The imminent regulation of sports betting across more countries in Latin America is a long-term investment that is keeping global industry players on the edge of their seats. A region characterized by its passion for sports, especially football, the revenue potential for the vertical is high, as Colombia has demonstrated since it implemented legislation in 2016.
But it is to Brazil that attentions inevitably turn, as demonstrated by an exclusive discussion with Camilo Millon, Head of Sales, Latam, at Kiron; Chris Nikolopoulous, CCO at Betby; Bobby Longhurst, CCO at Pronet, and Boris Chaikin, CEO of Soft2Bet, about the opportunities in the Brazilian market and the benefits that regulations will bring to the region.
The four experts agreed that Colombia set the pace for sports betting in Latin America, and a precedent for success in a commercial aspect, player protection and revenue for the State.
Potential domino effect
“Encouraged by the success of Colombia, more and more countries are moving to legalize online sports betting and introduce frameworks to foster its rapid growth,” said Millon. However, he stressed that Brazil will be the one to trigger the vertical as “another significant impact of sports betting legalization there, if all goes well, is the potential domino effect across the region as other countries look to emulate its success.”
The leaders highlighted Argentina, México and Perú as the next jurisdictions to be regulated and match the expectations in Brazil’s market. This step, they said, can only be taken once Brazil demonstrates that the conditions to develop the industry are favorable.
The interest in the Portuguese-speaking country lies in the fact that more than 200 million people live there — and they have a high interest in football. Currently, the legal sports betting industry is expected to generate around $1bn in revenue.
“Brazil could herald the beginning of a thrilling new commercial rush in the region. The seventh largest nation by population suddenly opening up to sports betting would be seen as a can’t miss opportunity,” said Nikolopoulous.
The Betby CCO added that, even though there is still a long way to go, “Brazil has an excellent example to follow in neighbor Colombia. Coljuegos has widely been lauded as a model regulator, benefiting all parties to create a safe betting environment.”
Explosion of activity
What will happen in the South American country, according to Nikolopoulous, will be on par with the explosion of activity that happened in the United States following the repeal of PASPA. That is why a comprehensive regulation that contemplates and protects the interests of all parties involved will be a requirement from operators, suppliers and players.
With an increased global competition, companies will have to stand out to gain market share. “A simplified product will be key, as will local favorites like video-bingo,” said Longhurst. “From a marketing perspective, more above-the-line brand focused campaigns will be important too, as opposed to the predilection for digital brand building that we see in Europe.”
The CCO of Pronet explained that Brazil could follow Colombia’s path, as it came up with “a set of technical regulations that bear a striking resemblance to those first implemented in Spain just under 10 years ago.”
“A similar route in Brazil and elsewhere would benefit operators and suppliers alike. Whatever they decide, those who can move quickly to implement new technical regulations, be nimble on corporate structure and play the long game on investment, will be those who are the most likely to succeed In Latin America.”
Echoing Longhurst’s thoughts, Chaikin highlighted the “unparalleled historic and cultural significance of sport” for betting’s success in the region, and also talked about future verticals that will gain popularity in Latin America. Also following Colombia’s steps, which expanded its legal offering during the pandemic, “virtual sports will boost revenue in the face of challenging economic circumstances.”
Following these examples, the CEO of Soft2Bet said that “the continent could be on track to replicate the dramatic upsurge in activity that followed the US repeal of PASPA.”
High expectations for the region
Recently, Kiron became the first supplier of virtual sports in Colombia, in partnership with local operator BetPlay. “We have been enthused by the encouraging response from local players to our portfolio, which has significantly raised our already high expectations for the region,” said Millon.
As the Head of Sales said, the popularity of sports in the region “set the scene for a flourishing sports betting industry on which virtuals will subsequently thrive.” Millon considers that “the high frequency nature of virtual games allows punters to enjoy their favorite sports with almost instant results, serving as the perfect crossover solution that appeals to both traditional sports bettors and new generation players.”
The four executives reinforced the need to regulate the industry in Brazil, and the rest of Latin America, to protect and provide security to the people and generate resources for the State in the post-COVID era, in an attractive environment for foreign investment that allows the development of local businesses. This will be the moment when the region becomes the focal point of sports betting in this decade.
