As Uzbekistan moves toward the impending legalization of gambling in 2025, the demand for licenses from various operators is on the rise, reflecting a burgeoning interest in tapping into this potentially lucrative market. This growing demand underscores the urgency for a comprehensive analysis of the gambling landscape to better understand its dynamics, challenges, and opportunities. Prepared by GCA experts, this market analysis aims to provide valuable insights into the current state of gambling in Uzbekistan, highlighting the factors influencing its development and the potential for future growth.

As of the end of 2023, Uzbekistan's population stands at 37 million, with a projected annual growth rate of 2%. The working-age population, between 16 and 60 years old, is approximately 20.8 million. At the beginning of 2024, the average nominal wage in Uzbekistan is around 4.92 million sums (approximately $388.60), while in the capital, Tashkent, the average salary is higher at 8.12 million sums (approximately $642).

Based on these figures, the potential audience for gambling, which includes individuals aged 18 and older (3% of whom are women), constitutes about 32.14% of the total population, equating to roughly 11,892,000 people, of whom 965,000 reside in Tashkent. Given the high religiosity of the population (89% adhere to Islam), traditional upbringing, and the presence of pensioners, the potential audience is reduced by about 40%. However, this factor is partially offset by the traditionally high interest in gambling inherent in Asian cultures. Thus, the volume of potential clients is estimated at 7,092,000 individuals.

Uzbekistan is one of the most sports-oriented countries in the region, with a particular interest in football. The national team actively participates in international competitions, generating high demand for sports betting.

In 2023, Uzbeks spent about $1 billion on online gaming according to official data, although unofficial estimates suggest this figure is 7-8 times higher. On average, a player spends up to $1,000 annually on gambling. Given these figures, the income generated by illegally operating operators in Uzbekistan may reach up to $2 billion, resulting in the state losing over $100 million in taxes under the current tax regime. This figure represents the net income from gambling activities in the GGR tax. Other taxes resulting from the gambling industry taxation and the growth potential of this sector, considering its geographical features and neighboring states, should also be taken into account.

To detail the player value in the gambling business in Uzbekistan by sector, key performance indicators (KPIs) were analyzed, including cost per acquisition (CPA), average revenue per user (ARPU), and lifetime value (LTV). The results of the calculations are as follows:

Online Casinos:

CPA: Approximately $100 per player.

ARPU: Around $1,800 per month.

LTV: $21,600 over 12 months.

ROI: Very high, as income significantly exceeds acquisition costs. However, this cost may decrease following legalization.

 

Sports Betting:

CPA: Approximately $90 per player.

ARPU: Around $1,500 per month.

LTV: $18,000 over 12 months.

ROI: High returns due to player engagement and frequent betting.

 

Lotteries and Instant Games:

CPA: Approximately $70 per player.

ARPU: Around $600 per month.

LTV: $7,200 over 12 months.

ROI: Moderate, as these players exhibit less engagement and lower average revenue.

 

Poker:

CPA: Approximately $80 per player.

ARPU: Around $1,200 per month.

LTV: $14,400 over 12 months.

ROI: Moderate return, depending on competition levels and player activity.

We can summarize the key points as follows:

• Online casinos remain the most profitable sector with high income per player and significant ROI.
• Sports betting also demonstrates high ROI due to engagement and active participation.
• Lotteries and instant games have lower profitability metrics but remain viable.
• Poker provides a good balance between acquisition costs and revenue.

These calculations indicate that operators looking to thrive in the Uzbek market should focus on active sectors with high income, optimizing their expenses for player acquisition and retention.

The regulatory body responsible for managing and licensing gambling activities will issue licences.

The tax on activities is set at 4% of turnover after deducting all winnings and returned bets. Individuals receiving winnings will be exempt from personal income tax. The new regulations do not specify a requirement for the beneficiaries to obtain residency but clearly outline the rules for identifying the ultimate beneficiaries of companies. Additionally, a betting accounting center will be established to oversee the activities of gambling companies.

In conclusion, the gambling market in Uzbekistan has significant growth potential, facilitated by the expansion of legal opportunities and the attraction of foreign investment. Enhanced regulation and the fight against illegal operators will help reclaim lost funds for the state budget, improve conditions for local players, and attract more international operators and tourists. Further reforms in this sector are expected to lead to sustainable growth and improved infrastructure, positioning Uzbekistan as a leading center for the gambling industry in Central Asia.

The expansion of legal opportunities includes licensing operators, which will increase state revenues through taxes and licensing fees. Attracting foreign investors will ensure the influx of capital and technologies necessary for industry development.

Strengthening regulation and combating illegal operators will reduce the outflow of funds abroad and increase state budget revenues. This will also create safer and more transparent conditions for players, enhancing trust in legal operators. As a result of these measures, sustainable growth in Uzbekistan's gambling market is anticipated, along with improved infrastructure and the creation of new jobs. This will make Uzbekistan an attractive center for international operators and tourists, fostering the country’s economic development.