A few months ago, I received a phone call from a betting agency that gave me pause for thought.
“I’m just setting up an account for you with $50 from us. You’re not going to say no to $50 are you?”
Well yes, actually, I did.
I hadn’t previously had anything to do with them and have no idea how they got my phone number. It was quite the hard sell, and according to the talkative operator, one of their selling points was that they would “personalise” my bonuses after going through my account.
We’ll come back to that story in a moment.
Obviously, gambling has been in the news this week, with the announcement of the restricting of advertising by online gambling companies during certain times when children are likely to be watching.
While there is a fair argument these restrictions are necessary, as children are restricted from gambling, will it really do anything for problem gambling?
Australians gamble a lot in comparison to other countries. However, the amount of money that Australians lost exploded in the 1990s, and when accounting for inflation and population, hasn’t been increasing over the timeframe that gambling advertisements have proliferated.
Here is a graph of our historical, real, per-capita gambling losses broken into pokies (not including casinos), racing and sport and the total in black:
Our gambling losses and the prevalence of problem gambling are dominated by poker machines. Despite the saturation of advertising that we’ve been subjected to by online bookmakers and the large amount of money they make, the lion’s share of the money still goes to pokies.
This isn’t surprising when you realise that gambling online isn’t any more addictive than other forms of gambling, and possibly less so. According to this 2015 review by Sally Gainsbury in Current Addiction reports, “Studies that have isolated Internet-only gamblers have found that these gamblers have lower rates of gambling problems than gamblers who only gamble offline and those who use both online and offline modes.
“Gamblers who engage in online as well as offline modes appear to have the greatest risks of harm, which is likely related to their greater overall gambling involvement.“
However, online gambling companies have something that previous forms of gambling such as TABs, old-school bookies, your local club and the like don’t have. They have your data.
They know what you put your money on, when you put your money on, and how much you put on.
And we can find out a lot about someone from their data, even if we only look at the first month after opening an account.
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In this study of the first month of betting on the accounts of over 4000 gamblers of online betting firm bwin, it was found that, “In general, the results of this study suggest that it is possible to identify risk factors that are associated with future gambling problems based on actual online betting behaviour, and that it is possible to make this identification during the first month of gambling.”
In other words, online bookies can tell from your first month of betting whether you are at a greater risk of developing into a problem gambler.
This knowledge is a double-edged sword. Although the ethics and privacy concerns are difficult, it is not hard to imagine a situation where this information can be used in the prevention of problem gambling.
Alternatively, it can be the basis for a profitable business model.
So now we come back to the story at the beginning of the article. While it may sound great for incentives to be “personalised”, I am uncomfortable with the low level of protection people have when they’ve opened a betting account.
If a betting company sees that you only bet $5 a win on the horses on Saturday, and give you a set of $5 free bets to have on the horses, no problems.
But the incentives won’t necessarily be like that, and the huge losses from poker machines in Australia show how efficient they are at taking money from problem gamblers.
The idea that we can have a company own both online gambling companies and poker machines is a huge cause for concern.
It seems all too easy for such companies to identify potential problem gamblers and “engage in online as well as offline modes”, send the risky gamblers to the poker machines as quick as they can.
We should be thinking carefully about how the data of online gamblers is used, because at the end of the day, they’re pretty good at going through the data and restricting the betting activity of those who win.
Editor’s note: Yes, The Roar runs ads from wagering partners. However, this article is the opinion of Nathan, and we support his right to express it.
Darryl from Sydney
Guest
Nathan Great article but poker machines aren't gambling. That's why they are titled gaming. They are programmed to lose. As Aransan correctly points out they are a tax on the poor. If you want to look into other topics especially given your background in greyhound racing here are some things to ponder. Poker machines in NSW rake about $8 billion per year off desperates, They are taxed at 11%. That is high enough tax to cause quite some damage. In 2014 the TAB with the permission of the NSW dept of gaming of racing and Racingcorp raised taxes on exotics on pari mutual racing from 16% to 22%. When Troy Grant brought out "tax Parity" one would have thought this tax cut would have gone back to punters instead of lining the pockets of stud owners and owners in general. Think again. There are so many "deals" done in the last 5 years that surely someone can pick up the ball and run with it. The pros are currently struggling to win so what hope is the normal punter. Taxed into oblivion so only the desperates can bet.
Interested
Guest
I don't think you've misled anyone at all - it's a seriously complex area and that's why we need to fund more research in to online wagering in Aus that has a practical use and can help ensure we've got the safest environment possible. It's a great article and hopefully gets people thinking more critically about the issue. Fingers crossed we see some sensible cooperation between government, the gambling industry and community sector soon!
Nathan Absalom
Roar Guru
First of all, thank you for your comments. It is obvious from them that you are far more knowledgeable about the subject matter than I am and hopefully people read your comments as well as the article. Yes, I did pick only a few articles that supported my narrative and you're right to point out where I've done that without qualifying statements. I hope I haven't misled anyone terribly but the subject it is a short article that is intended to be thought provoking. I think that your last point is the real take home message here. It would be a mistake to think that online gambling must lead to an increase in the prevalence and severity of problem gambling. It ought to be possible for the Government to regulate it well. But for that to happen the data will need to be used toward that end.
Interested
Guest
A few things worth pointing out: - The online Australian gambling environment is vastly different to any other jurisdiction. We don’t have online gaming (virtual pokies, casino) or in-play wagering which are available in the UK and broadly across Europe. This makes it difficult to translate research conducted in these regions (such as the bwin study) to the Australian environment. There’s sadly a lack of available research that is focused on the Australian online wagering environment, prevalence of problem gambling within this environment and the effectiveness of harm minimisation tools. - Even Dr Gainsbury’s research only examines the difference between online and land-based gambling. It doesn’t look at the harm profile of the different types of gambling within the online environment. For example, poker is a very different product to sports betting but they are all classified as ‘online’ for the purposes of measuring harm and impact. - Given that most problem gamblers would bet with multiple providers, it’s critical that any research in this area is conducted using data from across the industry rather than a single provider (such as the bwin study) so that all customer behaviour is captured rather than the transactions with a single operator. There are no doubt significant privacy challenges around matching customer data across operators however. - Finally, the online environment has the potential to be much much safer than the land-based environment if data is used for good and the government properly regulates the industry. Tools like deposit limits and self-exclusion are effective in the online environment – because the operators know who you are. This doesn’t exist in a land-based cash anonymous environment.
Aransan
Guest
Pokies are a tax on the poor.
peeeko
Guest
excellent read