Online Gambling Market size to grow by USD 150.5 billion to 2027
Source: Technavio
The online gambling market is estimated to grow at a CAGR of 11.03% between 2022 and 2027. The size of the market is forecast to increase by USD 150.5 billion. The growth of the market depends on several factors, including growing demand for mobile gambling, increasing betting on e-sports, and reduced stringency in government regulations.
This report extensively covers market segmentation by device (desktop and mobile), product (lottery, betting, and casino), and geography (North America, APAC, Europe, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.
Technavio categorizes the global online gambling market as a part of the global casinos and gaming market within the overall global hotels, restaurants, and leisure market. The parent global casinos and gaming market cover products and companies engaged in casinos and gambling facilities and operations. Our research report has extensively covered external factors influencing the parent market growth during the forecast period.
The growing demand for mobile gambling is notably driving the market growth, although factors such as growing online data security issues may impede the market growth. Our researchers analyzed the data with 2022 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.
Key Online Gambling Market Driver
The growing demand for mobile gambling is notably driving market growth. Smartphone penetration is increasing because of the declining average selling price (ASP) of smartphones and the developments in communication network infrastructure. Smartphones provide a convenient and intuitive interface for playing casino games and e-sports. Smartphone users engage extensively with their mobile devices on an intermittent basis for short to long periods of time. Thus, users are rapidly shifting from desktops to mobile devices for playing casino games.
Smartphones are becoming one of the major platforms for online gambling as they provide easy access to casino games and e-sports betting. They also support many mobile-based payment solutions, such as M-Pesa, Orange Money, and Airtel Money. Therefore, several vendors have launched mobile gambling applications due to the enhancements in mobile payment systems. Thus, rising smartphone penetration will boost market growth during the forecast period.
Significant Online Gambling Market Trend
The emergence of VR as a cure for gambling addiction is an emerging trend in the market. The use of VR allows people with gambling addiction to experience safe and secure virtual environments that are conducive to replicating the cravings of their addiction. This is done without subjecting the gambling addicts to real-life scenarios related to their addictions. VR helps therapists study the behavior of addicts when the latter are subjected to virtual gambling. The technology places individuals in an environment in which their senses are tested, helping therapists determine the progress of individuals.
Therapists are authorized to expose gambling addicts to a VR environment, catering to the latter needs. Addicts with strong cravings are gently ushered into the VR world setup. This is done by reducing the noise levels, the number of slot machines, the number of players in the casino, and the intensity of the entire environment. Therefore, the trend of VR being used as a tool to cure gambling addictions is likely to continue, which in turn, will fuel the market growth during the forecast period.
Major Online Gambling Market Challenge
The growing online data security issues are major challenges impeding market growth. Security and credibility issues in online gambling are some of the major factors hindering the growth of the global market. Most gambling websites do not have a proper dispute resolution framework and lack transparency in cash prize payouts. They also do not have fair and responsible casino gaming standards, which reduces the credibility of gambling operators and platform providers. This credibility issue has a negative impact on the scaling of the casino business and discourages new users from joining gambling games, such as casinos and poker.
Moreover, online gambling websites have become prime targets for cyber attackers and scammers. Gambling websites capture vital information about users, such as bank details and credit card numbers, which are vulnerable to hacking. Several offshore-run internet casinos do not have the latest cybersecurity technologies in place, which increases the chances of cyberattacks. Thus, issues like these will hinder the growth of the global market during the forecast period.
The report focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.
Who are the Major Online Gambling Market Vendors?
Vendors are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
Betsson AB - The company operates under one segment. The company under this segment offers online gambling that includes gambling products such as casinos, poker, bingo, sports betting, and scratch cards. The key offerings of the company include online casino gambling games.
The report also includes detailed analyses of the competitive landscape of the market and information about 15 market vendors, including:
888 Holdings Plc
Bet365 Group Ltd.
BetOnline
Camelot UK Lotteries Ltd.
Entain Plc
Flutter Entertainment Plc
Fortuna Entertainment Group AS
Galaxy Entertainment Group Ltd.
INTRALOT SA
Kindred Group Plc
LeoVegas AB
MGM Resorts International
New York State Gaming Commission
Scientific Games LLC
Sportech Plc
Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.
What is the Fastest-Growing Segment in the Online Gambling Market?
The market share growth by the desktop segment will be significant during the forecast period. The primary factor driving the segment growth is that desktop devices offer a better experience as they have bigger display screens compared with mobile devices.
The desktop segment was valued at USD 106.34 billion in 2017 and continued to grow until 2021. Most online gambling offerings are web-based, which are better experienced on desktops. Although many vendors have optimized their offerings for mobile devices and have developed apps for mobile platforms, users still prefer desktops for a better experience. Therefore, owing to these factors the segment in the global market will grow during the forecast period.
Which are the Key Regions for the Online Gambling Market?
APAC is estimated to contribute 39% to the growth of the global market during the forecast period. Another region offering significant growth opportunities to vendors is North America. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.
The market in the region is growing at a rapid pace because of the rise in the number of mobile application platforms. The US is the key leading country in the market in North America. The increasing use of websites and applications for online gambling, as well as the rising penetration of smartphones, has enabled vendors to launch online-based gambling. For instance, in 2021, Lotto.com Inc. announced the launch of the first digital platform in the state of New Jersey that allows lottery ticket purchases from any device without the need for an app or pre-deposited amounts. Likewise, In January 2020, BetAmerica launched an online platform for sports betting in Pennsylvania. Thus, owing to such factors the regional market is expected to grow during the forecast period.
The outbreak of COVID-19 had a strong influence on the market in North America. In 2020, the gambling industry was disrupted as the lockdowns following the outbreak led to the closure of casinos, which, in turn, led to an increase in demand for online casinos owing to technological improvements and changes in legislation, such as the legalization of online gaming, thereby driving the growth of the market in the region. With more countries in the region introducing regulations, online gambling in the country is anticipated to increase, with people downloading more online casino games, thus adding to the revenue streams in the overall market. For instance, according to the American Gaming Association, sports betting in the US brought in a record USD 1.5 billion in 2020, an increase of 69% from the previous year. In addition, the relaxation of lockdowns and large-scale vaccination drives in different countries in the region, coupled with increased funding toward the development of online interfaces of betting platforms from several resources also boosted the market growth. Therefore, this trend is likely to continue, which in turn, will propel the growth of the regional market during the forecast period.
