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Sports betting has been popular in Ontario for several years now, but it’s only recently that online betting has been allowed. With the advent of Ontario’s iGaming market, sports betting is now within reach of even more people.
How much is Ontario’s online betting scene expected to grow in 2023? This article will tell you all you need to know.
Unlike its American neighbors, Ontario’s online betting scene is relatively young. On April 4, 2022, the Alcohol and Gaming Commission of Ontario (AGCO) and its affiliate, iGaming Ontario, finally opened the Canadian province’s iGaming market.
Suddenly, online casinos and sports book operators were clamoring to get an early slice of the Canadian market. They all lined up to apply for a license, and iGaming Ontario handed those out gradually – after all, each operator has to meet strict standards set by AGCO and iGaming Ontario.
Sports book operators have to meet a total of 14 requirements to obtain a license, and agree to abide by the rules as they change. A year later, the list of safe and licensed Ontario betting sites continues to grow and it’s projected to become even bigger this year.
Market analysts predict that by the time Ontario’s online betting scene is a year old, it will generate a revenue of $989m CAD (US$736m), doubling by 2026. To truly understand just how large Ontario’s market is, we need to provide a little more context.
Ontario is Canada’s most populous province, home to over 15 million Canadians. That’s nearly 40 percent of the entire country’s population – definitely a significant chunk to capture in the early days of Canada’s online sports betting.
And although not everyone in that 15 million population will create an online betting account, anyone aged 19 or older is eligible. That’s a large percentage of Ontario’s population and a goldmine for any sports booking company.
That’s why it was no surprise when iGaming Ontario reported a total of $4.1bn CAD (US$3.5bn) in online wagers in the first three months of online betting legalization. That’s an average bet of $113 CAD (US$84) per person per month. And after paying players their winnings, online betting companies reported $162m CAD (US $120m) in revenue.
Remember, these figures are just for Ontario’s first three months of regulated online betting. Now that the province’s iGaming market has been open for an entire year, players have placed over $20bn CAD (US$14.8m) in wagers, resulting in $875m CAD (US$651m) in revenue.
Though not quite as high as the predicted figures, iGaming Ontario’s online betting industry growth is on an upward trajectory.
With such explosive growth, you might wonder whether Ontario’s online betting scene is already saturated with operators or if there’s still room to grow. That’s a valid question, considering there were only 17 betting sites when the market opened last year, gradually ballooning to over 70 a year later.
That growth is not without its pain points, however. Some online betting operators left Ontario’s market due to the tough competition against brands with deeper pockets. And those who have a physical casino presence in the province have also started to incorporate sports betting at their locations, which can be a challenge to online-only providers.
Strict advertising restrictions can also damper marketing strategies because Ontario is not afraid to issue fines. Advertisements must avoid certain marketing terms to avoid being deemed predatory. Meanwhile, those who manage to stay within the regulations risk alienating potential customers because of how pervasive their advertising can be on television.
Perhaps the most important thing to remember is that Ontario’s online betting scene is the first in Canada. As lucrative as that sounds, it can also be quite dangerous. Ontario will undoubtedly face legal challenges left and right. But for now, operators are happy to stake an early claim in an otherwise growing market.
With such a young and booming online betting market, Ontario will surely see new betting methods on its favorite games. And this is where operators can really get creative with what they offer.
One possibility is the option of expanding sports offerings in order to keep the online betting market going year-round. At the moment, Canadians enjoy sports at certain times of the year, leaving them with little for months once the season is over. While some players might see that as a reprieve, online operators see that as lost income.
But with multiple league offerings, players can enjoy betting on something any day of the year. And with plenty of news about sports betting from various providers every day, it’s only a matter of time before you discover a new league you never knew you’d enjoy.
Some analysts also predict that operators will look into incorporating other betting options during a game, such as betting on how many 3-pointers a basketball player may score or how many yards in total a quarterback might throw in a game.
The odds and reasons for betting may sound oddly specific to people who aren’t so involved in sports, but they give bettors more interaction with the games and more opportunities to win. For operators, that translates to possible revenue. And for players, it means more fun and a higher level of involvement.
However, online-only operators must pay attention to brick-and-mortar casinos and betting companies’ steps to lure customers back. Companies with physical locations are itching to get people back into their facilities after the pandemic lockdown’s hammering. Many people who haven’t played much since the pandemic miss the bright lights and loud sounds surrounding them as they play.
If online-only betting operators want to keep their customers from stepping into a physical betting location, they must display their ingenuity with their in-app offerings, and Ontario is a prime market for online betting services to test and introduce new features.
Ontario’s bold move to open its iGaming and sports betting market in 2022 turned them into an example for the rest of Canada’s provinces. The other provinces might emulate them or avoid the iGaming market altogether, depending on how Ontario’s market performs over the next few years.
Currently, only Ontario has multiple online betting platforms that players can safely use. Most other provinces either have one online betting provider or none, allowing gray market online betting to thrive. Those provinces might also open their own online betting market in the future, but that’s only if Ontario’s market keeps growing instead of shutting down.
Though there’s no immediate threat of Ontario’s online betting industry slowing down, the province faces a few legal hurdles. The most prominent one is the lawsuit presented by the Mohawk Council of Kahnawà:ke, claiming that iGaming Ontario is harming their market in Montreal, which has been established since 1996.
Another constant threat is the allegations that Ontario may be in violation of Canada’s federal criminal code when it comes to gambling. Even though Ontario claims its government is within its powers to regulate the province’s online betting industry, some people think it may have overstepped its bounds regarding gambling.
If Ontario successfully navigates the legal challenges while keeping consistent growth, it’ll only be a matter of time before the other provinces feel more comfortable opening their own iGaming and online betting markets. That kind of growth will surely bring a much-needed boost to the other provinces’ coffers.
Ontario’s promising growth during the first year of its iGaming market and the province’s large population makes for an attractive combination for operators from other regions, such as Europe. It helps that Ontario’s tax rate for online operators is only 20 percent, compared to the 55 percent levied on physical casinos.
That means for 2023 and beyond, Ontario players can expect the already long list of licensed online betting sites to grow even more. Although they might see some names removed from the list as the market sorts itself out, newer entrants will replace them as more and more operators want a piece of that market.
Players should also expect existing operators to diversify and offer more sports for betting, which means introducing other leagues they may not be familiar with. Platforms that don’t already include soccer (or football) might start offering those sports, while others might include uncommon sports such as curling.
With these possible changes and more, iGaming Ontario’s 2023 looks to be bright and ready for growth. If the market keeps its upwards momentum while maneuvering through various legal challenges, it might surpass its $1.8bn CAD (US$1.34bn) revenue prediction before 2026. And that can only mean one thing: Ontario is doing something right.