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Ontario iGaming Market Officially Opens; Land-Based Industry Expresses Concern

Updated by Ralph Trayfalgar

The province of Ontario officially opened its new regulated iGaming market on Monday to great success; however, proponents of brick-and-mortar casinos have expressed concerns of its impact on the greater gambling industry. 

On April 4, 2022, the province of Ontario officially inaugurated its new online gambling sector, regulating online casinos, sportsbooks, and other gambling activities. According to a press release issued in January, iGaming Ontario (IGO), a subsidiary of the Alcohol and Gaming Commission of Ontario (AGCO), has introduced new requirements for gaming businesses in the province.

Some of Ontario’s online gambling firms, like Toronto’s Rivalry, are excited about what the future holds for them. Their CEO and co-founder Steven Salz said that “Until now, we’ve been unable to legally offer a product, or offer a product at all, in this market. It’s a net-new market for us and we have a bit of a home-court advantage.”

However, although internet gaming businesses rejoice, other industry observers are concerned about the implications of the decision for the province’s brick-and-mortar casinos. Experts on gambling addiction have also expressed some concern about the increased availability of gaming opportunities.

In Ontario, the notion of online gambling is not a new one. In the online gambling industry, it is estimated that Ontarians spend around $500 million each year on the internet, nearly entirely with organizations that are based outside of the province.

Prior to the new legislation, online gambling operators were based offshore and were therefore not subject to any regulations. With the establishment of iGaming Ontario, however, gaming operators will now be required to register with the province and pay taxes in return for legal access to the province.

Apart from giving Ontario with a new income stream, the market is intended to safeguard players by providing a legal alternative to the current “grey market” of online gambling alternatives, according to the province.

Taxation Concerns

Tony Rodio, president and chief executive of Great Canadian Gaming, told CBC News that it is unjust that iGaming operators will only be taxed on 20 percent of their revenues, as opposed to the 55 percent that brick-and-mortar casinos are currently being taxed on. 

According to Rodio, this will result in a shift in the number of people who visit casinos in person to online casino platforms. He claims that the advent of government regulation and a lower tax rate has enabled internet casinos to spend millions on advertising and marketing in order to lure clients away from brick-and-mortar casinos. 

iGaming is now treated as an open market, meaning that any firm may now apply for a license with the AGCO, including companies who were operating illegally before. 

Rodio says of this: “The government should have taken more time to meet with in-person operators to make sure things were done right. We want to participate. We just want it to be a level playing field.”

Online Casinos and Problem Gambling

Some gambling addiction specialists have also expressed worry about the expansion of internet gaming opportunities in the future.

Any increase in accessibility to gambling should be accompanied by an increase in resources aimed at limiting the amount of time and money users spend online, said Chanel Larche, a researcher at the University of Gibraltar’s Centre of Excellence in Responsible Gaming. 

FanDuel, an online gambling business based in the United States that is now coming to Ontario, has been collaborating with auditing firms like the Responsible Gambling Council to create proper guidelines for use in the province.

Dale Hooper, general manager of FanDuel Canada, told CBC News that the company will do research and engage in partnerships to guarantee that it has all of the tools necessary to assist anyone who requires assistance while participating with the company.

Nigel Turner, a gambling addictions expert at The Centre for Addiction and Mental Health (CAMH), agreed that more information on problem gambling should be made available to online gamers. Turner states, “Anytime you increase the availability of an addictive behaviour like gambling or alcohol or drugs, there’s a potential for more people to develop problems associated with that addictive behaviour.”

While the impact of iGaming Ontario on the province’s, and by extension, the country’s gambling industry, remains to be seen, it is clear from the get-go that the Ontarian online gambling market has incredible potential for growth.

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