The downfall of the French online gambling industry was covered by the country's mainstream media on May 13 when France's leading newspaper, Le Monde, published an online article titled "Is Online Poker Going Through The Floor Soon?" ("Le poker en ligne bientôt au tapis?").
After the latest industry report published by ARJEL, France's gambling authority, showed that the country's regulated market did not manage to overturn the decline in revenues, one that began when the State launched a ring-fenced market in 2010, the newspaper suggested online gambling may not be the Eldorado that many had imagined.
"After a strong growth recorded right after the launch of the regulated market, the bets on online poker in France never stopped declining," Le Monde writes in reference to the money French players spent on the cash games offered on ARJEL-licensed sites.
After the industry reached its peak in 2011 — when French players spent over 6,5 billion Euros at the regulated cash games tables — number steadily declined, eventually falling 30.8 percent in three years. In 2014, the total money spent on cash games fell to €4.5 billion.
With tournament poker not being strong enough to compensate for the decline in cash games, the French gambling industry has seen a dramatic reduction in the number of licensed sites over the past few years. In fact, many of the operators that pulled out of the country are now focusing their investments on more lucrative markets.
Despite the initial enthusiasm from international poker operators after the adoption of the national legislation on online gambling five years years ago, the French poker market is down to just five active online poker networks, with Winamax and PokerStars holding a solid lead in traffic and revenues. I's a lead Le Monde considers a significant part of the problem.
"The weakest companies have been cut out from the industry, while only giants like Winamax and PokerStars managed to survive, as they have their hands on three-fourths of the whole market," writes Le Monde. "These two foreign companies have been active in the market since long before the legalisation, attracting French players well before they got their licenses from ARJEL."
To support the idea that the development of French online poker industry has been compromised by French authorities allowing Winamax and PokerStars an unfair advantage, the newspaper cites a Française des Jeux representative, who accused ARJEL of forcing the company to pull out of the French market by "allowing operators who had acquired a reputation and market share in illegality to continue their activities."
Taxes and Illegal Consequences Are The Key
As it would be difficult to explain the decline of a whole industry through the positions held by Winamax and PokerStars, Le Monde tried to highlight some additional factors that may have harmed the evolution of the industry.
Echoing what the ARJEL President Charles Coppolani said in his first-ever public interview in 2014, Le Monde believes that one of the main causes of poker's decline is the simple fact that the game is no longer as popular as it used to be.
"In 2010 poker was booming, there were many licensed sites, and a large number of beginners tried their luck at the live and online tables," Le Monde explains. "Only four years later, the number of players has decreased."
This position seems to be supported by the data published by ARJEL, as the total number of active online poker players in France has dropped from 300,000 to 246,000 people.
To complicate things, the French poker industry has also suffered from the global financial crisis, as former President of ARJEL Jean-François Vilotte told PokerNews shortly after he stepped down from the regulator's main chair.
In addition, the Le Monde article focuses on two additional issues that have been frequently debated by advocates for French gambling law reform — high taxation and measures against illegal operators.
With one of the highest taxations on gambling in Europe, and with 47% of the French players still active on unlicensed sites, Le Monde believes that ARJEL may need to push harder to convince the authorities to vote in favor of significant changes to the current law, because "if nothing will change, online poker risks to keep declining even more in the future."