Social casino games in the spotlight

By Charlotte Lee Updated
Old takes on new in the world of online gambling

The rights to Australia’s online gambling sector could be handed to First Australians and returned soldiers under a new proposal.

Sky News reports that currently, billions of dollars are leaving the country through offshore casinos without any taxation flowing back to Australia.

Speaking with Sky News, federal MP Bob Katter said the proposal was coming from the “real community”

“It would return money to us so we can look after ourselves,” he said.

Social casinos are a rising power in the casino industry.

Big Fish Casinos is one example of a non traditional gambling medium that is rising.

They are part of an unregulated grey area known as “social casinos”, the ABC reports.

The app-based products simulate online casino games such as blackjack, roulette and slot machines, but players can never cash out their virtual chips for money.

While social casinos are relatively new, it has become a multibillion-dollar industry.

Australians are the world’s biggest gambling loses per capita, losing more than $1,200 per year.

According to the Victorian Responsible Gambling Foundation, Australians spent a total of $25 billion on gambling in 2017-18.

Dr Christopher Hunt from the University of Sydney’s Gambling Treatment Clinic said social casino games appeared to be increasing rapidly in Australia, while participation in traditional forms of gambling was declining rapidly.

“Some of these games are being played by people in their spare time, like on the bus or on their way to work,” he said.

“A lot of companies that have previously focused on traditional forms of gambling are moving into more internet-based and social media types of gambling.”

In 2017, Australian gaming giant Aristocrat bought the Seattle-based Big Fish Games digital arm for $1.3 billion.

Online casino games are illegal in Australia, but social casinos fall into a grey area.

They are classified as entertainment, so are not subject to any gambling regulations.

Independent Federal MP Andrew Wilkie wants that changed, and said he would push the Federal Government to act this year.

“This is gambling and anyone who tries to tell you it’s not is wrong,” Mr Wilkie said.

“In my opinion, these should be regulated in Australia in exactly the same way as mainstream online casino games and that’s to ban them.”

Aristocrat refused to comment, instead referring the ABC to the International Social Games Association (ISGA).

ISGA chief executive Luc Delaney argued social casino games were “purely for entertainment”.

Mr Delaney said despite heavy scrutiny in recent times, no new regulation of social casino-themed games had been adopted – either under gambling or consumer protection laws.

“That’s because casino-themed social games offer no opportunity to win money, or anything of value.

“Video games, including social games, fall under a range of consumer protection regulations as do all forms of digital entertainment, which we believe is appropriate.”

Big Fish could be hooked for virtual chips

Australian gaming technology firm Aristocrat Leisure has found itself embroiled in a class action lawsuit in the United States last year over Big Fish Games’ virtual chips.

Aristocrat bought Big Fish for $1.3 billion, with the gaming giant confirming a lawsuit had been filed in the US District Court for the Western District of Washington.

The complaint, filed by Manasa Thimmegowda, claimed, “that certain games Big Fish Games offers for play are games of chance that are prohibited by Washington law.”

Thimmegowda was a Big Fish Casino player who reportedly lost over $3,000 after “regularly paying real money to purchase virtual chips,” according to The Sydney Morning Herald.

She is seeking “to recover her losses and to obtain the appropriate relief” for herself “a class of similarly situated individuals”.

Thimmegowda’s lawsuit comes less than a year after the Ninth Circuit of the US Court of Appeals ruled that Big Fish’s free-to-play online games such as virtual blackjack, poker and slot machines, have been found to be “illegal online gambling” in the state of Washington.

In the ruling, the appeals court said Big Fish’s virtual chips, which are required to play in Big Fish’s suite of games, “extended the privilege of playing” in the company’s series of interactive social games, which means that it falls under the Washington state law’s definition of a “thing of value”.

In the original lawsuit that Cheryl Kater filed against Big Fish Games’ then parent company Churchill Downs, Kater claims that she bought – and lost – more than $1,000 worth of Big Fish Casino virtual chips.

While they don’t have monetary value, the chips are required to play the games. If a player runs out of them, they will either need to purchase more or wait until the game offers free chips.

Kater wanted to recover the value of her lost chips, arguing that those chips represent “something of value”.

This latest lawsuit is not too dissimilar to what Kater’s grievance. In the appeals court ruling, the court said Big Fish’s virtual chips “extended the privilege of playing” and thus falls under the law’s definition of a “thing of value”.

Washington state law defines gambling as “the staking or risking something of value upon the outcome of a contest of chance or a future contingent event not under the person’s control or influence, upon an agreement or understanding that the person or someone will receive something of value in the event of a certain outcome.”

Aristocrat said none of its parties or Big Fish had been served with this latest complaint from Thimmegowda, but it “intends to vigorously defend the action.”

Aristocrat’s biggest players moving to the US

A number of Aristocrat’s senior management executives have relocated from Australia to the United States given the group’s largest customers are based in that region.

Managing director of Asia Pacific Aristocrat Leisure Chris Rowe has said that the change has not and will not impact the company’s operations in Asia.

“I don’t see any impact from the movement of management. We are still very much an Australian company, listed on the Australian Stock Exchange,” he said.

A number of new products and plans were introduced to the Macau market at the

MGS Entertainment Show recently.

Gross gaming revenue from poker machines in the Macau market stood at US$1.38 billion in the first nine months of 2018, up 16.8 per cent in year-on-year terms according to the city’s gaming regulator.

One of the new products exhibited at the MGS Entertainment Show was ‘Gold Stacks 88’.

The game has already been launched in the United States and has been brought into the Asia Pacific market with optimised currency, languages and jackpots.

Another product that was showcased at the trade show was ‘Spin It Grand’. It follows up on the popular ‘Super Wheel Blast’ and uses a wheel mechanic to deliver credit prizes.

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