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The iGamingBusiness.com Nordic dashboard, in partnership with core processing partner H2 Gambling Capital and Swedish review portal CasinoSvenskaOnline (https://casinosvenskaonline.com/), anticipates that the market will grow to €4.46bn by 2023, helped by the introduction of gambling regulation in Sweden.
This growth will be supported by regulation, with H2 predicting that the share of gross winnings derived from licensed offerings will rise to 80.5% of total winnings from 61.5% over five years, driven by channelisation and dot.se market growth.
Indeed, growth between 2013 - one year after the introduction of regulation in Denmark - and 2018, and then projections for 2018-2023 suggest that regulation is in fact a key driver of gambling growth.
This will be achieved despite the fact that markets such as Norway and Finland show no sign of moving away from protectionist monopoly models. In each country, this has led to the development of successful offshore markets, despite growing efforts to crack down on unlicensed activity in each country.
Nordic igaming had gross gains of €3.49 billion in 2018, an increase of 10.1% on the same period last year. Sweden, which opened its regulated gambling market on 1 January 2019, led the way last year, accounting for 34% of gross winnings in the region in 2018. It was followed by Finland with a share of 25% and Denmark accounted for another 20%.
According to data released by regulator Spelinspektionen in Sweden, unlicensed activity continued to grow in 2018, with Finland's Veikkaus citing unregulated growth as a factor in its decline over the year. However, H2 suggests that Nordic players tend to play through regulated offerings, with licensed sites accounting for 61.5% of gross winnings, up 0.8 percentage points from 2017.
Looking at the product range over the past year, sports betting was by far the most popular vertical. In 2018, betting brought in 40% of total winnings in Nordic igaming, followed by casinos with a share of 28%. State lotteries, whose market share declined as players moved to other verticals, accounted for 19% of the total.
However, the Nordic region seems to be lagging slightly behind other regulated markets in terms of mobile penetration. In 2018, this channel accounted for 44.5% of gross gaming winnings, while mobile gaming has become the preferred way to gamble in other territories. Mobile is expected to grow steadily, says H2, and become the dominant channel in 2020, with its share of revenue rising to 59.6% by 2023.
This slow development can be attributed to the fact that, with the exception of Sweden, gambling lags behind land-based gaming in the region. In Finland, for example, gambling accounted for 43.1% of total market revenue in 2018, and in Iceland 43.8%. Both Denmark (49.6%) and Norway (49.2%) saw an increase in the popularity of gambling, but both countries still lag behind Sweden, where online gaming accounts for 51.9% of gambling revenue. Across the region, gambling accounts for 48.3% of revenue, which is expected to rise to 56.5% by 2023.
H2 Gambling Capital is a leading team of consulting, market analysis and data specialists in the gaming industry. The company has 18 years of experience in the global gambling industry and its forecasts have been influential in shaping the views of lawmakers and investors on the gambling sector around the world.