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Gambling and Gaming: Pitfalls of an Industry on the Rise

Considering the massive rise in popularity the esports industry has seen in recent years, particularly since the Covid-19 pandemic has put a halt on more traditional sporting events, it makes sense that gaming has had a large and sudden impact on culture at large. One example of this influence is a stark rise in gambling, particularly among younger demographics. Despite laws and regulations prohibiting youth gambling, esports has filled the void left open by traditional sports in the gambling arena and young people are finding themselves more and more susceptible to the pitfalls of betting on esports.

Image Courtesy of The Sports

Compared to traditional sports gambling, which has been going on for as long as sports have existed, gambling on esports is relatively new. As esports has continued to grow in popularity, there’s been a steady increase in the numbers regarding betting on esports to match. Now, with Covid-19 putting a halt on a lot of traditional sports gambling, the rates of betting on esports has increased massively. A study from the UK Gambling Commission found that, just as they shut down due to the global pandemic, revenues from monthly esports betting in the UK increased by thirty times their previous rate. Not only was the gambling revenue of March 2020 thirty times that of March 2019, according to an article from the Next, the monthly gambling revenue “had more than doubled again” by June of 2020.

However, the biggest point of concern has less to do with the increase in gambling overall, but more specifically the age demographics of the people placing bets. According to the Next article, “In 2019, 17% of esports gamblers were aged 18-24. In general, more and more UK 16-34-year-olds are gambling, and the average age of gamblers is decreasing.” While this is most likely partly due to the fact that when it comes to esports and gaming, the audience demographics skew younger overall, there is likely something more at play. Considering “the number of problem gamblers aged 11-16 has also quadrupled to more than 50,000 in just two years,” it seems unlikely that this jump is due solely to the demographics of gamers. 

Sure, “93% of UK children play video games, averaging three hours a day and a growing number also follow professional esports teams,” but that doesn’t mean that 93% of children in the UK are going to develop a gambling problem. Rather, it seems more likely that, as opposed to gaming itself being the cause for the rise in youth gambling, targeted advertising is the real culprit. 

By analyzing “tweets related to both traditional sports and esports betting,” the folks at the Next “with GambleAware and in collaboration with Ipsos MORI, the thinktank Demos and the University of Sussex” arrived at a couple of interesting conclusions. Their analysis of social media behavior found that “85% of esports betting-account followers are under 24,” with 17% of that consisting of children under the age of 16. While followers of these “betting accounts” aren’t all necessarily participating in gambling, there’s an obvious correlation.

Image Courtesy of Digital Connect Mag

Furthermore, the analysis found a marked difference in the advertising practices used by gambling operators that catered to traditional sports betting as opposed to esports betting. More specifically, when it comes to esports, which has a younger overall demographic, “esports betting appears to concentrate much more on tweets that are funny, using gifs, memes and esports insider-knowledge.” The content is specifically designed to not obviously come across as advertising for gambling, rather appearing as shareable social media content. 

A third point of interest that this social media analysis uncovered was that a lot of these advertisers in the U.K. were breaking advertising codes by using “cartoons and animated characters, associated themselves with youth culture or featured esports stars under 25 years old.” This is the same issue that arose in the U.S. regarding cigarettes advertising in the 80s and 90s and has arisen, more contemporarily, with youth targeting flavors for vaping products.

While this data is specifically based on data from the United Kingdom, with a global industry like esports, trends that occur in other parts of the world need to be understood. Part of any globalizing industry is an element of cultural exchange, for better or worse. According to the Addiction, “It is estimated that around two million people in the U.S. are addicted to gambling.”  However, there are ways in which youth esports gambling may not play out the same way in the U.S. that it has in the U.K.

For starters, the Supreme Court only lifted its national ban on sports betting in 2018. While betting on traditional sports is now legal in some states, it isn’t legal in all 50 states. Furthermore, there are laws against gambling on high school sports due to the players being minors, and when it comes to esports, many pro gamers are minors. As such, the legalization of gambling on esports is often a gray area in the U.S. and if it’s not legal for adults, it’s definitely not going to be legal for young people. However, even in the U.K. there are laws against minors gambling as well. Just because something is illegal, doesn’t mean people won’t do it. 

Overall, while the data may be U.K. specific, the potential for an increase in gambling problems is universal. With the age demographics for esports skewing younger, young people are being exposed to the realities of gambling in ways they might not have before the rise of esports. The most important thing is to understand the ways in which young people may be taken advantage of and work to educate and guide those most affected by the rapidly growing industry of esports.

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