Not a level playing field…the rise of adult gaming centres
Against a backdrop of increasingly tightened rules for online slot sites, one corner of the gambling market is experiencing rapid growth.
Adult gaming centres housing physical slot machines are popping up all across the UK. Market leaders Admiral and Merkur now have £2 max spin slot machines in more than 500 UK High Street locations nationwide. With each machine taking an average of £30,500 per annum, revenues from the sector are high and growing – £381 million in the year to March 2023.
But there's a confusing disparity in treatment. Online gambling, including slots, has been the subject of much talk and action from regulators in recent years. Citing the risks of gambling harm and the need for greater customer protection, the focus has been on attacking online gambling harms.
The gaze of the UK Gambling Commission (UKGC) has been firmly fixed on slot sites, online casinos and betting sites, whilst their physical equivalents seem to be operating in a much less controlled environment. So why are adult gaming centres allowed to operate as almost a law unto themselves but online slot sites face even more ongoing restrictive regulation?
Flying under the radar
With much regulatory work ongoing around online slots and fixed odds betting terminals, it’s fair to say adult gaming centres have flown somewhat under the radar. Cash machines on-site give gamblers immediate access to their funds as they play, whilst free teas, coffees and snacks are straight out of the Las Vegas casino playbook. Licensing applications for new sites seem to be waved through by councils across the country, despite strong local opposition in some cases.
Yet Dr Matt Gaskell, head of the NHS Northern Gambling Service, said these machines pose serious risks to vulnerable players. Lower maximum stakes contribute to longer sessions, where large amounts of money can be lost.
“At low stakes, your money can last longer. Patients talk to me about losing long periods of time. It just adds to the preoccupation and the constant reinforcement and engagement with that product. And generally they leave you alone in those places.”
Alarmingly, the regulatory position seems to be heading the other way for adult gaming centres. Ministers are even considering whether punters should be allowed to pay with contactless debit cards.
A contrasting picture
The contrast with the approach to online slots is sharp. New protections aimed at younger players, including a stake limit, as well as financial vulnerability checks for all gamblers are among a raft of measures coming down the track for online operators. Measures to target bonuses, loyalty schemes and wagering requirements are also set to have a significant impact on online slot sites. These will no doubt impact revenues for online operators. Yet offline operators seem to be attracting much less scrutiny.
The government and the UKGC clearly have their sights set on the online sector. Even the mandatory RET (research, education and treatment) levy being proposed draws a distinction between online and offline operators, with proposals for a greater percentage of revenue to be levied for online operators.
It’s hard to build a case that online gambling is more harmful to vulnerable gamblers than the physical-world equivalent. Especially given the way some of the adult gaming centres are behaving, it could be argued that more should be done to control this emerging sector.
Players in adult gaming centres are, as noted by Dr. Gaskell, largely left to their own devices. The only real difference is that they are gambling away from home. The potential for gambling harms is the same, surely?
Drawing such stark distinctions between online and offline slots operators seems unfair and irrational. If regulators really are concerned about the impact of gambling harms, there is no justification for the difference in treatment between these two branches of the same market.
A chance to level things up
There is no doubt gambling in all its forms can result in real-world harms for a small minority of gamblers. But to regulate one side tightly whilst the other is allowed to grow without anything approaching the same level of scrutiny raises pertinent questions about the focus of regulators.
Although there is a clear case for better regulation online, the same is true of physical gambling locations. A just, fair and effective legal structure should tackle the problem on all fronts – not support with one hand what it punishes with the other.
As the adult gaming centre market continues to boom whilst the online sector awaits further draconian regulation, there are strong arguments for a second look at what could and should be done in the offline gambling world.