Sports gambling may drive 3G cell tel expansion

Mobile gambling is touted as one of the big revenue drivers for mobile data services in the next five years. "But it's not easy money, and the house is the big winner, so the real value for cellos may be in 3G-based VAS packages that maximize 3G's multimedia channels, Fiona Chau revealed in Wireless Asia. As 3G networks become mainstream and handsets with advanced Java and video capabilities, many believe that such trends will help mobile gambling grow sharply over the next few years.

One source of optimism for mobile gambling enthusiasts is the rapid rise of remote gambling on the internet, which has opened up sports betting and casino-style gaming to a mass-market audience. With millions of consumers now gambling online, market watchers and industry players believe that the large gambling community spawned by the Internet will be replicated to varying degrees in the mobile data world, as the immediacy and perceived anonymity of the Internet is increased when using a mobile phone.

Estimates on the size of the mobile betting market vary widely. Figures from Informa Telecoms & Media indicate that the global mobile gambling revenues will grow from $1.2 billion in 2005 to $7.6 billion in 2010, split across the chief categories of sports and spread betting, mobile lotteries and scratch-cards, and casino and skill games. Juniper Research is even more bullish, predicting that global mobile betting will grow from $2 billion last year to $19.3 billion by 2009, with mobile lotteries becoming the most popular form of mobile gambling.

Either way, Asia is pegged as a key market for mobile gambling over the next few years. Informa says mobile gambling in Asia will grow from $426 million to $2.7 billion by 2010, making it the second largest market for mobile gambling after Europe. Juniper Research reckons that Asia will see strong growth of mobile lotteries, due to the strong culture of lottery in the region - and because most lottery apps don't require 3G capabilities to succeed.

"Mobile lotteries don't need 3G networks and are applicable in developing as well as developed markets, and Asia has both," said Bruce Gibson, senior consultant with Juniper Research. He told Chau there will be strong growth in subscriber numbers in Asia, much of it at the lower usage end of the market - many of whom will be low stake lottery players.

"However, that doesn't mean that mobile gambling is easy money. Gambling, like porn, is essentially an adult content service, and thus it faces many of the same barriers and challenges that mobile porn services face today. In virtually every market in the world, gambling in any form is highly regulated even when it's legal. And for some cellcos, the real value may not be in gambling services themselves, but the value-added services built around them," Chau commented.

In Asia, the most successful mobile betting story so far is in Hong Kong, where over 100,000 mobile users are now using mobile phones to buy lottery tickets or bet on football matches and horse racing, either via SMS or WAP. Beyond Hong Kong, however, mobile gambling is still a new phenomenon in the Asia-Pacific region, because of cultural and regulatory hurdles. In Singapore, mobile operator M1 is limited to offering notifications of lottery results as well as soccer odds and match results. Chua Swee Kiat, communication manager at M1, said the company is offering such betting materials as a value-added service with a number of third-party content providers either on a revenue sharing basis or fixed fee basis.