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“Heinz from the internet”: DSWV criticises DHS methodology

| By Zak Thomas-Akoo
The German sports betting body Deutscher Sportwettenverband (DSWV) has taken aim at the country’s addiction association Deutsche Hauptstelle für Suchtfragen (DHS) for “incorrect” turnover figures.

The DSWV said that the DHS’ “Yearbook on Addiction 2023” incorrectly estimated the size of the sports betting market. In support of this point, the DSWV highlighted the nature of the DHS’ sources. These comprised affiliate marketing sites, rather than academic or government documents.

The DHS is an umbrella of therapy and treatment associations within Germany focusing on various forms of addiction. The organisation’s purview spans from alcohol and narcotics to gambling addiction.

The association claimed that the total turnover for the market stood at €18.3bn. This would represent a 409.6% increase from the previous year.

DSWV criticises “incorrect” DHS figures

However, the DSWV contested this assertion. It argued that the total staked stood at only €9.4bn for the year, a 21% rise.

The DSWV said that, despite pointing out the errors and providing the correct method of calculation, the addiction association still uses the higher figure in its article “2.4 Gambling – Facts and Figures” in the yearbook.

The trade body highlighted that the section’s author is professor Gerhard Meyer from the “Health & Society” department of the Institute for Public Health and Nursing Research at the University of Bremen.

“Not suitable for scientific study”

According to the DSWV, he calculated the figure based on the country’s total gross gaming revenue of €1.3bn and a pay-out ratio of 93% for sports betting operators. The lobbying organisation argued that many of the sources that Meyer used to make his claim “are questionable and not suitable for scientific study”.

The sports betting group said that it is not possible to determine the person and organisation behind the first site, Fussballwetten.com. The site is an affiliate marketing page and has no academic credentials listed.

The site also claimed that gambling is illegal in Germany, making no reference to the 2021 regulation of the gambling market.

In July 2021, the Interstate Treaty on Gambling went into effect, which created the licensing and regulatory regime for online sports betting and igaming in Germany. As a result of an earlier treaty – which was passed but never implemented – the legal status of sports betting was ambiguous, with a large grey market.

Of the “Top 10 betting providers” the affiliate site recommends on the page, the German regulator does not license a single one.

The site claims that operators can legally and safely take bets if they are licensed by the Curaçao regulator.

“This does not apply to Germany and such a statement puts the axe to any efforts to create a legal and secure sports betting market in Germany,” said the DSWV.

‘Heinz from the internet”

Meyer linked to two other sites (Sportwettentest.net, Wettanbieter.de) which are also affiliate marketing portals. The DWSV emphasised that the author of these sites is only identified by his first name “Heinz”.

The body also said that the statements on payout ratios do not reflect the actual complexity of the market.  

“These vary from provider to provider and from bet to bet,” said the DSWV. “They are determined by a number of factors such as the intensity of competition, the tax burden, the cost structure and the risk appetite of a bookmaker, as well as the gaming behaviour of its customers.”

The trade body highlighted that there are “large differences” between the online market and the retail sector, as the former tends to have higher payouts. The DWSV added that payouts can differ month to month even with the same operator.  

“In any case, the payout ratio of 93% stated by “Heinz” and adopted by Professor Meyer in his calculation is not a realistic average payout ratio to be assumed (especially considering the high tax burden of 5.3% on each bet in Germany).

“It is regrettable that at the Bremen Institute for Public Health and Nursing Research, which claims to conduct gambling research, sources such as ‘Heinz from the Internet’ are used as the basis of scientific work.”

The DSWV pointed instead to the cash-based tax revenues published monthly by the federal ministry of finance and the 5.3% stake tax as providing more appropriate basis for calculations.

The DSWV has in the past criticised the turnover tax as being too punitive.

“The German Sports Betting Association therefore again demands a correction by the DHS and Professor Dr Meyer.”

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