German sports betting wagers to top €5b for the first time in 2016

german-sports-bettingGermany’s sports betting market will top the €5b mark for the first time in 2016, despite the perpetual legal limbo surrounding the activity.

According to a new report by analytics firm GoldMedia, the German market will be worth €5.12b in 2016, over £300m more than 2015’s total. At least half the gains will be directly attributable to wagers placed on the Euro 2016 football tournament, which got underway last week.

GoldMedia based its projections on both land-based and online betting operators that are either licensed by the state or are paying taxes on their betting revenue despite the lack of a German license.

GoldMedia says these ‘grey’ market operators will account for €4.9b of 2016’s projected total, leaving just €210m generated by ODDSET, the state-owned monopoly provider that is currently the sole possessor of official approval to offer sports betting in Germany.

The German federal parliament’s Financial Committee said 63 operators paid taxes on their German wagers last year, up from 47 in 2012, despite doubts over their legal responsibility to do so. GoldMedia says the state will earn over €250m in sports betting tax revenue this year, 96% of which will come from these cooperative grey operators.

Germany’s tortured efforts to open up its market by licensing other operators is the stuff of Wagnerian legend, but the regulatory fumbling hasn’t slowed down these operators’ growth. GoldMedia says the grey market has posted average annual growth rate of 12.1% since 2012, the year the doomed Interstate Treaty was signed.

From 2014 to 2015, the grey market grew 6.8%, while ODDSET managed only 1% growth. Horserace betting, which represents only around 1% of the total pie, experienced negative growth of 2.3% last year.

Germany may account for €150m in Euro 2016 wagers but the event’s organizer says that’s a very small slice of the total. UEFA recently announced that it expects total wagering to top €68b, a healthy portion of which will come via Asian markets. UEFA expects wagers of around €1.13b on each of the 51 scheduled matches and a further €3.4b on July 10’s final match.