William Hill, a global gambling company, has announced it is investigating new betting laws that are due to take effect next month, and whether or not it may affect their Australian operations.
The company which currently boasts over 280k customers states the new tighter regulations could cut into their profits. Federal and state governments reached an agreement to ban providing credit to customers from online betting companies.
In response to this William Hill released a statement which said the credit ban in Australia, as well as the likely new consumption tax, would threaten profitability and put companies under further pressure.
The ban is being driven by long-time anti-gambling supporter Nick Xenophon, a former South Australian Senator. Xenophon went on the attack after hearing William Hills threat to quit Australia by saying the credit ban is very reasonable and well overdue, and that by threatening to quit just shows how greedy and desperate they are.
The credit ban which is set to be instituted across the country next month will effectively stop online companies from offering “free” wagers to customers after their bankroll or balance has run out.
Xenophon stated that there is clear evidence from experts in gambling addiction that this “free” credit betting actually promotes gambling addiction. He went further to say in his belief William Hill’s profits are driven by desperate people who need credit to try and overturn a losing streak.
Online Betting Still Profitable
Since last year gambling companies have to pay the state 15% of net revenue from bets after the consumption tax was introduced in South Australia. It seems likely that Western Australia, Queensland and Victoria will be implementing the same measures shortly.
Gambling industry analyst Tommy Wu feels there is still plenty of profit to be made from gambling despite these new tax introductions. He mentioned how sports betting is still very profitable, and that the best part of online gambling is that companies can scale their operations and overheads without increasing operating costs.
Mr Wu said the Australian venture of William Hill only profited AU$4.7m in 2016 and lost over AU$110m during the two preceding years. However, this was due to a company restructuring and not the profitability of Australian gambling.