Tag Archives: poker machines

Coles wants $1 maximum bets for pokies – so why won’t the pokie-makers play ball?

The Conversation

Charles Livingstone, Monash University

Wesfarmers, operator of Coles and other retail brands, reportedly wants to pursue harm-prevention modifications to its poker machines. It has asked five pokie manufacturers, including Aristocrat Leisure, for help in trying out games with a maximum bet of A$1.

All have refused, apparently citing costs.

Like Woolworths, Coles – which operates the pokies through its hotels – is a major player in this space. It operates more than 3,000 machines in Queensland and South Australia. But, seemingly unlike Woolworths, Coles is concerned about these machines’ potential for harm.

A true money-spinner

Woolworths, through its subsidiary ALH Limited, operates more than 12,000 pokies across Australia. Net revenue from these is around $1.1 billion per year; the business is a 75:25 partnership with the Mathieson family’s businesses.

Coles’ revenue from its machines is much lower – around $185 million.

Pokies are great money-spinners for hotels, clubs and casinos in Australia, and increasingly internationally. But the technology behind them is not particularly novel. Contemporary pokies are quite straightforward computers, albeit housed in a novel case and with a customised display.

What makes them different is their software, which uses well-established psychological principles to make them “attractive” to punters.

But the features that make pokies “attractive” also make them addictive. The Productivity Commission has estimated that 42% of pokie revenue comes from people with a serious pokie addiction – and another 20% comes from those with a developing habit.

Manufacturers have acted in the past

Given pokies’ computerised basis, the manufacturers’ refusal to work with Coles is remarkable.

Like all companies in the business, Aristocrat Leisure prides itself on its innovative capacity. Through its then-European subsidiary Aristocrat Lotteries, Aristocrat developed and provided the Multix game terminal to Norsk Tipping, the Norwegian gambling operator, from 2008 onwards. Aristocrat sold the business in 2014.

The interesting aspect of the Multix terminal is that it was intended to provide a much safer and less harmful slot-machine-like product. These replaced the existing slots, which the Norwegian government nationalised and withdrew from operation in July 2007.

The machine provides a platform for multiple games, imposes a statutory limit on how much people can spend, and operates on an account-only basis. Users can track spending and reduce their daily limits if they want to be careful. Thus, it incorporates a host of consumer safety and harm minimisation/prevention measures.

Closer to home, the Victorian government introduced a reduced maximum bet limit and reduced load-up limits in 2009. Aristocrat, along with other manufacturers, had to find a solution for these new requirements. That wasn’t very difficult.

The game software required some alteration, and cabinet artwork had to be reconfigured in some cases. It cost somewhere in the tens of millions, but there were no publicly aired complaints and it was implemented smoothly. For a business that makes around $2.6 billion a year, that was small change.

The Tasmanian pokie industry has recently undergone a similar transformation, again without too much fuss.

Perhaps the reduction from $10 bets to $5 bets didn’t threaten the industry too much. And reducing the load-up limit from $9,949 to $1,000 in Victoria was a no-brainer.

Why won’t the manufacturers play ball?

There may be many reasons for the manufacturers’ refusal to agree to Coles’ request, but it is clear the vanguard for the Australian pokie industry lies in New South Wales – particularly with lobby group ClubsNSW. Club businesses operate 70% of NSW’s 95,000 pokies. These made their operators $5.8 billion in 2014-15, of which the clubs made around $4 billion.

Pokie games are upgraded regularly, and the machines themselves tend to be turned over every five years or so. Even putting aside maintenance and upgrades, selling around 20,000 machines every year to clubs and pubs in NSW would earn the manufacturers around $500 million. So, losing a share of that business would be something to avoid.

A successful trial of $1 bets could demonstrate that pokie harm could be reduced. If that occurred, the revenue model for NSW club businesses that rely heavily on pokie revenue would be rattled.

When the Productivity Commission recommended $1 maximum bets and pre-commitment as likely good responses to pokie addiction and harm, the gambling industry, led by ClubsNSW, railed against them as unproven and experimental.

That wasn’t true, even then, as the industry well knows – it funded the original research. But why not seize the opportunity to acquire some more useful evidence through a trial?

The harm pokies cause is widespread and tends to affect those already under significant stress. Moving to $1 bets is a good first step toward reducing this harm, and Coles acknowledges it can’t continue in this business unless it finds a way to reduce avoidable harm.

There are many other ways to limit harm, however, as the manufacturers know full well. They’ve been innovating to make their products as “attractive” as possible for the last 100 years or so.

If they wanted to, they could also lead the way in making machines safe, and fun. Perhaps the super profits might be wound back. The operators would be able to claim they really do care about their customers’ wellbeing.

Clearly, that’s a claim Coles is keen to make. The manufacturers? Maybe not so much.

The ConversationCharles Livingstone, Senior Lecturer, School of Public Health and Preventive Medicine, Monash University

This article was originally published on The Conversation. (Reblogged by permission). Read the original article.

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Gambling on pokies is like tobacco – no amount of it is safe

The Conversation

Francis Markham, Australian National University; Bruce Doran, Australian National University, and Martin Young

Is occasional gambling safe? Our study found that gambling is like smoking: the more you gamble, the greater your risk of developing problems. There is no safe level of gambling, only risks that increase as you lose more money – even at relatively low levels of losses.

We examined large, nationally representative surveys in Australia, Canada, Finland and Norway, and found that no amount of gambling was safe.

In the graph below, we show the average relationship between money lost and problem gambling index scores in the four surveys. Gambling losses are shown on the x-axes, with problem gambling risk on the y-axes.

Crucially, there is no safe region on these curves where problems do not increase as you lose more money. This is different to alcohol, where moderate consumption may reduce your risk of mortality.

The relationships between gambling losses and problem gambling risk in four countries.
http://doi.org/10.1111/add.13178

We have known for some time that some forms of gambling are more risky than others. Therefore, we also examined the relationships between losses and risk for different gambling activities.

Electronic gaming machines – known as pokies in Australia, video lottery terminals in Canada and slot machines in the US – were the most strongly associated with problem gambling in every country in our study.

In Australia, there was also a clear relationship between money lost betting on races and problem gambling. Lotteries were also associated with problem gambling in Canada and Finland and sports betting was associated with problem gambling in Norway. There was no evidence of low-risk thresholds for any gambling activity.

Contradicting conventional wisdom

These findings are important because they contradict the conventional wisdom that there is a threshold below which gambling is safe. According to this view, gambling is much like alcohol, in that only after a particular consumption level has been reached does risk mount. It is only after heavy consumption (or losses) that problems supposedly occur.

As a case in point, the axiom that “safe levels of gambling participation are possible” is one of the six fundamental assumptions of the influential Reno Model, which describes itself as “a science-based framework for responsible gambling”.

This claim that safe levels of gambling are possible turns out to rest on two erroneous arguments. The first is an empirical case that supposedly documents low-risk thresholds for gambling.

The most prominent study of this kind found evidence for a “J-shaped” relationship between problem gambling risk and gambling expenditure. A J-shaped curve describes the situation where risk starts off very low and increases significantly only at higher levels of gambling losses (see panel A in the the graph below).

Unfortunately, this conclusion was based on an incorrectly scaled graph. In panel A, the range of money represented by each data point widens from $50 to $500, but the dots are still placed with equal distances apart. When the x-axis is correctly rescaled, a linear rather than J-shaped relationship emerges (see panel B).

The evidence base for ‘safe levels of gambling’ appears to rely on a flawed interpretation of data.
http://doi.org10.1111/j.1360-0443.2006.01392.x

The second argument sometimes made to support the idea of safe gambling is based on the anecdotal observation that some people do gamble large amounts without becoming problem gamblers. By extension, the argument goes, problem gamblers need to become like these responsible gamblers who can gamble without adverse impacts.

However, the existence of such individuals does not imply that gambling at that intensity is safe at the population level. For example, while some regular smokers may live to 100, this does not mean that smoking is safe or that we should promote “responsible smoking”. Such an argument fundamentally misunderstands the concept of risk.

What now?

Our findings have two important implications for regulation.

First, public information about gambling should not imply that moderate gambling is risk-free. Guidelines and other forms of public awareness campaigning should make it clear that, for poker machine gambling in particular, every increase in consumption increases the level of risk.

As a recent article in the Journal of the American Medical Association put it:

Traditional messaging oriented around “reduce, restrict, limit, ban” may make sense for determinants that have a linear relationship with health outcomes, as with tobacco and mortality.

Our research suggests that this kind of public health messaging should also apply to poker machine gambling.

The second implication relates to the “responsible gambling” model of regulation. This model rests on the notion that gambling in moderation is safe. In contrast, our research suggests that gambling at any level can be associated with harm. And the more money lost, the greater the risk of harm.

There is no threshold below which consumption does not increase the risk of harm. Harm-minimisation policies should seek to reduce the poker machine gambling of everyone, not just problem gamblers.

The ConversationFrancis Markham, PhD Candidate, The Fenner School of Environment and Society, Australian National University; Bruce Doran, Senior Lecturer (Geographic Information Systems), Fenner School of Environment and Society, Australian National University, and Martin Young, Associate Professor, Centre for Gambling Education and Research

This article was originally published on The Conversation. (Reblogged by permission). Read the original article.

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Poker machines and the law: when is a win not a win?

The Conversation

Cristy Clark

If I took all of the money out of your wallet, you’d probably feel as though you’d lost something – wouldn’t you? Now imagine instead that I only took 80% of your money. Would you feel as though you had “won” the remaining 20%?

What if I tried to convince you that you had actually benefited from this transaction by playing happy music and letting off a few firecrackers?

This thought experiment might help you to get your head around a proposed legal action by law firm Maurice Blackburn that plans to use Australian consumer law to argue that poker machine operators are engaging in misleading and deceptive conduct to entice gamblers into using poker machines.

Misleading and deceptive conduct is prohibited by Section 18 of the Australian Consumer Law. The central test for this is whether the conduct is likely to mislead or deceive consumers having regard to all the circumstances. To apply this test, you need to identity both the “conduct” and the “relevant class of consumers”.

In this particular case, the class of consumers might be “gamblers”. Or, it might focus more specifically on “novice gamblers” or “problem gamblers”.

Maurice Blackburn seems to have identified a range of potential conduct that it would like to target in its action. One that particularly stands out is the technique known as “losses disguised as wins”. This is where a poker machine enables players to bet on more than one line and a minor win on one of these lines sets off a graphics and sound display that indicates a “win” when, in fact, the player has lost most of their money.

Applying the law to poker machines

The nice thing about consumer law is that it relies on fairly common-sense questions. So, the court would basically ask: if a poker machine displays a series of flashing symbols and music associated with winning and makes a chiming sound indicating that it is counting up winnings, would an ordinary and reasonable (novice) gambler be misled or deceived into thinking that they had won something despite having actually lost money?

Further inquiries or closer attention to detail that could enable a person to discover their error is not particularly relevant to this test. Also, the literal truth can be legally misleading, because the law recognises that humans do not behave rationally and tend to form an opinion in response to their overall impression of conduct.

In this case, for example, it might be argued that gamblers pay more attention to the flashing symbols and music than they do to their credit balance.

Previous cases give some idea of how the courts have applied this test. In ACCC v TPG Internet in 2013, the High Court found that TPG Internet had misled consumers by advertising “Unlimited ADSL2+ for $29.95 per month” when this price was available only to customers who bundled broadband with a home phone service.

The important detail was that TPG’s advertisements actually contained an explanation of this condition, but it was displayed less prominently than the advertised deal.

The High Court found that the attention given to advertising material by an ordinary and reasonable person may well be “perfunctory” and, therefore, many will only absorb the “general thrust”. The court also emphasised that it was enough if consumers were sufficiently misled to engage further with the company, even if they subsequently understood the true nature of the offer and chose not to purchase anything.

The TPG case was followed by the Federal Court in ACCC v Coles Supermarkets in 2014. In this case, the Australian Competition and Consumer Commission (ACCC) successfully alleged that Coles had misled consumers by advertising its reheated frozen par-baked bread with the words, “baked today, sold today” and “freshly baked”. This finding was made despite par-baked bread being able to be truthfully described as having been “baked”, and that Coles had detailed its par-baking method on its website.

Once again, the court emphasised the importance of considering both the context and the dominant message of the conduct.

Forming an argument

So, how could Maurice Blackburn possibly prove that gamblers might be misled by the “losses disguised as wins” technique?

It might draw on recent Canadian research which found that the flashing symbols and music that accompany “losses disguised as wins” trigger similar arousal levels in novice gamblers as real wins do – and that arousal is a key reinforcer in gambling behaviour.

In short, research seems to have demonstrated that novice gamblers do pay more attention to flashing symbols and music than they do to their credit balance. Perhaps unsurprisingly, these bright, loud messages appear to dominate.

The ConversationCristy Clark, Lecturer in Law

This article was originally published on The Conversation. (Reblogged by permission). Read the original article.
 

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15 things you should know about Australia’s love affair with pokies

The Conversation

Francis Markham, Australian National University and Martin Young

  • Poker machines were legalised in New South Wales in 1956; the ACT in 1976; Victoria and Queensland in 1991; South Australia in 1992; Tasmania in 1997; and the Northern Territory in 1998. They are banned in Western Australia, except in the casino.
  • There are 196,900 poker machines in Australia; 95,012 are in NSW, with a further 46,663 in Queensland and 28,860 in Victoria. In comparison, there are just 16,440 pokies in New Zealand and 97,161 in Canada.
  • Australia has the most poker machines per person of any country in the world (excluding gambling destinations dominated by the casino industry like Macau and Monaco), with one machine for every 114 people.
  • In 2013–14, Australians lost A$11 billion on poker machines in clubs and hotels. A further A$1.5 billion is estimated to have been lost on poker machines in casinos. That’s a total of around A$700 per adult per year.
  • Australians lose more on gambling than any other nation, mostly because of poker machines. In 2014, Australians lost more than US$1100 per capita, compared with less than US$600 in New Zealand and the US, and less than US$500 in Canada and Britain.
  • In 2013–14, state and territory governments raised A$3.2 billion in taxes on poker machines in clubs and hotels – that’s 5% of state-levied tax revenue.
  • Between 20% and 30% of Australian adults play poker machines at least once a year (except in Western Australia). The 4% who play weekly are conservatively estimated to lose an average of A$7000 to A$8000 per year.
  • It’s easy to lose A$1500 per hour playing poker machines at their maximum bet size and maximum speed. Because poker machine returns are unpredictable over the short term, gamblers playing in this way could lose a greater or lesser amount.

It’s easy to lose around $1500 an hour on poker machines.
AAP/Dan Peled

  • The average poker machine in clubs and hotels makes A$56,000 per year. Some machines are much more profitable, with pokies in several venues in Victoria making more than A$200,000 each.
  • Poker machines have minted a select few super rich, such as James Packer (net worth A$6,080 million), Len Ainsworth (net worth A$1,840 million), Bruce Mathieson (net worth A$1,160 million), Arthur Laundy (net worth A$310 million) and the Farrell family (net worth A$275 million).
  • Poker machines are concentrated in Australia’s poorest suburbs. In Western Sydney’s relatively impoverished Fairfield, each adult lost an average of A$2340 on the pokies in 2010-11; in wealthy Ku-ring-gai and Willoughby, poker machine losses were just A$270 per adult.
  • In 2010, the Productivity Commission estimated that there were around 115,000 “problem gamblers” in Australia, who account for 40% of losses on poker machines. People who live closer to poker machine venues are more likely to experience gambling problems.
  • Around 30% of people who play poker machines weekly are problem gamblers or are “at risk” of becoming problem gamblers. In WA, where poker machines are only allowed inside the casino, the rate of problem gambling is one-third of that in the rest of the country.
  • Aside from banning poker machines outside casinos, the most promising harm-minimisation measures include reducing maximum bet limits and requiring gamblers to set a limit before they begin playing (pre-commitment).
  • Poker machine reform is popular in Australia: 70% of people agree that gambling should be more tightly controlled and 74% agree that people should be limited to spending an amount they nominate before they start gambling.

This article is part of our special package on poker machines. See the other articles here:

Bright lights, big losses: how poker machines create addicts and rob them blind

How real are claims of poker machine community benefits?

The ConversationFrancis Markham, PhD Candidate, The Fenner School of Environment and Society, Australian National University and Martin Young, Associate Professor, Centre for Gambling Education and Research

This article was originally published on The Conversation. (Reblogged by permission). Read the original article.
 

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Bright lights, big losses: how poker machines create addicts and rob them blind

The Conversation

Charles Livingstone, Monash University

Australians lose A$20 billion on gambling every year, $11 billion of which goes on poker machines in pubs and clubs. Why, then, are pokies so attractive? And why do we spend so much on them?

Ubiquity is one reason. The high intensity – the rapid speed of operation and relatively high stakes of betting up to $10 per “spin” – is another.

But there’s also a more insidious mechanism at work here: the basic characteristics of poker machines, combined with constantly refined game features, stimulate the brain in a way that, in many cases, leads to addiction with symptoms similar to those associated with cocaine use.

Poker machines cultivate addiction by teaching the brain to associate the sounds and flashing lights that are displayed when a punter “wins” with pleasure. And since the pattern of wins, or rewards, is random, the “reinforcement” of the link between the stimuli and pleasure is much stronger than if it could be predicted.

Into the machine

Poker machines, invented in the late 19th century, were originally mechanical, usually with three reels and a fixed and limited number of symbols available for display on the win line. Contemporary pokies are fully computerised. Usually housed in a retro-designed box, they refer to the old-fashioned simplicity of their predecessors. But they are as chalk and cheese compared to their mechanical forebears.

Today, the gambling machine industry employs an army of engineers, programmers, composers and graphic designers to produce increasingly sophisticated games and machines, with more ways of persuading people to part with their cash.

At the heart of the modern pokie is a series of random number generators. These are constantly operating and, when the button is pushed, the answer is instantly known. Each number corresponds to a “reel” symbol – pokies still appear to have reels that roll around when the button is pushed, but this is an illusion.

In Australia, unlike some other jurisdictions, the order of symbols on each of the visual reels must be constant, but the number of symbols can be different on each reel. This includes winning symbols.

Old, mechanical pokies had a limited number of “stops” because of the limitations of physical space. Electronic pokies have no such limitations. And the difference is profound. A mechanical pokie with three reels, 20 symbols on each reel, including one prize symbol, would have winning odds of 1/20×1/20×1/20, or one in 8,000.

A contemporary pokie will often have major prize odds of one in 10 million or more. The number of symbols on each reel is not limited by physical space, so the odds of a major win can be tweaked by limiting the number of winning symbols on certain reels.

A five-reel game may have two winning symbols on each of the first three reels, each of 60 symbols in total. The last two reels may have only one winning symbol, with 80 total symbols. This configuration would produce odds of 2/60×2/60×2/60×1/80×1/80, equal to one in 230,400,000.

This maths is at the heart of machine design. A slot game is just a spreadsheet. But it’s a spreadsheet with a lot of enhancements.

Tricking the brain

These configurations will regularly produce “near misses”. These occur when winning symbols appear on some lines, but not all. Experimental work has revealed that the brain stimulus produced by such “near misses” can be almost as significant as those produced by a win. The level of reinforcement is thus dramatically increased, without any need for the machine’s operator to actually pay out.

Current pokies also allow multiline bets, whereby users can select all available lines to bet on in a single spin. Mechanical machines were limited to a single line of three reels. Pokies now allow users to bet on 50 or more lines, configured from the video display of five reels and three lines.

The line across the middle is one such line, as are those above and below that line. But patterns of symbols are available in bewildering arrangements, combining lines and reels and multiplying the minimum bet by many times. A one-cent credit value game can thus be configured to allow at least a 50-cent minimum bet per spin if 50 lines are selected.

Most regular users report that their preferred style of use is “mini-max” – that is, the minimum bet with maximum lines. In a strange way, this reveals risk-averse behaviour. There’s nothing worse than seeing a win come up on a line you’re not playing, as a regular pokie user once explained to me.

How multiline poker machines work

But regular users will also increase their stakes when they can. This is to provide for the possibility of bigger payouts, or in some cases because they believe – incorrectly – that doing so will increase the chances of a win.

Pokies also allow the credits bet per line to be multiplied, often by up to 20 times. Thus, a one-cent machine becomes a device capable of allowing bets of $10 per spin. Each spin can take as little as three seconds.

For this reason, the Productivity Commission calculated that such machines could easily average takings of up to $1,200 per hour. But this is an average, and it’s not uncommon to observe people spending $400 or more on poker machines in as little as ten minutes.

Machines that accept banknotes allow significant amounts to be “loaded up”. In New South Wales, pub and club pokies can accept $7,500 at any one time.

The other capability provided by multiline poker machines is a phenomenon known as “losses disguised as wins”. This allows users to experience a reward from the game even when they’ve actually lost money.

If you bet on each of 50 lines at one cent per line and win a minor prize on one line (say, 20 credits), for instance, the machine will provide suitable reinforcement – sounds, lights and sometimes a congratulatory message – and acknowledge the credits won. But you’ve actually lost 30 cents.

This allows the amount of reinforcement delivered to the user to be magnified significantly – often doubled. Thus, the user feels like they’re winning quite regularly. In fact, they’re losing.

So what does all this stimulation do? Brain chemicals, particularly dopamine, are central to this process. Brain imaging has shown in recent years that the pattern of dopamine release that occurs during a gambling session is strikingly similar to that of cocaine and other addictions.

Poker machines are essentially addiction machines that have been developed over a long period of time to be as attractive to their users as drugs are to theirs.

This article is part of our special package on poker machines. See the other articles here:

15 things you should know about Australia’s love affair with pokies

How real are claims of poker machine community benefits?

The ConversationCharles Livingstone, Senior Lecturer, School of Public Health and Preventive Medicine, Monash University

This article was originally published on The Conversation. (Reblogged by permission). Read the original article.

 

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Online gambling review should not ignore the problems in our own backyard

The Conversation

Charles Livingstone, Monash University

As those who watch sport will attest, online gambling is seemingly ubiquitous. Certainly advertising for it is.

In Australia, the regulation of gambling services is a matter for state governments. However, the federal government has responsibility for telecommunications, which includes the internet. So, there is some division of responsibility for online gambling. This has arguably left the area less well regulated than it might be.

This is one ostensible reason the federal government has announced a review of the online gambling industry.

Background

The current federal legislation is the Interactive Gambling Act. It allows Australian operators to offer online betting. It also seeks to prohibit the provision of casino-style gambling – roulette, slot machines – to Australian residents, but doesn’t prohibit Australians from using such services.

This means that Australian-registered services are not allowed to offer some gambling services, but are permitted to take online bets.

The most recent review of the act reported in 2012. It concluded that it would be useful to consider a trial of some online gambling – suggesting online poker, which is thought to be a less harmful form of gambling than slots or other casino-style gambling.

The review also recommended a host of harm-minimisation measures be introduced into the online gambling arena. These included a pre-commitment system, an effective self-exclusion system and much-improved practices among bookies. The review recommended that better enforcement of offshore providers be implemented, although effective regulation of extra-jurisdictional gambling providers is likely to be futile.

Nonetheless, the review suggested that banking institutions should be rewarded for blocking transactions between Australians and nominated unlawful gambling providers. This may have some effect, although mainstream banking institutions provide only some of the plethora of ways of moving money around the world.

A recent Financial Counselling Australia report highlighted a number of what can only be regarded as very dubious practices among prominent bookmakers operating under Australian regulation. These include extending unsolicited lines of credit, failure to pay winnings on request and repeated inducements to gamble.

These practices are not caught by current consumer protections under credit law or gambling regulation. Bookies also appear to regularly share data on their customers, which is likely to breach privacy legislation.

What this review will focus on

Media reports early this month – when Social Services Minister Scott Morrison confirmed that a review would be held – appeared to focus on a range of the issues highlighted by the 2013 review, including consumer protection.

However, the terms of reference headlined this new review as being into the:

Impact of Illegal Offshore Wagering.

In fairness, one of the terms of reference of the review is concerned with increasing consumer protection.

It will be a quick review. The final report must be with Morrison by late December. Submissions will be sought from industry and the public.

Those concerned with the growing harms of online gambling – and particularly sports betting – will be disappointed with the terms of this review. There are a number of pressing concerns that, from a consumer protection perspective, might have ranked higher in both the terms of reference and Morrison’s messaging.

Online bookies are competing for market share in Australia, where the operators now include global giants such as the British bookies Ladbrokes and William Hill. Their practices have attracted considerable criticism as the scramble for revenue escalates.

Troubling practices include the continuing provision of credit, the pushing of boundaries on such issues as the prohibition of online in-play betting, and blanket advertising of their wares – including to children during sporting events – and the aggressive branding of sporting teams with gambling providers.

What is Australia’s real gambling problem?

Sports betting in Australia is likely to generate revenue – that is, player losses – of around A$750 million in 2015-16. It is the fastest-growing gambling sector and is likely to produce a new wave of gambling problems among the young men to whom these products are marketed.

Although modest in comparison to poker machines – which generated around $11 billion in losses in 2014-15 – it needs to be effectively regulated if Australia is to avoid adding to the already significant burden of gambling harm. The good news is that preventing this harm is actually quite straightforward.

Unfortunately, substantial and powerful segments of the Australian body politic are now closely affected by the fortunes of the bookies. These include Packer interests via CrownBet, the AFL’s official wagering partner. State and territory treasuries are also abundantly interested in maintaining the flow of money.

It is worth asking if the offshore online gambling sector is Australia’s most pressing gambling problem. Undoubtedly, some Australians get into a lot of trouble gambling online. Most of them will fall prey to bookies already licensed in Australia and offering services lawfully. Some will end up in trouble because of offshore sites offering unobtainable services such as online slots or roulette.

Overall, the market going to such offshore providers is estimated at around $1 billion, although there is no way of verifying this under current circumstances.

But, at least 75% of those with a gambling problem have it because of poker machines in clubs or pubs. We see little concern from the government about this group.

And, even in the online gambling environment, there appears to be little concern about first cleaning up our own backyard. The 2013 review made some very sensible recommendations about harm minimisation, including restricting or prohibiting credit betting. This is clearly a source of considerable harm to many. And prohibiting credit betting is in fact current federal government policy.

The Financial Counselling Australia report provided ample evidence of the excesses of the Australian online gambling industry. A recent whistleblower article from within the industry confirmed these concerns. These need to be a major focus of any review of the Interactive Gambling Act and other relevant federal legislation, including the regulation of advertising and banking services.

But if the renewed urgency behind this review is to highlight the “dangers” of offshore online gambling providers, then the bookies will be arguing as hard as they can that the solution is to allow them to offer the same services from Australia. After all, the internet is notoriously difficult to regulate and service providers licensed in Australia would be expected to observe Australian regulation.

It is important to ensure gambling is properly regulated. But it is probably better to address the main game first, or at least simultaneously. That involves making sure that current providers are adhering to the best possible harm-minimisation practice.

The 2013 review set up a clear set of goals for that. We don’t need another review to know what needs to be done, or to do it.

The ConversationCharles Livingstone, Senior Lecturer, School of Public Health and Preventive Medicine, Monash University

This article was originally published on The Conversation. (Reblogged by permission). Read the original article.
 

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