Advertising, operational guesswork, & a Svenska Spel sale: Sweden at CBS
From optimistic promise, to operational guesswork and finally a potential Svenska Spel divestment, via an advertising influx, Squid Game metaphor and B2B licensing; welcome to the journey that attendees travelled along during ‘Sweden: protecting its players’ at last month’s CasinoBeats Summit.
In a pre-empt of the country’s Moderate Party last week calling for a split and divestment of a section of Svenska Spel, Gustaf Hoffstedt, secretary general of BOS, who has welcomed the proposals, cited a past sale of Absolute Vodka by the state in teeing up the discussion.
“There’s quite a bit of actual precedent for what’s happening. I mean, at the end of the day it just depends if you need money or not,” noted Christopher Dalli, CEO of L&L Europe, after citing similar past examples in Malta, Austria and the Netherlands.
Morten Ronde, Founder and Managing Director of Nordic Gambling, picked up the mantle after being quizzed on if selling the state operator could be regarded as incomplete if the lottery is left in a monopoly.
“I think it depends on the setup really, because if you sell off part of the state lottery, how is it supposed to brand itself?, it was commented.
“Is it supposed to brand itself the same way as the lottery, but then you haven’t really achieved much. And that’s also why it’s difficult to sell it because what is it worth then if Flutter had to, you know, advertise it as Flutter rather than Svenska Spel?
“What is it suddenly worth then in the public eye? And that makes it difficult for the state to sell it because they know what they have now, a lot of money every year. But they don’t know what they’re going to get if they sell it?”
“There was not enough detail, we had no idea what we were doing”
Christopher Dalli, CEO of L&L Europe
Dalli continued by suggesting that “it boils down to any kind of acquisition,” with you simply having to look at the reasons behind any such sale.
“Why is it being sold? If it is kind of a conflict of interest, like you’ve alluded to where the government is saying this is not what the government should be doing, then obviously 100 per cent, you are right and they should be getting rid of all entities which are carrying out that activity,” he noted.
This concluded a 50 minute session that began with a tone of “a lot of optimistic promise” regarding 2019’s re-regulation, but which quickly turned into talk of an “unfinished product”.
“With the framework legislation of 2019 that was the idea, you know, that we come in, it sets the rules and the gaming operators will do the rest. So we know that we have all the freedom to do whatever we want,” Dalli said.
“Little did we know that what they meant was that all the other regulation was actually going to come in piecemeal fashion, through all the fines for the decisions and to guesswork. There was not enough detail, we had no idea what we were doing…and we’ll only find out way too late.”
Adding: “So, in truth, if you have to tell me how I can sum up the 2019 legislation, it was an unfinished product. And I think that the jurisdiction itself is still caught in between two minds as to what it wants to do.”
Ronde maintained this tone: “So what they haven’t done regularly that you should is to provide guidance, there was very little or no guidance,” before including a Squid Game comparison regarding the country’s regulatory approach.
“I listened to not two or three gambling ads in a row, but rather seven, eight or nine”
Gustaf Hoffstedt, secretary general of BOS
“I’d like to reiterate the fact that 70,000 people in the country have signed up to the self exclusion tool while the market has been growing which is an accomplishment in itself,” Alen Kojadinovic, Head of Casino at Acroud, later stated.
“And so, I think the regulation apart from some certain aspects, such as with relation to unlicensed operators, has been successful.”
And so the conversation turned to a hot topic across many regulated jurisdictions around the globe, that of advertising.
“I remember the spring of 2019, I had a short walk to my office. And I always listened to private commercial radio,” Hoffstedt began ahead of the next topic being broached.
“And during that period, I listened to not two or three gambling ads in a row, but rather seven, eight or nine in a row. So there was this explosion of advertising. And we kind of lost the relation between us, the industry, and just about anyone else in Sweden.”
Dalli kicked things off by suggesting that “the industry has to hold itself accountable” and that it should have been “steering the conversation early on” and not waiting “until the regulator sets that line in the sand”.
The L&L Europe CEO explained: “I can only speak for myself, but at the same time I think anyone who has an objective view of the industry will be the first one to say that we ruined ourselves, the industry oversaturated the advertising, it’s just non stop.
“Even, you know, I’m Maltese, I live in Malta, we actually are lucky enough that our jurisdiction is one of the few where the political side is a non factor because there is political assent and it pushes the gaming sector to the commercial benefit to the country, unlike some of our counterparts.
“Definitely there are things we could have done better”
Morten Ronde, Founder and Managing Director of Nordic Gambling
“But even then we’re not immune to it. If you switch on the TV, it’s just like advert after advert after advert that’s just bringing too much of a negative light on what we’re trying to do.
“All the good work that goes on behind the scenes is completely lost because there is a stigma, which is that these gaming companies are one raking in millions and two rinsing people dry, and that is very far from what is actually happening in truth in the operation.
“So if you go from overnight where advertising was not allowed on your TV stations and radio stations, and all of a sudden, it’s all you see that you are again, and in a particularly culturally sensitive jurisdiction, then you are making it impossible to self-moderate.
“And this is not a Sweden issue only, this is a hot topic in multiple jurisdictions, the UK, Netherlands, for example. It’s one of the most commonly talked about in parliament.”
However, despite acknowledging that “there are things we could have done better on marketing,” Ronde did voice a slight objection on this issue.
“On that point I actually disagree, because I think that’s the nature of the competitive market is that you can’t make agreements on how much you can advertise, or what kind of things you can advertise, maybe you can do that,” he said. “But I think that’s for the regulator to set boundaries.
“I think what the industry could have done was to be more compliant because … there’s also been a lot of actual failings, AML failings, things that we just have to realise that as an industry we don’t do it well enough. And that creates a bad image in public. So, definitely there are things we could have done better.”