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Part 2: The changing affiliate landscape The long arm of the law Whether affiliates will be able to avoid the regulatory embrace in any given jurisdiction is a matter of some debate. To be clear, affiliates have a choice of whether to take heed or ignore what is being said by regulators in any given jurisdiction; as Garner puts it, the long arm of any government is unlikely to stretch to every bedroom affiliate. Yet arguably any jurisdiction intent on policing its gambling sector doesn’t need to resort to finding every affiliate working in every nook and cranny; as has been shown in the UK, it ‘merely’ has to pressure the operators working within the market with regard to all their marketing activities. Putting operators on notice effectively does the same for the affiliates. In this way, a regulator potentially achieves control of the affiliate sector working within its jurisdiction at arm’s length and at relatively little extra cost. “It stands to reason that if operators are increasingly under the spotlight of the relevant regulators to ensure that their marketing activities are conducted properly, affiliates will need to up their game too,” says MacDonald from Wiggin. “In many jurisdictions, an operator cannot simply claim that the marketing of their products and services was produced by an affiliate as a way to relieve them from their compliance obligations (and rightly so).” It means that affiliates will need to ensure that are producing marketing that complies with all the relevant is the appearance on affiliate websites,” he says. “It is fairly hard to display a good amount of T&Cs on a mobile screen without it looking pretty ugly. Some affiliates will find this tougher than others, it all depends on their backend features and functionality. Affiliates who are using Wordpress for example will likely have a tougher time compared to those who have a proprietary backend.” rules. “Whilst this may mean that the more non- compliant affiliates find themselves out of work, this is a huge opportunity for those affiliates who understand the regulations to gain the trust of the operators and dominate the sector,” MacDonald concludes. Wellard at iGamingXL says that while some affiliates will choose to work with unregulated brands, “for the most part, affiliates want to stay within the regulations”. “This gives them possible two routes. First, find the operators who are fully licensed within the market and already have their traffic, and promote only those. Or, second, look to emerging markets where opportunity is not so fierce. There are pros and cons for both and it’s possible that affiliates will choose both options initially.” (The options with regard to emerging markets are discussed in the final section of this report.) For Sims, the issue comes down to one of trust, between operators and affiliates as much as between the players and the merchants. “Affiliates have to show they are trustworthy and engaged with doing things in the right way,” he says. “If you are hoping someone will tell you where you are going wrong, you are on the slow road to ruin.” Craig Van Flute, chief marketing officer at Argyll Entertainment, points out that the vast majority of affiliate partners for any operator are now “big businesses” and they themselves ensure they are up to date with compliance requirements. “They all know they are risking their lucrative working relationships with operators by failing in this area,” he says. Around 5-10% of the sites we see month-on-month are either changing dramatically or disappearing Ian Sims, Rightlander Under pressure: Regulation and the evolution of affiliate marketing 13