Gambling Commission considering social gaming regulation
Concerns over high player spend prompting move to look at legislation for sector.
The UK Gambling Commission has reportedly launched an investigation into social gaming, examining whether the sector should be regulated in a similar fashion to real-money gambling.
Financial news site This is Money reports that amounts spent by players on virtual currency, with no way of verifying player age, has prompted the Commission’s move, with its corporate affairs manager John Travers telling the site: “The key question is, is it gambling or not?
“We are monitoring developments and assessing any wider implications for licensing objectives,’ he explained, saying that social gaming was “at the perimeter” of current legislation.
Social gambling games are currently unregulated, as players cannot win real money when playing such products, but the fact that punters can spend large sums on the games has led to calls for greater control over the products, after one player spent a reported US$13,000 (£8,500) in three months, according to This is Money.
The current lack of regulation has seen operators and affiliates view social as a gateway into regulated markets which allows them to bypass the controls and costs imposed by regulation, including Barcelona-based affiliate Cmedia, which moved into the social space by launching Soda Poker on Facebook.
At the time of Soda Poker’s launch the company’s business development director Oliver Crane told eGR: “Government regulations have made affiliate marketing tougher and tougher, so developing a B2C model alongside our B2B model seemed to be the best way for us to make the most out of our position while allowing us to offer separate products to separate player profiles.
“Standard casino and poker operation is incredibly tough, and as we have the critical mass and traffic for it, we decided to go into social, which allows us to operate in our key markets without worrying about the regulatory issues,” Crane explained.
Analyst Ivor Jones of Numis Securities told This is Money that regulation of the sector would end such launches, and would severely impact revenues for social operators and Facebook: “If regulators conclude that such games with gambling characteristics should be regulated, it will be difficult for them to continue to be offered in many places, which would financially hurt the games operators and Facebook.”
The news follows last month’s announcement that Japan’s Consumer Affairs Agency is to crack down on operators offering a game called ‘complete gacha’, in which customers can win virtual goods after paying 300 Yen (£2.33) to play the game. The Agency, according to Japanese newspaper Yomiuri Shimbun, will contact companies through industry groups to request that they stop offering the game, before sending cease-and-desist orders to operators which refuse to comply.