November 07, 2014

French Internet Poker Market Falls To €57m In Q3 2014

French online gambling regulator Autorité de Régulation des Jeux En Ligne (ARJEL), has released its third quarter results for the country’s gambling industry and while sports betting gross gaming revenues were up by a massive 94% to €60 million, online poker continued its dramatic decline with revenues shrinking by 2% to just €57 million.

Poker Declines For Third Consecutive Quarter

In the third quarter, ARJEL reported a 2% fall in the country’s online poker market to €57 million, and while cash games noted a turnover drop of €59 million to €1.040 billion, tournament entries actually improved slightly by €2 million to €354 million.

Earlier this year, ARJEL President Charles Coppolani declared that poker was a losing proposition, and issued a public statement saying; “The fad is over. Basically, the online poker market may be mature.” Unfortunately, France’s quarterly results seem to be leaning in that direction, and the country has now experienced three quarters of declining revenues.

Nevertheless, while Coppolani has dismissed poker as a “fad” and “too complicated for a young audience”, the ARJEL President seems to be overlooking what is likely to be the real root cause of the problem, namely a ring-fenced market with a lack of liquidity, and a French government which has placed too high a tax burden on online poker operators.

Unappealing French iPoker Market

French online poker operators are currently subjected to an extortionate 37% tax rate, and also find themselves further disadvantaged by an estimated 45% of French players preferring to play on unlicensed sites, representing a considerable drain on France’s online poker industry. While ARJEL’s current President Coppolani seems to have overlooked just how significantly these factors have affected online poker in France, ARJEL former President Jean-François Vilotte,at least seemed to have had a better grasp on the situation and previously warned:

“Poker is going through a difficult time, but this is not something that is happening only in France, as Spain and Italy are experiencing a similar trend as well. Seen from a broader perspective, this is a problem of legalized markets competing against non-legalized ones. If legalized markets won’t learn how to become more flexible and adjust themselves quicker to what people want, they will keep doing the work for illegal websites and help them to win against their legal competitors.”

In addition, this uncompetitive situation has recently affected the country’s players and on September 26th, officially shut its doors leaving between €300,000 and €500,000 of customers’ bankrolls and bonuses stuck in their online accounts.

Signs That ARJEL May Finally Be Addressing Shortcomings

However, there are at last signs that France’s regulator is beginning to see the need to improve the condition of its online poker market, and Coppolani recently met with a select group of French players and journalists in an effort to improve communication between ARJEL and the players in the future. Amongst a number of issues he has promised to consider is the need to introduce more poker games to the French online poker community, to reduce tax for online poker operators, and to share liquidity with other European countries, such as the UK, Spain and Italy.

Sports Betting The Outstanding Performer

While online poker continues to struggle from a number of factors, France’s gambling regulator ARJEL had nothing but praise for the country’s sports betting industry, which reported gross gaming revenue (GGR) of €60 million, up by 94% compared to the €31 million generated in Q3 last year.

Helping France’s sports betting balance sheet was the country’s promising performance at the 2014 FIFA World Cup in Brazil, which saw the national team reach the Quarter-finals before losing 1-0 to eventual winners Germany. While French bookies took €47 million from punters during the World Cup, French sports betting in general was up by 34% to €245 million in Q3, with football betting the most popular attraction with 63% of the action. Tennis proved the next most popular sport with 24% of total sports wagering, while horse racing continued to wane, falling by 7% in GGR to €238 million.

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