First-hand insight into the market for iGaming in the largely unregulated Asian region

THE GROWTH OF online gaming in Asia is primarily driven by ever increasing (and reliable) Internet penetration, coupled with expanding Internet access via the ubiquitous mobile phone. In terms of product adoption, online sportsbetting would be the largest segment, followed by online live stream video casino, RNG casino, keno/numbers games and then poker and other Asian P2P games.

Currently, most Asian countries seem to be some way from creating a regulated framework for online gaming; however, in the long-term I would expect it to follow in the footsteps of Europe with individual countries taxing and regulating the sector.

Hong Kong already offers online horseracing and football betting via the Hong Kong Jockey Club. It’s the only legal form of online gaming there, with everything else strictly prohibited. Indeed, it’s difficult to argue with this approach, as the products generate a huge amount of tax for the Hong Kong government, and the company’s residual profits are invested back into the community. Singapore and Macau also have licensed online sportsbetting.

The take up of poker in Asia has been slower than many industry observers, me included, initially expected. Historically, global online poker has grown due to powerful TV exposure, but this has been limited in Asia as gambling content for television is usually very restricted.

It’s interesting to note that where it was allowed to be shown on TV within Asia, online poker jumped in popularity. The best example is the Philippines, a region where poker is shown regularly on TV, where PAGCOR (the Philippines’ government gaming regulator) has licensed over 20 poker rooms in the country and where there is now a large grass-roots, land-based poker community. Although online poker is yet to be formally licensed in the Philippines, the amount of people playing online at international sites could feasibly persuade PAGCOR to adapt its regime to suit the existing demand.

Room for growth

Today, online gaming represents between five to eight percent of the total global gaming market. I would estimate that the comparative figure for Asia is still less than one percent of all gaming in the region, as you need to take into consideration the huge casino industry, the considerable horseracing markets of Hong Kong and Japan, plus the pachinko industry of Japan and Asian-wide lotteries.

Clearly, in online penetration terms,

Asia has substantial room for growth and that explains why many Western operators are setting up shop in the region. Asia has long enjoyed online games and I also expect to see growing popularity in variants of social poker/P2P games, with in-game revenue generation as opposed to 'full on’ gambling adopted by the next generation of players in Asia.

As far as the current market size in Asia is concerned, detailed and accurate market statistics are difficult to come by, but my best-estimate would indicate that the online gaming ‘pie’ would split up as follows: 50 percent sportsbetting, 35 percent casino (of which 65 percent is video-stream and 35 percent RNG), ten percent for keno/ numbers games/lottery, four percent for poker and one percent for other online games. Games such as online bingo have yet to be adopted and even popular Asian land-based games such as mahjong and Do Di Zhu haven’t proved popular online, primarily due to concerns regarding collusion. There are three or four online gaming operators in Asia that dwarf their comparable Western operators, but these are all privately held and the owners keep a low profile.

Another indication for the potential that Asia offers is to see how the land-based gaming industry has developed, particularly in recent years. As far as the casino market is concerned, I think most people know that Macau has now grown to be far larger in handle than Las Vegas', and that Singapore, with just two casinos, has already overtaken the Vegas strip. The Genting Resorts World Casino in Manila, Philippines has done fantastically well since launch and has shown that you can generate growth in both domestic traffic and international visitors if you offer a quality product. This has led to other major groups reviewing the Philippines with the second major casino due to open early next year. Vietnam has an integrated resort project underway, Japan is again further reviewing its public policy on casinos, and locations like Cambodia, Malaysia and Laos have had a casino industry for some years.

Future opportunities

From many perspectives - whether macro-economic, operator, software provider or affiliate - I think the Asian marketplace currently offers the best opportunities in the world.

The market is fast-growing and is strongly based on an inherent and ‘cultural’ connection with gambling. Through access to high-quality software programming resource in the region, there is a raft of exciting new products being delivered by a large selection of providers, both big and small. I’ve been in the industry for some years, but I’ve never seen as much innovation in sports/casino/side games/ numbers games, with a particular emphasis on the mobile phone channel, than I am seeing right now. ONEworks provides its sportsbook platform to most of Asia’s major sportsbooks and we are very busy right now dealing with both Asian customers and Western operators looking to do business in Asia.

From a player’s perspective, it’s easy to see why there is such growing interest in the region. For example, in the sportsbetting sector, Asian punters have preferred in-running betting for some years and have typically been offered far more in-play events and more competitive pricing than their European counterparts.

In addition, many of the leading Asian operators (like 12BET.com, bodog88.com and SBOBET.com) have been sponsoring Premiership football teams, and have become far better known in Europe, as players have found their sites. They have seen the more competitive pricing available and range of markets, and many have permanently switched to these sites.

Price competition in the betting market is always of benefit to the player - perhaps similar to the way in which Betfair’s exchange model ‘disturbed’ the status quo in the UK some ten years ago - and we’ve seen plenty of evidence of this ‘new wave’ at ONEworks, witnessing the effect that better prices and more markets can have on player behaviour, customer demand and operator profitability.

From an operator’s perspective, regulation is always going to be a challenge and, generally, the privately-held firms have done better as they are more flexible and can adapt quicker. Bet365 is an excellent example of being extremely successful in Asia (as well as the rest of the world), as it has seen the opportunity, developed a great product mix, and delivered through its reputation and excellent customer support. Asia has also had a very stable licensing regime for nearly ten years through the CEZA Philippines regulatory environment2 which has provided operators with an efficient and effective base. Some 50 licensees now have their headquarters in the Philippines and have invested significantly to base their businesses there.


With Asia’s ‘cultural connection’ with gambling, proven demand for online gambling in the region, the potential for growth, and increasing interest in the region from European operators, any affiliate operation would do well to ensure that they have Asia as a key part of their strategy for the rest of this decade, and beyond.

“Any affiliate operation would do well to ensure that they have Asia as a key part of their strategy for the rest of this decade, and beyond.”
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