SBC News Voice of the Sports Betting Industry
This May, VIXIO Regulatory Intelligence launched its Market Assessment Tool (MAT) – a first-of-a-kind device providing a comprehensive overview of over 140 global gambling jurisdictions for all stakeholders.
Central to MAT’s development, SBC gets the full breakdown from VIXIO VP & Chief Analyst James Kilsby on delivering a +2-year project to match the industry’s intelligence demands for an evolving and highly speculative global gaming sector.
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SBC: Can you detail the development of VIXIO’s ‘Market Assessment Tool’ (MAT), from its original concept phase, through to its design, testing and final launch?
James Kilsby: At VIXIO, we are always evaluating how we can evolve our products and services to better serve our clients across the global gambling industry. For more than 15 years, our regulatory intelligence platform has featured jurisdictional regulatory reports summarising the compliance requirements and legal restrictions related to different gambling products in different jurisdictions.
But as regulation of online gambling has spread beyond Europe to a wider range of global markets we have also been asked, fairly consistently, to provide a quicker answer to the more fundamental questions – for example, can I see a list of all countries where online gambling is regulated.
The Market Assessment Tool is an iteration of those conversations and a unique offering that categorises nearly 150 global jurisdictions in how they approach online gambling. The challenge here was how to capture the nuances across different jurisdictions, so we developed nine categories that we felt would best outline the legal and regulatory status of each jurisdiction as well as the actual or potential size of each market.
We then took those proposed categories to VIXIO’s Executive Advisory Board made of 11 senior compliance, strategy and regulatory professionals representing different organisations across our client base. Once we were comfortable we were on the right track, VIXIO’s in-house regulatory research team evaluated each jurisdiction against the nine categories while our tech team built an effective tool that would allow users to filter, compare and evaluate them.
Over the past two years, we have already developed a series of research tools on our platform to allow for easy comparison of laws and regulations in responsible gaming and advertising across Europe and North America, so we were able to take the same approach but apply it more broadly here to categorise a wider range of global markets across a wider range of criteria.
SBC: What data and insights will be provided to audiences viewing MAT’s “140+ global jurisdictions’ regulatory approaches to online gambling”?
JK: The nine categories featured in the MAT enable users to immediately understand the state of play in terms of regulation today for both online betting and gaming, the level of compliance burden, licensing and tax status and how restrictive each jurisdiction is when it comes to advertising and marketing. On top of that, our clients can view which direction the jurisdiction is heading in terms of becoming more restrictive or more liberal, see how big the market is or likely to be in gross revenue terms, and how mature each market is in terms of its current growth trajectory. There are so many other regulatory specifications and market variables for each jurisdiction that clients would still need to evaluate using VIXIO’s broader regulatory research reports and data sets, but the MAT is a unique “cheat sheet” when it comes to understanding the online gambling market on a global scale.
As well as this rapid review of global markets, a compelling feature of the new tool is the ability for clients to search for jurisdictions that meet specific criteria. Say, they want to see a list of all fully or partially regulated markets in Europe or Latin America, offering a medium or competitive tax rate and liberal advertising restrictions, and are worth at least $200m in annual GGR. And then that would point them to a list of nine countries from Bulgaria to Colombia worthy of further exploration using other parts of the VIXIO platform.
SBC: How is VIXIO working with on-the-ground stakeholders to provide accurate data and insights on individual market’s regulatory developments?
JK: The MAT is maintained by our in-house analysts who are already responsible for maintaining our more detailed regulated research, aggregated data sets and market forecasts. Those analysts watch for and evaluate regulatory and market developments on a daily basis, which very much involves speaking with regulators, policymakers and local experts in different markets where necessary.
Going forward, the MAT will be updated on a quarterly basis – with some exceptions where there is a fundamental change in regulatory status taking immediate effect. Those updates and our accompanying analysis will provide a catalog of regulatory trends and also allow VIXIO to flag for what we’re watching for in terms of anticipated changes over the coming quarter.
As an intelligence stakeholder – how does VIXIO provide a ‘balanced assessment’ of market risk and opportunities in a changing and uncertain world contending with dynamic factors such as conflict, inflation, cost of living and unstable governments?
Not just this new Market Assessment Tool, but much of VIXIO’s content and product is really designed to help our clients navigate this fundamental challenge facing the gambling industry. There are now more opportunities than ever to expand into regulated and licensed markets for online gambling, not just in Europe but globally.
However, operators and suppliers have to clearly understand the regulatory and compliance burdens that are invariably unique to each market and current or future policy risks. We expect to see and capture in this tool how regulation rarely sits still. Established regulated markets are tightening around advertising and RG among other areas, while at the same time those countries, states and provinces that don’t currently have regulations for online gambling are looking to introduce them.
SBC: What is the hardest area of covering highly-speculated markets such as Brazil, where igaming laws are yet to be definitively settled on?
JK: Our new MAT is really designed to capture the status of online gambling as it is today, but then flag the direction of travel in terms of policy and capture changes in future once approved by lawmakers or regulators. Let’s take Brazil as an example; we categorise Brazil right now as a “regulating” market on the basis that a law has been passed to allow for online sports betting but that law has not been regulated or implemented yet. We’d expect Brazil to transition to a ‘partially regulated’ market in the next three or four months or so, once a regulatory decree for online betting is enacted by Congress. But another possibility is Brazil’s Senate passing a broader gambling bill that’s already been passed in the lower house of Congress, allowing for regulation of all online gaming as well as land-based casinos and video-bingo. So there is a pathway for Brazil to become what we would define as a ”fully regulated” market as well.
What we have found with our research to create this tool is the global online gambling market is really less grey than you’d expect; actually most jurisdictions do allow some form of online betting or gaming whether through public lotteries or on a limited basis, if not through a licensing regime. A challenge is how do you define markets that could be looked at in at least two different ways – by law, those jurisdictions might be a monopoly or partially regulated, but operators servicing customers from offshore might still be able to legitimately say it’s a grey market from their perspective.
So again take Brazil, which is both regulating but also a grey market from another point of view. Through the robust methodology we developed for the MAT, we have looked to capture what the laws and regulations of each country or state allow for, rather than the legal status from an offshore perspective, but there is always nuance and a need to do much closer diligence, which is where VIXIO’s broader research and insights come in.
SBC: How do you see VIXIO developing MTA in 2023 and beyond?
JK: I mentioned undertaking a quarterly evaluation of all global markets and cataloging regulatory, policy and market changes accordingly. Through the tool, users will be able to see a visual timeline of these changes for each jurisdiction, so as changes occur they would be able to pinpoint exactly when a country went from being liberal to restrictive on advertising, or moved to the point of being considered a large market rather than a medium-size one. Beyond that, we will be adding enhanced functionality from a user point-of-view – heat maps showing regulatory changes, for example.
We are also intending to move to a point where clients can use their own inputs and evaluate and rate each jurisdiction accordingly. We’ve applied our own expertise and methodology and have our own definitions of what makes a jurisdiction restrictive, competitive or otherwise, but operators and suppliers will have their own views; some companies are more comfortable with higher tax rates than others etc. We are looking to empower our clients to conduct their regulatory and strategic research based on their companies’ particular circumstances and reflecting the varying size and scale of operators and suppliers who use the VIXIO GamblingCompliance platform.
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James Kilsby – VP & Chief Analyst @ VIXIO Regulatory Intelligence
