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Stats SA has published its Personal services industry, 2023 report, followed by a data story that focused on the gambling and betting components of the sector.
“Gambling and betting are on the rise. Not only is this supported by data from the National Gambling Board, but it has also emerged in economic and household findings from Stats SA,” the agency stated.
Specialist data visualisation publication The Outlier created a chart for its latest newsletter, illustrating Stats SA’s findings about the massive growth in online gambling.
It explained that the personal services industry includes the education, health, entertainment, and recreation sectors.
Stats SA reported that, in 2018, health and education services generated about 70% of the income in the personal services industry. That decreased to 56% in 2023.
The results of its latest survey, conducted in 2023, show that recreational, cultural and sporting activities represented 37% of the income generated by the personal services industry, which was estimated at R688 billion.
“Recreational, cultural and sporting activities” is the category that includes betting and gambling services.
The bubbles in the chart below show only the services in the sporting and other recreational activities category (i.e., not cultural).
The total income for this category was estimated at R209-billion in 2023. The gambling and betting services, which are in shades of green, grew from a combined income of R25-billion in 2018 to R191-billion in 2023.
“Casino and gambling houses are again the losers, registering a decline of 3.3% per annum over the same period. This places the activity among the bottom 10 worst performers,” Stats SA stated.
“Casinos were once the most popular form of gambling, boasting 84% of market share in 2009/10, while betting accounted for 10%.”
Stats SA said that betting expanded its influence over time, dethroning casinos during the Covid-19 pandemic to become the dominant form of gambling. Its rise has remained unabated.
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Legality of online gambling in South Africa
The rise of online gambling has occurred despite the National Gambling Board repeatedly stating that it is illegal in South Africa.
Despite this, many licensed and prominent sportsbook operators continue to offer online casino games, such as slots, roulette, and blackjack.
The National Gambling Board highlighted this as a significant point of non-compliance from betting operators, stating that online bookmakers offered online casino games illegally.
Its position on online gambling is supported by a 2011 Supreme Court decision involving Piggs Peak Casino, which upheld a High Court ruling that online gambling was not permitted in South Africa.
However, legal experts at the time explained that what prevented companies from offering online gambling in South Africa was that it was impossible to get a licence to run a legal online casino.
While the National Gambling Amendment Act introduced regulated online gambling and was assented to by former President Thabo Mbeki in 2008, it was never put into operation.
Several attempts have been made to introduce new laws to govern online gambling in South Africa, primarily from the Democratic Alliance, but these have not made it through Parliament.
Although Internet gambling platforms cannot obtain national operating licences in South Africa, permits from provincial authorities are being used to operate online casino services.
Money spinner
According to the National Gambling Board’s latest annual report, Mpumalanga recorded the highest gambling turnover, or bets placed, at R359.3 billion.
The Western Cape followed closely at R353.2 billion, followed by Gauteng at R173.7 billion. Four years ago, Gauteng earned the most revenue from gambling.
The Western Cape has surged past, reporting over R5 billion more gambling revenue than South Africa’s wealthiest province last year.
Mpumalanga recorded nearly the same gross revenue as Gauteng, which is curious given its much smaller population.
However, this is unsurprising considering that many of South Africa’s top online betting platforms have licences issued by the Western Cape and Mpumalanga provincial gambling authorities.
These include Betway, Hollywoodbets, Sunbet, World Sports Betting, SuperSportBet, Easybet, and Bet.co.za, some of which have multiple licences from different jurisdictions.
Most of these platforms offer sports betting in addition to casino games, including live-streamed table games.
The National Gambling Board reported that South Africans wagered R1.14 trillion during the financial year that ended on 31 March 2024.
Gross revenues from gambling reached R59.3 billion during the year, with 60.5% attributed to betting, primarily online, on events like horseracing and sports.
Less clear from the report was whether earnings from the casino games offered by online sportsbook platforms were being aggregated under betting or another category.
Nationally, betting far outpaced other forms of gambling, generating a turnover of R761 billion — more than double that of casinos, which brought in R297 billion.
Online betting operators have generated substantial additional tax revenue for the provincial governments that issue their licences.
The report showed that the Western Cape earned over 30% of tax revenues from gambling, banking almost R1.46 billion during the year.
Gauteng was in second place with R1.15 billion in taxes collected (23.8%), while Mpumalanga was third with nearly R890 million (17.8%) and KwaZulu-Natal fourth with R734 million (15.2%) collected.
Issued on MyBroadband by Jan Vermeulen | https://mybroadband.co.za/news/internet/610873-online-gambling-grips-south-africa.html
