Opinion.

Covid-19: Where are we now? A Gambling perspective.

23/06/2020

At a glance

“I believe that this year will be a tipping point for everything; an earthquake within a longer-term tectonic drift from land-based to remote gambling, and from public to private entertainment experiences. Contactless payment, contactless entertainment, the continued rise of the online but isolated individual. An international community that is connected more, but touches less. Gambling experiences will need to address themselves to the personal needs, wants and vulnerabilities of individual players if they are to appeal.”

Our Head of Gambling Carl Rohsler reflects on the state-of-the-market as part of his preface to the latest edition of The Gambling Law Review.

As flies to wanton boys are we to the gods.
They kill us for their sport.

(William Shakespeare, King Lear, Act 4, scene 1.)

It was in these sombre terms that Shakespeare spoke of fate and chance, and man’s place in the world, in King Lear. The play was first performed in December 1608, and the timing is significant because, for the previous several months, all of London’s theatres had remained shut by government decree. Each day a formal notice (known as a Plague Bill) had announced the number of dead in the city, and it was only when the numbers had dipped sufficiently that the theatres and other entertainments were permitted to re-open.

Over the past few weeks (this was written in April 2020), the world has begun to face a unique and important challenge. Most of us are isolated from each other and at the same time surrounded by the very substantial effects of the coronavirus pandemic, which is leading to huge economic stresses, crashing financial markets, massive travel disruption, and the greatest restriction on personal liberty
since the end of the Second World War (to say nothing of the illness from which hundreds of thousands are currently suffering). Against such a background, it is hard to find something eye-catching to write about what seems, by comparison, the rather prosaic topic of gambling regulation.

One thing that the current crisis highlights is that, although humans persist in thinking of the world as divided into separate jurisdictions, viruses are less troubled by those niceties. It has never been clearer that we are a single species in an international community and that whether one is seeking to control the proliferation of gambling or germs, the key to effective action is international coordination. If the current pandemic holds some general lessons for policymakers, perhaps they are these:

  • The world has become completely interconnected and, whether we are legislators, regulators or operators, one cannot simply consider what happens in the narrow confines of one’s home jurisdiction;
  • In order to have an effective response to a common problem, it is necessary for governments to work with a unity of purpose. A respect for international comity is crucial to any effective regime. Everyone has to recognise that they not only have a duty to create effective regulation for their own jurisdiction, but also to implement one that does not ignore the needs of countries around them;
  • Although the problem is an international one, there are still some differences between societies, which means that a spectrum of different approaches may be appropriate; and
  • No-one has all the answers and, when faced by complicated challenges, we would all benefit by learning the lessons of those around us.

It is also instructive to watch how cooperatively people react to curfews, closures and travel bans. It seems that, like gambling operators, the general public is willing to submit to stringent regulation and endure some hardship when it is clearly for a common and important good, even if at the expense of personal wealth and liberty. However, the cooperation of the regulated is always to a large extent required, and that cooperation is conditioned on there being an acceptance that restrictions are logical, proportionate, applied without discrimination and, above all, effective in combating an accepted problem.

Gambling regulators and politicians are no doubt reflecting upon these points. More regulation may sometimes be needed (but, equally, it may not always be productive). Operators are prepared to take many steps to protect against underage or inappropriate gambling patterns, but imposing unwarranted restrictions or creating burdens that are too high or ineffective simply creates a distraction, and may risk undermining the respect in which regulators are held. There is a complicated balance to be struck between defending the vulnerable from harm and protecting the public’s freedom to choose its leisure. Never was that balance more starkly in focus than today.

It is easy to see that the current crisis will have a sharp impact on different aspects of the gambling world. With no sport for three months, there is literally nothing to bet on. Bingo halls, arcades and casinos will be heavily hit, and many will not survive. Even large-scale lotteries are being suspended. But with millions stuck at home and looking for new entertainment, virtual betting and online gaming will surely be growth industries.

Will coronavirus have a long-term impact on our society? The answer is yes. But the impact will not be measured by a temporary increase in the amount of hand-washing. For some years, we have been undergoing a social evolution caused by the opportunities that new technology can bring. We have become more connected, more impatient, more capable of listening to more than one channel at once and more accepting of having a virtual world as a substitute for the real one. For all that, some areas of society have been slow to transition to new ways of behaving. While many of us could work from home, it was still generally viewed as the exception rather than the rule. In the same way, millions of us still congregate in order to be entertained – whether for sport, cinema, theatre or casino. But the scale of the publicity and of the practical necessity of large-scale enforced isolation is going to mean we embrace a cultural shift more quickly than we had imagined. In my view, it will lead to a significant and long-term impact both on how and where we work, and how and where we play.

With that in mind, at the beginning of a new decade, it is perhaps worth looking back to see where we have come from and to where we may be heading in terms of the way that leisure time is spent (at least among those in the developed economies).

In 2010–11 we saw the birth of both Instagram and Snapchat, two of the world’s most popular software applications. Both were at the vanguard of the second generation of social apps following the ground-breaking achievements of Facebook and Twitter. Both accelerated an important social change because, combined with the ubiquity of GPS telephones with cameras, they made our communication patterns more data-rich, visual and granular. In doing so, they have highlighted a facet of our value system in an unexpected way. Photographers and reporters used to take pictures of important events occurring in the outside world that they wanted to record and show them to a wide number of people. We now take pictures of trivial incidents to illustrate and record our personal lives in a way that is designed to be viewed by small audiences of friends. Indeed, such has been the importance of the geo-located photograph that Instagram has actually managed to create its own landmarks: places that have become important in their own right only because they happen to be where other users have visited and geo-marked. Instead of looking through the telescope, we are looking in the mirror. And, in a world now self-isolating and physically distancing, the focus on the individual connecting to others virtually is only going to get stronger.

Uber began its operations in California in 2009 and Airbnb started a few months before that. Both companies have profoundly influenced what were the relatively traditional businesses of transport and accommodation. Although the approach of each is different, both of them have contributed to a new spirit in which the individual (whether giving or receiving a service) is placed in a unique position, at the centre of the map of their life. Public transport becomes personalised transport. Mass accommodation has become a personalised home. An entire economy is being built around individual choice.

Finally, we are experiencing three sorts of payment revolution. First, we have stopped using cash and now pay invisibly. Contactless payment mechanisms using RFID were first trialled in 2007 and first became usable through mobile phones (using near field technology) in about 2014. The e-ticket at check-in has become the norm rather than the exception. The second revolution is that many of the things that we purchase are rented, not owned. Rather than owning things, we use services.

There has also been a sea-change in the places where we spend money. Congregating on a Saturday afternoon at the retail mall had already gone into sharp decline before it recently became actually illegal. Home delivery (of literally everything imaginable) had already become normal before it became necessary.

Laying behind all of these changes is a profound evolution in what is recorded about our lives, as well as what we choose to record ourselves. The growth of processing power and the size of the data sets mean that our needs, habits, likely wants and vulnerabilities will all be more and more accurately detectable. We can expect our ability to make predictions about consumer behaviour (including where we go, what we do and the viruses that we carry) to become significantly more sophisticated. These improvements will both determine how and in what forms gambling and entertainment is presented to it and, crucially, how we react to that entertainment, and when it is perceived as doing us harm.

How will these developments change the world of gambling? I believe that this year will be a tipping point for everything; an earthquake within a longer-term tectonic drift from land-based to remote gambling, and from public to private entertainment experiences. Contactless payment, contactless entertainment, the continued rise of the online but isolated individual. An international community that is connected more, but touches less. Gambling experiences will need to address themselves to the personal needs, wants and vulnerabilities of individual players if they are to appeal.

To give perspective, back in the mid-1990s, as a young lawyer, I went to a conference at which we were addressed by a member of Gaming Board for Great Britain (as the regulator was then known). Having finished his presentation, a member of the audience asked him what he thought of the apparent rise of remote gambling. He replied that, although some people might do it, it would be unlikely to take off, because it could simply not challenge the excitement and entertainment of a day at the races. I mention that anecdote not to poke fun at the speaker, but rather to emphasise that, at the time, he was explaining a perfectly legitimate and sensible view of the world (in a decade when it was a normal evening’s entertainment to go to a shop to hire a video cassette and then post it back through the front door of the shop the next morning). While it is true that attending a live sporting event is still a very popular collective experience, and will continue to be so for many years to come, those activities are currently effectively prohibited in the UK, just like Shakespeare’s plays in the early 17th century.

Note: This opinion piece was originally written in April 2020 and is part of the preface to the fifth edition of The Gambling Law Review (released in June 2020), of which Carl Rohsler is the Founder Editor.

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Carl Rohsler Partner, Head of Commercial, IP and Technology

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