The Italian future

Italy has propelled itself to the forefront of the egaming industry, with new and progressive regulation reaching an advanced stage. It has all of the right ingredients for a successful egaming market; the technology, internet penetration and mobile phone usage. Whether your business is online, mobile or both, there are compelling reasons for Italy to be top of your regulated market hit list.

For mobile in particular, you only have to look at the way Italy uses mobile technology to understand the size of the opportunity. According to the UN’s agency for information and communication technologies, the ITU, Italy boasted a 151% mobile phone penetration rate in 2009. That is with a population of 60m. With more advanced smartphones continuing to thrive, high usage of internet and phone-based apps and with a strong propensity to gamble, the market is set for the coming of egaming services ““ just as soon as the regulation is in place.

Full regulation is the final step in a long journey for Italy. We should not underestimate how significant this is simply because it has taken time to arrive. As we’ve seen from other markets, Italy’s persistence will pay dividends and attract foreign investment as egaming firms look to enter the market. But this does not mean that Italian businesses will miss out. The coming egaming industry has huge potential to benefit the local economy. Foreign investors will partner with local experts to generate new opportunities for firms and create sizeable new revenue streams for the government. Now we see major firms with strong local brands such as Neomobile become attracted to, and supporting, the burgeoning industry.

What does the future hold?

Italy is a great prospect, but the impact of its regulation does not stop at its borders. Its decisions will have a much wider impact across Europe, and the next six months will be critical. In two years’ time, egaming regulation will be in place or in the process of being established in most European countries. Denmark is expected to complete the regulatory process towards the end of this year pending the outcome of discussions in the European Court of Justice. The Netherlands, Spain and possibly Sweden will have passed regulation in the next two years, and Germany won’t be far behind. The European egaming market will grow significantly, with mobile gaming generating a significant portion of the industry’s revenue.

The competitive landscape will experience similar large-scale changes; both in Italy and across Europe. There will be identified market leaders with new and as yet unknown players taking major market share from the incumbents. Media groups and broadcast enterprises, as well as other land-based gaming groups who can adapt their approach and then use their scale to their advantage, will have entered the industry. Egaming will become a recognised and central source of revenue for this new breed of company, as well as a solid source of tax revenue for governments. New technologies and distribution channels such as smartphones and app stores will serve this growing market and the leading players will take advantage of these channels.

These developments, in one way or another, will also make their way to the US in the next five years, most probably on a state-by-state basis. Major land-based gaming businesses in those states that welcome land-based gaming will operate interactive gaming offerings on an intrastate level. The larger operations will have expanded these offerings overseas and will take advantage of their recognised brand names to leverage their size and power, capturing international egaming market share.

With Italy leading the way, the growth and development over the next five years will change the face of the egaming industry forever.