Fixed odds betting terminals (FOBTs) have long been the source of controversy in the UK and, late last week, UK gaming regulators made the decision to move the maximum stake at FOBTs from £100 to a mere £2. To say that this decision will have a major impact on the UK and UK-facing gaming industry is something of an understatement.
The new rules on FOBT maximum wagers are set to go into effect sometime this fall, but impact from the decision was felt by UK operators almost immediately. On Thursday, stocks in William Hill dropped more than six percent while shares in GVC Holdings dropped by four percent.
Operators across the spectrum have long said that reducing the maximum wager on FOBTs to £2 has the potential to cost thousands of gaming industry jobs. Betfred’s managing director Mark Stebbings told the BBC that the decision was a purely and that, “This decision will result in unintended consequences including direct and indirect job losses, empty shops on the High Street, and a massive funding hit for the horseracing industry.” (The UK horse racing industry does receive a subsidy from taxes generated by FOBTs.
Supporters of the new limits, such as Tom Watson, the shadow culture secretary, pointed out that FOBTs and their ability to create frenzied gambling addicts are an issue that should have been addressed long ago saying, “The great tragedy of this is [that] for five years now pretty much everyone in Westminster, Whitehall and in the country has known that these machines have had a very detrimental effect in communities up and down the land.”
While it’s still not known how severe the impact from this decision will be, it’s certain that the UK gaming industry will definitely be taking a hit when the new regulations go into effect.
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