Social casinos: the history and legality of the industry

The concept of “mobile commerce” was firmly established in economic dictionaries a few years ago, but in the past, 2018, year, it turned into a powerful trend, which is impossible to ignore. Now we can observe a wide variety of mobile devices, without which the life of the modern generation is unthinkable. Almost everyone has an Internet connection, and people use social networks on a massive scale, which allows e-commerce to develop successfully.

One of the most powerful engines of mobile commerce are the online services of the gambling industry, including such a relatively new concept as “social casinos”. What are the trends and prospects for the development of this industry and what companies are setting the pace today?

A bit of history

Free gaming in social networks made an application for success back in 2007. Facebook then offered development tools that were distributed free of charge and provided almost unlimited reach. This allowed a small number of companies producing games for a narrow audience to attract hundreds of millions of active users in a short time.

Already in 2011, more than a hundred start-ups appeared, which began an active battle for existing players. Technical capabilities have allowed us to constantly improve existing games, as well as accelerate the pace of release of new products.

Thus began an era in which developers were able to introduce new options almost every week. User interest remained high, competition grew, and with it the quality of numerous applications improved.

“Today, when creating new applications, their developers, above all, are guided by mobile devices. At the same time, there was a revolution in social networks, which in many ways changed our communication culture and the style of online communication in particular; from simply posting statuses and photos on social networking pages, we moved to a new level – social media started offering services that are more concerned with education, information retrieval, and messaging, ”comments Hussein Sahin, founder of Yazino.

Mobile gambling: today and tomorrow

Gambling in social networks (the so-called social casinos) took an intermediate position between classic online casinos and non-gaming with the ability to buy virtual items or bonuses for real money. In social casinos you can play at the expense of the balance in virtual currency, enjoying the process and not risking to stay with empty pockets.

Of course, developers offer in-game purchases for real money, but you cannot reversely exchange virtual money for real currency if you win. For this reason, virtual casinos are allowed on social networks and on mobile platforms and successfully developed in countries where there is a ban on land and online casinos.

According to statistics, in recent years, the number of people who gamble in social networks has exceeded the number of registered users of online casinos with a game of real money almost 20 times. The number of players in social casinos has almost reached the figure of 5 million per month.

According to forecasts, in three years, social and mobile casinos with virtual currency will generate half the income of the entire online casino sector, which is equal to 19 billion euros.

Last year, revenues amounted to 4.5 million euros, while 5 years ago this amount was several times less, which indicates a rapid growth in the gaming audience of the mobile sector.

Initially, the market developed most actively in the Asian region, but today we observe how Europe occupies a leading position. Here gambling operators are the most active in the world.

Market Leaders and Success Stories

Social media gambling is an especially promising market sector for companies, as there is no such thing as real money winnings, unlike land-based casinos and traditional online casinos. It is therefore not surprising that more and more companies are striving to join this fast-growing sector. For example, a few months ago, Playtika bought Caesars Entertainment Corporation, a famous corporation owned by Ceaser’s Palace. The amount of the transaction – 80 million dollars.

Caesars became one of the first operators in the industry who was able to see the potential of the market, so that in 2011 he became the owner of a stake in Playtika. Over the next years, the company was engaged in development, strengthening its position, acquiring new companies and expanding its customer base.

Playtika and earlier actively expanded the boundaries of its business, acquiring new companies, expanding offers. For example, by joining Buffalo Studios, the brand has been replenished with bingo games, as well as poker with the Electronic Arts World Series of Poker app. Last January, Caesars Interactive bought Pacific Interactive, which made it possible to unite all the companies under the Playtika brand. This significantly strengthened the company’s position: in the first 9 months alone, total revenue reached a figure of $ 430.4 million.

The daily audience of the operator exceeds 5.7 million active users. In a month this figure reaches 18.6 million, and the number of unique monthly users is 16.8 million. No other casino can boast of such figures.

Also on the market there is a social bookmaker, in the creation of which the German developer Crowdpark is participating. 6 million dollars were invested in the development.

It is planned that this money will be used to create a platform where participants will be able to bet against each other on all sorts of events, including political ones. This idea is not new. Since 2002, they have been successfully betting against each other on the Betfair betting exchange. But in Crowdpark they claim that they managed to invent a completely new genre of games for Facebook, and their range will soon be replenished with new casino games. Expansion to a number of other platforms should also occur.

Another company that is actively developing its games in the social sector is DoubleDown. They did well with roulette, blackjack, slot games and video poker.

By and large, it is this factor – the interaction with each other during the game, the joint game with friends from social networks – determines what the future of the industry will be. 

Also, the development of social gaming will provide games with cross-platform, that is, the ability to play the same game from different devices. This is expressed in its synchronicity: each of the friends participates in the process from his own device (laptop, tablet or smartphone). It is the synchronism of the game that made social gambling so popular as a pastime among a large number of players.

Therefore, Yazino is planning to create mini-studios next year, in which ideas for new categories of games will be tested. The company believes that due to their own vision and new technologies they will be able to provide players with a deep immersion in the gameplay.

In the near future, the social casino should appear at the club of the English Premier League “Manchester United”. The team owners made a deal with social game developer KamaGames, which will create a social casino for Red Devils fans around the world. It is planned to develop a series of games, the first of which will be available on PC, and the second – on mobile devices and on Facebook.

These games will be freely available, which guarantees a low entry threshold. By participating in card battles with each other, fans of the club can count on quite real prizes: tickets for idol matches and club paraphernalia.

“Manchester United Social Poker on KamaGames software will give our fans a new way to communicate not only with the club, but with each other. This is just the first social game that we will launch as part of a partnership, our fans will see many others, ”says group managing director Richard Arnold.