Plainridge Park Casino executives told state gambling regulators Thursday that there is no deception involved in their online casino game, which some have criticized as giving gamblers the false hope of replicating wins experienced online at real slot machines.
Carl Sottosanti, general counsel for Penn National, which owns Plainridge, fired back at critics “whose agenda is to imply we are somehow doing something inappropriate.”
“But I submit that facts are stubborn things and that they dispel” any notion that the company is engaged in deception, he said.
One major criticism of online casino games, like Plainridge’s Hollywoodcasino.com, is that it allows players to win at a higher rate than they can realistically expect at the brick-and-mortar casino.
But Sottosanti said Plainridge doesn’t control the payback percent rate on its online casino game. He said the online payback percent rate is set by the game developer and Penn National merely buys it “as an off-the-shelf product.”
“We do not control online,” he said, adding that Plainridge controls only the payback percent rate on its 1,250 slot machines at its casino, the state’s first, in Plainville.
Rob Gustafson, a representative for the game developer, Scientific Games, said the payback rate for both online and real slot machines falls between 88 percent and 96 percent. A payback rate of 100 percent means players can expect to break even, while any rate below 100 percent means players will lose, but more slowly at higher payback rates.
“Both online and off-line operate within same payback range,” he said.
But the tendency is to set the payback rate higher on the online games, he added.
Players of online casino games do not bet money but can win credits that allow them to compete against other players.
Stephen P. Crosby, chairman of the gambling commission, invited Penn National officials to give statements at the hearing for the educational benefit of the commission. Crosby has said he is not certain the commission has jurisdiction over online casino games, but that the commission should nevertheless become familiar with this fast-growing segment of online gaming.
Sottosanti said courts in a handful of cases have concluded that playing at online casinos does not constitute gambling.
“It’s not gambling, because there is no payment required and there is no opportunity to win,” he said.
He said gambling regulators have decided they cannot regulate online casino games for that reason.
Chris Sheffield, another Penn National executive, said the company is preparing to offer a new element to its online casino game: redeemable credits. But those credits will not be awarded on the basis of winning at the simulated slot machines. They will be awarded strictly on the basis of amount of time spent on the game: The longer a player stays on, the more redeemable credits he or she will get.
Sheffield said players will be able to redeem those credits, though the details have not been worked out. He said Plainridge representatives would return to the commission at a later date for further explanation.
Sheffield said Penn National is moving quickly to expand the number of customers who play its online casino game, because marketing research shows that online customers patronize the brick-and-mortar casino more often than those who do not play online, and they spend larger amounts of money at the real casino.
“Online casino games are an amazing opportunity and a very powerful tool for building loyalty and getting new customers,” he said.
In its first six months, Plainridge’s online casino game attracted about 350,000 players, Sheffield said.
Last month, Keith Whyte, executive director of the National Council on Problem Gambling, told the gambling panel that “it’s pretty clear there are some risks” to online casino games.
“When you simulate gambling online, whether for money or not, you can develop a gambling problem or exacerbate a problem,” Whyte said.
Whyte said the casino industry and its regulators should discuss voluntary guidelines to protect players.