Mobile Monday panel discusses real-money gambling on mobile

The Mobile Monday meetup series hosted a panel on Monday at Adobe’s San Francisco office where industry veterans in the real-money gaming space weighed in on real-money gambling on mobile as one of the latest emerging mobile monetization models.

Mobile Monday is a non-profit organization that brings together mobile industry developers, entrepreneurs and developers to share knowledge through education groups and panel discussions.

The Mobile Monday Silicon Valley chapter’s panel was moderated by Mido founder and CEO Greg Ovalle. The panelists for the event included new Betable chief product officer Ya-Bing Chu, Big Fish Games general manger, Self Aware Games and casino products Carey DiJulio, Playstudios product team member Wynn Wu, Bam software and services co-founder and CEO John Ford and angel investor and serial entrepreneur Ken Arnold.

Real-money gambling is clearly a topic of great interest to mobile developers because,as Chu pointed out: “One of the reasons why there’s so many people here is that there is a lot of ambiguity and uncertainty around what is legal and what isn’t.” Here are the highlights of the discussion:

When will online gambling be legal in the U.S.?

Real-money gambling is currently illegal in the U.S. because of the Unlawful Gambling Enforcement Act of 2006. There are some exceptions to the law including fantasy sports, online lotteries and horse racing. In the U.K., gambling is part of the norm, so companies are creating social casino games that allow players to gamble with real money such as Big Fish’s Big Fish Casino. DiJulio says online gambling legalization will happen in the next year at a state-by-state level, but not at a federal level. While DiJulio is optimistic that legalization will happen in the next year, Chu says legalization won’t happen for a long time. “Poker will be first and this seems like it will take years,” Chu said. “I don’t see it happening quickly.”

Differences between game developers and traditional casino companies

Panelists seemed to agree that production value, speed and innovation are notable qualities for game developers but not traditional casino companies, despite casino manufacturers efforts like IGT acquiring DoubleDown Casino developer Double Down Interactive and Caesars Entertainment acquiring Slotmania developer Playtika. Wu, a former Wynn Las Vegas director of estrategies, believes game developers still have the upper hand when it comes to production value displayed in games on mobile and Facebook because they’re able to operate at a speed traditional casino companies aren’t used to. Chu added that in terms of acquisition, traditional casino operations want content faster but it takes 18 months to certify a slot machine that costs $15,000 to make as well, and that’s not the speed of the business anymore. At a casino convention, Chu says most of what he saw was comfortable stools, confetti guns and lit floors, with the handful of game makers displaying giant HD screens for slot machines as their attempt at innovation. “I can see why these companies are starved for content,” he says.

Converting virtual currency to real currency players

Currently, in the U.S., the only way to technically convert virtual currency players to real currency is getting them to go to a land-based casino or play one of the legal online methods like fantasy sports. In the U.K., for example, players can play mobile games with either virtual or real money. DiJulio believes the option of having both currencies will create a Venn diagram, where virtual currency players and real money players overlap. Chu says “there’s an overlap but we don’t know the size of it at this point.” He added that it isn’t necessarily about about conversation, but more about reaching the largest audience possible. Ford believes the cross over isn’t that big, but once you get virtual currency players to dabble in real money, then that’s “big money.”

Lastly, Chu says “there’s a lot of money and space left for innovation, and it’s ripe for disruption.”