Sweden looks to increase its limp channelisation rates by limiting the appeal of unlicensed casinos by limiting their access to top-tier casino games.
The Swedish Gaming Authority, Spelinspektionen, is constantly at odds with the country’s online gambling industry association Branschföreningen för Onlinespel (BOS). With the recent induction of Niklas Wykman as the new minister for financial markets, and the online gambling sector now falling under his purview, BOS is pushing for significant changes.
One of their primary concerns with the current regime is that the government is making decisions as an operator, thanks to its vested interest in the success of lottery operator Svenska Spel, rather than an impartial oversight body.
BOS leadership also feel that too many laws are being passed which hamper the growth of licensed gambling brands while allowing unlicensed sites more leeway.
The Value of Channelisation
In our review of Denmark’s regulated market, we discussed how it had raised its channelisation ratio from 39% to 90% between 2012 and 2022. Sweden, in contrast, started strong but has continued to linger just above 80% despite their best efforts.
BOS published a report earlier this year that proved that if Sweden could hit the 90% channelisation mark, it would mean an additional SEK1.1 billion in revenues and create more than 450 local jobs.
BOS chief executive Gustaf Hoffstedt said:
“We look forward to having a discussion with Niklas Wykman about how gambling policy can best be developed in Sweden. Firstly, the licensed gambling companies must be protected at the expense of the unlicensed ones.”
Hoffstedt and his supporters are frustrated with the recent slew of limitations and restrictions which have seen 2022 Swedish gaming revenues perform poorly. While there was a moderate year-on-year increase, the last quarterly reviews showed a 6.85 decline.
Unlicensed Casinos Need Games to Thrive
In a seemingly unconnected decision to try to improve the local regulatory landscape, the government announced a review of its laws surrounding gambling game providers.
The announcement does not detail the entire amendment; instead, it invites existing and future casino software developers to attend a symposium on December 7th, where they will share all the proposed new regulations.
The one piece of information made public is that the government intends to formalise a supplier restriction which states that licensed game providers are not allowed to provide games to unlicensed online casinos.
This groundbreaking amendment will create a clear separation between legal and illegal gambling sites if approved. Leading providers benefit the most from working with local governments and will likely bend the new law rather than exit the market. This decision will limit the marketplace appeal of unregulated operations and help Sweden increase its lacklustre channelisation percentage.
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