The new German state gambling authority Glücksspielbehörde der Länder (GGL) has been criticized on the accuracy of its claims about the size of black market gambling in the federal republic, Focus Gaming News reported December 11.
In response the GGL issued a clarification on the way data was collected to measure the size of the unregulated and unlicensed market that operates in the shadows—but also often in plain sight.
German trade organizations DSWV and DOCV warn that about half of gambling activity is illegal.
The GGL responded that studies backing such claims are “contentious” and that several have challenged the statistics the state has published. In a statement the regulator said that it welcomed “scientific discourse on survey methods” and it was open to other and new ways of obtaining that data.
But the authority also confirmed that its method of measuring the market was superior and didn’t back down from its previous estimate that the unlicensed market is about €300 million-€500 million 2 to 4 percent of the size of the legal market.
It also estimates that up to 900 unlicensed websites are operating in Germany. They range from online casinos, to virtual slot machines, online poker, sports betting and forms of lotteries.
It issued this statement: “The GGL firmly rejects criticism from the industry that the GGL’s approach to collecting data from the illegal online gambling market is based on a static model that does not take market changes into account.” It noted that the black market is a moving target: “due to the ever-changing nature of the black market. All collected data is estimated, providing a snapshot of the market at a specific time.”
DOCV and DSWV, whose members are sports getting operators, hired economist Gunther Schnabl of the University of Leipzig to do his own study of the illegal market.
He found that players in the legal market were 50.7 percent as of last March. He also found that 28.9 percent of such traffic was to unlicensed operators based in the European Union and 19.9 percent to operators elsewhere. Schnabl also found that 75 percent of online gaming revenue goes to the unregulated market.
