Should Social Gaming Online Be Regulated In Australia?

Players spending money on social gaming online are starting to speak up about the significant amounts of money spent on such games. While they are free to play, there are incentives to make in-app purchases, and some players want them regulated. Some Australian lawmakers agree.

What is Social Gaming?

It is important to clarify social gaming. This is not a home poker game or friendly bingo game. Social gaming refers to games played on social media platforms.

Social gaming became popular due to platforms like Facebook offering games offered through the platform. Most of these games can be played by simply logging in through Facebook. They are also “social” because of the ability to compete against friends and others in a social online atmosphere.

As this type of gaming has become more popular, more companies have developed apps that offer the same kinds of games. The free-to-play games deliver some type of game, from brain stimulators, card games, and trivia to mystery-solving games and fun competitions.

They may be free games, but they almost always offer some type of purchase options for things like more chips or lives or clues. There is no requirement to buy anything, but players who want to progress in the game without waiting for more chips can make purchases to move forward faster.

How to Lose Money Quickly

ABC News recently featured the story of a man named Geoffrey Pelham, a 58-year-old who played online slots via the Big Fish Casino social gaming app. He played for approximately an hour but spent hundreds of dollars doing so. He said he would pay $160 for play-chips for online slot games and lose those chips in 10 minutes.

In total, Pelham spent thousands of dollars on the games and won only virtual chips. To be fair to the game manufacturers, this is the clearly stated result of winning. No real money is up for grabs, as the games are for entertainment purposes only.

Pelham contended, though, that the casino apps trick players by handing out free chips to new players and then induce them to buy more. “They give you free chips when you first sign up to suck you in,” he told ABC.

Rise of Big Fish

According to ABC, social casinos online are a multi-billion-dollar industry. As people gamble less for real money online casinos, social gaming rises. The games are easy to access and quick to play, especially on mobile devices.

Big Fish is one of the largest companies in the social gaming world. Launched in 2002 and based in the state of Washington in America, the company’s portfolio has grown exponentially. With everything from solitaire and other card games to branding with names like Toy Story, Big Fish has games in nearly every category imaginable.

In 2013, Churchill Downs acquired Big Fish for approximately $885 million. And in 2017, Australian-based Aristocrat bought it for $1.3 billion.

American Lawsuits

Big Fish has had its share of troubles in the past decade, as players overspend on app options in the free games and then try to sue the company.

When one woman in America – Washington state – spent more than $1,000 on extra chips in a Big Fish game, she sued. She claimed that the social gaming offerings were illegal under Washington law because it prohibits games in which players risk “something of value upon the outcome of a contest of chance…upon an agreement or understanding that the person or someone else will receive something of value in the event of a certain outcome.”

The first court ruled for Big Fish, but the Court of Appeals ruled for the plaintiff, saying that the play-money chips were “something of value.” This made Big Fish games illegal in the state.

That court ruling prompted companies like PokerStars – its free-money poker site – to leave the state out of fear of violating the law. The Washington Gambling Commission denied that the decision would affect PokerStars, but the Big Fish case scared many companies.

The same ruling also prompted more players to file lawsuits against other social gaming companies like Playtika and High 5 Games.

Australian Lawmakers Eyeing Regulation

Independent Federal MP Andrew Wilkie is often at the forefront of issues regarding gambling, typically in favor of oversight and tighter regulations. For example, he was one of the MPs calling for a royal commission after the Crown Resorts scandal broke.

Wilkie responded to social gaming concerns recently by saying he will be pushing the Australian government to regulate the industry. “This is gambling,” he said to ABC, “and anyone who tries to tell you it’s not is wrong. In my opinion, these should be regulated in Australia in exactly the same way as mainstream online casino games and that’s to ban them.”

It is unclear if the government will regulate or ban social gaming in 2020, but Wilkie seems interested in doing so.


Rose Varrelli avatar
Rose Varrelli
Senior Casino & News Writer

Hi there! I’m Rose, and with nine years behind me in the iGaming industry, I craft engaging narratives at CasinoAus. My education in Communication across Europe has sharpened my skills in fintech, casino legislation, and digital marketing. Backed by a strong foundation in SEO, storytelling, and cross-cultural communication, I’m passionate about creating content that resonates globally and educates our audience.

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