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October 23, 2019

Online gambling companies hope to thrive on 5G broadband but regulators are circling

By MarketLine

The advent of 5G will enable big innovations for in-game sports betting and virtual reality. Both could bring online gambling to more people and ramp up the stakes for companies and players alike.

5G will enable live betting which takes place during pauses during a sporting event. Delivering calculated odds and processing bets from thousands of devices during a live sporting event will be one of the most direct and lucrative applications for 5G connectivity.

Meanwhile, virtual reality, currently limited by broadband strength, will turn the immersive and popular world of online casinos into an addictive escape for first-time and experienced gamblers.

Live in-game sports betting will allow gambling companies to squeeze more revenue out of single sports events, whilst VR casinos target a tech-savvy millennial audience with cutting-edge visuals and social interaction.

5G coincides with a wave of gambling legalisation in the US

The US Supreme Court lifted a federal ban on sports betting in May 2018. So far 11 states have legalised it and 28 have proposed legislation to that effect.

Legalisation frequently attracts regulation. Heavy taxes on gambling companies created a strong incentive for governments – most recently the Swedish government – to open up regulated markets.

The US has the highest number of 5G installations scheduled to be operational by the end of 2019 thanks to US President Donald Trump’s determination to roll out 5G ahead of China.

The 5G rollout, along with sweeping gambling reforms, will ensure that US citizens are among the first to be exposed to live sports betting and VR casinos.

Mobile broadband carriers in the US – including Verizon and AT&T, two of the biggest in the world – have already hinted at the 5G-gambling synergies with investments in sports betting companies.

Online gambling companies are openly proselytizing the advent of 5G as a gateway to wider demographics, more addictive gameplay and higher retention rates.

Under such circumstances, companies risk encouraging governments to tighten regulations over business practices.

2019 has seen Italy and Belgium ban advertising for online gambling, tighter controls in the UK have resulted in five companies being banned and Uganda and Cambodia have banned it altogether.

China is hostile to gambling and exerts significant pressure on smaller economically-dependent neighbours to ban it. As China is the number one 5G provider for the Asia-Pacific region, the leverage of Beijing over gambling-friendly neighbours will only increase.

While 5G has huge potential to boost revenues with new technology, the spiral of superfast betting and immersive VR experiences could frighten governments into tougher regulations.

Providers of 5G will be weighing up the risks and rewards of this market.

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