Euro Vision: Italy's mobile landscape

In an extra from eGR Mobile Intelligence’s analysis of the mobile gambling landscape around Europe, we look at how better regulation could be about to spark a revolution on the channel in Italy

Mobile represented just 14% of the online gambling market in 2014 according to a study by the University of Milan. Giulio Coraggio, a technology lawyer and partner at DLA Piper, says there are several factors behind the slow mobile adoption rates among operators. For one, Italy’s cellular and mobile internet connection options tend to be slower than much of the rest of Europe.

This has been compounded by Italian operators failing to drive innovation on mobile, while several of the foreign operators which have since entered the market tend to roll-out mobile products in their core markets before Italy. And finally, Italy’s ecommerce market is relatively small, estimated at around €15bn in 2015; conservative estimates of the UK market put it at upwards of €75bn.

Not that Italy’s mobile channel isn’t growing rapidly. The University of Milan report found that in 2014 mobile revenues more than doubled year-on-year to €99m, although it is worth noting that major UK operators, including Betfair and William Hill, drew more from their mobile channels in 2014 than every licensed operator in Italy combined.

Italy’s market is split between major multi-national operators and local competition. Lottery operator Lottomatica, which has expanded into sportsbook and poker, remains a force alongside Sisal and Snai, which have both invested heavily into mobile in recent years. Meanwhile the usual suspects – bet365, PokerStars, William Hill and Paddy Power – have experienced mixed results in the country but are likely to persevere with regulatory reform on the horizon.

Much needed reforms to the way Italy taxes sports betting were delayed in July, but are expected to be passed by the government before the end of the year. The changes will see the country’s regulator, AAMS, ditch its current turnover tax in favour of a gross gaming revenue model while also liberalising the types of markets operators can offer.

There is clearly opportunity in the market. Coraggio points to the hefty upside for mobile in Italy and some operators are beginning to find creative ways to drive growth on the channel. Carlo Di Maio, sportsbook director at Eurobet Italia, says this is because many customers are don’t like using a credit card on a mobile device,  Eurobet offers a cross-channel solution which allows users to book a bet on a mobile device before going into a retail location to pay for it.

Eurobet’s local approach has put its mobile operation ahead of many of its competitors. In June, 38% of its digital sportsbook volume was via mobile, compared to the national average of 27%. He added that casino was reporting an even higher mobile share, bucking the nationwide trend which saw the vertical draw just 10% of its revenues from mobile in 2014. “Mobile is the fastest growing channel,” Di Maio says. “In fact we’re investing quite heavily in it because it’s something that we strongly believe in. If you look at the UK, the share of turnover is now higher on mobile than on online. In the next year or so it will be the same in Italy.”

Coraggio sees no reason why this shouldn’t be the case, pointing to improving infrastructure and a generational shift. He also notes that while Italy’s regulatory framework hasn’t provided the sort of growth on the channel that was hoped upon introduction, the reforms should help spur growth in 2016 and it is likely that much of this growth will be driven by mobile. One of the proposed changes, which will potentially see the AAMS simplifying its registration requirement, could be particularly beneficial.

This is an extra exploring the mobile gambling landscape across Europe which appeared in issue 22 of eGR Mobile Intelligence