- Ontario has fined BetMGM and PointsBet for bonus advertisement infractions.
- The Alcohol and Gaming Commission of Ontario (AGCO) has strict guidelines against advertising of bonuses, inducements and similar credits outside of a company’s website.
- Ontario launched their regulated and competitive iGaming market on April 4.
Ontario’s ‘best of class’ iGaming marketplace continues to grow and that’s no surprise. Ontario is poised to become among the biggest sports betting jurisdictions in the world and a lot of that has to do with the intelligent regulatory framework they’ve created. Throw in some favorable demographics–Ontario has a population that would make it the fifth largest in the US–and it looks to be an absolutely great situation for the provincial governments, players and businesses.
I’m not sure if Ontario set out to create the best regulatory environment in North America but that’s what they’ve done. None of the anti-competition nonsense seen in so many states–online betting companies that complete the licensing process can operate in Ontario. No arbitrary limits on the number of licenses and, even better, no requirement that online gaming companies must partner with some type of legacy gaming business or financially/politically juiced in entity. Licensing fees are extremely reasonable–$100,000 per site. Regulations are sensible and minimal.
One area where the province left no ambiguity was in the area of advertising and marketing. The most significant limitation here is one that gaming companies should be excited about–public advertising of ‘inducements, bonuses and credits is strictly prohibited’. There will be bonuses available, but they can’t be advertised to the general public. They *can* be offered via a gaming website or app. They can also be provided through ‘opt in’ marketing. The provincial gaming regulators say this type of regulation was ‘ put in place to protect Ontarians’ but it is also to the benefit of sportsbooks and other gaming companies. It has the ancillary benefit of forcing sportsbooks to find other ways to differentiate their offerings instead of engaging in a costly and endless ‘bonus war’ with competitors (eg: New York).
Earlier this week, the province made clear that they’re not going to mess around with this. They assessed fines to BetMGM and PointsBet. Here’s the damage from the Alcohol and Gaming Commission of Ontario (AGCO) website:
BetMGM Canada has been served Notice of Monetary Penalties totalling $48,000 for their alleged failure to comply with Standards 2.04 and 2.05.
PointsBet Canada has been served Notice of Monetary Penalties totalling $30,000 for their alleged failure to comply with Standard 2.05.
Standard 2.05 is the prohibition against advertising bonuses and related inducements. Standard 2.04 prohibits ‘implying that chances of winning increase the more one spends’ and reads as follows:
No offers that require players to incur substantial losses: Offers must be truthful, shall not mislead players or misrepresent products (Standard 2.04). Offers shall not communicate products or promotions that are not reasonably attainable without incurring substantial losses (Standard 2.04 requirement 15).:
BetMGM is alleged to have violated both aforementioned standards:
Contrary to Standard 2.05, BetMGM Canada posted the following alleged gambling inducements:
- A “$250K Launch Party” advertisement, including a contest offer where the first-place winner gets $100K in casino bonus. The post was initially tweeted on April 4, 2022, and later, tweeted again on April 11, 2022.
- A “Bellagio” advertisement, including an offer of a $10 casino bonus in return for a $25 bet. The post was initially tweeted on April 4, 2022, and later, tweeted again on April 6, 2022, and on April 8, 2022.
- A “Jimi Hendrix Free Spin Friday”, including a chance to win 100 free spins in return for following the registrant’s Twitter account. The post was initially tweeted on April 8, 2022, and later tweeted again on April 8, 2022.
Contrary to Standard 2.04, BetMGM Canada posted the following:
- A tweet stating that “the more money you put in per bet, the higher your chance is of winning”, tweeted on April 10, 2022.
Those are all pretty cut and dried examples–it sounds like the problem might have been the MGM social media team not being clear on the restrictions and/or mistakenly tweeting promotions that are being offered in multiple jurisdictions. Doesn’t look like an egregious effort to circumvent the provincial gaming regulations.
PointsBet is alleged to have violated Standard 2.05:
Contrary to Standard 2.05, PointsBet Canada advertised the following alleged gambling inducements:
- During the period of April 4, 2022 to April 21, 2022, posters on GO trains and in multiple products with an inducement to play for free.
- During the period of April 4, 2022 to April 17, 2022, posters at two GO train stations with an inducement to play for free.
Without seeing the posters in question it’s hard to comment. They don’t explicitly list ‘free play’ as an inducement in the regulations but likely consider it ‘indirect inducement’:
This standard applies whether inducements are advertised directly or indirectly. Indirect inducement advertising includes, but is not limited to, the display of promotional codes and/or general references that invite individuals or the general public to learn more about inducements on the gaming site.
The only specific reference to free play type perks is this:
Offers must not be described as free or risk-free if the player actually needs to risk their own money or incur a loss to qualify.
This is a tricky area that companies will have to learn to properly navigate. From the sound of it, were I running ‘Jim’s Race and Sportsbook’ in Ontario I could say:
“Check out Jim’s Race and Sportsbook website!”
But couldn’t say:
“Play for free at Jim’s Race and Sportsbook website.”
“Check out the beefy bonuses at Jim’s Race and Sportsbook website.”
I can’t imagine that the intent of these regulations were to prohibit companies from using what sales jargon calls a ‘call to action’. It’s something that is very commonly used by every type of business in the world. It does become a matter of semantics–most calls to action (called ‘CTAs’ in the biz) include some type of ‘value proposition’. Things like ‘Send your email and get a free report’. You can find a more in depth explanation with examples at the Hootsuite owned advertising site AdEspresso.
See what I did there? That last sentence of the previous website is a ‘CTA’. Would it be acceptable under Ontario’s ad guidelines? Is gaining knowledge or finding information an ‘inducement’? That would be a judgement call. I’d probably say it is an ‘inducement’ but would the AGCO? Realistically speaking, it might be tough to say anything more than ‘Visit our website’ without it being considered an ‘inducement’. Offering ‘free to play’ games is commonplace in the industry–to the extent that PointsBet likely didn’t consider it to be an ‘inducement’.
Here’s an interesting example from the Ad Espresso website:
The part at the bottom–‘Try Hootsuite Free for 30 Days’ would definitely be considered an ‘inducement’ for the same reason PointsBet got pinched. But what about the text at the top? ‘Manage your social with the only platform that lets you create, schedule, publish and analyze–all in one place.’ Is convenience or efficiency an inducement? Probably. That would appear to mean that I couldn’t promote the ‘easy to use interface’ on a sportsbook website.
The bonus advertisement prohibition is a fairly cut and dried proposition. It could get tricky depending on how the AGCO interprets the concept of an ‘indirect inducement’. The AGCO has a process for appealing these rulings:
A registered operator served with Notice of Monetary Penalty by the AGCO has the right to appeal the Registrar’s action to the Licence Appeal Tribunal (LAT), which is an adjudicative tribunal independent of the AGCO and part of Tribunals Ontario.
PointsBet might have a pretty good case for appeal. Again, the context of the ‘offending posters’ is crucial here but on a conceptual level–and assuming that ‘free meant free’–they might have a salient point to argue. Both fines are reasonable IMO–small enough to reflect the lack of ‘willful intent’ but large enough to get gaming company’s attention. Also from the AGCO website:
Ontario is one of the only jurisdictions in the world to prohibit broad public advertising of bonuses and other gambling inducements.
I oppose restrictions on gaming advertisements in theory, but I actually like this one. Not so much for the ‘responsible gambling’ angle but the fact that it’s an elegant way to stop the race to the bottom ‘bonus war’ before it happens. Just trying to ‘out-bonus’ your competitors is a lazy marketing tactic and not one that will necessarily get you the clients you want. It may get traffic and signups from players looking to get ‘something for nothing’ or even those who are trying to exploit the bonuses. It isn’t a way to establish brand loyalty and ultimately that’s what sportsbooks–and every other product and service–really wants.