Smartphones: they can do just about anything. But it’s their potential to act as casinos, bookmakers and even the humble bingo caller that’s got gambling researchers betting on trouble.

For the moment it’s pretty hard to gamble real money online — bookies, of course, are legal, but current legislation forbids online casinos from operating in Australia. That means games like blackjack, roulette and poker are technically not available to local internet players — although savvy operators can find their way to an overseas casino.

The ban also extends to mobile smartphones. But that hasn’t halted the surge in gambling-themed games being offered in the iTunes and Android application stores. Slotomania, Bingo Bash and Poker by Zynga are just some of the gambling games to rise to the top of the download charts.

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Social media too has seen huge growth in “free” betting games, with games such as DoubleDown Casino, Mirrorball Slots and Bingo Blitz boasting millions of players on Facebook.

Sally Gainsbury, a postdoctoral research fellow at Southern Cross University’s Centre for Gambling Education and Research, has been surveying people who gamble using the internet, mobile phones and digital TV. She reckons social media and smartphones are a major growth area.

Gainsbury says many of these games offer a “freemium” experience, meaning the app is free but players can fork out real money for extended features, bonus levels and more fake coins to play with. “It really is a training, or priming, for real money gambling , which can then obviously end up with serious problems for when people spend more money than they can afford,” she said.

In Slotomania, for example, a new player starts off with 200 coins, which can disappear not long after signing up. To keep you playing Slotomania offers the chance to buy more coins with real money. The most popular in-app Slotomania purchase on iTunes is 18,000 coins, which costs $10.49. Essentially it’s paying to gamble for “fun”, without the opportunity of a pay-off.

Charles Livingstone, from the School of Public Health and Preventive Medicine at Monash University, is concerned games like Slotomania may be played by kids. He says kids with access to their parent’s credit card could get hooked on the game and easily buy the in-app purchases.

Slotomania — which was the top grossing iTunes app of 2012 — says it’s intended for players over 21, but is actually rated for ages 12+ in the iTunes app store with “frequent/intense simulated gambling”.

“Should a 12-year-old be playing a slot machine, would you allow 12-year-olds into a casino? This is crazy stuff,” Livingstone told Crikey. “To all intents and purposes, it is gambling. The fact that you don’t win money is neither here nor there because it costs you money to keep using it.”

Gainsbury also has concerns with the unrealistic odds offered by these games, which may be more skewed in favour of the player than real-life gambling. People who win big on Facebook may not do so well at the local RSL.

“They’re actually manipulated to encourage people to win, so that they enjoy the games,” Gainsbury told Crikey. “They’re supposed to be fun and entertaining, but they really misrepresent what gambling actually involves.”

Despite the regulatory issues, the global race to cash in on smartphone and social media gambling has already begun. According to Juniper Research, global annual betting through mobile handsets and tablets will top $100 billion by 2017, up from just under $20 billion last year.

In the UK, Facebook has teamed with online casino giant 888 (its poker game is fronted by Shane Warne) to offer real-money gambling on the social media network. That move follows the launch of Facebook’s first real-money betting game Bingo Friendzy in August, which offers bingo and slot machine gambling to those in the UK.

There are moves in the US to also allow online social casino games, with app market leader Zynga (Farmville and Mafia Wars) applying for a gambling license in Nevada. Crucially, all have cited the importance of the social aspect of these games as the reason for their interest.

Gainsbury doesn’t think Australians will be able to gamble real cash on Facebook or smartphones any time soon. But if there is a move to legalise, companies already offering simulated casino games are in the box seat. “For a young person if they’re used to playing a free play game with a particular operator you’re much more likely to go on and play the real-money game with the same operator,” she said.

The Interactive Gaming Act is currently under review, with one likely change being the approval of online poker. The interim report has noted the issues surrounding social media and smartphone gambling, as well as the “free-to-play” simulation games.

“The regulation is completely out of step with the current reality on internet gambling,” said Gainsbury. “It was created in 2001, which is just a lifetime ago in terms of where internet gambling was then.”

Gainsbury, who sent a submission to the review, believes there isn’t a lot of political will to move on online gambling. She thinks the government was spooked by the politically damaging pokies campaign, and doesn’t want to pick any more fights with powerful lobby groups.

Livingstone says games like Slotomania are pretty much unregulated — the sudden convergence of gambling and social media could cause major problems.

“The danger in my mind is it becomes very difficult, particularly for young people, to discriminate between what is simply a bit of fun and something that can end up costing quite a lot of money,” he said. “In a sense this is grooming them for real-world gambling where they will lose a lot more money, a lot more quickly than they think.”

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Peter Fray
Peter Fray
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