Geolocation technology allows websites to identify a user’s geographical location. In the context of online gambling, geolocation restrictions limit access to gambling sites based on the gambler’s location. As more countries introduce such restrictions, these policies have implications for both players and gambling operators.
Rise of Geolocation Restrictions
Geolocation restrictions have become an increasingly common policy measure for regulating online gambling. As of 2024, dozens of countries have implemented geolocation technology to enforce strict gambling laws and licensing requirements.
For instance, in 2018 Spain required all unlicensed gambling sites, like Casino Jet4bet, to use geolocation tools. This enabled Spanish authorities to block access from within the country. Similar licensing approaches combine geolocation with IP blocking as seen in Sweden, Denmark and Portugal.
In the United States only six states offer online sports betting, casinos and poker sites with appropriate licensing. Geolocation ensures providers adhere to intrastate requirements by preventing out-of-state players from accessing these sites.
Limit Access for Online Gamblers
For players, the steady expansion of geolocation presents new barriers to accessing online gambling services. Gamblers are now effectively locked out of licensed sites based solely on their location.
With many unlicensed and black market alternatives still available, critics argue geolocation simply pushes players towards risky offshore operators. However, even accessing these often requires workarounds like VPNs to spoof locations.
In Sweden, Spelinspektionen has ordered ISPs to block over 2,000 domains of unlicensed gambling sites. And globally, there were over 5,500 domain blocks as of 2023 according to an IBM report. With such extensive restrictions, casual and low-tech gamblers face exclusion from online gambling entirely.
Impacts on Gambling Operators
On the industry side, geolocation restrictions have significantly disrupted online gambling operations looking to expand in new markets. Compliance costs have also increased pressure on margins.
A 2023 survey of 14 gambling executives found that over 85% believed geolocation requirements created high barriers for entering new jurisdictions. With complex policy variations between countries, even giants like Bet365 have scaled back licensing applications.
Smaller operators face even tougher challenges competing, as shown in the table below:
| Company | Revenue | Geolocation Compliance Costs |
| Flutter Entertainment | $9.2 billion | $112 million |
| Betsson Group | $1.1 billion | $22 million |
| Zeal Network | $210 million | $7.8 million |
Additionally, as countries continually update regulations, keeping geo-compliance systems up to date generates ongoing IT expenses. Flutter Entertainment, owner of FanDuel and PaddyPower, has increased its yearly geolocation spending from $31 million in 2021 to over $112 million in 2024.
Future of Online Gambling Regulations
As geolocation restrictions expand globally, the future of online gambling regulations remains filled with uncertainty. Policymakers continue weighing further constraints to limit unlicensed operators against the risk of limiting legal options for players.
Several countries are considering even more aggressive stances, such as Finland which recently proposed new legislation banning unlicensed gambling outright. However, a 2020 study found that outright bans rarely achieve policy goals and often have unintended consequences.
More moderate countries are responding with additional licensing opportunities. The United Kingdom Gambling Commission plans to issue more licenses in 2025 and 2026. Similarly, several U.S. states including Ohio and Maryland are progressing bills to open intrastate online gambling.
Despite varied approaches, licensing rather than outright bans appears the most sustainable path forward. Ensuring legal regulated alternatives exist before imposing geoblocks avoids issues facing countries like Norway.
A collaborative approach between regulators, licensed operators and player advocacy groups can shape balanced policy. Technological measures like geolocation will likely remain but must be applied judiciously to enable continuing innovations in the online gambling industry.
Bottom Line
Geolocation brings order and control to the chaotic online gambling landscape. But these technological borders also introduce new costs for operators while limiting options for players.
As more countries follow the lead of European regulators, the use of geolocation restrictions will only continue increasing. Gambling providers must either adapt their operations or face exclusion from lucrative regulated markets.
Meanwhile players unwilling or unable to bypass geoblocking systems may eventually see their access decline. Ultimately the convenience that made online gambling so easily accessible is slowly being eroded by the necessary regulation of a growing digital economy.
