Swedish Vice Prime Minister Bosse Ringholm announced last week that his government has awarded domestic gaming and lotteries operator Svenska Spel a license to operate poker over the Internet for a two-year trial period. The move seemed inevitable as early as September when Ringholm told an audience at the 14th annual Spelakademin (Gaming Academy) that he would like Sweden's gaming operators to have the same opportunities as private foreign competitors.
Redirecting money from foreign gambling providers back into the domestic economy remains is the primary motivation behind the Swedish government's decision. It is estimated that foreign gaming companies that pay no taxes in Sweden will collect about 84 percent of the projected US$1.8 billion in interactive gaming revenue for the year 2005. Online poker in Sweden is said to constitute between $1.1 billion to $1.2 billion in turnover, which translates to an estimated $124 million in profit for the foreign operators.
Although Svenska Spel collects only 8 percent of all of the country's interactive gaming revenue (state-controlled race betting company ATG collects the remaining 8 percent), the company is confident that it can capture 30 percent of Sweden's Internet poker market and deliver $40 million to the government in taxes within a year.
Ringholm, who is also the minister for sports and gambling, explained that it is also better for the Swedish market to be served by a domestic company that is concerned about the negative effects of compulsive gambling than by foreign ones without such concerns.
Several licensing conditions have, therefore, been laid out to ensure that Svenska Spel operates in a safe manner. Maximum bets are not to exceed $10,000, and all gamblers must set a cap on the maximum amount they are willing to lose throughout the duration of their play before they may participate. Further, advertising may only be done in newspapers and on the Internet, and all advertisements must be accompanied by the problem gambling hotline telephone number.
Svenska Spel hopes to have its poker site running by early March.
Swedish gaming software company Boss Media has been enlisted to provide the poker software and network for the venture. Boss Media and Svenska Spel have worked together for several years on digital gaming products, including Svenska Spel's online and mobile soft-gaming offerings.