What Happens Before April 4th Stays Before April 4th
Ontario announced April 4th as its go-live date for Internet Gaming. But it’s more than just the date that registered operators can launch. It’s also the date (with one exception) that all operators are expected to stop offering services to players located in Ontario without a gaming registration.
The Alcohol and Gaming Commission of Ontario (AGCO) has made it clear that Operators’ activities in the Ontario “grey market” prior to April 4th will not put them at a disadvantage in any way from a regulatory perspective. This is a different approach as compared to what other jurisdictions have done (e.g., the Netherlands).
Forget disadvantage, these operators now have an advantage over new entrants to the market! They have (i) an existing customer base, and (ii) brand awareness. I still have a Bet365 hat (.net, of course) that I got at a Toronto Argonauts game. While sitting in the Bet365.net touchdown zone.
Is that fair?
This is not the first example of a company being at a commercial disadvantage because it has conducted its business according to the letter of the law. Clearly new entrants to the market are at a disadvantage. The best way to make up that disadvantage (since these are essentially marketing companies)? Pelt our eyeballs with advertising. To its credit, Pointsbet “Canada” seems to be doing the right things (very funny Trailer Park Boys ad, sponsoring Canadian curlers) to curate a fun and Canadian image.
Why should the regulator care?
Good question. They don’t. The goal of the Ontario iGaming framework is to capture as much of the grey market as possible, not to reward entrants who have 100% been playing be the rules. Therefore, it is essential to the framework that grey market operators NOT be at a disadvantage.
From the Internet Gaming Operator Application Guide
We want to ensure a smooth and efficient transition to the regulated igaming scheme for operators. To help facilitate this:
- We will be as practical and pragmatic as possible, consistent with our regulatory mandate, when engaging with applicants.
- The AGCO will coordinate the timing of registration issuance with iGaming Ontario’s commercial contract signing. This includes confirmation of data exchange so that these three events coincide and the transition to the regulated igaming scheme is as seamless as possible — with the goal of having no “blackout” period.
This is not like the US market. First, a much higher percentage of players already play with iGaming sites who will be registering or have no intention of registering. Second, the government run iGaming site already has brand awareness and a head start.