Allan Petrilli, VP Sales and Growth at Intelitics, says that legalizing single-event sports betting in Canada presents a huge opportunity but there are still plenty of challenges to overcome.
The passing of bill C-218 last month was a major milestone for online sports betting in Canada. More than a decade in the making, it will allow operators to obtain a license, enabling them offer single-event sports betting legally for the very first time.
Of course, the unregulated market in Canada has thrived for many years with operators offering single event sports betting as well as casino to players. Making single event sports betting legal will undoubtedly disrupt this market, but there is still a lot up in the air about how it will be rolled out.
Regulation and licensing will be done at the provincial level, but questions remain about the process for regulation and licensing in each province and what will happen to operators that have been targeting the market for many years.
These questions will be answered over the coming months as regulatory frameworks emerge in each jurisdiction, but perhaps the biggest question is what opportunity does the regulation of single event sports betting present for operators already in the market or considering making a play.
The fact the market has thrived without regulatory oversight is a clear indicator that there is appetite for online gambling and specifically single-event sports betting. Therefore, the opportunity is significant and large so long as operators get it right.
One of the biggest upsides created by regulation and licensing will be the greater marketing opportunities that become available to operators. They will not be forced to promote freeplay.net products and it will also likely see tier one ad platforms enter the fray.
This includes Facebook and Google which will allow operators – and affiliates – to start promoting brands in a policy abiding way. This is a seismic shift for both Canadian online betting brands, and also for consumers who will be made aware of the wide range of legal sites available to them.
Of course, regulation and licensing will not be without challenges. These are some of the immediate areas that need clarity before the first licence application can be considered:
What does regulation mean for unlicensed brands that have operated in the Canadian market for years; a market that has never actively prohibited them?
What will happen in the provinces that decide not to offer legal single-event online sports betting? Will unregulated brands be able to continue to operate in these jurisdictions?
What does licensing look like? Will it be prohibitive to all but the largest operators and brands? For me, one of the biggest unknowns surrounds multi-vertical operators currently targeting the market. Remember, bill C-218 only covers single-event sports betting and not other gambling products such as casino, slots, bingo and poker.
It is looking like the market will start to open up for licensed operators towards the tail end of 2021. In the meantime the market will remain grey. I think this will lead to a surge in operators setting up shop in Canada and brands that plan to submit for licensing ramp up their marketing efforts.
On the flip side of this, you will also see hesitancy from some operators currently already live in Canada that may not wish to go through the licensing process. This in turn could lead to a number of brands being careful about how they approach the market ahead of regulations coming into force.
Those that do want to push ahead must take a considered approach to Canada. Do not think it is the same as the US market; the culture is different, player preferences are different and there are plenty of peculiarities that need to be understood.
If operators do not get a firm grasp on this, they are bound to fail. This is why they must lean on the information they currently hold on their Canadian players – assuming they are live– but not too heavily as it is not likely to represent the market as a whole.
They should also engage with local experts, especially when it comes to legal aspects as those in these positions will be among the first to learn about regulatory and licensing frameworks and what will be required of operators.
Other than that, operators not live should start to build out their plans now even though the path to regulation is not entirely clear. Once the first framework is announced, it will be quick and ruthless and those with a head start will be best placed to leverage the first mover advantage.
As a Canadian, I am hugely excited about the opportunities the passing of bill C-218 brings for operators, suppliers, affiliates and most importantly players. Regulation and licensing have been long overdue, but they have legitimised the market and I only expect it to grow from here on out.
