Central America and the Caribbean used to be havens for gambling companies from the US. As a result, the likes of Costa Rica have economies built on the industry.
Around 200 significant online casino companies are either based or have a presence in the country.
But a storm is brewing in the north as the US begins to claim more and more territory. And it’s already quite successful, with forbes.com on record as saying US online wagering revenues are set to break the $44 billion barrier, the current record. Costa Rica must move fast to protect itself. What’s less clear is the solutions, yet there are some at the nation’s disposal.
Build Better Infrastructure
The way gambling businesses use Costa Rica is smart. Rather than creating a customer base in the country, they set up servers that host their platforms. This is cheaper and less hassle than opening a land-based establishment. Of course, this means that Costa Rica’s infrastructure must be on point to continue attracting recognizable brands. Without a high level of internet connectivity, there’s no reason for them to set up shop in Costa Rica.
A lot is being done to address the situation, such as investing in fiber-optic internet lines that go beyond the scope of DSL or cable. After all, in 2020, the country reported an increase of 146% in fiber-optic internet lines. Still, this was on the back of the government being urged to modernize the internet network in 2019, with a 60% gap in 4G mobile penetration being reported.
Additional fiber-optic and 5G development schemes are in the pipeline, which is reassuring news since the link between a booming online gambling industry and the internet is glaringly obvious. The US, for instance, provides over one million fiber route miles from a single company (Verizon), while lifewire.com points out that 5G networks collectively cover 75% of the country.
These elements have impacted the sector positively, not least its market value, but also in terms of the user experience because operators are plugging holes to the point where they can give away huge bonuses, such as the ones listed on bonusfinder.com by BetMGM and FanDuel, that engage consumers and encourage more people to sign up for their services. Once Costa Rica’s online infrastructure is up to scratch, providers based on Costa Rica will be able to use the same strategy.
Keep the Public Onside
If the public decides to no longer support the online gambling industry in Costa Rica, the market will suffer a huge blow. Governmental agencies are working hard to ensure the appeal doesn’t slip, something that’s reflected through the Social Protection Board (JPS), a body that aims to promote trust and transparency.
To do this, it’s reviewing applications for online gambling companies, but with a twist. For example, there will be no middleman, and the operators will deal directly with the JPS. Also, the games will become its property, handing the regulator additional control. Finally, 70% of the profits will go to its treasury to enable it to fund programs outside of gambling.
By using the profits to improve society, the public will undoubtedly get behind the plan because it will enhance several aspects of Costa Rican life. For companies, the PR will be positive since it will paint the brands as selfless and altruistic because they are doing their bit for the people.
America will challenge Costa Rica in terms of its rapidly growing wagering industry. That’s impossible to stop. What Costa Rica must concentrate on are the things it can control, such as quality infrastructure and public engagement.