Thursday, July 24, 2008

B.C.'s online gambling plan means more problems

The nice people at B.C. Lotteries have just offered me $5 to try online gambling.
"Pay for Play Promo Cash," they called it in the e-mail. If I go online to gamble, the corporation will match the money I spend up to $5.
The Crown corporation's marketing people are just doing their job. It has a goal of recruiting more gamblers every year and increasing the average amount each one loses. That's how the business grows.
But it seems risky - or perhaps just destructive - to try and lure people into online gambling, with its great risks of addiction or problem gambling.
Especially for this government. In opposition Gordon Campbell opposed gambling because it destroyed lives and families and created a province of "losers." The party promised to halt gambling expansion.
And then did the opposite, including the introduction of Internet gambling in 2005.
It's a risky kind of kind of gambling to be promoting through e-mails sent to thousands of people like me.
A study released last week found online gamblers "play" more frequently and bet more aggressively than those who go to casinos. The study, by professors from the University of Western Ontario and the University of Nevada, found Internet gambling participants gambled much more frequently and risked more than people who went to casinos or bought lottery tickets.
Their gambling was easier to hide from family and friends and more likely to become part of their daily routine.
All in all, a higher risk activity with a greater likelihood of problems for the gamblers and their families.
The study concluded that governments should consider getting into the business, perhaps in partnership with casino companies, to protect gamblers from the risks of semi-legal Internet betting sites.
That might justify B.C. Lotteries early ventures into Internet gambling.
But the study raises some questions at the same time, starting with the wisdom of trying to offer cash to people to come online and bet.
B.C. Lotteries sets targets for the number of new gamblers - people who bet in some way each month - that it wants to recruit. Those have been public, part of the corporation's service plan, until this year.
Last year, for example, the corporation planned to use ad campaigns and promotions to recruit 240,000 new regular gamblers in B.C. (In fact, the number of gamblers dropped as a result of the scandals that hit the corporation.)
The government sets out to lure people who had stayed away from gambling and into buying lottery tickets or putting money into slot machines down at the local bingo hall.
Or into gambling online, a kind of betting that attracts younger participants.
B.C. Lotteries has set some significant limits to reduce the potential damage from its Internet gambling. Participants can't transfer more than $120 a week into their gambling accounts, so an individual's losses are limited to $6,240 a year, assuming he hasn't managed to set up one or two accounts in other peoples' names.
The corporation has controls to ensure gamblers are 19 and bar themselves from future betting on the site.
But the study suggested greater safeguards: Cross-checking new users with a list of pathological gamblers; having the site send messages when people have lost a lot of money or are playing long hours; and clear and large numbers on screen to tell the gambler how much he had lost during a betting session.
More fundamentally, it recommended government-controlled Internet gambling as a necessary evil. If people wanted to bet online, better it was regulated.
That's different than setting out to persuade people who otherwise wouldn't gamble that they should start betting.
Online gambling hasn't worked that well for B.C. Lotteries. The goal was to hit $18 million in revenue last year, but it fell short at $14 million. But the corporation still hopes people will be betting $48 million a year by 2010.
And some of that money is going to come from individuals and families who really can't afford to join Campbell's club of "losers."
Footnote: B.C. Lotteries online offerings include Keno and round-the-clock sports betting as well as "interactive games." These involve bettors, by letting them do things like click on balls to try and keep them aloft. But the clicking is actually meaningless in terms of the outcome, which is determined by a computer as soon as the bet is placed. Like the whirring and spinning of slot machines, it's just a way of keeping people involved so they lose more money.


Anonymous said...

Why play a losing game?
Study uncovers why low-income people buy lottery tickets - July 24, 2008.

Although state lotteries, on average, return just 53 cents for every dollar spent on a ticket, people continue to pour money into them — especially low-income people, who spend a larger percentage of their incomes on lottery tickets than do the wealthier segments of society. A new Carnegie Mellon University study sheds light on the reasons why low-income lottery players eagerly invest in a product that provides poor returns.

In the study, published in the July issue of the Journal of Behavioral Decision Making, participants who were made to feel subjectively poor bought nearly twice as many lottery tickets as a comparison group that was made to feel subjectively more affluent. The Carnegie Mellon findings point to poverty's central role in people's decisions to buy lottery tickets.


Anonymous said...

Sean Holman has some 'interesting' quotes from Housing and Social Development Minister Rich Coleman - here's a sample: "One of the highest growths that we're seeing in problem gaming is stuff that's not under the control of the governments in Canada or in British Columbia. Even though, under the criminal code, we have responsibility for the conduct and management of gaming, these Internet sites that you can put your Visa card into from your residence have no control outside of British Columbia."

So the highest growth in problem gamblers is the exact same area that BC Lotteries is trying to grow their business? With Coleman in charge, you just know a disaster is coming.


Anonymous said...

The B.C. Lottery Corp. set a revenue record of $2.6 billion in 2007, $64 million more than expected.

The 2007/08 Annual Report is now available [.PDF - 3.8 MB] LINK

pumpkin254 said...

Oh my, it surprised me...