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Finland is one of the few EU countries where gambling is still strictly regulated and organized by a state monopoly. For years, gambling has been under a monopoly, supported by almost all political forces. But now the clock is about to change, as it has proved impossible to manage the digital market at state level.
Liberating the market
Veikkaus CEO Olli Sarekoski hinted in the company's interim report that Finland may have to consider dismantling its gambling monopoly if Veikkaus' share of the digital market continues to decline. Casino games are popular in Finland, of that you can read more here.
In terms of the advertising world, breaking the monopoly would mean tens of millions of euros worth of new advertising revenue for Finland, as global gambling companies burn billions of euros in marketing globally. For some Finnish agencies, the change could mean an unprecedented day of reckoning.
But for agencies, the change would also be a headache, as they want to work with responsible partners these days. For example, working with Veikkaus is not seen as a bad thing, as Veikkaus is a responsible gambling company with a wide range of tasks, including preventing gambling problems and returning people's gambling losses to society.
Global private gambling companies are often a different story. Most of them are only in the business of maximizing profits. Their activities are also often far from responsible, as their marketing feeds the gambling problem, which has also grown to enormous proportions in Finland.
According to Veikkaus, Finns lost €1.7 billion to the monopoly in 2019, with around half of the total losses coming from the 2.5% who gambled the most. According to the THL, in 2019, three percent of Finns, or around 112 000 people, had a gambling problem, and if you include everyone affected by a gambling problem, the number of sufferers is many times higher.
60%, or the vast majority, of online gambling takes place in an unrestricted environment. This means that only a little over 40% of digital gaming in the competitive market takes place under rules set by Finnish society or taxed in Finland," explains Sarekoski.
Help from a licensing model?
As a solution, Veikkaus now offers a licensing model that has already been introduced in Sweden and Denmark.
In practice, it would mean that there would be common rules of the game, i.e. everyone who meets the criteria could apply for a license and there would be a lot of operators operating under common rules. All gambling would then be regulated.
The licensing model would have to slightly liberalize the practices that Veikkaus currently has in place, but on the other hand it would have to tighten up the practices that currently exist in external gaming.
In other words, there would be a tightening up of the 60% and a slight liberalization of the 40%. That would be the only way to achieve the 90% level of channeling that exists in Denmark and Sweden, for example. Gambling would still be controlled, so it would not be a Wild West situation.
The licensing model would significantly improve Veikkaus' business position. In the everyday life of the player, the license model would above all mean that there would be much more choice.
Beneficial for all
A licensing system could improve conditions for Finnish players, both in terms of responsibility and supply. As a whole, the licensing system can also be seen as an excellent opportunity for casino companies and various sports clubs, for example.
- B.E. Delmer, Gambling911.com
