Will UK Investors be betting on UK online gambling stocks in 2020?

As a market showing consistent growth, the UK online gambling industry has long found itself a primary focus of tech-engaged investors. As with many tech subsectors, however, this is one where potential investors need to factor in the reliability of long-term growth. Many online businesses plateau after a few short years, and this common trend raises questions as to UK’s online gambling viability in 2020 and beyond.

Looking at current patterns and the industry's evolution, how likely is it that this sector will still perform in the new year?

The Current State of the UK's Online Gambling Market

Currently, the online gambling market within the UK is immense and on an upward trend. Interested readers can check out the current market leaders to investigate the state of modern UK gambling sites. These iGaming platforms rely on offering a wide range of games, with a significant emphasis on slots as well as bonuses like deposit matches to draw players in and keep them interested.

According to the most current statistics available from the UK Gambling Commission, some aspects of the industry have slowed during the latest year, while others have grown. Overall, the casino industry has seen a slight downturn of 0.6%, which some speculators have put down to uncertainties within international relations.

Contrary to this is the growth of the online gambling subset of slots, which saw a 5.8% increase in profit in the period from April 2017 to March 2018.

According to most predictors, however, the overall decrease is only likely to be a very short-term change, which has already shifted significantly within the latest year.

Larger Trends

On a long-term scale, the online gambling industry worldwide is expected to expand significantly into the next decade. A report from Market Watch predicted a CAGR of 8.77% during the 2019-2024 period, with other research reaching similar conclusions.

The reasons for this growth are assumed not just from the greater trends of the last few years, but also from the new technologies and broader variety of games which have recently gained momentum. As mentioned, slot games are one side of this industry, and they tend to perform well regardless of exterior factors. A large part of this comes from the diversity which these forms of software offer. By adopting online software models, slot games are capable of far greater reach than their brick and mortar cousins, lending them unmatched flexibility of concepts and themes.

"Paf Game Show 05.2015" (CC BY 2.0) by Paf - games sport casino

It is not unusual for online casinos to offer hundreds of different slot games today, and these libraries are consistently growing. The expanding opportunities these games offer through the increase of their host platform power should also be factored in. While slots are all based on a single central formula, individual offerings have massively evolved thanks to more powerful devices.

Another subset of the industry which has been benefitting immensely from evolution are live casino games. These are table games such as roulette and blackjack which play as they would at any offline casino, save for a digital interface which allows the player to interact with a dealer who is an actual person, as the results are live-streamed to the former's device.

As a relatively new entry within the world of online casinos, live casino games quickly became popular. This popularity continues to drive their development today, with many casinos that offer these games looking to expand, and many that don’t seek to adopt these forms of gaming for themselves. In fact, such has been the popularity of live-streamed casino games that new types of games have been devised and added to online casino lobbies in recent years.

The final major contributing factor to the expected upward trend comes from the ubiquity and improvements of mobile phones. These have quickly become the go-to devices for many internet users, and this also extends to players of online casino games.

"SAMSUNG Galaxy Fold Foldable Phone" (CC BY-ND 2.0) by TheBetterDay

As more people upgrade their phones to more powerful devices, the number of potential players will only grow. This is aided by related technologies such as folding screen phones, which have made existing opportunities increasingly engaging. 5G connectivity might eventually also factor into this equation, though at this point it remains strictly unnecessary for any online casino games.

Investing in the Industry

Given the upward trends and future growth that seems inevitable, investment within the UK's online casino industry appears a safer bet than many other tech-focused sectors. As with any other investment, however, caution should be measured in exactly which companies are worthy of investment.

Many of these businesses will see continual growth within the next few years, but this pattern will naturally not apply to every online casino service. If you are interested in investing, take the same care you regularly would, and you could find a tidy profit within the iGaming industry.

This article does not necessarily reflect the opinions of the editors or management of EconoTimes