Informe del mercado del juego de Tanzania de 2019: Resultados Generales ?

In a market report by Shikana Law Group, director Amne Suedi Kagasheki examines the gaming sector in Tanzania, including growth trends, protagonists, and consumer behavior

The gambling industry in Tanzania has established itself as an important sector in the country contributing more than 3% of the Gross Domestic Product. Currently, the gambling industry is regulated by the Tanzania Gaming Council (GBT), which was established under the Gambling Act No. 4 of 2003. The GBT is responsible for overseeing, controlling, and regulating all gambling activities in Tanzania. In the 2018/2019 fiscal year, the entire gaming industry contributed 94.8 billion shillings in tax revenue, compared to 78 billion in the 2017/2018 fiscal year. The Tanzania Gaming Board attributes this 26.1% increase to the growth in technological innovation and the improving business environment. In addition, more than 20,000 people are directly employed by gambling companies in Tanzania, thus becoming one of the important sources of employment.

This article provides an analysis of the main findings of the market report on the gambling industry in Tanzania, produced by the Shikana Group. The report aims to provide valuable insight into the different types of gambling business activities in Tanzania, including their growth trends, major market players, consumer behavior, potential risks, and all factors driving the expansion of gambling in Tanzania.

Below are the findings of the 2019 market report on the gambling industry in Tanzania:

As of 2019, sports betting was the leading commercial gaming sector in terms of gross gaming revenue (GGR) surpassing retail 바카라s that were previously the country’s top gambling activity. In the 2018/2019 tax year, the GGR of sports betting was approximately 68.1 billion shillings, with 17 billion in gambling tax revenue. The popularity of sports betting has been driven by a number of reasons, including the evolution of smartphones, internet and mobile penetration levels, advertising, the popularity of sports, and the widespread use of mobile money services.

The growing youth population has also played a significant role in the growth of sports betting. According to business insider.com, Tanzania is the eleventh country in the world with the youngest population. In addition, Tanzania’s population is projected to reach 89 million by 2035. This long-term demographic trend presents an opportunity for potential market growth, both for sports betting and the gaming industry in general. A survey conducted by the Shikana Group shows that 89% of people who participate in sports betting activities are between the ages of 18 and 34. Tanzania’s young population is important to the gambling industry, especially sports betting, which mainly attracts younger generations.

The Gambling Board offers licenses for both online and retail sports betting in Tanzania, although online sports betting has grown at a very rapid rate compared to retail sports betting. In 2019, there were 20 licensed operators for online sports betting, while retail sports betting only had 6 licensed operators. If online sports betting continues to grow at the same rate, retail sports betting can be expected to slowly begin to disappear as cheap mobile phones remain widely available and internet penetration levels are expected to continue to rise. Over time, most retail sports betting operators are expected to fully migrate to the internet, possibly as early as 2025. Emerging technologies and general macroeconomic conditions will greatly influence the pace of this early withdrawal of retail sports betting operations.

The online sports betting market is dominated by three private operators: betPawa, M-Bet and Sportspesa.

However, the growth of online sports betting has not been without its problems. Tanzania’s national budget for 2021/2022, approved on June 24, 2021, introduced higher fees on mobile money transactions, which will undoubtedly affect iGaming. Tanzania and its neighbouring countries are world leaders in terms of the highest number of registered and active mobile money accounts per capita and the volume of mobile money. In September 2020 alone, transactions totalling 11.5 trillion shillings were made across the six mobile money platforms: M-Pesa, Tigo Pesa, Airtel Money, Halo Pesa, Ezy Pesa and T-Pesa. The popularity of mobile money is largely due to the large number of subscribers and the wide accessibility of the platform across the country. STM Gaming’s CEO, Alessandro Pizzolotto, sees the East African iGaming sector as a prime opportunity for the growth and expansion of gaming due to the popularity of mobile money usage in the region. (Source: European gaming).

Online betting operators have already taken advantage of these mobile money services, which allow bettors to place bets online using mobile money platforms such as M-pesa. In addition, upon winning, traders deposited the total sum won into bettors’ mobile money accounts. For this reason, the recent drastic increase in mobile money transaction fees will likely have a negative impact on online gambling, as people will be increasingly deterred from using mobile money services and more players may prefer to place their bets through retail operators to avoid these new fees. The ongoing global COVID-19 pandemic may also negatively impact the demand for sports betting, both retail and online, in the short term, although it remains unclear what the medium to long-term implications will be for the sports betting market.

Apart from the aforementioned challenges, the domestic sports betting market remains highly competitive. Sports betting operators, both retail and online, are increasingly competing for customers by offering bonuses and free bets or plays to new subscribers. Some traders have devised strategies to win over clients by offering bonuses that cover or are greater than the taxes charged to clients on winnings. Billboards, sporting events, radio, online advertising, and in-transit advertising are the most common ways operators advertise their brands. Some operators have also turned to local celebrities and sports sponsorship to promote their respective brands. In addition, some operators have developed mobile sports betting apps to offer customers relatively quick, cheap, and easy access to bet at their convenience. Some have also partnered with mobile network providers to allow customers to gamble through their mobile apps without incurring internet charges.

Tanzania’s newly approved national budget for 2021/2022 also reduced the gambling tax on winnings from 20% to 15%. This modification will likely incentivize more people to place bets, as they pay less tax on the payout.

CASINOS EN INTERNET

Online 바카라s were the fastest-growing gaming activity in terms of gross gaming revenue (GGR) in the 2018/2019 financial year. Its GGR reached 13.8 billion shillings, a 97% increase from the previous year. This trend is expected to increase steadily in the coming years, as more operators begin to integrate online 바카라s into their platforms and more users are aware of this new gambling activity. As of December 2019, there were six licensed internet 바카라 operators (only five of them are active).

The growth of internet 바카라s comes as a result of recent technological advances and the massive spread of mobile phones. Tanzanian gambling operators now have access to a wide range of customers who are not physically located in their city. The new opportunities offered by the growing demand for online gambling services allow operators to expand from traditional brick-and-mortar operations.

The transition from physical to digital services has not only allowed gambling operators to expand their customer base and thus increase their revenues, but at the same time it has reduced operational costs, such as labour, equipment and property rental. With an increasing number of operators migrating to the internet, the growth potential for online gambling in Tanzania depends on the rate of internet penetration in the country.

The number of internet users in Tanzania has increased steadily, from seven million users in 2012 to more than 25 million in 2019. In December 2019, the internet penetration rate in Tanzania was estimated at 46%. The rise of domestic internet users means that gambling operators offering online services now have a wider customer base to draw on. At the same time, the rise of online gambling services also allows Tanzanian customers to gamble in the privacy and comfort of their own home, rather than being forced to go to a point of sale. Tanzanian consumers now have different options, from choosing between competing gambling operators to selecting which of a wide variety of online gambling activities they wish to enjoy. The presence of affordable smartphones is expected to continue to contribute to facilitating internet penetration.

According to quarterly statistics from the Tanzania Communications Regulatory Authority (TCRA), in 2018, 96% of domestic internet users accessed the internet through a mobile network. Thus, mobile phones are not only an essential means of communication, but they have also become the main computing devices needed to access the internet. The small but fast-growing online 바카라 market presents an opportunity for potential investors.

Online 바카라 operators have also started using “live” 바카라 games that have a live dealer instead of a random number generator (RNG). This allows players to see and hear the dealer as they shuffle, deal, and manage the entire game. Live 바카라 players can watch the cards being shuffled and the roulette wheel spinned, just like in a brick-and-mortar 바카라, to create a more realistic remote gaming experience for customers who want to play at their convenience and in their privacy, but still want that “realism” and a more engaging interactive experience. The main players in the internet 바카라 market are iplay 8바카라, Meridianbet, and Pmbet.

SMS LOTTERY

SMS lotteries have become increasingly popular in recent years. In the 2018/2019 financial year, the SMS lottery had a gross gaming revenue (GGR) of 24.8 billion shillings, making it the third largest gaming activity in terms of GGR. Despite its popularity, the SMS lottery sector saw the biggest drop in revenue compared to other gambling activities in Tanzania. Its GGR fell from 65 billion shillings in the 2017/2018 financial year to 24.8 billion in the 2018/2019 financial year. This equates to a 62.2% drop in the GGR. There was also a 32.1% drop in real sales revenue, from TZS 90.8 billion in the 2017/2018 financial year to 61.7 billion shillings in the 2018/2019 financial year.

The above figures are indicative that SMS lottery activities have seen the largest revenue decline per percentage compared to all other gaming business activities. However, SMS lottery operators have an advantage that they can take advantage of. This advantage is that no internet connection is required to participate in the lottery. This means that a greater number of people can participate, even those who don’t have smartphones or internet access.

There are four gambling companies that have been authorized by the Tanzania Gaming Board (GBT) to operate SMS lotteries in Tanzania, all of which are active as of December 2019. These companies are Mobibet Company Limited/ Biko, Lucky Games Ltd/ Mojabet, The Network Limited/ Tatu Mzuka, Vodacom Tanzania Public Limited Company.

OVERALL RESULTS

Interest in and participation in all other gambling activities, such as retail 바카라s, slot machines, and forty machine sites, are expected to decline in the short term, due to the effects of the ongoing COVID-19 pandemic. The larger medium- and long-term implications of the global pandemic on Tanzania’s gambling market as a whole remain unclear. Although the immediate demand for online gambling may be depressed and likely to dampen growth in the short term, the medium- to long-term effects remain unclear. Based on the strong growth trends recorded in recent years, Tanzania’s online gambling market continues to represent a potential business opportunity of interest to potential investors.

To learn more about gambling in Tanzania, check out the full report on the Tanzanian gaming industry on the Shikana Group .

Read an interview with Amne in the latest issue of SiGMA Magazine.

SiGMA Calendar 2022

In 2022, the SiGMA Group will be moving to a number of exciting locations, the first of which will be Kenya, with Nairobi on the agenda for March. Here we plan to tap into a market full of sports fans and a young, digitally connected generation. We have also planned exhibitions for countries that are taking their first steps as regulated markets: in June we will go to Toronto and Ukraine, in what will be the first live events for the new SiGMA Americas and SiGMA CEI brands. Both countries are set to test the waters with operators and affiliates next year, making them a great location for the SiGMA Group conference stage and exhibition floor plan.