The Thin Line Between Online Gaming and Online Gambling

Discussion in 'Lets Talk about gambling and more...' started by Marina, Oct 11, 2014.

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  1. Marina

    Marina Administrator Staff Member

    One of the most highly debated topics today is where to draw the line between a traditional game and a gambling venture. If a person says that they play poker on the net or that they like to hit the
    slots, the distinction seems clear. The line becomes a bit murky when the person says, “I only play free slots.” Technically, that’s not gambling by US standards, because it doesn’t involve “…risking by
    any person of something of value.” The laws further go on to exclude “points or credits that the sponsor of the game or contest provides to participants free of charge and that can be used or redeemed
    only for participation in games or contests offered by the sponsor.” This means that technically, even if a player stands to win a prize, he still hasn’t gambled, because he won’t lose anything that has value
    outside of the particular website he is using. The UK, however, doesn’t make this distinction, stating that it’s still gambling “whether or not he risks losing anything at the game.”

    Enter Social Gambling

    In an era where gambling laws are unclear or are continually changing, online outfits wanted a way to test markets and grow demand for their products. A few companies that had already made it big in
    the world of online gambling decided to roll out their games in certain areas, allowing people to play free. This gave them a chance to see if a virtual casino had a chance of making profit in the region and
    it also helped them develop a following for their products. This way, as countries loosened their restrictions, the ventures could open their doors and would already have consumer interest for their games.
    The free versions have also been used to help people who were casually interested in the games transition into cash-betting consumers. What these companies didn’t realize was that their free sites would
    become immensely popular.



    Social gambling sites, like DoubleDown and Jackpot Party developed an immense following, as did numerous mobile apps, Facebook and Yahoo games. The games offered were free and, at inception,
    were clear offshoots of the casino industry. Popular games were slots and poker, and companies profited by monetizing the games, themselves, or their sites. Rather than collecting money for each round
    that was played, operators made money from ads or charged admission to their sites. Meanwhile, other social games grew in popularity, like Mafia Wars and Farmville, which were clearly not gambling
    games. Eventually, these games that supported themselves with advertising revenue began to offer advancements within the games, but with real-world price tags. Then, the world saw something curious
    happen. Zynga, creator of Farmville, stepped into games that involved betting for real money. On the opposite end of the spectrum, 888 Holdings, which was known world-wide for their online casino,
    developed Bingo app for Facebook. This was shortly followed by a poker app. With companies on both sides of the field stepping into this middle ground, players and legislators were left wondering where
    the line should fall.


    Many of the crossover companies lept back to their original positions after a short period of time, though a few still exist. Those who are trying to tough it out aren’t reporting strong revenue.
    The most recent reports suggest that 888 is satisfied with their Bingo offerings and will continue to keep the game available. Their parent company is also working to acquire some other up and
    coming online casino entities at the present time. When Zynga dropped their paid games, they cited difficulties with regional laws.

    It’s still very difficult where the line should be drawn between online games and online gambling. Even sites that don’t pay out real-world prizes give players a social status and, though cash payments
    help players advance through the game, they’re mostly still games of chance. We’ve also seen traditional board games slide into the market, like Yahtzee, which is a slot game put out by WMS.

    Most countries haven’t stepped in to try to define exactly where the line should be drawn. Some of the larger gaming regulation agencies are looking into solutions and may set up a list of standards
    that clearly define. However, as both social gaming and social gambling are world-wide ventures, it will still be up to each country, and sometimes regions within each, to clearly define laws.

    The importance of defining laws is also highly debatable. For municipalities, it could mean a huge increase of tax revenue if social games are considered gambling. It will also help determine what,
    if any, responsibilities the entities have to players in terms of fair play and social responsibility, There’s little argument that even the simplest Facebook app has the potential to addict and bankrupt
    a person, even if it’s not gambling. As of now, though, the determination of what these games are is largely up to the player.
    Mike, Ellis and Kotsy like this.
  2. Kotsy

    Kotsy Well-Known Member

    Wow! A lot of food for thought.

    I was once playing bingo online during a break. It didn't cost me anything to play. The boss said it was still considered gambling because I could win something.

    Interesting how each area in the world interrupts this.

    I think it's gambling if you risk something of your own accord.

    Nice article Marina and gives you a lot to think about.
    Marina, Mike and Ellis like this.

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