The latest research by the UK Gambling Commission shows that the country's illegal online gambling market is expanding, with an increase in the number of unlicensed operators raising industry concerns. The study points out that the demographic characteristics of illegal gambling consumers are similar to those of legal users, mainly male frequent players aged 18-24, challenging the traditional perception that only self-excluders and minors would turn to the black market. Regulatory bodies and legal operators are facing challenges on how to effectively address this trend.
Current Issues and Research Report
The recent research report released by the UK Gambling Commission reveals the current state of the illegal online gambling market. The study refutes the view that only self-excluders and underage users would engage with illegal gambling, pointing out that the demographic characteristics of legal and illegal gambling consumers are almost the same.
The study shows that the main user group of illegal gambling consists of males, young people aged 18-24, frequent gamblers, and players with a Problem Gambling Severity Index (PGSI) score of 8 or higher. This finding changes the industry's traditional understanding of the composition of black market users.
Public Awareness and Regulatory Solutions
The research report shows a clear lack of public understanding of the regulatory system. Elizabeth Dunn, a partner at Bird & Bird law firm, points out that although consumers recognize the importance of licensed operators, they are not actually aware of how to verify license status.
This disconnect in awareness partly stems from insufficient consumer awareness and also reflects the increasing complexity of the illegal market. Alasdair Lamb, a senior partner at CMS law firm, adds that users typically see illegal sites as a supplementary choice rather than a complete substitute for legal platforms, with most respondents expressing a preference for consuming on legal sites.
Market Size and Development Trends
The UK Betting and Gaming Council (BGC) cites research from Frontier Economics estimating that currently about 1.5 million Britons gamble on illegal sites, with an annual expenditure of 4.3 billion pounds. More than one-fifth of gamblers aged 18 to 24 are using unregulated sites.
Monitoring data from Yield Sec shows that the UK black market share has grown from 0.43% in 2020 to nearly 9% by 2025, with growth mainly due to targeted marketing strategies and increased regulatory pressure on legal operators. Currently, there are over 500 illegal sports betting and casino operators targeting the UK market.
GamStop Program and Implementation Challenges
The UK's national self-exclusion program GamStop has had over 600,000 users registered since 2018, allowing users to self-exclude from accessing all UK licensed sites. However, the company acknowledges that preventing illegal activities remains a significant challenge.
GamStop cites Ipsos evaluation data showing that only 8% of more than 4600 users reported using unlicensed or illegal operators. The company emphasizes the need to correctly view the scale of black market operator activities, while supporting the empowerment of the Gambling Commission to deal with illegal sites.
Responsibility Attribution and Regulatory Challenges
Ismail Vali, CEO of Yield Sec, believes that the UK Gambling Commission and GamStop have a responsibility to provide a safer online gaming environment. He points out that illegal platforms target self-excluders or users showing signs of addiction directly through data brokers, social media algorithms, and SEO manipulation.
Vali warns that if not properly addressed, the number of users on illegal platforms may continue to grow, especially with the increase in advertising on illegal streaming sites. He calls for attention to the regulation of supply chains, advertising, and social media content.
Industry Response and Future Measures
Elizabeth Dunn from Bird & Bird law firm emphasizes the regulatory challenges faced by the industry, noting that the commission's ability to take effective action against offshore unlicensed operators is limited. Regulatory bodies are increasingly focusing on the regulated B2B market to prevent the supply of games to unlicensed operators.
The industry calls for regulatory bodies and operators to conduct more consumer-oriented educational activities to raise awareness of the importance of legal operators and help consumers identify and verify license status.
