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Consequences of the ban on legal gambling advertising for the media market

When a state faces a problem, banning its source seems to be the simplest and most obvious solution. However, every decision has consequences, and banning something does not always lead to the desired results. Moreover, from the point of view of public administration, sometimes a ban can create much more problems than the introduction of effective regulatory mechanisms. Therefore, the government's latest initiative to ban advertising of legal gambling may have more negative consequences than positive ones. These consequences will be felt not only by legal gambling organizers, but also by the media market and players.

On May 21, the government issued a  decree banning all gambling advertising. These changes, which introduced a complete ban on gambling and betting advertising, will remain in effect until the so-called law on fighting gambling addiction No. 9256-d, which is currently being considered by the Verkhovna Rada and has a number of serious  drawbacks. In fact, if adopted, this law will simply enshrine significant restrictions on advertising by legal gambling organizers, which will create many problems for licensees and even more opportunities for illegal gambling companies.

The ban on gambling advertising is presented as one of the measures to combat gambling addiction. The main argument of the innovation's supporters is that the disappearance of legal gambling advertising from all media platforms will reduce the attractiveness of this type of leisure, and people will play less.

Unfortunately, however, it does not work that way. In fact, it will simply lead to the fact that legal organizers will lose access to effective external communication, while illegal organizers will start to invest more and more in advertising on dubious telegram channels, online platforms and other alternative media. This will result in a significant information imbalance, when illegal gambling brands will be familiar to almost everyone, while legal gambling organizers will remain in information isolation. Will this help fight gambling addiction, given that illegal companies are its  main  source? The question is absolutely rhetorical.

In addition, if 9256-d is adopted and advertising for legal gambling organizers is banned, legal media will lose a significant share of their revenue. According to the most  conservative  estimates the media market will lose at least UAH 600-700 million by the end of the year. Television broadcasters will lose up to 400 million, radio broadcasters will lose about 100-150 million, and outdoor advertising will lose almost 50 million. The ban will also affect legal online media, which are expected to lose at least UAH 100 million.

Moreover, it is worth understanding that in most cases, gambling advertising is not just some banners or single publications. Licensed gambling companies often sponsor entire sections or columns on a long-term basis, sponsor sports broadcasts, and provide media support for sports teams and events. That is why the ban on legal gambling advertising will be a sharp blow to the financial capacity of many media outlets that, to be quite frank, often use gambling advertising as a relatively easy source of income that allows them to cover many operational issues, including employee salaries, financing other media projects, etc.

Thus, the current result of legislative innovations is approximately the following: dubious telegram channels and online media (that do not pay any taxes) will advertise illegal gamblers, while legal media (that pay taxes) will lose revenue because legal gambling organizers are banned from advertising. You can draw your own conclusions about how useful this approach is for the state budget, the development of legal business, and the fight against the spread of gambling addiction.


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