Opening up local sports betting market could expand gaming revenue sources – Analyst

Liberalising the local sports betting sector would help casinos diversify their gaming offerings and sources of revenue, gaming consultant David Green told Macau News Agency.

Local authorities have extended the current Macau SLOT Co. Ltd. concession for betting on football and basketball for three more years but removed its exclusive rights to this market while allowing it to possibly explore other lotteries and mutual betting.

“I think it is a good move. The Macau SLOT concession only related to football and basketball which, while popular, are not the only sports betting propositions that people are interested in,” the founder and CEO of Newpage Consulting told MNA

“The concession system is intended to produce an income stream for the SAR; that is why the rights to offer various forms of gambling, including sports betting, are outsourced by way of a concession grant”.

While in Las Vegas punters are accustomed to seeing casino sportsbooks in casinos where clients can watch different sports and bet on the outcomes, such operations are mostly absent in Macau, with sports bettors relegated to dedicated betting shops operated by Macau SLOT.

According to Green, allowing for sport setting operations could help drive greater gaming revenues by allowing casinos to offer sportsbooks, even if they are outsourced to another concessionaire holding a sports betting concession under some form of the management agreement.

‘Sportsbooks are not of themselves great moneyspinners for casinos, but they have the benefit of encouraging people to stay longer. If, for example, they have a money bet on the Superbowl, the outcome is not determined for at least 3 hours; people will likely find their way to casino games during extended breaks in play, and will also likely patronize casino F&B outlets,” Green added.

“Sportsbooks in Australia, and probably many other places, have done a roaring trade since COVID caused casinos to either shut down or observe restricted density limits”.

The global COVID-19 pandemic and related government restrictions led to changes in the availability of gambling in Australia, with land-based gambling venues temporarily closed and major national and international sporting codes suspended, according to a report from the Australian government.

The same report pointed out that almost 1 in 3 survey participants signed up for a new online betting account during COVID-19, and 1 in 20 started gambling online, with horse racing, sports betting, greyhound racing and lotto the most popular.

In the US about 20 states allowed some kind of sports betting, with a record US$1.5 billion in total revenues generated in 2020.

The global sports betting market was valued at US$85 billion in 2019, with the Asia Pacific region believed to be responsible for 47 per cent of the world’s sports wagers.

Meanwhile, the revenue coming from betting on football and basketball in Macau in 2020 dropped by 27 per cent year-on-year to some MOP$543 million (US$67.8 million) – the lowest amount in the last five years – something that can be attributed to the disruption caused by the pandemic worldwide on the scheduling of sports events.

Allowing for more betting offerings has been seen by analysts as a possible way to assist the recovery of the local gaming market following the pandemic impact, with sports betting volume still a minuscule part of the total gaming generated in the city.

Macau’s cumulative gaming revenue reported between January and May amounted to MOP42.4 billion, up 28.7 per cent from the same point in 2020, but 66.2 per cent lower than in the same period in the year before the pandemic broke.