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The U.K. drastically reduced the size of bets allowed on roulette and poker machines, crimping a profitable business for the gambling industry that’s been blamed for addiction and contributing to economic hardship.

The maximum bet on fixed-odds betting terminals now will be 2 pounds ($2.71), down from 100 pounds, the government said in a statement Thursday. The Gambling Commission also will tighten rules on online gaming, adding stronger age verification and proposing that operators set limits on consumers’ spending until affordability checks have been conducted, the government said as it finished a review of gambling.

“We have chosen to take a stand,” Culture Secretary Matt Hancock said. “These machines are a social blight and prey on some of the most vulnerable in society, and we are determined to put a stop to it and build a fairer society for all.”

The decision is likely to encourage bookmakers to seek new sources of revenue, a trend that’s already under way with Paddy Power Betfair Plc’s announcement Wednesday that it’s in talks to expand into U.S. sports betting. William Hill Plc, seen by analysts as the most exposed to the measure, said the measure may cut its total gaming net revenue by 35 percent to 45 percent and lower annual profit by as much as 100 million pounds.

Betting Shops

The machines are used by thousands of betting shops across Britain, and have helped offset a decline in revenue caused by the growth in online gambling. A 2-pound cap would force half of the U.K.’s 8,500 betting shops to close, with 21,000 job losses, and cost the horse-racing industry — which sells broadcasting rights to the bookmakers — 50 million pounds a year, according to analysis by KPMG.

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