Expect More Ontario Gaming Growth Through 2022

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Expect More Ontario Gaming Growth Through 2022
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No one is booking any celebratory parades just yet, but those Q2 numbers have the people at the Canadian Gaming Association feeling bullish about gambling in Ontario, looking for other provinces to follow Ontario’s regulatory model.

Ontario Seeing Significant Growth

According to iGaming Ontario — which works in collaboration with the province’s regulator, the Alcohol and Gaming Commission of Ontario, and the provincial government, to administer legal igaming in the province — total wagers through Sept. 30 were $6.04 billion, with total gaming revenue at $267 million. 

That’s a 48% and 65% increase, respectively, from Q1 numbers through June 30. There were 628,000 active player accounts and an average monthly spend of $142 through Sept. 30. There are currently 25 operators and 44 active websites in the province.

Those numbers do not include results from the province’s Ontario Lottery and Gaming Corporation, which the industry is waiting on. A spokesperson from OLG said they’re waiting for their Annual Report to be tabled at Queen’s Park, where the Legislative Assembly of Ontario is based, then they can post the numbers.

CGA president and CEO Paul Burns says, anecdotally, he has heard the OLG has “been doing well, and they’ve seen an increase, especially in their casino business. They have had some pretty significant partnerships on the sports side.”

The OLG has announced sports betting partnerships with the NHL and the NFL, among others, deals that include distribution rights to official logos and cross-promotions.

Burns said to expect to see continued growth through Q3 and Q4 as the Ontario market really sizes out. 

“(Those numbers) were positive to see,” he said. “That’s good GGR on the chart, and when we factor in OLG numbers and other operators coming in we will have a better idea of what is going on.”

One impact on the summer month numbers was seeing PokerStars enter the market, Burns added.  

Gray Markets Slowly Coming On Board

Things are going to get more interesting for those following Ontario over the next two weeks. When the market went live on April 4, many of the gray market operators who had been running offshore businesses for years were allowed some time to work their application processes with the AGCO and iGaming Ontario, and to get their licence. 

Many are still in the queue, working with the regulator and iGO. Gray market operators must come into compliance by Oct. 31, or they risk having their registration refused, and the AGCO will take “appropriate regulatory action” against any operator that doesn’t meet the new standard.

At the recent G2E event in Las Vegas, iGaming Ontario Executive Director Martha Otton also spoke about the “tremendous amount of interest” in the Ontario market, which includes sports betting, casino games and Esports. 

Burns says iGaming Ontario is “going to work hard to get people in as best they can but there’s been a six-month transition. There is a lot of people who never thought it would last this long. And the reality is (operators) had 13 months to apply, and a lot of companies waited until the very last day.”

Still, according to people like Burns, as more operators enter the fray, Ontario is well on course to be positioned as a “very strong North American market”, right up there with Michigan and New Jersey, a competitor to New York. 

Other Canadian provinces, British Columbia in particular, are carefully looking at the Ontario model. Burns says he is hearing that the regulator in B.C. will have a conversation with the industry next year. There’s a lot of industry interest in Alberta and Quebec. Alberta has a new government leadership, and people are waiting to see who the new finance minister will be, to get a better sense of their direction regarding all this.

“I think what we want is for the provinces to begin a dialogue with the industry, just like Ontario did,” Burns said. “Listen, talk to everybody, the stakeholders within the gaming business, the land-based casino operators, online operators, talk to suppliers. It is very important that everybody be consulted, so they can learn and build a model that suits their market best. I don’t know if anybody will follow the Ontario model exactly.”

What is clear is that provincial jurisdictions don’t want the gray markets to continue, he added. 

“It’s a mix of regulation and enforcement that will create a healthy market, protect consumers, offer good consumer choice,” he said. “Standing there and doing nothing is not an option anymore.”

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Mark Keast

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