Govt row with betting firms has thrown advertising revenue into low

The Betting and gaming sector has been growing since the launch of Sportpesa. There was a slight decline in media value exposure in 2018 due to the tax levy. Similar trend has happened in 2019.

With the suspension of betting firms, however, a survey by GeoPoll indicated that the media industry had been projected to lose 10% of 2019 advertising expenditure, an equivalent to Ksh14 billion projected loss.

Since the upsurge of Betting and gaming advertising spends, there has been a correlation between this sector, the Communications (driven by telecommunications companies) and Media sectors.

Betting firms are major revenue drivers for communications and media companies, how exactly has advertising pends been impacted by the suspension of betting firms’ operations?

According to a joint survey by research firms, GeoPoll and Ipsos dubbed Unpacking Betting in Kenya, betting adverts are a big revenue minter for media houses.

The sector contributed Ksh11.2 billion, Ksh13.1 billion, Ksh16.9 billion and Ksh12.8 billion to media revenue in the financial years 2016, 2017, 2018 and between January and June 2019 respectively.

The sector was expected to contribute more than 10% to the advertising revenue pool this year before the government swooped in claiming that the betting companies owed the taxman Ksh26 billion in unpaid taxes.

In the recent report released by Ipsos, TV has continued to be the most popular advertising avenue gobbling up 56 percent of the advertising billions, radio 35 percent, while print commands a paltry 9 percent.

The Standard newspaper made Ksh218 million having already issued a profit warning two weeks ago expecting this year’s profits to be 25 percent lower than last year’s.

People Daily made Ksh64 million, The Star56 million and Business Daily Ksh40 million.

In the print media business, The Nation continues to be the top draw with Ksh340 million going back to Nation Centre.

Betting and Gaming sector has been riddled with controversy and success stories over the past few years.

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Lawrence Baraza is a prolific writer with competencies in Digital Media, Print, and Broadcast. Baraza is also a Communication Practitioner currently spearheading Digital content on Metropol TV's Digital Desk.

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