Betting revolution under way in Brazil

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Sports betting in Brazil is coming out of the shadows and it is time to shine a spotlight on the opportunities for operators to get in on the action.

There has always been an appetite for gambling in Brazil but laws introduced in the 1940s saw it outlawed. Progress towards a relaxation of the strict rules has been slow but the authorities are now seeing the appeal of valuable revenue streams to boost the economy.

With access to the internet growing and a sports-mad population, the potential for a Brazilian boom in betting is obvious. State lotteries and betting shops linked to horse racing tracks have provided some opportunity for betting previously but the turnover they generate will be almost nothing in comparison to the new era of legal online betting.

What has changed?

While the North American betting gold rush has captured plenty of attention in recent years, the Brazilian market looks similarly ready to take off after the introduction of new regulations.

It was legalised in 2018 but the real game changer came in July 2023 when Brazilian president Lula da Silva issued a provisional decree to regulate sports betting websites. That bill was passed by the Brazilian Senate on Tuesday and while there are still further hurdles to be cleared before it is signed into law, there is clearly an appetite for change at all levels of government and in the general public.

Not all types of betting are being legalised. Bingo halls remain outlawed while interactive gaming is not regulated but a revolution in sports betting is coming to match anything seen in the United States.

Who will be negatively impacted?

The new regulations spell bad news for offshore betting website operators that had previously been tapping into the huge demand in Brazil. Despite the threat of potential legal action, sports betting operators have looked to take advantage of this vast market but the lack of regulations has left customers – and the operators themselves – at some risk.

The revenue streams of these operators are expected to dry up as the government introduces new rules on who can do betting business in the country. Anyone wanting to get involved will need to pay licence fees and pay taxes on their profits.

What are the opportunities?

For anyone wanting to play by the rules, the potential is obvious. Brazil’s population of more than 216 million people ranks it seventh in the world and the love of sport, especially football, is surely unmatched anywhere on the planet.

Turnover from sports betting is forecast to be more than r$65 billion (around 12 billion euros) in 2024 and more than double that figure in 2025.

Onshore betting in 2023 accounted for around 13.5% of the total market in Brazil but should be more than half in 2024 and by 2025 it is predicted that 94% of all betting here will be done using onshore operators.

Who are the market leaders?

The race for a share of the market has already begun and the betting scene has undergone a dramatic shake-up. Bet365 has been the leader for a number of years but its market share is expected to have dropped from a peak of 66.8% in 2020 to below 38% in 2023.

Sportingbet was the second largest operator in the last few years but has seen its market share go down from almost 12% two years ago to an estimated 8% in 2023.

New operators are getting in on the act, with Betano – recently announced as an official sponsor of Euro 2024 – highlighting the growth possible in Brazil by establishing an estimated market share of 14.6% in the space of three years.

Blaze is also one of the new kids on the block. It has taken over as sponsors of Brazilian football team Santos and also agreed a four-year partnership with Neymar to act as their global ambassador.

Having only entered the market in 2021, they are estimated to have enjoyed a 4.4% market share in 2023.

How can operators get involved?

Clearly there is plenty of potential for new business in Brazil but with new government regulations still to be ironed out, using reliable software providers is vital.

Altenar’s team of experts have proven knowledge and experience of the South American markets and can help optimise the performance of sportsbooks without falling foul of the new laws.

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