UK global gaming giant Entain Plc reported that fourth-quarter group Net Gaming Revenue (NGR) rose a healthy 11% (+7% on a constant currency basis) over the same period in 2021.
Another key takeaway from last earnings update was Entain's "underlying excitement" and expectation that Brazil will finally legalize online sports betting in 2023 after the country's former President Jair Bolsonaro failed to approve such legislation under pressure from right-wing religious groups.
However, it is generally believed that Brazil's new President Lula da Silva is anxious to pass a sports betting bill so that his government can reap the tax revenue on the country's estimated billion-dollar "grey" online sports betting market.
In December, Entain recently relaunched its UNIKRN sportsbook and skill-based wagering platform in both Canada and Brazil, an early sign that the operator is bullish on Brazil's imminent entry into the global regulated online sports betting market.
Currently, several major offshore operators are raking in hundreds of millions of dollars of sports bets each year from Brazilian customers. Although there are no official statistics available, an Aposta Hub survey of the most-searched betting sites on Google revealed that bet365 led the way, followed by Betfair, Betano, EstrelaBet, Betsul, Betmotion, and 1Xbet.
Gaming industry experts estimated in August that had sports betting legislation been in place for the World Cup, the country would have collected R$3 billion ($564 million) in tax revenues in addition to R$2 billion ($376 million) from the sale of operating licenses.
She explained: “We had expected that the sports betting legislation would come through and that Bolsonaro would sign that during this transition period. So now Lula has one and he’s setting up his government. But despite this delay, we still expect regulated sports betting, in Brazil, during 2023 with the new administration".
“So that means legislation probably toward the end of 2023. Then hopefully, we’ll be regulated by the end of the year or into 2024. But we are waiting for the new administration to pick up the matter.”
Whilst Bolsonaro’s administration was reluctant to sign any sports betting legislation into law and set up a regulatory framework across Brazil’s federal states, it is generally understood that President Lula is more receptive to sports betting given the tax revenue opportunities that regulations could yield for both federal and state government.
Entain’s leader also anticipates that 2024 could see the advent of regulated igaming in Brazil, too, with the legislation currently being developed in the early stages of the Lula premiership.
She added: “We will also be waiting to see what happens with that (igaming). But that should also be on the agenda later on. So all in all, sports betting might be regulated through 2023, it might slip into 2024 and then on the online casino, probably also beginning of 2024."
“However, that doesn’t change our excitement about the Brazilian market and underlying trends.”
On the UNIKRN market launch, Nygaard disclosed that the soft launch has ‘had a good start’ and is ‘looking good’ as a competitive product in Brazil, with further scope for expansion. It is part of Entain’s commitment to only operating in either regulated markets or markets that are set for realistic future regulations, which Brazil is perceived to be.
“We’re playing the long game here. It’s really important for us that we build almost a market around our business, and we’re going about this the right way. In 2023, we’re looking to expand into global markets. I’m not gonna line them all up here, but we are looking at, for example, Australia and New Zealand that have really strong regulations and a great esports audience," she told investors.
“Of course, we learn as we go along and upgrade our products. So I think we should stress that we’re playing the long game here, we’re really flexible in marketing.”
Source: GMB
