A new study from the Sweden gambling regulator Spelinspektionen (SGA) shows a slight year-on-year decrease in channelisation towards licensed offerings in 2024.
The report, published on Monday, found the channelisation rate for the competitive market in Sweden fell to 85% in 2024, 1% lower than the 86% rate reported in 2023.
The study utilised a different methodology from previous years, after Spelinspektionen tasked itself with developing a new method for calculating the channelisation rate.
H2 Gambling Capital’s figures have been disregarded this year, although the company recently adjusted its channelisation estimate for Sweden from 91% to 72%.
Spelinspektionen’s new methodology utilises player surveys and internet traffic analysis, with 5,767 respondents to the study and 2,032 unlicensed websites identified.
Online casino was found to be a particular pain point in terms of the illegal market, with online casino’s channelisation rate estimated to be between 72% and 82%.
In comparison, betting is estimated to have a channelisation rate of between 92% and 96%.
The total proportion of players who played in the licensed competitive market during 2024 is estimated to be 96%.
The player survey found the main reasons for playing on unlicensed offerings is a better opportunity for winning on websites without a Swedish licence.
Reflecting on the update, Gustaf Hoffstedt, secretary general of the Swedish Trade Association for Online Gambling (BOS), said it was important to compare the estimated channelisation rate of 85% to Spelinspektionen’s long-term target of 90%.
Prevalence of illegal online casino a key concern
In Hoffstedt’s view, it’s “unacceptable” that approximately a quarter of online casino is being played on unlicensed offerings.
He believes that more needs to be done by politicians to improve the rate, adding: “It is equally unacceptable that this has been accepted by political decision-makers for half a decade, since the channelisation has also been low in previous assessments, without effective regulatory measures being taken.”
Later this month, investigator Marcus Isgren will present a proposal to alter the scope of Sweden’s Gambling Act.
Isgren is expected to consider measures that will make it toughen for illegal sites to operate in Sweden.
Hoffstedt welcomed these changes, although he also warns overregulation of the legal market must be addressed to ease the restrictions on licensed operators.
“Anyone who understands the gambling market knows that the elephant in the room is that the licensed market is so tightly regulated that it does not appear attractive enough in the eyes of the consumer,” Hoffstedt concludes.
“Without a review of, for example, the total ban on bonuses and other loyalty programmes, next year’s channelisation assessment from the SGA will also be a disappointment.”
By comparison, Netherlands regulator KSA reported in July that the market’s channelisation rate had dropped from 95% to 93%.
However, KSA also admitted there is a chance that some players are gambling large amounts with illegal providers.
With the Gambling Act review expected later this month, new data shows the channelisation rate in Sweden has dropped year-on-year.