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Inquiring minds want to know, or at least Forbes.com Financial columnist Louis Bedigian: Will Zynga's New Hire Exploit Gambling or Consumers?
The question is being asked after it was revealed that the world’s leading social media company and biggest operator of a “free-to-play” online poker room, Zynga, just hired 888.com’s former VP of Regulated Markets, Maytal Ginzburg. 888.com operates the world’s 4th largest “real money” online poker room and is widely seen as having one of the largest global Web casino businesses.
Ginzburg’s arrival comes after a number of key departures at Zynga.
Bedigian writes:
Zynga’s biggest chance of success is the legalization of online gambling in all 50 of the United States. The company could feasibly enter markets where online gambling is already legal and regulated. But in doing so, Zynga would face competition from a host of companies that have been in the business for several years. Those companies will surely do everything in their power to defend their turf.
Among those companies already established is none other than 888.com, which is perhaps the oldest existing Web casino provider today, formerly known as Casino On Net.
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Bedigian adds:
Zynga stands to benefit the most from domestic gambling because it is has yet to receive widespread acceptance and legalization in the United States. By building a series of games to take advantage of gambling if and when it becomes legal, Zynga could beat its competitors to the market. At the very least, Zynga would have the luxury of competing on a level playing field.
Bedigian points out that “critics of Zynga might be inclined to believe that the company will use the same exploitation and copycat tactics to bolster its online gambling business” that were used to help make it the biggest gaming provider on the Facebook platform.
Facebook itself entered the “real money” online gambling market last month with the introduction of a Bingo game in Great Britain, where Internet gambling has been widely embraced and legal bookmakers line just about every corner.
By taking advantage of this, Zynga will inevitably publish and promote games that people spend more money on than they had intended.
Regarding the potential for exploitation, Bedigian concludes:
This will occur even if the company has no intention of exploiting consumers. Zynga may only wish to exploit its fellow game developers. If consumers buy into this exploitation, however, and come to Facebook with bulging eyes at the prospect of winning real money, no one wins. In this scenario, everyone loses.
- Aaron Goldstein, Gambling911.com
