Is the Prevalence of Gambling a problem and what problems do we expect in the future as children are exposed at an early age?
With the country in a lockdown people have been spending far more time at home than ever before. After seeing a lot of new stories about how prevalent gambling in the UK has become I thought it about time to ask if it was a problem or not. However, when you dig deeper, there is far more to it than you might expect.
The state of Gambling in the UK
Let’s just look at how much the gambling industry makes in the UK. In the year April 2019 to March 2020 the gambling commission reported a £10.2bn (£10,200,000,000 to put that in perspective) gambling yield which is the profit they make after paying out winnings but before operation costs. (Industry Statistics – November 2020 – Gambling Commission). It should be noted that this just covers the profits that are shared with the gambling commission by the companies it regulates. This is also not including the lottery which is by far the biggest form of gambling in the UK with 30% of the UK population taking part in the lottery in 2019. That works out at, roughly, 20.4 million people. Gambling statistics 2020: Learn more about how Brits gamble | Finder.
This value above is actually less than in previous years partially due to a maximum bet restriction which came into place in 2019 which reduced the maximum allowable bet from £100 to £2 on fixed-odds betting terminals (referring to electronic betting machines ie electronic roulette or poker etc.
The gambling commission currently estimates that 0.7% of the population are problem gamblers which would mean approximately 476,000 people would have gambling addiction. Some others do report a figure much higher than this with YouGov reporting it at 2.7%. One of the more concerning problems is the discrimination of the issue among the demographic of the country. The black and other (including mixed) ethnic groups have the highest prevalence of gambling addiction as a percentage of the individual groups. The study also showed that the unemployed or economically inactive have the highest gambling addiction prevalence along with the North East and West Midlands areas of the country. Gambling behaviour in Great Britain 2016 (gamblingcommission.gov.uk)
Currently, the UK is the leader in online gambling; a title we likely should not be proud of. A report by the Edison Group showed that Europe is responsible for 54% of the worlds online gambling market of which a sizeable 15% is contributed by the UK alone. GamingSectorReport2019 (edisongroup.com). One of the biggest issues is the lack of controls over the online space. As TV adverts have been focusses on to prevent gambling related marketing before the watershed, (a time in the UK where the TV rules change to prevent children from being exposed to bad language, gambling, graphic/violent shows etc. In the UK it is 9pm), there are virtually no restrictions in adverts online, in mobile apps or social media. This has made the UK the home for online gambling. The gambling act from 2005 is one of the main reasons for this. The act made many things legal such as certain adverts on TV but also made it very simple and easy for online betting companies to get a license under the gambling commission. This act is one of the most freely obtainable industry regulations in Europe. The intention was to regulate the gambling to prevent addiction by making it easy to get a license to operate however this then flooded the UK with many online sites. A search on the gambling commission website shows that there are currently 719 active remote (online) licenses that they are regulating and worryingly this is increasing year on year Find licensees (gamblingcommission.gov.uk).
What about the effect in young people who are exposed to the unregistered gambling in video games. Are we setting them up to fail?
One of the biggest things flying under the radar at the moment is the prevalence of gambling (although the companies would disagree as argued by EA who say they are “surprise mechanics”) in the video game industry. By far the biggest issue is not only the loot boxes affecting younger and younger generations by making them accustomed to gambling, but the video game companies specifically target and manipulate their games in order to make sure that these mechanics are the only options. A good example is the FIFA ultimate team mode which requires you to purchase loot boxes (in the form of card packs) in order to play the mode. The latest controversy comes from a leaked internal document where they clearly state they are pushing people from other modes (ie the free to play modes) and into the ultimate team mode. fifa_doc.pdf (documentcloud.org).
On top of this gaming companies are also increasingly hiring psychologists and neuroscientists who are focussed around cognitive development in children. Recently income from in game purchases makes up the majority of revenue of many gaming companies. Activision Blizzard reported that over half of their yearly revenue is now microtransactions Over half of Activision Blizzard’s $7.16 billion yearly revenue came from microtransactions | TechSpot. If the money is good and outperforming all past revenue it will only get worse from here.
There have been many studies such as Gaming_and_Gambling_Report_Final.pdf (begambleaware.org) which have highlighted the links between loot boxes and microtransactions in games and gambling addiction. It is only reasonable to link the increase in “whales” in the video game industry to the targeting of gambling in games and manipulation of gameplay to encourage people to spend in addition to the original game price. Creating “pay walls” in order to prevent people from progressing (or making it increasingly difficult to progress) so they will purchase loot boxes, time savers or progress skips.
Whales - People who spend an extreme amount of money on video game in game purchases. They can often spend their whole salary on a single game. There are various other terms for low, medium and high spenders.
Many countries are researching this topic further and countries are putting additional laws in place to control and regulate these. Countries such as Japan, China, Netherlands and Belgium are already ahead in terms of regulation. The UK is currently debating on how to handle these concerns and the House of Lords has already discussed and proposed laws against companies using loot boxes.
If you feel the same about gambling targeting children I would recommend writing to your local MP or council and push them to do something. The best way to be impactful is to be consistent.
If you enjoyed reading this article please rate, share and check out some of our other posts!
Credit to Pixabay for title image
Credit to Epic games, EA and Activision Blizzard for the images