Speaker at this month’s Betting on Sports conference (17-20 September) Tyrone Dobbin, MD of Sportingbet South Africa, gives us an operator’s perspective of the continent’s most successful market – and why working together is the key to maintaining a stable regulatory environment.
iGAMING TIMES: How does the sports betting market in South Africa differ from the other key jurisdictions on the continent?
TYRONE DOBBIN: Firstly, South Africa is a long established, heavily regulated market with an investment friendly ecosystem. Although operators often have to limit innovation and technical capabilities to remain compliant with some prescriptive legislation and obsolete policy requirements; the tax models, fiscal and regulatory frameworks are mostly on par with global standards. As a result, the sports betting market continues to flourish. A major driver in fueling this growth in South Africa is the unique and very popular “Bet on Numbers” offering.
iGT: What is the online–retail mix in South Africa – and what are the most common ways people pay to play?
TB: For now, retail (bricks and mortar) continues to dominate the industry with market share accounts suggesting retail still represents over 60 percent of revenues. The assumption is that growth in smartphone and mobile broadband has been the principle driver for sports betting revenue growth, but the reality is that the number of retail outlets has increased 40 percent in the past three years. The evolution to a more online world will see some rightsizing in retail, but for now the business mix continues to favour those with well-placed retail environments.
iGT: South Africa is quite unique in that online casino games are not allowed but online sports betting is. How does this rule affect things?
TB: This is a complex topic and would take some detailed background policy information and explanations to present a full response. But in short, licenses for online casinos were never issued. For years, the Department of Trade and Industry took the fallacious view that regulating online casinos would be detrimental to player protections and would lead to job losses. Unfortunately, this regulatory framework exposed confused customers and operators to the exact opposite of what the DTI had intended. Illegal online casinos are prevalent, impacting player protections, fiscal revenue collections and licensed operator trading conditions. Watch this space though; as government policy is now being guided by the Fourth Industrial Revolution, where all key stakeholders are again positioning this topic of legal online gambling as a necessity to promptly resolve.
iGT: There have been lots of talks about crypto regulation, and blockchain more generally in South Africa – do you this making a significant impact on the betting sector or wider economy?
TB: No. Not for the betting sector just yet. In the South African sense, I think crypto has become a banality and buzzword in our sector. That being said, we are seeing some development in the regulatory and policy frameworks for the wider tech and finance sector with blockchain and crypto currency regulations.