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Online gaming operators pulling out of facebook apps

Monday, 02 February 2015 15:23    
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Over the past few years, a rash of online casino operators took to Facebook with real money online casino apps targeting Facebook users. In recent months, it appears that some of the largest operators are doing an about face and pulling its apps.

One of the most prominent online casinos to pull the plug was Magic 888 Casino. The site's app was launched on Facebook a little less that a year ago, but hadn't been as successful as company principles had originally hoped. Magic 888 Casino was joined by gaming operator Gamesys, which also withdrew its application in mid 2014 after running the app for just under two years.

Many of these online gaming operators may have felt that Facebook's large population of users was tailor made for the online casino industry due to the popularity of other gaming activities on the Facebook site. However, they seem to have overestimated the willingness of Facebook users to pony up cash to gamble with such a huge variety of free games already available. While free games like Candy Crush, Farmville and Cityville have proven to be big winners on Facebook, there just doesn't seem to be much demand for gambling apps.

Of course, there were other financial considerations that may have also led to the decision to cease Facebook operations. In 2014, the UK government began levying a new "consumption tax" on online casino operators. The new 15% tax is being imposed on any such operators that wish to publicly advertise to residents of the UK.

According to a Magic 888 Casino spokesperson, the margins were proving to be too small through the Facebook app to justify paying the new tax. Without the opportunity to properly advertise, the ability to drive patrons to the site's app was greatly hampered.

It's worth noting the Magic 888 Casino is owned by 888 Holdings, which also owns and operates 888 Casino. That casino was launched in 1997 and has proven to be one of the more distinguished and reliable online casinos in the world. It would seem to be quite relevant that a site with this kind of pedigree would struggle in a new enterprise such as the Facebook gaming sector.

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