iGaming Daily

Ted Menmuir (00:01.602)
The month of June was closed by the iGaming... Sorry, let me start again. The month of June was closed by the Gaming in Spain conference taking place in Madrid, which saw delegates tune in for a long awaited update by the regulatory authority of the DGOJ. In attendance, iGaming Daily reports on Spain's regulatory progress and whether its ambitions can match the high technical demands sought by federal authorities on customer care, fraud and under 21 protections.

The iGaming Daily podcast is brought to you by Optimove, the leading CRM and marketing solution for the global gaming industry. I'm Ted Memwear and joining me today is Christian Lee, business journalist for iGaming Expert. Christian, how are doing?

Christian Lee (00:43.573)
Yeah, I'm good. Thank you. Like I said, just got back from Madrid. So slight, not quite as well. here in the UK, but still not too bad.

Ted Menmuir (00:51.438)
Okay, so let's jump straight into it. Look, was a busy week last week and conferences are alike. So just provide a general overview of the Gaming in Spain conference and what were its narratives and themes that it to audiences.

Christian Lee (01:10.615)
Yeah, it was a really insightful day in Madrid. was a range of speakers from across the industry, which was good to see. So it was like regulators, operators, some industry analysts as well. So sort of those in attendance and myself, we got to see the perspective on the current status of Spain's market from a wide range of viewpoints. was good. Like the main narratives, which we'll go into more detail, is definitely around regulation. It's a little bit of a crossroads at the moment with the DGOJ really.

Ted Menmuir (01:27.373)
Mm-hmm.

Christian Lee (01:40.535)
pushing to get some new amendments to current regulations and it's just a case now of waiting to see what happens with them.

Ted Menmuir (01:47.999)
So yes, it has been quite a long wait. And I'd like to shout out William Van Ault because I think when he does conferences, he kind of really offers that wide perspective on things and also kind of distinct opinions of what's going on in the market. Now, going on, let's focus on kind of this regulatory progress in Spain. Where is Spain's market as stands in terms of its regulations and what is it trying to achieve?

Christian Lee (02:15.105)
Yeah. So there's three main points that, the regulators are trying to achieve at the moment. One, they're reconsidering the rules around deposit limits. So at the moment, deposit limits, there's a weekly, monthly and daily deposit limits that are per operator, but they want to change that to cross platform. So the spend across different accounts will be taken into consideration with the limits. they're reconsidering what they're going to do regarding advertising restrictions because before

Ted Menmuir (02:24.482)
Mm-hmm.

Ted Menmuir (02:35.245)
Yeah.

Christian Lee (02:45.463)
They brought in some pretty strict avatar restrictions with them, which were then repealed last year. So it's a case of what's the next step with them. And then also finally, the DG, DG, J, sorry, I'm developing a new risky behavior algorithm to detect players who may be at risk of problem gambling. And that's something that they were really keen to push. once complete will mandate the operators use this algorithm on their platforms.

Ted Menmuir (03:15.734)
So it's being kind of a...

strange path to Spain because I mean it triggered its its regulatory process very early in 2020 in at the start of the decade pretty much and it's the first stage was very much focused on advertising and consumer protections and in a way it was kind of like one of the the lead European nations to kind of take on overhauling its gambling framework. How has that kind of been received by the operators and the commercial

side of the industry.

Christian Lee (03:51.767)
Well, think one thing that I found really interesting to find out when Michael Arena, which he was a direct general DG or J spoke was that the algorithm that I mentioned that they are developing this because operators are supposed to use our own risky behavior detection algorithms. But it's something that very few, maybe two or three operators are actually implementing themselves, which kind of shows that the DG or J doesn't really have that bite to properly enforce certain rules.

which is maybe why things have sort of slowed down a little bit because they don't have sort of the authority that they would like to have in terms of sort of pushing things forward and making sure that operators are following things as the rail decrease states.

Ted Menmuir (04:36.322)
So even in that process, we're talking about the DGO German, they've undertaken significant changes in the way they're governed. I think they used to be governed by the Ministry of Justice. And now their overview has now moved to the Ministry of Consumer Affairs. How has that kind of impacted their governance of Spanish gambling?

Christian Lee (05:01.015)
That's probably what the question is, sorry. That stumped me a little bit, that one.

Ted Menmuir (05:02.952)
Okay. All right, probably forget about that.

Okay, but, so, okay, so, but yet since kind of 2021 and since kind of implementing advertising changes in consumer protections, I mean, there's been really, I mean, the regulatory progress in Spain has dragged, why is that?

Christian Lee (05:32.501)
Yeah, I think again, as I say, it looks like it's somewhat comes down to the DGJ and in terms of do they have that sort of authority to be able to push the government to make the changes that they want to put in place? mean, even in terms of advertising restrictions, they're looking at maybe the back end of 2026 before anything gets done. it really looks like it's a case of that within the government and within the DGJ.

There isn't sort of the mechanisms in place to really push things forward at a rate that you would maybe expect in other places.

Ted Menmuir (06:07.608)
So in the conference Mikel Arana gave this actually quite long awaited update on to delegates and how was that taken and what was their kind of response to that?

Christian Lee (06:20.767)
Yeah, so it was definitely an interesting response. As you say, it's not really addressed the industry in a while. The message from Arrhenius himself was around that the Spanish market is growing in a positive direction, but there is some issues around risky behavior, especially among young people. He did really emphasize that the DG or J is trying to work with operators rather than against them. But this was something that when speaking to some people afterwards, they sort of

They sort of told me that the DGJ isn't really that communicative with operators within the industry and they don't really listen to what they're saying. I thought it was interesting as well that after Rebaen made his speech, he didn't really stick around to listen to what other people had to say or sort of speak to operators or people in the industry. I appreciate he's probably quite a busy man, but yeah, it was interesting to know after seeing that he wants to be more, sort of like create a better relationship.

Ted Menmuir (07:06.711)
Yeah

Christian Lee (07:17.527)
He was sort of god as soon as his speech was done and this was the first of the day so he didn't really get to see anyone else speak.

Ted Menmuir (07:24.28)
Do you think that the DJI has kind of harmed its regulatory process by announcing these very big kind of technical projects? But when they went to kind of technical consultation, they've kind of been stumped. Do you think that's part of the problem?

Christian Lee (07:42.711)
Yeah, think what it does is, I think it leaves operators in limbo because they get told these changes are coming to place, but they don't know when that's going to happen. So once they know that some sort of technical regulations coming in, they're trying to prepare for that. They're trying to sort of adjust their platform to make sure that it's ready for the new changes. But if you don't know when that's going to happen, there's only so long you can sort of wait and wait and wait before.

you force a major change to keep up with the market. So I think it's definitely a tough situation for operators to be in, sort of waiting around for what looks like the mid-law back in the 2026 before they'll find out what the future is for the market.

Ted Menmuir (08:27.896)
Do think the operators are still kind frustrated by kind of the major interplays or the major points of conflict in Spanish gaming?

Christian Lee (08:33.791)
Yeah, definitely presents a lot of frustration within the market itself.

Ted Menmuir (08:41.368)
Okay. All right. now can we go into a break?

Ted Menmuir (08:49.72)
Fucking okay.

Ted Menmuir (08:57.71)
Okay.

Ted Menmuir (09:01.016)
Okay, thanks, Christine. We're just gonna head into an update. And in the second half of the podcast, we're gonna focus on the trajectory of Spanish gambling in 2025.

Ted Menmuir (09:15.008)
for fuck's sake. Thanks, Christi. Okay. Thanks, Christian. And we're gonna head into an ad break. when we when we're fucked. Thanks, Christian. We're just gonna head into an ad break. And when we return, we're talk about the trajectory of Spanish gambling when we return.

Christian Lee (09:19.223)
I'll again.

Ted Menmuir (09:39.438)
Okay, are you

Christian Lee (09:41.515)
Yeah.

Ted Menmuir (09:45.172)
Okay so from this update given by Micaela Rana, mean what do you think are the key projects that the DOJ is trying to prioritise in the coming future?

Christian Lee (09:55.511)
I think it's definitely this algorithm that we've mentioned. It gave quite a detailed breakdown of how the DG or J is working alongside sort of different academics and using sort of scientific data to create an algorithm that is intended to identify when a player is engaging in risky behavior. And I think it's really quite interesting because you see a lot of the times that operators or regulators bringing these detection systems that

use arbitrary measures or arbitrary thresholds that someone can reach. this seems to be taking characteristics from previous examples of problem gambling. And it's found a range of variables and a range of player types that exhibit different behaviors, can then be put up against current behavior to identify when someone may be running into trouble.

Ted Menmuir (10:53.549)
Mm-hmm.

Christian Lee (10:53.889)
And I think it could really be something that is used elsewhere outside of Spain because it might be applied elsewhere because of the fact that the variables aren't Spanish specific, they can definitely transfer to other areas. So I think that's the main thing that they are pushing to bring in as soon as possible and make sure operators are using it.

Ted Menmuir (11:15.86)
Interesting and another area I to pick your brain on is Spain is another one of these states that is kind of prioritizing under 24 and under 21 protections. What are they and how do they kind of align with what we're seeing in other markets?

Christian Lee (11:34.805)
Yeah, so I think the protections will come into play somewhat with this algorithm that we've mentioned. Age will be one of the factors that comes into it. It was interesting that Arrain, that Arrain in his speech really did highlight the, really did highlight the problem in terms of young people gambling in his talk. He produced some stats that showed

Ted Menmuir (12:00.001)
Mm-hmm.

Christian Lee (12:03.319)
There's a significant number of people between 18 to 25 that lost over 3000 euros last year, which I guess it can be seen as a concerning figure because I don't know too many 18 to 25 year olds myself that can really afford to lose that much money in a year on gambling. I think what they will do will sort of be aligned with other areas. see that when it comes to things like deposit limits,

Ted Menmuir (12:22.328)
Mm-hmm.

Christian Lee (12:30.839)
Some countries have looked to reduce deposit limits for that age group. Now, Spain haven't said that themselves, but it may well be something that they are considering. So I think the things like deposit limits, advertising restrictions as well. They are likely to focus on things like social media influencers and social media marketing, which obviously is something that is more popular within the younger day room graphics. So again, that's an area that I think they'll really focus on to try and make sure that young people are gambling responsibly.

Ted Menmuir (13:01.198)
So I want to kind of take you back to 2021 when Spain implemented kind of a blanket ban and started to kind of impose these quite hardcore kind of customer protection, especially with the limits. Do you think we're coming to kind of a trade off where, okay, if they're going to go and take a high technical command with the algorithms, do you think the DGOJ or the Ministry of Consumer Affairs

Do you know if there's any kind of trade-offs where they might lessen the commands or the compliance commands on deposit limits or advertising?

Christian Lee (13:34.283)
think it's something that they will need to consider to be honest, because some of the conversations that other people had on the various panels was around the fact that it's okay bringing in these tighter restrictions, but at the same time, you need to maintain a good player experience within the regulated market to prevent people going to the black market. Because there's no point bringing in really tough restrictions if that then just forces people out of the market.

Ted Menmuir (13:48.322)
Mm-hmm.

Yeah.

Christian Lee (14:00.663)
as we've seen in other areas, like with the Netherlands when they brought in the deposit limits, I think the sort of rate of people going to the black market has increased rapidly because of that. So it's something that they have no choice but to look at because they want as many people in the regulated market as possible. No regulator wants the black market to thrive. So if they're not taking that into consideration, they're going down a dangerous route.

Ted Menmuir (14:26.504)
And overall, mean, look, Spain's still a great market. It's still tax effective. But what is kind of the operator's view of what's going on in Spain? mean, it's still a commercially viable market compared to other European counterparts.

Christian Lee (14:45.687)
Yeah, it definitely is. I mean, there's the few people I spoke to, they see there's a lot of potential there, especially on the online market, because Ed Birkin from HDCapital, I believe, he produced some data on the market and only about 24 % of it is done online at the moment. So which is relatively low compared to a lot of other comparative markets. So that's an area that has a lot of potential for growth.

Ted Menmuir (15:03.328)
Right, yeah.

Christian Lee (15:13.929)
Also as well in terms of sports betting, Spanish people tended to bet domestically in terms of football and things like that. They'll bet on La Liga or they'll bet on international football games involving Spain, but there wasn't too much volume on things like the Premier League. So if an operator can get in there and really push their online platform or push betting on the markets, there's a lot of room for growth in them areas.

Ted Menmuir (15:30.776)
Yeah.

Ted Menmuir (15:38.764)
Very interesting, very interesting. So finally, Christian, mean, Spain, moving market, how are you going to kind of monitor developments in the coming months and what should audiences expect?

Christian Lee (15:50.145)
think audiences should expect a lot of changes in the next sort of three to six months, just with what we've discussed regarding all the regulations is coming to a point now where operators need to know what the next steps are and operators need to know what they will have to comply with going forward. So it's definitely a case of what I will be doing and what what our listeners should be doing is, is keeping an eye on what announcement from the DGRJ

There'll be no doubt more updates in turn this algorithm in terms of what they decide on deposit limits and ultimately advertising restrictions as well. So like a lot of markets, we do say that it's a case of waiting and seeing, but I think you think things are happening pretty imminently.

Ted Menmuir (16:37.131)
And as always you can follow Christian's work at iGaming Expert and on SBC News. Thanks for tuning in.