Crystal balls will be glistening across the industry this month, as commentators strive to figure out what 2024 has in store for U.S. gaming, but one theme that it takes very little expertise to foresee the growing significance of is safer gambling.
The American Gaming Association (AGA) had combating illegal gambling and strengthening responsible gaming initiatives at the heart of its strategy for 2023 and, according to AGA vice president of strategic communications and responsibility Cait DeBaun, these will remain priorities over the coming year.
Talking to Yogonet at the end of last month, DeBaun pledged to work to expand the AGA’s commitment to responsible gaming by commissioning research and uniting the industry behind efforts to make gambling safer.
She highlighted the likely role of artificial intelligence in achieving a safer gambling environment going forward, suggesting the technology may be able to incentivize safe betting habits while identifying and flagging risky behaviour.
The AGA already runs a Responsible Gaming Education Month each year, has a Responsible Marketing Code for Sports Wagering, and recently launched a ‘Have A Game Plan. Bet Responsibly’ campaign via strategic partnerships with leagues and operators.
On the surface of it, all these initiatives appear to be contributing to a safe and responsible industry. But now, more than five years after PASPA was repealed, the AGA would be well advised to unite the U.S. industry behind a truly coherent safer gambling policy. One that goes beyond earlier attempts to do the same in more established markets.
As sportsbooks and online casinos proliferate, it is inevitable that a head of steam will build behind strident safer gambling campaigners, who may be well meaning but not well informed.
An article in The Guardian last week demonstrated how, in the absence of any really good data on problem gambling, campaign groups have a tendency to conflate research and figures, painting a bleak but not necessarily accurate picture of the industry.
The article titled “Gambling boom detrimental to New Jersey economy, report says” contended that the social and economic benefits of legalising gambling in the U.S. may be mitigated by the cost of increased harms.
It cited research by NERA Economic Consulting, which had been commissioned by the Campaign for Fairer Gambling to assess the economic output of the U.S. industry. In it, NERA argued that $2.4bn had been spent by people gambling online in New Jersey in 2022.
The consultancy said the online gambling sector then went on to pay $110m in wages to New Jersey employees and generated $22m in new spending across the state’s economy.
However, the report suggested that had that $2.4bn been spent elsewhere in the recreational economy, it would have led to about $1bn in wages, generating $200m in new spending.
Online gambling “does not yield the types of positive knock-on economic outcomes that other discretionary industries do”, The Guardian reported NERA as arguing. It seems a somewhat flimsy argument even before you try to interrogate how its conclusions were reached.
The article then went on to compare New Jersey’s online casinos’ $385m contribution to tax revenue with figures in a UK study by the London-based National Institute for Economic and Social Research.
It concluded that New Jersey may face $350m in social costs linked to online gambling, including healthcare, welfare, homelessness and criminal justice. The point being that this would negate any proposed financial benefit to liberalising the market in the first place.
In the interest of balance, The Guardian did consult Jeff Ifrah, who somewhat sensibly pointed out that NERA’s conclusions were “akin to comparing apples to oranges”. Ifrah is founder of gaming law firm Ifrah Law and the iDevelopment and Economic Association (iDEA), which aims to expand interactive entertainment businesses in the U.S.
“Without considering how jobs grew exponentially with the legal igaming market in New Jersey, NERA is providing an inaccurate assessment and false conclusions”, Ifrah told the Guardian.
“The NERA report is misleading for many reasons and betrays a basic misunderstanding of the most fundamental aspects of the legal igaming industry: Without legalized igaming, consumers turn to illegal, offshore sites that offer zero protection to players nor any economic benefits to the state.”
The responsible gambling movement is as hindered by these misleading and alarmist attempts to analyse the pros and cons of the gambling industry as the industry is.
Questionable facts and figures are trotted out at regular intervals in the UK and across Europe, sometimes prompting regulatory reforms but rarely illuminating the true cost of harmful gambling to society.
If the U.S. is to improve on its European counterparts in this area, it must start with gathering its own market-specific data. While questionable reports like the one above will be shrugged off by industry insiders such as Ifrah, they may have a more detrimental effect on public opinion.
