A recent study commissioned for the Finnish government outlines the opportunity cost of the current monopoly, showcasing the insane financial losses and the poor channelisation rates achieved under Veikkaus.
Thanks to the intervention of Finland’s Social Democrat Party, the country has found itself unable to move past the current state-owned gambling monopoly with which it is now struggling.
The local government commissioned a report to delve into the current state of online gambling in the Nordic territory.
The intent of the report was outlined as follows:
Quote“The goal of the project has been to assess the current state of Finland’s exclusivity system in relation to the goals laid down in the Lotteries Act, to examine the gambling systems in use in countries relevant to the preliminary investigation, and to evaluate the societal benefits and disadvantages of various gambling systems.”
Unsurprisingly, the report concluded that the current state of affairs did not adequately serve the needs of the government nor those of the players. The information went so far as to state that maintaining the monopoly was "not recommended".
Always Follow the Money
While the government does not promote online gambling at unregulated casinos, they have not made it illegal. This fact has meant that online gamblers in Finland can choose between gambling at Veikkaus-supported gambling sites or taking their chances with unlicensed offshore providers.
According to the study, Finland's market channelisation rate is an abysmal 50%. In real terms, half of the country's gambling population is voting with their wallets. The results speak poorly of the quality, variety and engagement of the online casino offering that Veikkaus provides.
The financial implications of this poor channelisation are astounding. The report concluded that Finnish gamblers spend approximately €550 million with unlicensed operators annually.
Which Path Will They Follow?
The report compared Finland’s channelisation results to those of a regulated multi-license region like Sweden. The Swedish market is known for being well-regulated and supporting player safety while allowing the gambling industry to prosper. At the core of its overall success is the fact that it has achieved and maintained a market channelisation rate of over 90%.
Not only does this mean 90% of the money wagered online adds value to the local economy, but the industry begins to add value to other sectors such as marketing, advertising, programming, web development and higher education.
However, a report is just that, a report. The document outlines two paths that Finland could pursue. The first would be to double down on the monopoly, aggressively block Finnish access to unlicensed sites, and create banking protocols to ban gambling transactions.
The recommended alternative would be to follow in Sweden's footsteps and legalise online gambling in the country, implementing a licensing regime that provides local players with the entertainment they already seek out, while directing their spending back toward Finnish coffers.
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