UK newspapers The Times and The Guardian have reported that the Department for Digital, Culture, Media and Sport (DCMS) will seek to open a further ‘12-week consultation period’ for its ongoing review of FOBTs wagering levels.
At present, it appears that DCMS will delay its judgement on whether to reduce FOBTs wagering from £100 max-bet to the reported options of £50, £20 or £2 per spin
As yet, DCMS has not officially confirmed the extended consultation period, however, UK media have stated that stakeholders close to the department have confirmed that DCMS will now seek further assistance on its FOBTs review.
Further to the consultation period, UK media reports that DCMS has advised industry stakeholders not to pursue a judicial review to try and block its final decision.
The government’s delayed triennial industry review has become a high-stakes battle for a number of UK betting stakeholders, who have a significant exposure to FOBTs as a key revenue-generating channel.
Industry governance is in-acceptance, that the UK government will reduce the current £100 (per 20 seconds) max-bet level on machine betting, but wish to avoid ‘nightmare scenario’ of a reduction to under £20.
Throughout 2017, betting leadership has petitioned the government that a below £20 limit will jeopardise the entire UK retail betting sector, forcing the industry to drastically scale down its betting shop portfolio.
Not all betting leaders are against the governments FOBTs judgement. Last September, outgoing Paddy Power Betfair Group CEO Breon Corcoran was reported to have sent a letter to UK Minister for Sports Tracey Crouch stating that FOBTs had become a ‘toxic issue’ for the sector and that a drastic cut in machine betting levels was needed in order to quell ‘societal concerns’.
Corcoran and Paddy Power Betfair would be criticised for the DCMS letter, with industry stakeholders’ claiming that the FTSE operator was seeking to hijack the triennial review in order to fulfil its UK expansion ambitions.
From an investor perspective, speculation is running rife throughout UK betting, with city analysts detailing that a drastic cut in FOBTs wagering will likely lead to a new round of sector consolidation and M&A activity.