Online slots channelisation at 20-40% in Germany, warns DOCV

Channelization for online slots in Germany is currently estimated to stand between 20% and 40%, according to recent data presented by the Deutscher Online Casinoverband (DOCV).

At the DOCV’s recent ‘Beer, Pretzels, and Policy’ networking event, held during the ICE conference on January 21, Dirk Quermann, President of the online slots and casino segment in Germany, shared insights drawn from academic research. This data underscores the ongoing trends within the German online gambling market.

Switching focus to sports betting, Mathias Dahms, President of the Deutscher Sportwettenverband (DSWV), provided additional context, revealing that channelization for sports betting is significantly higher, ranging from 60% to 70%.

The DSWV reported that approximately 29 online betting entities hold licenses in Germany, collectively generating a staggering €7.3 billion (£6.1 billion/$7.7 billion) in stakes in 2024, alongside an estimated gross gaming revenue (GGR) of €1.1 billion. This marks a 4% increase in stakes compared to 2023, although it is critical to note that overall stakes have decreased by 15% since the implementation of the 5.3% turnover tax in 2021, highlighting the ongoing challenges within the sector.

Concerns Over GGL’s Black Market Estimates

Dahms expressed serious concerns regarding the black market’s impact on the German betting landscape, stating that the Gemeinsame Glücksspielbehörde der Länder (GGL) has not fully acknowledged the magnitude of the issue. “We face an increasing black market problem in Germany,” Dahms asserted. “We firmly believe the GGL’s estimates underestimate the true scale of the black market, which is a daily concern for our operations.”

In its July report, the GGL estimated that the black market accounted for approximately 4% of the total German gambling sector. This figure encompasses online betting, online slots, and land-based revenues, leading to claims of black market revenues between €400 million and €600 million compared to the legal market’s total of €13.7 billion for the year, of which €3 billion was generated online.

Industry representatives have disputed this assessment, arguing that it fails to accurately reflect the true scale of the black market. Simon Priglinger-Simader, DOCV Vice President and Entain Regulatory Affairs Counsel, emphasized this discrepancy, indicating that the black market’s share could represent as much as 20%, based on the GGL’s own figures.

Both associations are optimistic about their ability to work collaboratively with the GGL in addressing this pressing issue. “I am confident that with time, we will achieve a mutual understanding that leads to effective solutions,” Dahms indicated regarding the ongoing dialogue with the regulatory body.

Impact of Turnover Tax on Market Viability

Quermann and Dahms also highlighted the significant challenges posed by the current turnover tax structure, which has resulted in a decline in overall gambling tax revenues. Quermann noted, “Taxing stakes for slot games and virtual gaming is an ineffective approach that ultimately discourages player engagement.” He underscored the precarious situation within the German gambling market, stating, “It is genuinely difficult to remain viable in Germany’s gambling landscape. Without meaningful dialogue and collaboration among stakeholders, including the GGL and policymakers, the market’s sustainability may be at risk.”

Dahms echoed these sentiments, stressing the necessity for the online slots and sports betting sector to enhance engagement with policymakers and regulatory authorities to address these critical challenges. “If we fail to strengthen our conversations with politicians and regulators about these pressing issues, we risk losing both customers to unregulated markets and licensed operators exiting the industry entirely,” he warned.