A new survey, conducted by polling firm Motivaction on behalf of state-owned brick-and-mortar casino operator Holland Casino, suggests that the (currently unregulated) Dutch online gaming market could be significantly larger than previously estimated.
According to the survey, as many as 1.5m Dutch adults gamble online, spending an average of €26 per month for a total annual spend of around €500m.
Spokesperson Michael Verheul of Holland Casino added that Motivaction‘s survey might even significantly undervalue the online Dutch market:
“5.6 million Danes spent €338m during the first three quarters of 2015. The Netherlands has three times as many inhabitants. That adds up to a billion euros.”
However, Speel Verantwoord, the Dutch trade organization of online operators, basing itself on the audited yearly results of several operators, values the Dutch online market considerably lower: between €218 and €245 in 2014.
Rutger-Jan Hebben, director of Speel Verantwoord, also points out that comparing populations to estimate market size is questionable at best:
“Using Spain instead of Denmark as a point of departure, the size of Dutch online market would only be €70m, a third a Spain’s €215m. Moreover, based on the Danish benchmark, the Spanish market would be worth €2 billion annually, instead of the actual €215m.”
Asked to comment, Simon Holliday of market research firm H2 Gambling Capital questioned the findings of the Holland Casino-sponsored survey:
“H2 have concluded that the total Dutch player (onshore and off combined) interactive gambling market would commence at c€281m in 2017 and then grow at a CAGR of 12.4% to c€450m by 2021.”
The wildly differing estimates of the current size of the Dutch online gaming market are closely tied to the debate about the appropriate tax rate for online operators. Holland Casino explicitly desires a uniform tax rate for both online and offline operators, which would mean that the proposed rate of 20% for online operators would have to be raised. Online operators looking to legally enter the regulated Dutch market are thus being accused of deliberately underestimating the size of the Dutch online market in order to justify their lower tax rate.
It should be noted, however, that this accusation cuts both ways. As a higher tax rate on remote gaming would prevent foreign operators from entering the Dutch online market, soon-to-be privatized Holland Casino has a clear commercial interest in having this rate raised in order to limit its future competition – and thus in estimating the size of of the Dutch online market as too large.
Illustratively, VAN, the Dutch association of land-based slot machine operators, another party which would benefit from a small number of foreign entrants into the Dutch online market, immediately said that Motivation’s estimate of the Dutch online market means that there is “enough room for a uniform gaming tax rate,” i.e., a rate on online operators that is higher than 20%.
Since the full survey by Motivaction has not been released, the reliability of its findings in relation to other studies remains – for now – unclear.
