Baltic Online Markets Soar Past €400m In 2021

February 21, 2022
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Overall regulated online gambling revenue in the Baltic region jumped by 84 percent year-on-year to €409m in 2021, with exaggerated channel shift helping Latvia and Lithuania to become the latest European markets to pass €100m in annual market size.

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Overall regulated online gambling revenue in the Baltic region jumped by 84 percent year-on-year to €409m in 2021, with exaggerated channel shift helping Latvia and Lithuania to become the latest European markets to pass €100m in annual market size.

Full-year gambling statistics collated by regulators in Estonia, Latvia and Lithuania have revealed the full extent of last year’s sharp uptick in online gambling activity in the Baltics, with consolidated online gross revenue in the region surpassing the €406m yielded in 2019 and 2020 combined.

Latvia’s Lotteries and Gambling Supervision Inspection (IAUI) reported in early February that overall Latvian online revenue, excluding lottery games, grew by 91.8 percent year-on-year to €109.1m in 2021, up sharply from an equivalent gain of just 4 percent in 2020.

That low-single-digit prior year growth rate came after Latvian operators were hamstrung by a temporary ban on gambling from March 23, 2020 that was controversially extended to the online market from April 7, with emergency measures eventually lifted on June 8.

Efforts to limit the spread of COVID-19 conversely played to the benefit of Latvia’s online sector in 2021, with land-based gambling venues having been shuttered from November 9, 2020 until June 15, 2021 and then again from October 11 through to the end of this month.

Aided by heightened retail-to-online channel shift, Latvian online casino revenue more than doubled year-on-year to €87.9m as land-based gaming revenue cratered to €18.7m, down 81.5 percent. The yield from online sports betting, while remaining undersized in comparison, improved by 47.4 percent to €19.4m in 2021 amid a normalised sporting calendar.

Baltic states annual online GGR

According to data collected by the country’s Tax and Customs Board (ETCB) and shared with VIXIO GamblingCompliance, neighbouring Estonia delivered broadly similar growth to Latvia despite its relative maturity as a regulated market and lack of COVID-provoked interruption during 2020.

In the 12th full year since licensed online gambling operations began under the ETCB’s oversight in 2010, headline online revenue rose by 87.7 percent to €197.6m in 2021.

This total, based on tax data, includes unspecified contributions from land-based betting and, VIXIO understands, foreign-facing operations conducted under Estonian licences in offshore markets such as Finland and Norway.

Online casino revenue as reported by the ETCB leapt by 96 percent year-on-year to €153.4m in 2021, supplemented by 92 percent growth in online sports-betting GGR to €28.9m and a more modest gain of 26 percent in online poker revenue to €15.4m.

Estonia, the smallest Baltic state by population, remains larger than Latvia and Lithuania in terms of regulated online gambling revenue, due in part to legal amendments in 2012 which removed the requirement for online licensees to locate their servers in the country.

Some 24 operators held online licences in Estonia at the start of 2022, with international brands including Unibet, PokerStars and bet365 competing with local specialists such as OlyBet and Optibet in a regulated system comprising “dot.com” and “dot.io”, as well as “dot.ee”, domain names.

In parallel, Estonian land-based gaming machine revenue steadied at €37.3m in 2021, up 2.7 percent year-on-year but down 28.8 percent versus the €52.5m yielded in 2019.

Quarterly statistics published by the Lithuanian Gaming Control Authority earlier this month, meanwhile, showed that locally-licensed online gambling revenue climbed by 71.5 percent year-on-year to €102.2m in 2021, the market’s sixth full year of operation.

Although lagging equivalent rates in the more mature markets of Estonia and Latvia, this growth was achieved against a more challenging prior-year comparative of 47 percent and resulted from 105 percent growth in online casino GGR to €67.9m and 29 percent growth in online sports-betting GGR to €34.3m.

Lithuania became the last of the three Baltic states to regulate online gambling at the start of 2016, launching a more limited regulatory framework allowing only those operators with existing land-based operations to apply for licences.

Although recent amendments to Lithuania’s gambling law will allow online-only operators to enter the market without a land-based presence from July 2022, the ability of new entrants to capture market share is likely to be constrained by a ban on bonuses and other promotions that entered into force last summer.

The casino-skewed growth observed across all three Baltic markets in 2021 meant that gaming products accounted for €326m or 79.8 percent of combined online GGR in the region, up from equivalent ratios of 75.4 percent in 2020 and 67 percent in 2019.

The trio of markets came under increased scrutiny at the start of 2021 following the announcement that online gambling giant Entain had made a £250m offer for Baltic specialist Enlabs.

Entain completed the acquisition in April 2021 after raising its bid for the Swedish-listed firm and was subsequently reported late last year to have made an indicative cash offer of more than US$1bn for Baltic-facing multi-channel operator Olympic Entertainment with a view to entrenching its new leading position in the region.

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