Apr

29

How Much of Social Gaming is Social Gambling?

Mark Stephens

The more I look around the more it seems that Monopoly money just doesn’t get people excited anymore. If you’ve noticed how Facebook is becoming more like a casino every day you will understand what I’m talking about. How has social gambling come to play such a large role in social gaming (talk about "monetising games"!) and is it creating any problems?

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A Short History of Online Gambling

Online gambling via virtual casinos started in 1994, but it started to become popular in the late 90s. By 1997 there were 200 websites devoted to it.

In 1999 multiplayer online gambling was introduced and here we saw the first roots of the social gaming side to the industry. These online casinos allowed people not only to gamble, but to chat and interact with each other too.

By 2008, it was estimated that worldwide online gambling revenue was $21 billion – a significant industry in its own right, despite heavy regulations from the likes of the US and Australian governments. In fact, alongside the pornography industry, it could be argued that the gambling industry has been the biggest beneficiary of the spread of the Internet since the early 1990s.

The coming together of social media and online gambling really needs to be considered in the light of this background.

It was a match “made in heaven” – huge numbers of people gathering together in one place with time on their hands to play games… Who wouldn’t want to have a little flutter or two or a few hands of poker with friends, anywhere in the world, at any time of the day or night? Real money or just for a little bit of fun?

As well as poker, the likes of roulette, blackjack, pachinko, baccarat and bingo have also become popular online, both for real and virtual currency.

Facebook and Zynga

It didn’t take long for the up-and-coming social media platform Facebook to realise the potential five or six years ago. Zynga Poker was one of the first of the successful games on Facebook and grew with the social media giant, hand-in-hand.

Many people enjoy poker for virtual currency and don’t want to lay down the real bucks. This has been popular from the time of online casinos, where you could play with unlimited virtual dollars rather than risking your monthly salary or your house! This model helped to make Zynga Poker the largest poker site in the world, with over 35 million users.

In 2012 Zynga announced that it was moving in to providing real money games for the first time, but only outside the US. Two real money games were recently released in the UK called Zynga Plus Casino and Zynga Plus Poker.

Slot Simplicity

Just recently we have also seen the popularity of online slots increase on Facebook and elsewhere. Just as in a real casino, slots are a big cash cow, and recently International Game Technology, which is the world’s largest slot-machine maker, announced a big increase in profits based partly on the doubling of revenue from slots in social gaming.

Zynga Slots is also attracting millions of new users each month, and is one of the fastest growing games on Facebook currently.

Digital Chocolate, which is another leading social game developer, also recently announced the launch of SLOTS! Pocket UK for the iPhone and iPad, with a real-money play feature and many new interfaces to add colour and variety to the mind-numbing simplicity of slot games.

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Merging of Markets: Problem Gaming?

It seems everywhere we turn there is more evidence of the two markets of online gambling and social gaming merging.

Recently BuddyBet announced private funding for its P2P sports betting product in the UK, yet the company is described in press releases as a “social gaming start up.”

One article said this:

“A recent study by investment bank Digi-Capital estimated the online and mobile gaming industry will be worth $83bn (£54bn) by 2016, despite social gaming investment falling by $1bn last year, and BuddyBet is confident that it will take advantage of a rapidly expanding market.”

The COO of above-mentioned Digital Chocolate recently said:

“Real-money play is a major growth opportunity in mobile gaming and we believe by combining social game design with RMG, we will help pioneer a whole new class of mobile gaming.”

You’ve heard of “problem gambling” right?

Might we have a case of “problem gaming” developing? The lines between social gaming and social gambling are increasingly blurred and we see online betting and card gaming increasingly falling under the same “social gaming” umbrella as the ones our kids are playing.

Is there really a close connection between a 10-year old playing MindFeud or Quopples and an adult betting on a Premiership football match?

Other than using the same device to do so, the two worlds are miles apart – and they need to be kept that way, if you ask me! Instead we see them moving closer together.

Are we going to see Facebook offer real-money games in the near future? Possibly. What do you think?