Government prepares clampdown on fixed-odds betting machines
Bookies are facing a crackdown on betting machines which have been dubbed the “crack cocaine of gambling” – a move that could send their profits plunging.
MPs will this week attempt to stop punters being able to bet stakes of £100 on fixed-odds betting terminals (FOBT), according to several reports.
The digital, culture, media and sport department is due to wrap up its long-running review into the gaming machines. And sports minister Tracey Crouch is expected to consult with bookmakers and others in the industry on slashing the maximum stake to £50, £20 or £2, the reports said.
A cut to £2 would “materially reduce revenues and profits for retail exposed UK betting companies”, according to analysts at Barclays.
“We think the market is pricing in a worst case scenario: we think a more ‘benign’ outcome is more likely,” they noted.
Ladbrokes Coral for example, is estimated to derive around 35 per cent of its net machine revenue from FOBTs. Analysts at Hargreaves Lansdown said each machine earns William Hill more than £1,000 per week and “any significant changes would hit the group hard”.