Alberta Gaming Market Launch Delayed Until 2025

Alberta’s Expanded iGaming Market: A Step Back to 2025

Posted on: October 20, 2024
Last updated on: October 20, 2024

In a recent announcement that has captured the attention of the gaming industry, the Alberta government confirmed that the launch of its much-anticipated expanded iGaming market has been postponed to 2025. This development raises questions about regulatory processes and the overall direction of online gaming in the province.

Image/AGLC: The Alberta government has confirmed that the launch of a new Ontario-style, competitive iGaming market won’t happen until 2025.

More Time Needed to Refine the Regulatory Regime

Brandon Aboultaif, a spokesman for Dale Nally, Minister of Service Alberta, articulated the government’s rationale for the delay. According to Aboultaif, ensuring a conducive business environment while prioritizing the health and safety of Albertans, particularly the youth, is paramount. He stated, “We want to get our iGaming strategy right to ensure fairness and transparency to everyone.”

Stakeholder engagement is highlighted as a key component of the process. The government is committed to maintaining an open dialogue with industry players to refine the regulatory model and align it with Alberta’s red tape reduction priorities. Aboultaif assured the public that updates will be forthcoming as the work advances toward the 2025 target date.

The Grey Market Challenge

As the province prepares to establish a competitive iGaming framework akin to Ontario’s, it faces significant challenges from an existing grey market. Currently, the only legal platform for online gambling in Alberta is Play Alberta, operated by the Alberta Gaming, Liquor and Cannabis Commission (AGLC). Since its launch in late 2020, Play Alberta has amassed over 313,000 registered player accounts, resulting in projected total bets of $5.36 billion for the 2023-2024 fiscal year, capturing 45% of the province’s iGaming market.

However, the presence of illicit online gambling sites poses a serious challenge, complicating the government’s efforts to channel gamblers toward regulated platforms. This ongoing issue underscores the urgency of developing a robust regulatory framework.

Industry Concerns and Cabinet Discussions

In the lead-up to the announcement, speculation within the industry suggested that an operational iGaming market could be realized by the end of 2024. Some sources hinted at an early 2025 launch, while others anticipated a timeframe extending to Fall 2025. However, internal presentations to Premier Danielle Smith’s cabinet about the proposed regulatory regime faced significant hurdles, reportedly being shot down twice due to concerns expressed by cabinet members. An industry source candidly remarked, “Things have gone pear-shaped in Alberta. It’s gone sideways.”

Tax Rate Disputes

One of the contentious issues that arose during discussions was the proposed tax rate for online gambling operators. There was talk about a high 25% revenue tax on gambling sites, compared to Ontario’s 20%. Industry insiders have expressed fears that such a rate could undermine a competitive market, negatively affecting channelization. As evidenced by an Ipsos study from February 2024, Ontario’s iGaming market has achieved an impressive channelization rate of 86.4%, highlighting the importance of a balanced tax approach.

Looking Ahead

The landscape of iGaming in Alberta remains uncertain as the government navigates the complexities of regulatory frameworks, tax implications, and ongoing stakeholder engagement. The commitment to refine the iGaming strategy reflects a cautious approach aimed at ensuring fairness and safety, but the industry will be watching closely for further developments.

As Alberta gears up for its eventual entry into a competitive iGaming system, its journey illustrates the critical balance between innovation, regulation, and market integrity. Industry stakeholders are left eagerly anticipating updates, hoping for a robust framework that not only promotes growth but also protects the interests of all parties involved.