of players searching for ‘unlicensed’ brands.
“Equally concerning is that newly regulating markets such as Germany appear to be ignoring their mistakes. There is no regulated market on earth that is proposing such damaging rules, and we would urge them to take heed of Sweden’s rapid plunge toward encouraging unlicensed activity.
“This should serve as a real warning for German lawmakers who have plenty of time to alter their proposals to benefit and protect players and to ensure their newly regulated framework is commercially successful.”