Key Moments:
- Seventy-five percent of survey respondents have reported greater demands from operators, including stricter attestations, expanded audits, and speedier remediation.
- Seventy-one percent expect suppliers to face a pivotal choice between licensed and grey markets within the next five years, as enforcement intensifies.
- Ninety percent say that technical compliance and product rules are becoming more fragmented across regulated markets, increasing complexity and costs.
Survey Reveals Accelerating Regulatory Demands
Suppliers serving the online gambling sector are grappling with increasing pressure from both operators and evolving licensing frameworks, according to the findings of Vixio’s 2025 Gaming Supplier Survey. More than 100 senior B2B executives participated between April and July. Seventy-five percent said operator expectations are intensifying, pointing to stronger attestations, expanded audits, and faster corrective measures. These new compliance obligations now tie directly to business strategy, market access, and product development.
James Kilsby, Chief Analyst at Vixio, remarked, “The Gaming Supplier Survey underscores the increased regulatory burdens falling on online gambling suppliers as more European jurisdictions introduce specific B2B licensing regimes and regulators scrutinise how illegal, offshore sites are being supported.”
Additionally, Kilsby commented, “Regulation of iGaming is spreading to new parts of the world and suppliers are grappling with an increasingly diverse set of technical compliance rules and other regulatory restrictions, as they seek to capitalise on these exciting growth opportunities.”
The survey, launched at the Global Gaming Suppliers Seminar in Las Vegas, highlights urgent focus areas. These include automated KYC for faster onboarding, stronger internal controls for live rule changes, and product development aligned with regulatory rules. These concerns are now central to strategic decision-making and market entry.
Choosing Between Licensed and Grey Markets
Suppliers are rapidly approaching a crucial decision point regarding whether to operate exclusively within licensed markets or continue serving grey areas, as regulatory enforcement gains momentum. The survey found that eighty-six percent believe current policies do not adequately consider technical and product design implications, while eighty-one percent say that regulators are now more informed about supplier dynamics. Seventy-one percent predict that a decisive ‘choose licensed or choose grey’ inflection will emerge within the next five years, reshaping the direction of compliance.
Accordingly, suppliers are redirecting investment and efforts toward markets with regulatory frameworks that support innovation and revenue strategies. Movement toward high-growth but compliant jurisdictions is gaining priority, while regions imposing tough requirements may see supplier activity slow or pause.
Regulatory Enforcement Moves Forward
The forthcoming decision between grey and licensed jurisdictions has already moved from theory to reality in some markets. Zach Birnbaum, Principal Analyst at Vixio, stated, “In certain markets, this enforcement of choice between grey and licensed markets is already occurring,” in exclusive comments to SiGMA News.
Birnbaum noted that, in April 2024, Michigan started requiring suppliers seeking new or renewed licenses to confirm they are not servicing unregulated operators internationally, as a continuation of recent enforcement efforts. Michigan also took direct action against unlawful online casinos, delivering cease-and-desist notices to eight entities operating without proper authorizations.
He continued, stating that California and New York lawmakers have taken steps against online sweepstake casinos with special attention to content providers and payment processors, and that Sweden, Romania, and Spain have intensified actions against dual supplying. Brazil is also increasing regulatory tightness.
“As a result, in terms of enforcement mechanisms, we are expecting a strong push for formal and enforced supplier licensing or registration with prohibitions towards non-licensed market supplying,” Birnbaum said. “As to timing, that will vary, but we are expecting a series of regulated markets to implement these measures in the near-term within the next 1–3 years.”
Operators have raised their own standards, seeking regulator-level rigor in compliance through detailed contracts, heightened onboarding scrutiny, and more thorough audits. These evolving demands are forcing supplier compliance to the front of business strategy.
Latin American Opportunities Coupled with Compliance Demands
Latin America has emerged as the leading growth region, but the complexity of compliance and tax obligations will dictate the pace of supplier expansion. Brazil, in particular, has been forecast by Vixio to surpass US$10 billion in annual gross gaming revenue by 2028, positioning it as a major global regulated market, per Birnbaum.
Birnbaum also indicated that Mexico, Peru, and Colombia could reach over US$1 billion by 2028, but warned that these opportunities come with potential tax-related obstacles. Entry into these markets emphasizes the importance of robust licensing, internal controls, frequent audits, and dedicated teams to adapt to regulatory shifts and manage breaches.
Technical Compliance Creates Fragmentation and Costs
The divergence of technical standards across regulated jurisdictions has led to increased compliance burdens, with ninety percent of executives citing mounting complexity and expense. Birnbaum commented, “Technical Compliance rules from the regulator side are likely to continue being fragmented as shown by the survey results.”
He also suggested that industry-driven best practice codes may help create some harmonization and support operations amid disparate requirements.
Artificial Intelligence Finds Role in Compliance, Trust Key
AI is starting to play a role in enhancing compliance by enabling features such as automated KYC checks and real-time monitoring of transactions. Birnbaum stated, “The primary areas of focus are primarily usage-based on RG and AML, as consumer protection is a key focus for regulators generally globally, as seen with a strong push towards enhanced advertising restrictions.”
He highlighted progress in detecting harmful behavior and improving both KYC and suspicious activity monitoring as immediate priorities.
“This strategy can lead to increased buy-in from regulators as a focus on consumer protection will also permit public buy-in,” said Birnbaum. Once industry and regulators establish trust in AI-driven compliance, “other areas of potential AI innovation may then be tackled, such as personalised game feeds, or enhancements to game designs.” Still, fifty-eight percent believe AI’s effectiveness will hinge on the regulatory response over the next three to five years.
Strategic Compliance Takes Center Stage
The landscape for gambling suppliers is shifting toward stringent enforcement, more rigorous licensing, and heightened operator scrutiny. Compliance has transitioned to being a cornerstone of business planning and market entry.
AI-driven solutions, especially those supporting consumer protection and transactional integrity, are becoming standard expectations. Proactive suppliers are introducing their own compliance frameworks and opting for jurisdictions that offer regulatory clarity. Product features are being meticulously mapped to jurisdictional technical standards, and cross-functional teams now lead ongoing compliance training and quarterly reassessments.
Transparency, clean market access, and measurable consumer protection outcomes are increasingly prioritized. Suppliers are reevaluating dual-service approaches in gray markets and aligning with regions that offer explicit B2B licenses. Publishing annual compliance reports has become routine among industry leaders, irrespective of regulatory mandates.
Regional Market Projections from Survey Respondents
| Region/Country | Projected 2028 GGR (US$ Billion) | Notable Challenges |
|---|---|---|
| Brazil | >10 | Compliance & tax headwinds |
| Mexico | >1 | Tax headwinds possible |
| Peru | >1 | Tax headwinds possible |
| Colombia | >1 | Tax headwinds possible |
Conclusion
For a comprehensive overview, the Vixio 2025 Gaming Supplier Survey provides detailed insights on the evolving compliance environment for gambling suppliers.
To stay informed on deal-making and regional insights, the SiGMA iGathering: Dine Drink Dance – Autumn Edition is scheduled for 17 October in Limassol, offering an opportunity for industry networking and partnership discussions.
- Author
Daniel Williams
