Investors can still be well served by putting money into Australia’s thriving online gambling market, but that might not remain true forever. Australia has a thriving online casino market, driven by a number of factors, but that market is facing scrutiny and criticism from social and political groups and might see changes that limit its viability for investors.
Gambling has long been considered part of Australia’s national identity. It is the largest horse-racing country in the world, has a reputation for fanatic sports supporters, and international visitors are often surprised by just how easy it is to find a poker machine in any local drinking establishment.
Betting and gambling are often seen as common, everyday activities for many Australians. As the betting and gambling markets have transitioned into digital spaces, Australia has been a fertile market for them. Investors looking for burgeoning markets have long considered the Australian digital gambling environment to be one worthy of attention, but is that going to change? Growing societal and political pressure could mean that the Australian online gambling landscape will see new regulatory changes.
Let’s look closer at the popularity of gambling in Australia, why it’s still a good choice for investors and what the market’s future could look like.
Aussies Love To Have A Flutter
One of the key reasons that the Australian online gaming market is worthy of investor attention is that Australians love to gamble. Throughout the 2022-23 financial year, Australians positioned themselves as the world’s leading gamblers by placing $244.3 billion in bets. This is obviously a huge sum of money, and while other gambling markets, like that in the United States, are growing fast, that doesn’t mean that the Australian market is suddenly worthless.
If you were looking to invest in an online gaming platform in the Oceania region, Australia is likely your best bet for market growth and return. While NZ is also an option, with a number of options to choose from, the NZ regulatory market is much tighter, and its online gambling ecosystem is nowhere near as mature as Australia’s.
Even as casino and gambling activities have digitised, Australians haven’t missed a beat. Engaging in betting or casino activities online is commonplace and has simply become the next evolution in what many Australians see as part of their national cultural identity.
The Online Casino Market is Still Good For Late Investors
While the online casino market in Australia is relatively mature, probably the most mature of the SEA or Oceania region, it isn’t yet as mature as some of those in Europe. This means that while there are regulations in place and competition exists between platforms, those regulations don’t stifle growth to a great extent, and the competition doesn’t yet choke the market.
As is the case in many different markets, the regulatory environment fails to keep up to speed with the reality of the situation. For Australia, this means that gambling is widely accepted and practised, even at offshore platforms that operate outside of the regulatory environment, and regulators seem relatively powerless to effect changes. For investors, this environment remains fertile ground as many operators are able to generate significant revenue.
To break down some other reasons that the Australian online gambling market is a good space for investors, the market benefits from:
A tech-savvy population: Australia has a very high level of internet penetration and almost total smartphone adoption, which means online gambling is very accessible.
Player loyalty: Australians like to be able to trust where they play, so once they find a platform that resonates with them, they are likely to stick to it.
Although not an exhaustive list, these are good indicators that investing in this market can be worthwhile.
Potential Changes in the Offing
We’ve mentioned a number of times that the current ecosystem might not last, and there are signs on the horizon that more changes might be coming. Australia has always been a nation that enjoys gambling, but growing concerns about gambling addiction and the responsibility to protect those vulnerable to it are becoming a bigger part of the national conversation.
Following pressure from political and societal groups, the current Australian government appears to be considering strong restrictions on gambling advertising in particular. A leak in August of 2024 revealed the planned restrictions to be a nationwide ban on gambling ads between 6 am and 10 pm, including a full ban on any ads during daytime sporting events.
Interestingly, there seems to be concessions being made to the unique position that horse racing and other racing events hold in the Australian culture, and gambling advertisements may still be allowable in and around those events.
While some are criticising these proposed plans as not protective enough, the current Australian government has cited concerns of driving residents into the arms of offshore operators as a key reason for keeping their changes reserved.
While these changes might not seem huge from an investor’s point of view, the lack of advertising could hurt many operators’ ability to acquire new customers, especially around sporting events, where they currently reach their key demographics. The changes are also a sign of a change in the weather for the Australian gambling industry, perhaps indicating a drift closer towards the harsh regulatory environment of the UK and elsewhere in Europe.
Final Thoughts
For investors considering getting into the Australian online casino market, the way is still very much open. The market remains relatively sound and still has room for expansion, without being choked with too much competition. But is the Australian online casino market as safe for investors as gold? Of course not.
Investors should be aware, however, that the Australian government is openly moving to increase restrictions on advertising for gambling, and other regulatory changes could well follow. Would these changes freeze out the market and make it unworthy of investor attention? Currently, it seems not, but no one can know what the future might hold.