Sweden's Svenska Spel To Expand Into Online CasinosFebruary 5, 2015 4:33 pm
Sweden’s state-run monopoly, Svenska Spel, has announced it now intends to complement its current line of online gambling games which include lotteries, sports betting, bingo, and poker by adding casino games to its product mix. Offering an explanation as to the company’s latest decision, Svenska Spel CEO Lennart Käll cited a recent report released by Sweden’s gambling regulator Lotteriinspektionen, which found that 20% of the country’s problem gamblers play on sites other than Svenska Spel, with the company subsequently suggesting the situation could be improved by directing such gamblers towards their site “where social protection interests are put over profit.”
Nevertheless, Svenska Spel’s explanation has already attracted derision from skeptics who pointed out that the company’s marketing budget is currently 50% bigger than in 2006, and that a separate study revealed 80% of gamblers surveyed said if they developed a gambling habit they would still be unsure where to seek help.
A possible alternate explanation to Svenska Spel’s decision to add casino games could be found in the company’s latest Q2 results, which were lower by 6% at $316 million in 2014, with earnings also lower by 6.5% to $161.5 million. The addition of online casino games, which currently account for around 7% of the country’s gambling market, could therefore help boost its earnings, whilst shutting out competition from competing operators such as Unibet and Bet 365.
Even PokerStars represents a potential threat to Svenska Spel, and whilst the poker room accounts for just 1% of Sweden’s online gambling market, it controls 25% of the country’s poker market. In the eventuality of PokerStars making casino games available for Swedish players, Svenska Spel could thus potentially see its command of the market eroded further.
Sweden’s monopolization of its online gambling market through state-run company Svenska Spel is vehemently opposed by the European Union, which considers it in breech of EU legislation concerning the free movement of services.