The first-ever Social Gambling Conference was held in London earlier this month, and among the hottest topics raised concerned the industry’s lack of regulation.
Online gambling sites can (rudimentarily) be broken down into two groups: real-money gambling sites, in which people can buy and cash out credits, and social gambling sites, in which people can buy some credits, but do not have the ability to cash out. The most common example of such a game would be a social casino title.
The distinction may seem subtle, but from a regulatory standpoint, it makes all the difference in the world. Should social gambling sites be forced to follow the same guidelines as sites that offer the possibility of real monetary winnings?
As Venture Beat spells out in its coverage, compelling arguments can be made for both sides.
At the Social Gaming Conference, Jez San, president and founder of real-money gambling firm PKR, said he believes self-regulation by the social gaming industry is the best course of action.
“I don’t believe social games should be regulated. But I do believe the providers of the social games should take a more responsible attitude than they are currently taking,” San said.
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The logic behind San’s argument is pretty simple to follow. Social games are not real-money gambling games, so they shouldn’t be subjected to such stringent regulations. That being said, they lend themselves to addiction. If there’s no self-regulation, an inevitable addiction case will pop up, gain a ton of negative press, and regulation will find its way to the social game industry anyway.
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“We don’t want to be profiled as having ruined someone’s life or bankrupted a single mother who can’t pay the bills,” San said. “We act in a very responsible manner. We don’t allow minors to play, and we don’t allow the vulnerable to play. The social gaming world doesn’t acknowledge such problems and would like to put its head in the sand and pretend that it’s a free world and people can spend whatever they want.”
To weigh in on the other side of the debate, Venture Beat quotes Andrew Hughes, chief executive of social-casino firm AbZorba Games. Hughes’ argument is that only 7 percent of any social casino players ever actually buy anything, and that characterizing social gaming sites as purposely addictive is unfair.
“It is entertainment. You do not have to play. About 98 percent of my gamers never pay a single cent. They can earn chips looking at advertisements. Nobody can take the monetary value out of our game,” Hughes said.
“Social gambling is about a free experience.”
To read more comments by San, Hughes and others, read the full Venture Beat article here.
Or, watch a video from the first Social Gambling Conference below.
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