November 14, 2003
Betting, Playing, Games and Gambling

OK, so I just got back from the first night of the NYU Law School "State of Play" conference. Speaking tonight were Richard Bartle (great inventor of the MUD) and Raph Koster (Chief Creative, Sony Online Entertainment) -- moderated by the oft-brilliant Julian Dibbell.

These are three very smart guys, but I personally didn't feel like there was much meat in the discussion. It seemed like both Bartle and Koster were focusing on the possible abuses of power by admins, which to my mind is far less threatening than the many abuses that players inflict on each other.

But then Bartle on his way to making a point (I don't remember the original point) said something about, if we were playing the board game Clue, and I offered you $20 to show me your cards, and then won the game...

It got me to thinking, you know, the funny thing about games IRL is that some of them are already legislated and regulated, and that's what we call gambling. And it got me wondering, in a room full of lawyers, why it is that some games are regulated and others are not?

Because, this is pure conjecture, the moral (and, down the line, legal) argument against unrestricted gambling is that people are taking something fixed (like money) and assigning it to a system that is arbitrary (like dice). Now, that's true with the stock market as well, but then, that's regulated too.

So, in the last 5 months, 5.79 million dollars have passed through eBay's category 1654, which are all the virtual goods of Ultima Online, etc. So here's my question: haven't people essentially bet (or invested) 5.79 million dollars, hoping that it will yield a profit within that same market?

Because what's different about that than playing high-stakes craps? One answer may be "game of skill." As I understand it, that's why it's ok to put 25 cents in a pinball machine but not a slot machine, because pinball machines were once demonstrated to be based on skill, not luck. "The trick is to create a game that is both playable, with an outcome that depends more on skill than luck. The law requires that it must be possible for a skillful player to win under normal playing conditions."

So is it just that? That your success in virtual worlds is understood to be purely a reflection of skill? Because to flip it around, if skill isn't part of gambling, what's counting cards all about? Or why do the same guys go to the world poker championships year after year, if skill's not involved?

In short: gambling, and virtual worlds, take cash, enter it into a parallel currency (betting chips, or gold pieces), and multiply or diminish that parallel economy in ways that involve chance. Then the currencies of that parallel economy can be converted back to real cash.

What I was unable to articulate tonight is that I'm not trying to say that online gaming is the same thing as gambling. I just don't understand how it's different.

Kio, if you don't hear me paging you, I'm paging you.

Posted by kevin slavin at November 14, 2003 12:39 AM

I love my new pager! One thing that's interesting is that "betting" is a general concept under which fall a number of specific activites. The Ebay-Ultima stuff is specifically arbitrage, which is what the stock market is, which has something to do with where our culture draws the line between skill and luck. I guess that's the heart of's a fundamentally arbitrary line (game vs. gamble, arbitrage vs. bet) that we draw over and over again, marking the dark from the light, the productive from the wasteful (or production from consumption), the player from the parasite. Sometimes there's a big machine drawing the line for its own reasons: witness the Chicago Board of Trade in the 1880s which shut down so-called "bucket shops" as gambling dens. What happened in them, and why did the CBT care? Bucket shops were where you could speculate on small denominations, and they were drawing business away from the CBT's trading floor. I think maybe the salient point is not that online gaming and gambling are inherently so different, but that our culture needs them to be.

Posted by: Kio on November 14, 2003 10:14 AM
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