August 10, 2020

In recent weeks we have seen three Parliamentary reports published which will all play a critical role in shaping the future of gambling regulation in Great Britain (and possibly beyond). Each report’s vision for the future of the gambling industry varies in its tone and coherence, but they present clear themes which we expect will dominate much of the policy debates that will take place when the formal government review of the Gambling Act eventually commences. These include familiar areas such as advertising, ‘affordability’ checks, online limits and, which forms the focus of this blog, responsible product design, as well as recommendations to impose a new ‘duty of care’ on operators and to categorise loot boxes as gambling once and for all.

Below is the second in Wiggin’s series of blog posts that will examine these key trends. In this blog, we assess the House of Lords report ‘Gambling Harm – Time for Action’ (‘the Report’) and its observations about the future of responsible product design and the work already undertaken by the industry and the Gambling Commission in this area.

The Report commences its substantive discussion of responsible game design at paragraph 162, page 48.[1] Putting aside the  recommendation that stake limits should be applied to online gambling products[2] (which is quite a separate matter from responsible game design but one which was never going away following the FOBT saga),  the Report concludes that speed of play and spin for online games should be slowed down.[3] These are not novel recommendations and are areas that both the Gambling Commission and the industry are pro-actively discussing. We will revisit this in more detail below.

What is perhaps surprising is the Report’s recommendation for a new testing system for games predicated, in part, on a game’s “addictiveness” and the basis on which the Report arrives at this recommendation.

The Report rightly asserts that certain game characteristics can plainly bring about damaging behavioural responses from gamblers. It is clear that game design and the application of structural characteristics play a key role in the impact different games will have and the potential harm they could create[4] but also accepts that pinpointing a particular component of a game that is particularly harmful or addictive is very challenging, complex and that research into this area is limited[5].

However, despite this, the Report then makes, in our view, the somewhat sizable and questionable leap to recommend that The Gambling Commission should establish a system for testing all new games against a series of harm indicators, including their addictiveness and whether they will appeal to children. A game which scores too highly on the harm indicators must not be approved.[6]

The Report seems to arrive at this recommendation on the basis of a relatively flimsy conclusion that, because game designers are aware of each piece of code that creates a game, therefore there must be a way of developing a test for gambling products which can assess games for their addictiveness.[7] We do not think one necessarily follows the other and, in our view, no amount of time, cost, resource and industry and regulator collaboration would put in place an effective testing procedure capable of analysing and ascribing an addictiveness rating to each game on a holistic basis in a manner which would have a measurable impact (typically a cornerstone of effective regulation).

Practicalities of implementing such a testing regime aside, this is looking at the issue of addictiveness in a vacuum and it should be recognised that structural risk characteristics of games need to be considered in the context of situational risk (under what conditions is the game played) and personal risk (who is playing it). What is risky to one person in a certain environment may not be the same to another. For example, “appeal to children” may not be considered a risk factor in an environment where children are excluded (as is the case with online slots as enhanced by the age-gating initiatives of the Commission in 2019 which also apply to free-to-play games). Although the focus of the debate appears to be around online slots, the Report’s observations are not so narrowly drawn and direct comparisons with, say, online bingo, are very difficult to draw.

We must also not lose sight of the fact that the vast majority of people have a healthy and fun relationship with gambling and that skill, time and cost is invested in games so as to make them entertaining and enjoyable for the mass market. Elements that pose addictive risks to the very few also represent highly entertaining and non-harmful elements to the majority. There aren’t too many sports, board games or computer games which don’t trigger feelings of excitement and/or frustration at a win or a near miss. Would anyone play them if they didn’t? Of course, minimising harm to consumers is key, but sweeping regulation without thought to its effects on consumers as a whole, poses its own issues.

It is our view that instead of adopting the Report’s recommended new testing system (which the Report admits would be a very significant challenge for any regulator[8]), minimising harm to problem gamblers by better game design is better served by the work currently being undertaken in these areas by the Commission and the Betting and Gaming Council (BGC).

The Commission recently announced a new consultation on online slots game design and it also established (in January 2020) an industry working group, headed by Scientific Games and Playtech, focusing on responsible product design. The working group’s proposed changes to date involve imposing a minimum slots spin speed of 2.5 seconds, eliminating features that accelerate game play (quick spin, turbo play) as well as Slam stop or Stop reels. Split-screen games that permit multiple stakes on different slots would also be prohibited.

However, in the Commission’s recent update on progress made by the industry working group, the Commission felt the initial code of conduct proposed made by the BGC members didn’t go nearly far enough, including not addressing all the issues raised by the newly formed Experts by Experience Group. The BGC are due to publish an updated code by the end of September 2020 which is expected to address some of this criticism. The timing of the commencement of the consultation would suggest the Commission is not prepared to wait until then to move the discussions on game design forward.

The Commission, wrongly in our view, came under scrutiny from the House of Lords Select Committee in the Report for not doing enough in respect of game design and related harm indicators with the Report. Perhaps this criticism explains why the Commission is consulting on the industry’s first set of proposals with a deadline for responses ahead of the expected date of publication of the industry’s second set of proposals. It is a curiously condensed timetable but certainly lays down the gauntlet for the BGC in terms of where the revised code is pitched.

One only has to look at the Commission’s consultation to see how seriously and actively the Commission is looking to address the issue of responsible design.

The Commission states in its introduction to the consultation that:

The aim of this consultation is to make play of online slots safer by: – adopting some proposals from the industry working group and ensuring a consistent approach for all relevant licensees, not just BGC members; and – consulting on additional ways to keep consumers safe – over and above the contents of the draft code provided by industry.

The Commission puts forward a number of initiatives and measures that it proposes adopting as new RTS requirements (some of which have already been put forward by the BGC in its own list of proposals) which include:

• Simultaneous play. Operators should prevent multiple slots games from being played by a single account at the same time.
• Limits on speed of play. There must be a minimum of 2.5 seconds from the time a game is started until a player can commence the next game cycle. It must always be necessary to release and then depress the ‘start button’ or take equivalent action to commence a game cycle.
• Removal of features that accelerate game play. Games must not permit a customer to reduce the time until the result is presented; features such as turbo, quick spin, slam stop are not permitted.
• Auto-play. Providing auto-play functionality for slots will not be permitted and the gambling system must require a customer to actively commit to each game cycle individually.
• “False Wins” and “losses disguised as wins”. Games must not “celebrate” with auditory or visual effects a game win for returns which are less than or equal to the last total amount staked. Where the return is lower than or equal to the stake, the game should not refer to the result as a win. This proposal does not remove the requirement already existing at provision 7E of the RTS to inform consumers about the result of the game, only those elements which add celebration.
• Net position and time elapsed. All gaming sessions must clearly display: (i) the net position, in the currency of their account or product since the session started; (ii) the elapsed time since the session started. Time displayed should begin either when the game is opened or once play commences. Time should run for the duration of the session regardless of whether the customer minimises the session.

We are also aware that certain suppliers are looking at rating systems which further highlight the “risk vs reward” of online slots by reference to pay-out ratios and game maths – i.e. features which are entirely measurable.

It is this type of transparent rating system which, combined with certain of the measures on which the Commission is consulting, will – in tandem with a sensible position being reached in relation to the distillation of the concept of “affordability” into something which can be consistently measured and applied – achieve an overall regulatory environment which protects the vulnerable whilst preserving the enjoyment of the vast majority. Whilst we don’t envisage that the BGC will have any issues with rectifying the most egregious of games that say, for example, overenthusiastically celebrate wins that don’t constitute a net win, requiring the industry to revisit, assessed and potentially re engineer each and every game would require an almighty cost and time resource and could threaten the commercial viability of certain operators in the industry.

Advances in responsible game design can undoubtedly make a contribution to the overall protection of consumers. However, it is but a component part of a regulatory framework which must be capable of implementation on a fair and consistent basis. A “testing system for addictiveness” is a concept which grabs headlines but, in reality, doesn’t feel achievable – energy and resource would be better directed elsewhere.

The consultation on responsible game design is open until 3 September and can be accessed here. We encourage anyone with a position on this topic to respond.

 

[1] https://publications.parliament.uk/pa/ld5801/ldselect/ldgamb/79/79.pdf

[2] Para 186

[3] See paras 190 – 193. At para 193, the Report recommends that the equalisation of speed of play and spin, so that no game can be played quicker online than in a casino, betting shop or bingo hall.

[4] Para 166

[5] See para 168 (citing Dr Luke Clark, Professor in the Department of Psychology and Director of the Centre for Gambling Research at the University of British Columbia and advisor to the authors of the Report).

[6] Para 175

[7] Para 170

[8] Para 174