Italy’s Sweeping Gambling Reform Sparks Rapid Consolidation in Europe’s Largest Market

Italy’s gambling industry is undergoing a seismic transformation as sweeping regulatory reforms trigger a wave of consolidation, effectively redrawing the competitive landscape in Europe’s largest gaming market.

With higher financial and compliance thresholds, smaller operators are being squeezed out, while larger, multi-channel corporations are poised to take dominant positions.

On May 30, the Italian Customs and Monopolies Agency (ADM) officially concluded its tender process for awarding new remote gambling concessions. Although successful applicants will only be announced after the summer, industry insiders are already bracing for a dramatically different market environment.

Moreno Marasco, president of Italy’s LOGiCO online gambling association, spoke ahead of the changes, predicting a sharp contraction in the number of active operators. "This is a significant drop, despite the Italian market’s exponential growth in both revenues and legal operators," he said.

Indeed, where the previous tender attracted 93 applicants, the current round has seen only about 50 contenders. Based on current projections, the number of remote operators is expected to fall from 81 to roughly 33 — a reduction of nearly 60%. "When the new system comes into force," Marasco added, "the competitive landscape will be thoroughly redrawn."

The driving force behind this upheaval is a suite of new requirements introduced by ADM, particularly a dramatic increase in licensing costs. The initial concession fee now stands at €7 million per vertical and per brand — a price point that has effectively excluded smaller firms from the playing field.

Christian Tirabassi, founder and senior partner at M&A advisory firm Ficom Leisure, suggests that this steep entry price is part of a deliberate strategy. “There are very small companies that were able to operate in a market that was [worth] €4 billion at the time, now €5 billion, with an investment of €250,000,” he explained, referring to the previous cost of a remote gaming licence. “The regulator decided that this is not acceptable. You don’t want to put a delicate operation like this in the hands of a company without financial strength.”

The focus of the reform, according to Tirabassi, is to elevate the financial, technical, and compliance standards of all participants. “You need to be a company that won’t skip AML requirements to save €5,000,” he said, emphasizing the importance of integrity and robust operational systems.

Additional financial burdens await successful bidders. Online sports betting and casino operators will face taxes of 24.5% and 25.5% on gross gaming revenue (GGR), respectively. On top of this, they are obligated to pay an annual fee equal to 3% of GGR and allocate at least 0.2% — capped at €1 million — to responsible gambling campaigns.

The effects of these changes are already rippling through the market. Ficom Leisure has played a key role in a series of mergers and acquisitions where smaller operators have been absorbed by larger, more capable companies. "Post-tender, we expect large, integrated, multi-product, multi-channel companies to dominate the market," Tirabassi said.

He forecasts that just a handful of operators will account for around 80% of Italy’s projected €5.2 billion in remote GGR, with no more than 30 to 35 companies operating legally. “The reform has brought the price of the licence to a normal level,” he noted. “The previous price – how cheap it was – that was the abnormal part. Add to that the stricter requirements and the fact that, to be successful in Italy, you need to be omnichannel. All of that has created natural selection in favour of larger corporations.”

But the licensing overhaul is only one part of Italy’s broader effort to modernize its gambling framework. The reform aims to raise standards in cybersecurity, anti-money laundering (AML), and player protection — key areas where Italy hopes to set a new European benchmark.

Italy, which first regulated online gambling in 2006, will soon phase out a 20-year-old system in favor of new technical rules that include advanced player protection mechanisms. These will allow users to set personal limits on deposits, playtime, and spending. Self-exclusion options and automated warnings designed to curb compulsive behavior will also be introduced, with particular attention paid to the 18–24 age group — a regulatory first in Europe.

Despite the regulatory headwinds, the Italian gambling market continues to thrive. In 2024, total GGR reached €21.6 billion, up 4.4% from the previous year, with about €5 billion coming from online channels. The segment is experiencing “dizzying growth,” particularly among major players.

One example is Flutter Entertainment, which made headlines with its €2.3 billion acquisition of Playtech’s Snaitech in 2023. According to analysts at Jefferies, Flutter could command a 30% share of the Italian gaming market thanks to its diverse brand portfolio. Flutter already held a 15% share in online betting and iGaming through Sisal and PokerStars, while Snaitech contributed an additional 10%.

Land-based gambling is also on the reform agenda, though progress has been slower. The government originally planned to unify the licensing scheme and implement stricter regulations — including cash deposit caps of €100 per week and mandatory ID systems — by the end of 2025. However, resistance from regional governments has delayed implementation until mid-2026.

Tirabassi believes that the key to long-term success in Italy’s evolving market is scalability across both digital and physical channels. “Since skins are forbidden under the new concessions scheme, operators will have to secure concessions not just for every vertical and channel they want to operate in, but also for any separate brands,” he noted. This, he suggests, will further reinforce the trend toward consolidation.

With barriers to entry rising, those who survive the tender and navigate the new regulatory landscape may find themselves with a far larger share of an expanding market. “Those who win out in the market could ultimately reap much greater rewards,” Tirabassi said.

Even amid this market turbulence, some things remain constant. Incumbent IGT will continue to operate the Italian lottery until 2034. Its IGT-led consortium, LottoItalia, recently beat Flutter in a competitive bid for the nine-year concession, offering €2.23 billion — more than twice the €1 billion base price. In a market increasingly defined by financial muscle, IGT’s move serves as another reminder: in Italy, only the strong survive. 

By fLEXI tEAM