The UK’s Guardian newspaper has published what it believes is a scoop, namely, that Stoke-based bookies Bet365 make a lot of their money from China. (This is what happens when the media not only covers the betting world but starts taking bets themselves.)
The privately held Bet365 is a phenomenally successful online gambling firm, generating revenue of £1.28b in 2013. Based on a study of UK Gambling Commission (UKGC) documents, international media reports and interviews with current and former Bet365 staffers, the Guardian concluded that only half of the company’s revenue comes from markets in which Bet365 is officially licensed to conduct online operations.
Among the smoking guns allegedly pointing to the scale of Bet365’s China obsession is the size of its Chinese-speaking workforce. Bet365 is Stoke’s single biggest employer and an unidentified Bet365 staffer told the Guardian that at least 50 staffers in Bet365’s call center are there “just to follow the Chinese customers,” making it “the biggest department apart from the English [speaking] one.”
The Guardian also claimed Bet365 had “a complex payments system” that allowed it to take wagers in China’s currency, which is actually pretty decent customer service, sparing punters from having to keep converting to pounds, euros or dollars. Bet365 also stands accused of routinely altering its Chinese-facing domain names in order to circumvent IP-blocking by China’s great firewall. You know, exactly like Bwin.party used to do in Belgium when their domains ended up on that country’s online gambling blacklist.
BET365 SAYS NOTHING TO SEE HERE (ALTHOUGH THEY SAID IT IN CHINESE)
Bet365 declined to address any of the Guardian’s specific points, but issued a statement saying the company took its legal and regulatory obligations “very seriously” and is “compliant with all applicable legislation” and therefore “any allegation of illegality on the part of Bet365 is therefore untrue.”
Bet365 says there is no Chinese legislation that “expressly prohibits the supply of remote gambling services into China by operators who are based outside China.” Bet365’s lawyers believe China’s anti-gambling law “does not extend to the provision of services into China by gambling operators and service providers who themselves have no nexus with the territory.”
Bet365 insists it has “no people assets or infrastructure in China and does not engage any agents, aggregators or intermediaries, for any purpose, in China.” The Guardian had referenced examples of what presumably were agents in China who were jailed for promoting Bet365 via blogs but Bet365 maintained that it is the “responsibility of affiliates to assess the legal implications.”
Bet365 has applied for a license under the UK’s new online gambling regime, which requires operators to legally justify their presence in any market from which they derive 3% or more of overall revenue. As part of its licensing application, Bet365 said it has shared with the UKGC “the legal bases underpinning the business derived from the group’s material markets.”
At any rate, Bet365 announced on Monday that it was consolidating its international-facing online gambling operations under its Gibraltar license, so this is all Phil Brear’s problem now.