One of Ontario’s now-many operators of online sports betting sites is pulling the plug on its operations in Canada’s most populous province.
Coolbet announced Thursday that it will stop offering Ontario sports betting in early April. The online sportsbook and casino said it will turn off all deposit options on March 21 before closing its gaming operations on March 22 and shuttering its site and mobile app on April 3.
“We strongly encourage you to withdraw your funds as soon as possible,” the operator said in a blog post. “In case you have not made any withdrawals before, we would require you to verify your bank account that will be used to pay out your remaining balance. Once you have requested the withdrawal please check your email for further instructions on how to complete the verification.”
GAN-owned sportsbook @CoolbetCanada says it "will stop offering its services in Ontario on April 3rd."— Geoff Zochodne (@GeoffZochodne) March 16, 2023
Coolbet was among the first operators to launch in the province's regulated iGaming market last April, but is now exiting and asking players to request their withdrawals ASAP. pic.twitter.com/BgcGhUo1p1
Ontario’s regulated market for legal sports betting and online casino gambling is the only one of its kind in Canada, allowing private-sector operators to take bets from residents in exchange for a cut of their revenue. However, that market has quickly gotten very crowded, with more than 70 iGaming sites now active in the province, which doesn't include the sportsbook and internet casino offered by the government-owned Ontario Lottery and Gaming Corp.
Coolbet was in the first wave of private-sector operators to launch in Ontario in April 2022. The operator tried to carve out a good-sized market share with a focus on transparency and advertising efforts such as a partnership with “Canada’s Fastest Man,” Andre De Grasse.
A harsh climate
Nevertheless, it was tough sledding for Coolbet, which is owned by gaming technology provider GAN Ltd.
In August 2022, about five months after launching in Ontario's regulated iGaming market, GAN's CEO acknowledged they had a "slower-than-anticipated start" in the province. The company's chief financial officer added that they had "softened" their outlook for Ontario due to the "intensely competitive environment."
It is partly because of that competitiveness that GAN is pulling the plug on the Ontario experiment. While Coolbet remains available in other parts of Canada, and while GAN will continue evaluating "regulated market opportunities" that present the possibility of good returns, Ontario is off the table for now.
"The company is focused on maximizing profitability and investing capital and resources into only the highest return regions," GAN said in an email to Covers. "Unfortunately, given the competitive nature of the market and the heightened promotional environment we didn’t see a near-term path to profitability, so we are reallocating our resources elsewhere."
The competitiveness of Ontario's iGaming environment will weaken only somewhat with the departure of Coolbet. Moreover, that competitiveness could mean that Coolbet's exit from Ontario is just one of several. Indeed, the approaching anniversary of the launch of the province’s regulated iGaming market means other bookmakers are likely weighing whether to renew their licenses amid such a tough business climate.
Ontario charges iGaming operators around 20% of their revenue to do business in the province. Operators can apply for a one or two-year permit but must pay an annual regulatory fee of $100,000 per gaming site.
Coolbet's iGaming registration is set to expire on April 3. As a result, Ontario-based users must start getting their affairs in order.
“If you have a bet that cannot be settled by [end of day March 22] because the outcome is still unknown, the bet will be voided and refunded,” Coolbet’s blog post stated. “This includes futures and in parlays, if any of the outcomes result (sic) is not known the part of that parlay will be voided and odds set to 1.00.”