UKGC's Black Market Stat Sourced Externally

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A Freedom of Information (FOI) disclosure has revealed that a key statistic on the size of the UK’s illegal gambling market, quoted by Gambling Commission (UKGC) CEO Andrew Rhodes, was not produced by the regulator itself. Instead, the figure was sourced from a commercial data consultancy via the Danish gambling regulator.

The Key Statistic

In a keynote speech at the IAGR 2023 Conference, Andrew Rhodes described the UK as having "a liberal marketplace with high levels of channelisation, reported at 97.6 percent."

Channelisation is a critical metric in gambling regulation. It measures the percentage of gambling activity that takes place with legally licensed and regulated operators, as opposed to on the illegal or ‘black’ market. A high channelisation rate, like the 97.6% figure quoted, suggests that the vast majority of consumers are using safer, regulated websites that offer consumer protections. The implied 2.4% represents the share of the market held by illegal operators.

The Freedom of Information Request

Following the speech, an FOI request was submitted to the UKGC on 18 October 2023, asking for the source material and calculations used to arrive at the 97.6% statistic.

In its response, the UKGC provided a full disclosure, stating: "This statistic was taken from a presentation by the Danish Gambling Authority (DGA), Spillemyndigheden."

The Commission further clarified that the Danish authority, in turn, had sourced the figure and its underlying calculation from H2 Gambling Capital, a commercial firm that provides data and market intelligence on the global gambling industry.

What This Reveals for Consumers

The disclosure highlights the complex nature of data concerning the size and scale of the illegal gambling market. For consumers, the key takeaway is that even the UK's primary regulator may rely on third-party, commercially produced data to inform its public statements on crucial industry trends.

While the 97.6% figure may be an accurate estimate, the fact that it was not generated from the UKGC's own compliance and enforcement data is significant. It demonstrates that in a globalised industry, data often flows between regulators and commercial intelligence firms.

This is important because the perceived size of the illegal market is a central argument in debates over the strictness of gambling regulation. A small black market is often used to justify the current regulatory framework, while arguments for a larger black market are used to caution against tighter restrictions that could supposedly push players towards unlicensed sites. This FOI response shows that the foundational data for these arguments can originate from sources outside the direct control or research of the national regulator.