Flutter Entertainment Ceases German Betfair Sports Betting
Flutter Entertainment owned Betfair has stopped accepting bets in Germany, coinciding with the 4th Interstate Treaty on Gambling (IST) coming into law in the country. Flutter’s strategy is to concentrate on the “stronger performer” PokerStars brand.
German customers of Betfair are no longer able to place bets on the platform after the website was closed to local players on 30 June. The company prevented new customers from signing up to the operator on Tuesday, and the newt day blocked all bets being placed using the website.
The domain is still accessible, and existing customers can still log in to request withdrawals. Although it is not known at this time how long customers will have to do this. It is also not known what will happen to outstanding bets.
Different bookmakers have taken different approaches when leaving markets. Depending on the operator’s terms and conditions, a likely outcome is the voiding of bets, although it has been known for bookmakers to settle existing bets as winners.
Flutter Entertainment are instead pushing their PokerStars brand, which they describe as a better performer in the German market. In addition, the move aligns with the company’s international realignment strategy.
A spokesperson for the company said: “Since the completion of our combination with The Stars Group last year, it has been our intention to withdraw access to Betfair from Germany in favour of PokerStars, which is a stronger performer in the market.”
Early this year, the company revealed its multi-year international expansion strategy, which combined brand realignment, internal investment, and the possibility of future mergers and acquisitions to increase revenues. Flutter Entertainment identified PokerStars as the vehicle to drive this growth. In addition, the company revealed that brand awareness was high, higher than Betfair, which had previously been a flagship brand. Therefore a brand realignment made commercial sense.
The company revealed data that showed brand awareness of PokerStars in Spain was 94%, Italy 89%, Brazil 88% and France 93%. Therefore using one brand for international operations would cut costs. Another reason to make the switch is the user base. PokerStars has a larger customer base and has three more times international members than Betfair.
The company is also interested in re-building the poker vertical of PokerStars. The new owners of the Stars brands feel the previous owner, The Stars Group, neglected the group’s core product and intends to invest in improvements. Flutter’s CEO Peter Jackson said in March: “We know that when we invest in marketing and player generosity, customers respond over time, so we intend to hold these levels of investment,” Flutter CEO Peter Jackson told investors.
“The good news for us is that we have some terrific assets at our disposal with which to grow the business and direct casino investment is a key tenet of our new strategy for the business.
“The quality of our casino product is excellent. We have over 1,500 titles of which 100 proprietary, designed by our own in house studios, and we have the expertise to deliver strong direct casino acquisition in a way that PokerStars has not in the past,”
Although removing Betfair for sports betting from the German market makes commercial sense for its owner, its timing seems coincidental to industry observers.
The 4th Interstate Treaty on Gambling (IST) came into law the same day. The Treaty legalises the casino vertical for the first time in Germany but also introduces taxation. Operators must pay a 5.3% rate on poker and turnover revenue.