Pidemia, which rapidly spread to almost all continents, triggered a collapse in oil prices, a correction in the exchange rates of major currencies, shaken the position of crypt currency assets and had a powerful impact on the service sector. Gambling business, at least the ground segment, has already felt the full weight of the incident.
No matter how accurate some forecasts may be, there are always factors that elude analysts’ attention due to the low probability. A similar situation occurred in late 2019 with the Coronavirus epidemic. The problem that initially affected China has spread rapidly and assumed planetary proportions. The impact of the pandemic affected not only the physical health and psychological condition of earthlings: global economic processes were affected. Most markets, especially those not related to the provision of remote services, will feel the impact of the virus long after the outbreak is over. One of the most vulnerable industries is the service sector, particularly terrestrial gambling. We offer an up-to-date snapshot of how the current situation has affected gambling markets around the world.
It should be noted that the closure of ground facilities is affected by the policy of countries, as well as measures taken to ensure the prevention of virus spread. As a rule, it is a question of declaring quarantine.
Macao Gambling Market: First Swallow
The Macau gambling market was the first to be affected, mainly because of its proximity to the point of contamination. The ground casinos were closed on the night of February 4. Quarantine lasted 15 days. The reason for the measures was the contamination of three local residents.
|Even before the announcement of the termination of gambling establishments in Macau analysts of Sanford C. Bernstein Ltd. released a forecast that even a two-week closure of facilities will reduce GGR for the first quarter of this year by 50%. And these are not the most unfavorable forecasts: according to some analysts, we may speak about the reduction of GGR by 75%. At the same time, all experts are united in one – the closure will affect the annual performance of the industry. On the average experts speak about 6 % reduction in annual calculation.||In spite of the fact that quarantine has not been prolonged and in the specified term objects have reopened their doors, the situation will unequivocally undermine financial indicators of gambling operators not only for the first quarter, but also for 2020 as a whole. Do not forget that people who have only recovered from the shock, it is unlikely to be willing to travel in search of excitement.|
Philippines: “invincible” market
Over the past year and a half, the Philippines has radically changed its attitude to the gambling business at the top level of the country. If previously the guarantor of the local constitution Rodrigo Duterte was an ardent advocate of morality and declared war on gambling “arbitrariness”, at the moment he is one of the strongest defenders of the online gaming industry, which has been repeatedly attacked by the Chinese authorities. Duterte himself explains this position by his desire to save jobs for citizens, but do not forget about the 5.69 billion generated by the industry.
It should be noted that the Philippine gambling establishments, unlike those in Macao, have indeed not been quarantined. Nevertheless, we should not discount the Achilles’ heel of the country – offshore gambling operators (POGOs), which are known not only for their dominance of scandals, but also for attracting human resources from China. Especially for the latter, the authorities have initiated individual passing of the virus test. You can read more about it here.
At the same time, the recent PAGCOR report contained a rather ambitious forecast of the gambling segment growth this year. It should be noted that earlier no such optimism has been noticed behind the Filipinos, especially against the background of concerns about closing the online segment to the benefit of China.
According to the information provided by the gambling regulator, this year’s industry revenue may reach $5.69 billion, which is 11% more than a year earlier.
It should be noted that all the above does not take into account the spread of coronavirus and the impact of the pandemic on land-based gambling institutions. Therefore, experts do not share the iridescent forecasts from the country’s gambling regulator. If the latter are wrong, the Philippines may become the first country whose business component has overcome the influence of coronavirus.
Italy is the European home of the coronavirus…
Italy is good for everyone, even the virus. Following on from China and South Korea, the most devastating consequences of the coronavirus’ spread have reached Italy. The government has banned the movement of citizens unless it is related to professional activities or the need for medical care. Thus, all facilities related to the sphere of services, including casinos and PPS bookmakers, were forced to quarantine until April 3. The latter can not but affect the financial performance of the ground segment of gambling business.
European countries: all online
However, Italy is not the only European country affected by the spread of coronavirus. Thus, in most other countries, the decision to move to remote work is made. Gambling regulators have not been left out of it. In this respect, Lithuania, Latvia and Denmark were on the front line.
Danish authorities disbanded the gambling regulator and sent their employees home. Thanks to modern technologies, the latter can cope with their professional duties without leaving their homes. Quarantine will last until March 29.
The Lithuanian gambling regulator said that applications for participation in the self-exclusion program will be accepted only online.
Eastern Europe and the post-Soviet space
|Slovenia’s gambling establishments were temporarily closed until 20 March. The stalemate situation in Italy influenced the decision of the country’s largest gaming operator to temporarily shut down its operations.||Following Slovenia, the Georgian authorities ordered to stop the work of cultural and entertainment facilities, presumably, the next in line are ground gaming facilities – PPS bookmakers and casinos. The initiative to temporarily shut down some facilities belongs to the Coordination Council of the country. However, even if there is no explicit prohibition of gambling sites, the latter will still be blocked for indirect reasons. For example, the fact that the country has significantly restricted movement from countries that traditionally are “suppliers” of visitors to Georgian casinos. First of all, we are talking about Turkish citizens.|
Russian representatives of the betting market hope that the epidemic will be stopped until the moment of large-scale sporting events – European football championship and summer Olympic Games. Otherwise, according to bookmakers, cancellation of such large-scale events may have a strong negative impact on the betting market.
Fortunately for countries that legalized online gambling, most of the users, having found themselves in quarantine, in search of gambling entertainment, are likely to rush to the online platforms of gambling operators. At the same time, globally, the market will be able to compensate for losses incurred by the ground segment through online operations. At the same time, it should be noted that in case of cancellation of major sporting events in the vertical bookmaker will have nothing to balance.
Recall that the value of shares of American gambling operators, whose gaming establishments are located in Las Vegas, fell rapidly due to the spread of news about the Coronavirus pandemic.