Social apps popularity challenge Australian law

But new poker and slot apps available on mobile devices are not considered gambling because they don’t allow players to directly wager or win real cash. Known collectively as “social casino games”, they simulate real life wagering and keep users playing, sharing, and using real money to purchase in-game currency, extra credits, expansions and gifts.

DoubleDown Casino, Slotomania, Zynga Poker, Betting Billionaire and MyVegas are but a few of a myriad of gambling-like apps on Facebook that are becoming increasingly popular. Slotomania was the most downloaded app on the iTunes Store in 2012.

And industry reports reveal that the worldwide social gambling market far exceeds real money online gambling with 170 million users per month versus 50 million real money users.

But there is still a mammoth discrepancy in terms of revenue: social gambling generates us$2 billion per month, while online gambling produces us$36 billion.

Although in the strictest sense it is not yet possible to gamble through these apps, some developers are finding ways to monetise gambling-like play. Virtual Gaming Worlds, a start-up based in Perth that operates the largely popular Facebook app Chumba Casino, bases its business model on sweepstakes.

This strategy profits from a loophole in Facebook’s policies, as some jurisdictions, such as the United States, don’t consider sweepstakes to be gambling. This loophole could be an entry into the Australian market if regulations loosen up.

The Facebook slot app myVegas, developed by PlayStudios for the MGM Grand – one of the biggest casinos in Las Vegas – allows players to cash-in their winnings in selected establishments for prizes that range from free meals to tickets for shows or swimming with dolphins.

Some of the slots available in myVegas are extensions of the casino’s branding strategies, with titles such as New York New York, Excalibur and Mirage. These use cartoonish designs that echo popular social gaming titles like Farmville and constantly invite you to add your Facebook friends to the player roster.

Other gambling-themed apps present inspirational narratives of personal achievement while interacting with the real world. Betting Billionaire promises a “chance to live the millionaire lifestyle you always dreamed of and try to become a Billionaire”.

Players achieves this by using “your knowledge of sporting events to bet big on Football, Tennis, Horse Racing, Basketball and more” and competing “against your friends to see who knows their stuff”. In the gameplay you can “Spend your winnings on the latest bling from cool 

cars to luxury homes”.

Like Chumba Casino, Betting Billionaire could very well benefit from the loopholes in Facebook’s policies concerning sweepstakes and profit from a large pool of would-be-gamblers.

The popularity of these apps has cultural and ethical implications in a country like Australia with a high incidence of problem gambling. And these are evident in the merging of the gambling and gaming industries.

The consolidation of the social casino industry has involved key industry players such as slot machine manufacturer IGT, which bought Double Down Interactive; WMS, which launched Lucky Cruise Social Casino, a social casino that operates on Facebook; and pokie machine giant Aristocrat, which acquired Product Madness, a top five operator of slot games on Facebook, with more than 500,000 daily active users.