Offshore firms control over half of Philippines' online gambling market

PAGCOR's boss has said that illegal gambling operators account for 50% of the online market in the countryTengco opposes an outright ban on online gambling as he believes it would be detrimental to player protectionPAGCOR is busy deploying new tools to help bolster consumer protections

PAGCOR Chairman and CEO Alejandro Tengco has recently given a radio interview, commenting on a proposal by Senator Juan Miguel Zubiri to completely suspend online gambling in the country.

PAGCOR’s boss is cautious about sweeping anti-gambling measures

The interview was later reported on by the Inquirer and revealed Tengco as a pragmatic executive aware of the issues that the iGaming market in the Philippines currently faces. However, the proposed ban by Zubiri is not the way forward, Tengco argued.

Presently, PAGCOR-licensed gambling companies only account for anything between 45% and 50% of the entire market, with the rest filled by illegal operators. Suspending the regulated market would only serve to empower these rogue operators.

Tengco explained that illegal operators targeted Filipino players from overseas, and said it was the black market that was getting in the way of the regulated market reaching its full potential.

Casino Guru's Head of Casino Research, Matej Novota, had this to say, clarifying on why illegal gambling operators continue to be so appealing to ordinary customers: "The main issue is that illegal operators often offer a significantly better product than licensed ones. People value freedom of choice, and if the illegal option provides a better experience, many will naturally choose it."

Yet, the issue also remains localized with physical advertisement, such as billboards, also cited by detractors as a problem. Tengco assured us that PAGCOR is already working on the issue, but is giving licensed operators some time to adjust their offer and comply.

In the meantime, the executive said that he would rather favor a proposal such as the one put forward by Senator Sherwin Gatchalian, who is seeking to introduce stronger consumer protection safeguards without upsetting the regulated market.

Among those are tighter controls over gambling advertisements and a fresh set of measures meant to target theillegal gambling market. Another way to ensure that consumers are protected is to limit access to certain payment gateways, such as GCash and Maya, as well as introduce limits on how much can be deposited.

Regulate, do not ban online gambling altogether

Tengco also said that PAGCOR is beefing up its own efforts to help people who may be suffering from gambling-related harm, using a mix of a 24/7 hotline as well as AI to track and monitor for signs of addiction.

Among the proposed measures are self-exclusion tools and mandatory cooling-off periods, which should help players rein in their habits, Tengco argues. Yet, much remains to be done to bring the channelization to anywhere near sustainable levels.

Even in markets with fairly high channelization (i.e., the number of players that play onshore), it is possible for 50% of the gross gaming revenue to be spent with illegal operators.

While Tengco may not have a clear vision of how PAGCOR should enact the necessary transformations, his natural aversion to side with a mass ban on online gambling is right.

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