Inside Asian Gaming

MAY 2018 INSIDE ASIAN GAMING 29 Pachinko has become the target of efforts to combat problem gambling. That’s kicking an industry when it’s down. IN FOCUS population of 125 million, according to the Japan Productivity Center White Paper on the Leisure Industry issued in 2016. Some estimate the current player population at below 10 million. Parlor numbers, 18,000 in 1995, fell to 10,258 at the end of last year, according to Tokyo’s Yano Research Institute, split among 3,244 owners. Pachinko turnover – equivalent to cash-in for casino gaming machines – reached a record ¥33 trillion in 2005 (US$309 billion at the time) and has decreased by a third since. Still, pachinko’s ¥22 trillion turnover represents 4% of Japan’s GDP and the industry employs 400,000. Customarily an after-work diversion and often occupying prime real estate around train stations, pachinko (and pachislot, operating in tandem and collectively termed pachi) is, from a legal perspective, simple amusement, where players win balls or tokens that can be traded for prizes at the parlor. In a legal gray area, the player can then take their prize outside the parlor to exchange it for cash. Tokyo Union Circulation exchange counters, with bright orange TUC signs, are hidden in plain sight near the capital’s pachinko parlors. TARGET PRACTICE That gambling element has drawn scrutiny in connection with efforts to legalize IRs in Japan. “Because of growing public attention to prevention of gambling addiction with IR laws in mind, [greater regulation] is being driven by government, not only for the pachinko/pachislot industry but also for government-controlled gambling,” gaming machine manufacturer Sega Sammy, a partner in Korea’s Paradise City IR, said in a statement to Inside Asian Gaming . “The administration and the industry decided that the regulation on the payout rate would be necessary as one of the solutions to prevent addiction.” Regulations that took effect in February cut pachinko jackpot yields from 2,400 balls to 1,500 and pachislot jackpots by an identical 37.5% from 480 tokens to 300. The National Police Agency declared that the maximum profit for four hours of play has been set below ¥50,000; it was more than ¥100,000 under prior regulations. The new measures, proposed last year by Prime Minister Shinzo