TIME EUROPE
January 22, 2000, Vol. 157 No. 3
Place Your Mobile Bets
Gambling could be the killer application that will help make third-generation cell phone licenses pay off
By JENNIFER L. SCHENKER
When you think of serious gamblers — the ones who wager on the horses or football matches — you conjure up an image of aging men milling around a seedy betting shop. Well, cell phone gambling is about to change all that. In fact, it may turn out to be the real killer application for the next generation of mobile phones, the ones that will offer high-speed access to the Internet. Promoters of mobile gaming think it will attract a new breed of gambler — including a younger, more upwardly mobile crowd.
Over the next two years advances in technology will allow punters to watch live horse races on their cell phones while wagering in real time. Football fans for one team will be able to bet against supporters of the other sitting on the opposite side of the staduim. Chess, trivia, celebrity romances, politics, sports, anything will be fair game for someone itching to place a mobile-phone Internet bet.
Today, casino operations based in the Caribbean generate 75% of the online gaming market — with estimated revenues of $2.6 billion — and 65% of the players are American. But the U.S. market share should drop to 45% by 2005, with Europe accounting for 35% and Asia around 20% as the focus shifts from online casino games played on PCs to sports and other gambling over mobile phones. At least that's the bet of Indiqu, a U.S. company that supplies tools for cell phone wagering.
"Mobile gambling will undoubtedly be the world's first major mobile commerce application and is likely to be the most lucrative of all m-commerce segments over time," says Robert Lezec, Indiqu's president and ceo. In the off-line world, about 1% of global consumer spending is lost on betting. Based on that, Andrew Burnett, vice president of gaming research at Merrill Lynch in London, predicts that online gambling will jump from about $3 billion in 2000 to $58 billion by 2004. And scores of businesses, from telecommunications companies to sports portals to traditional bookmakers, are betting that mobile gambling will lead the way.
Why? Because cell phones make impulse betting easier, according to a global poll by Swedish mobile phone-maker Ericsson. "The stock exchange is also about gambling, and there are a surprising amount of young day traders," says Henrik Palsson, director of Ericsson ConsumerLab. "People with very similar profiles are interested in using these mobile betting services. It is all about instant gratification."
The poll found that nearly 9% of Swedes said they would be interested in gambling over their phones, with even higher percentages among younger mobile users. College-educated people are less likely to bet, but Palsson is convinced that mobile gambling will reach entirely new segments of the population.
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