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The online gambling industry is worth an estimated $88 billion, with some experts predicting that market value will reach more than $125 billion by 2027. Online casinos are becoming increasingly popular, offering many advantages that their land-based counterparts don’t. While many of these benefits favour the user, online-only platforms are also lucrative for operators. “How much does online casino software cost?”, is one of the first questions would-be operators should be asking. Once you’ve factored in your outlying costs, you can start reaping the benefits of effortless promotion, vital analytics and the scalability of an online platform.
Getting Started: Online Casino Software Costs
Arguably the most important thing you’ll need to invest in is a gaming software package. A typical online casino offers hundreds of games. How much does online gambling software cost? This largely depends on the number of games included. If you want your platform to be competitive, you’ll need to offer a full range of baccarat, blackjack, roulette and poker titles. Lottery-style games like keno, instant wins and online slots should also be included. With more operators offering live dealer games than ever before, your gaming software should also cover this.
Software is generally one of the most expensive start up costs casino operators need to think about. The most basic packages can cost as little as $10,000, although functionality and development potential are limited. If you’re thinking about offering a larger gaming library, start up costs for online casino platforms can skyrocket, especially if you want to include games from leading providers like BetSoft, NetEnt and Microgaming. As well as the outlying investment, you’ll also need to factor in commission costs.
How Much To Open an Online Casino: Other Startup Costs
Before you can get your business off the ground, you’ll need to apply for registration as a legal entity. But how much does it cost to open an online casino?
The cost to open an online casino in the USA depends on which state you’re based in. In some states, registration can cost as little as $600. In other states, costs can rise to as much as $1,400.
Wondering how much it costs to open an online casino in the UK? Here, registration tends to be more expensive, with first-year costs amounting to around £1,450 and second-year costs adding a further £600. Once you’ve included company incorporation fees, banking fees and additional charges, registration costs are closer to £9,000.
How Much Do Licensing Fees Cost?
To operate as a gambling business, you’ll need a licence. Costs vary between jurisdictions. As well as the initial cost, you’ll need to budget for annual fees and application costs. In the UK and most of Europe, annual licensing fees can be considerable and soar to six-figure levels. Jersey, Gibraltar and Malta all offer budget-friendly alternatives, with annual incorporation fees costing only a fraction of what you’ll pay elsewhere.
On average, casino operators should expect to pay around $75,000 per year for a licence. There’s also the issue of paying taxes on casino profits. Once again, this varies between jurisdictions. In some countries, tax on profits can be as low as 1%. Elsewhere, tax payments can swallow up almost 25% of your profits.
How Much Money Does It Take To Open an Online Casino – Other Expenditure
Once you’ve chosen a gaming system and filed for a licence, get set for more costs. You’ll need to invest in a website, although this is relatively affordable. However, creation costs will always be higher if you’re planning on a more complex and feature-rich platform.
You’ll also need to integrate financial tools so you can accept deposits and send payments to players. The best casino platforms offer a variety of payment methods, including credit and debit cards like Visa and MasterCard, as well as e-wallet services like PayPal, Neteller and Skrill. These services typically demand operators to have a minimum of $50,000 to get started. Using a third-party payment processor is far more convenient, but this comes at a premium. Over a year, payment processing fees can stack up to around $250,000.
Operators also need to set aside a reserve to honour prize payouts to payers. This varies according to local regulations. In most countries, a reserve fund of $500,000 is required. This should be set aside in a separate corporate account and not used for any other business expenses.
What About Marketing?
A successful casino platform also needs an effective marketing campaign. Blogs, email marketing and ad networks can all be utilised here, but to see real results, you’ll need to engage with an affiliate partner. A marketing affiliate can direct significant traffic to your platform, but monthly expenditure can be as high as $100,000. While cheaper alternatives are available, recently-launched online casinos will end up spending a significant share of profits on affiliate marketing.
Main Types of Online Casino
Online casinos can be broken down into three broad categories, with larger operators offering users access to all of them.
- Web-based platforms are the most common type of online casino, with users able to access games through any internet browser. They can be accessed via desktop, smartphones or tablet devices.
- Download-only casino platforms are another option, with players needing to download a software client to their device to access the full suite of games. Although these casinos aren’t as in demand as they once were, they’re generally faster than web-based ones and offer more advanced features.
- Casino apps are more popular than ever before, with most major operators offering dedicated apps. Unlike mobile-friendly versions of desktop sites, these apps are specially designed with smartphone and tablet devices in mind.
The Online Casino Development Process
Now we’ve explored how much it costs to open an online casino, let’s explore the development process. Developing a casino platform is complex and time-consuming. What’s more, when you’re starting from the ground up, it’s easy for online casino development costs to get out of hand.
If you want to accelerate your speed to market, handling casino game development independently isn’t a good idea. While conceiving a game is simple enough, the design and development stage can take months. Game testing also adds to your timeline. Naturally, all of this adds to your budget. If you’re already stressing about how much money you’ll need to start an online casino, investing in game production is something you’ll want to avoid.
At EvenBet Gaming, our development services make your life easier. Choose from thousands of games from leading providers and seamlessly integrate them into your online gaming software. Take your pick from popular titles covering all casino categories, including online slots, roulette, blackjack and more. You can also integrate mini-games to enhance user experience and secure new revenue streams.
What Does It Cost To Start an Online Casino? – Full Breakdown
Need a reminder about what you’ll need to spend to get your platform up and running? Below is a snapshot summary of how much it will cost to start a gambling website:
- Gaming software packages: anything upwards of $100,000
- Website creation: as little as $1,000, but generally much higher
- Gambling licences: minimum of $75,000 annually, but varies between jurisdictions
- Payment processing fees: around $250,000 per year
- Reserves: around $500,000
- Personnel costs: Minimum of $120,000, but can vary considerably
- Marketing costs: varies wildly, but a good affiliate marketing campaign can cost $100,000 every month
As you can see, once you’ve factored in every fee to run a gambling business online, annual operational costs can easily break into seven-figure territory.
Looking for Customisable Casino Software Solutions?
Launching an online casino platform isn’t without risk, but you can take charge of costs and increase your chances of success by investing in the right software. If you go it alone, casino development can take months, if not years, especially if you’re aiming for a more complex platform. Looking to get your platform to market sooner? Speak to the team at EvenBet Gaming today. As an industry-leading iGaming developer and supplier, we can help you mitigate unnecessary costs, retain customers and maximise profits.