The Dependence of Online Gambling Businesses on High-Spending Customers: Quantification and Implications.

Abstract

Online gambling has grown to be a significant industry but it faces regulatory threats because of perception that it is heavily dependent on a small segment of its customers who gamble heavily and at a level carrying elevated risk of harm. Employing a large multi-operator data set from Britain, which records individual transactions by some 140,000 individuals observed over one year, we are enabled to provide more precise estimates of the degree of concentration of revenue, compared with previous studies. High dependence on a relatively small number of customers is shown though there is variation from product to product in how small the group of account-holders of potential concern is. We conclude with a discussion of prospects for the industry in light of heightened awareness of gambling harm and resulting restrictions on online gambling spending introduced or proposed by governments or regulators in several jurisdictions.