Alberta has made no secret that it is cribbing from Ontario’s playbook to set up a new iGaming market.
That said, Alberta’s version of a competitive scene for online sports betting and casino gambling operators could look slightly different from the framework established by its Canadian cousins.
This is at least according to comments made by Service Alberta and Red Tape Reduction minister Dale Nally, the lawmaker tasked with overseeing the iGaming overhaul out west.
Nally recently told Gambling Insider in an interview that he thinks there will be “a lot of similarities” between the Alberta and Ontario markets in a few years. He also told Covers in June that Alberta will not cap the number of operators that can enter its market or require them to partner with land-based casino operators; Ontario does the same.
Alberta’s plan, then, would be Ontario-like and allow multiple private-sector operators of online sports betting and casino gambling sites, such as bet365 and BetMGM, to legally set up shop in the Western Canadian province. Those operators would compete with the government-owned Play Alberta, which has a legal monopoly.
It's getting interesting out west...
— Geoff Zochodne (@GeoffZochodne) May 27, 2024
Alberta Legislature Passes Bill That Could Lead to Sports Betting, iGaming Expansionhttps://t.co/MuWaG9GsXF @Covers
But, as he did with Covers in June, Nally also suggested to Gambling Insider that the “conduct and manage” function for Alberta’s iGaming market will be housed within his ministry, rather than a separate agency.
Nally said the government heard “loud and clear” from operators about their reluctance to turn over information to the province’s Alberta Gaming, Liquor and Cannabis Commission (AGLC).
That is because the AGLC already conducts and manages online gambling via the Play Alberta site and would be fighting for business with the incoming operators.
“We will be focusing on having a light touch when it comes to regulation,” Nally told Gambling Insider.
It's complicated
The term “conduct and manage” is a hard-to-define but important term for legal sports betting in Canada. That is because the federal Criminal Code says a provincial government can conduct and manage gambling activities, which means having a certain degree of control over those activities.
In Ontario, rather than conducting and managing through a ministry, the province set up an entity called iGaming Ontario (iGO) as a subsidiary of the Alcohol and Gaming Commission of Ontario (AGCO). iGO exerts its control over the market via contracts with operators, setting out what they can and can’t do.
“As we go down this path, if we see that we have to open up another regulator, like they did in Ontario with iGO, we can certainly do that down the road,” Nally told Gambling Insider. “But right now, we're not looking to have a standalone operator for the regulatory environment.”
It’s a seemingly small and technical difference from what Ontario is doing, but it’s a difference nonetheless, and one important to the overall setup of Alberta’s iGaming market. It also suggests there could be other areas where Alberta sports betting deviates from the Ontario model, which, based on the number of operators and sites, has proven popular.
The buck stops where?
Nally has made other comments that suggest as much, even if Albertans still end up with something that looks a lot like the well-populated market in Ontario, where there are 50 operators and more than 80 regulated sites offering sports betting, casino gaming, and poker.
Perhaps the matter that's looming largest for operators is the revenue they’ll have to share in Alberta. In Ontario, operators must turn over roughly 20% of their receipts to the province. But Nally has suggested in the past that Alberta could go higher.
“I can't envision a scenario where our revenue share is lower than Ontario, because we still have to have the revenue generated to pay for the regulation, and then [social] responsibility and things like that,” Nally told Covers in June.
Alberta prides itself on its lower tax rates — it also has no provincial sales tax — so going higher than Ontario’s iGaming revenue share would be an interesting turn.
Nally even noted the province’s lower taxes during his talk with Gambling Insider, stating that those rates, a younger population, and greater disposable incomes tend to lead to more wagering. He cited as an example the millions of dollars staked on 50/50 draws during the Edmonton Oilers appearance during the Stanley Cup Finals.
Over THIRTEEN million?! 🤯💰
— Sportsnet (@Sportsnet) June 16, 2024
Get your @Oil_Foundation 50/50 tickets 🎟: https://t.co/cddarDeXaS pic.twitter.com/G4ad31rapj
However, south of the border, some state lawmakers have sought to increase tax rates for sportsbook operators. In Illinois, those efforts were successful this past summer, hiking the amount of revenue that bookmakers must turn over to the state to as high as 40%.
While more tax revenue has intrigued legislators, it has concerned operators. DraftKings even flirted with the idea of a “gaming tax surcharge” for winning bettors in four states, a proposal the company decided to scrap following feedback from customers and decisions by other operators not to do the same.
Nally also told Gambling Insider that Ontario launched its iGaming market and is now consulting with First Nations, while Alberta is doing that work upfront. Those consultations could be significant for both provinces, as there are Indigenous communities who either have some connection to the gaming industry or are hoping for one via regulated online gambling.
Nally noted Alberta has 46 First Nations, six of which have brick-and-mortar casinos.
“We haven't made any decisions,” the minister added. “We are listening to our Indigenous partners and asking them, ‘What do you want this space to look like? And how do you want to play a role? Do you want to be an operator? Do you want to have more of a passive role?’ So we're having those engagements now and I'll be bringing forward some recommendations shortly to my cabinet colleagues."
Alberta is also unique in that it licenses charities to conduct and manage gambling events at casinos owned by private-sector operators, which are paid by the charities for their services. The province’s embrace of iGaming has reportedly created some concern about the impact to that kind of brick-and-mortar gaming.
Another difference between Ontario and Alberta could be the transition period “grey” market operators, such as those regulated offshore, have to stop taking bets without provincial authorization if they want to join the new market.
Ontario gave those operators more than six months to make the switch, but Nally told Covers in June that “we're probably going to have a tighter window than they had in Ontario.”
Timing is everything
The exact date of Alberta’s launch has yet to be announced, although key dates such as the CFL’s 111th Grey Cup in November and the Super Bowl in February are still ahead. Nally told Covers in June that “we want to move sooner as opposed to later.”
Ontario debuted its competitive iGaming market in April.
When Alberta does go live, though, it may inspire others. Ontario and Alberta are so far the only provinces to either launch or announce the intention to launch a competitive iGaming market in Canada.
Nally recently suggested that even more governments may follow suit once they see the "value proposition" that sort of market provides.
“We're not bringing iGaming into the province,” Nally told Gambling Insider. “It's already in all the provinces. You may as well make it more responsible, a little more safer, and collect a few tax dollars for the benefit of the people that live in your province.”
