Italy's New Online Gambling Regulations Set to Challenge Operators and Players, Warns DailySpin CEO

Operators face significant challenges as Italy prepares to introduce sweeping changes to its online gambling regulations, predicts Eric Stööp, CEO of DailySpin.

These changes, he argues, will make it much more difficult for operators to enter and compete within the Italian market, and ultimately, could harm players by reducing competition and innovation.

DailySpin, a comparison site that bills itself as a "one-stop shop" for players, chose Italy as the starting point for its expansion into other regions. However, according to Stööp, the changes in the country's online gambling landscape could stifle competition. "With less competition, the players usually suffer in the end as the offering from the operators will be less compelling," Stööp explains.

The new regulatory adjustments follow a pattern seen across global gambling markets, with Italy already having caused controversy in 2019 with the introduction of a ban on gambling advertisements. Now, Italy's regulators are preparing for further measures, which could potentially deal another blow to the industry.

"I think the biggest change is that it will become more expensive to operate a licensed operator in Italy, and also all the skins of the so-called casino online AAMS operated under the same license will be removed," Stööp outlines. "This will likely lead to consolidation through M&A. With less competition, the players usually suffer in the end as the offering from the operators will be less compelling. Less return to players on casino games and odds, and through promotions and loyalty. Product innovation will be less important as the competitive landscape fades."

In addition to these changes, the CEO also pointed to significant upgrades in technology infrastructure that operators will be required to implement, along with regulatory verification processes and testing lab accreditation mandated by the Italian government. These requirements may drive operators to seek third-party solutions for services they previously managed internally.

Although Stööp does not foresee these adjustments as insurmountable, he acknowledges that the additional IT and associated costs could squeeze smaller operators out of the market. "Italy was one of the first countries in Europe to regulate their online gambling market, and the channelisation from the unregulated market has been very good compared to expectations," he said. "We have noticed a trend in recent years that the unregulated market is growing. There have been mentions about bonus restrictions and more responsible gambling measures in the new regime. I really hope that the regulators don’t go too far with certain player restrictions for bonuses and limits as we are certain that this will just supercharge the outflow to unregulated operators."

Stööp also voiced concerns about the black market, which has been a rising issue in many regions. He points out that governments and regulators are not doing enough to address illegal operators. "There are way too many easy political points being scored by just implementing measures that have not been thought through to either increase the state budget or to score points with the public as gambling in general is still considered a moral grayzone," he said. "It is also way too easy for unregulated and illegal casinos to accept players in the regulated landscape, as way too little is done to close them down or prevent them from accepting new players in the specific jurisdiction."

DailySpin, as a comparison platform, plays a crucial role in educating players about the legal and safe options for gambling. Stööp expressed understanding for why some players might turn to the unregulated market: "We always try to educate our readers on the pros and cons of regulated vs unregulated casinos. But I can understand that players turn to unregulated casinos in certain markets as the regulator has done a very poor job in implementing measures that don’t interfere with the player experience."

Concluding the discussion, Stööp emphasized the importance of balancing responsible gambling measures with maintaining a positive player experience. He noted that overreaching regulations could backfire, pushing players toward unregulated operators. "This drives players into the hands of the unregulated market as they want to escape the implications of their player experience, and we end up with a lose-lose scenario for the regulator and the player," he said.

"DailySpin always ensures compliance with the framework set forward by the regulator. We only wish that regulators take into consideration the player experience when they operate the framework going forward, as the balance is very important to ensure as great of a channelisation into the regulated environment as possible," Stööp concluded. 

By fLEXI tEAM