Lee Richardson – Gaming Economics – Africa…untapped gold?

leerich
Lee Richardson

In January Gaming Economics analysed the relationship between global sports-betting and television audiences for the English Premier League (EPL).

We highlighted the fact that, despite garnering 15% of the global TV audience for the EPL, Africa woefully under-served its 1.4 billion population wanting to bet on the sport it undoubtedly adores.

Does the continent therefore represent an opportunity on the doorstep of forward-thinking European e-gaming operators?

There’s certainly a fast-growing ‘grey’ sports-betting market in such territories as Nigeria (who’ve more than twice as many people as Germany and three-times the population of either France, Italy or the UK), Kenya (as sizeable as Spain) and Uganda (more populous than Poland).

Typical on-line sports-betting stakes are tiny by international standards – perhaps £0.65 ($1.00) – but attractive enough in per-capita GPD measures, especially in sub-Saharan Africa, and margins are good.

Currently run by local and regional operators, sports betting customers use their mobile phones to bet via SMS and pay through M-Pesa, the proven payment system designed and launched for Africa by Vodafone in 2007.

Perfect for a continent where more than 1 billion people have mobile phones but no bank account, Morgan Stanley, the US investment bank, now estimates that 40% of the entire Kenyan economy passes through M-Pesa.

Across Africa, a wealthy middle-class is beginning to emerge. Having already overtaken South Africa as the continent’s largest economy, Nigeria joins Kenya as the two fastest-growing economies. Over the next 10 years, the Economist Intelligence Unit expects Africa to be second only to Asia as the world’s fastest growing region.

But despite also being the world’s second most connected region by mobile ‘phone subscriptions, just 2% of today’s global online sports-betting market emanates from Africa.

That’s clear, unsatisfied demand for betting on sports, particularly football. So with proven payment systems and infrastructure in place, growing disposable income and an increasingly positive economic outlook, what’s missing?

Well, South Africa’s recent decision to shun online gaming regulation is disappointing.

Gaming Economics believes a more positive attitude from national governments toward proper licensing regimes and sensible taxation could work wonders for new inward investment, new revenues and new jobs.

European bookmakers already know what Africans like to watch on TV. For any of them seeking new markets, and new growth, over the next decade, they also know where to look, and who to lobby.

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Lee Richardson – CEO – Gaming Economics

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