Blurring boundaries: the expanding world of online entertainment

Technology

Sponsored by SOFTSWISS

Leading tech software company SOFTSWISS reflects on social casino trend

Social casinos are gaining popularity as they offer the same thrill as classic casinos but without the risk of gambling for real money.

These platforms are merging traditional gaming with iGaming, creating new ways to engage players. According to statistics from the largest European slot game social casino, SpinArena.net, the number of players in 2024 has tripled since the beginning of 2023.

Let’s break down how social casinos have become a trend and why big industry players are betting on them.

How social casinos work

Social casinos use virtual currency instead of real money. They stem revenue primarily by selling virtual items that enhance the gaming experience without monetary risks.

“Players of social casinos can purchase chips and use them for in-game rewards,” says Max Trafimovich, CCO at SOFTSWISS, a leading global software supplier for the iGaming industry. “But there is no option to cash out winnings. All purchases are no different from, for example, buying some armour in an online fantasy role-playing game.”

As social casinos do not involve real money withdrawals, they do not require the same stringent regulations as their traditional counterparts. These platforms open doors for businesses to reach new demographics and global markets, providing fresh ways to engage users.

The absence of real money withdrawals also eliminates the associated risks of money laundering. As a result, players are not subject to KYC or anti money-laundering checks. That is why people can play at social casinos on Facebook, or on similar mobile applications that can be found on AppStore or Google Play.

The transformation of social casinos

Social casinos rose in the mid-2000s, mainly thanks to Facebook – the platform offered free development tools that quickly spread to provide virtually unlimited reach.

Today, the global audience for social casinos has reached 85 million, according to the Australian Communications and Media Authority. This market is expected to reach €10 billion by 2030 according to Business Research Insights.

According to Statista.com, the social mobile casino has grown to become one of the top-grossing mobile gaming genres worldwide, after role-playing games, strategy and match games.

“The success lies in how social casinos combine the excitement, adrenaline and potential for winning something with a social layer,” explains Trafimovich. “Players no longer just compete against the house as in a usual casino. They unlock achievements and engage in friendly competition, bragging to each other.”

The intersection of gaming and gambling

The mechanics of social casinos are not the only bridge between gaming and gambling. The street is two-way – the “gamblification” of gaming is also an expanding process.

MMO games have increasingly adopted elements traditionally associated with gambling. For example, loot boxes offer the chance to acquire exclusive in-game items and features through real-money purchases, keeping players hooked.

This crossover highlights the growing synergy between the two sectors, enhancing player engagement by infusing the excitement of gambling with the interactive nature of gaming.

“We are not talking about the fact that at some point in the future gaming and entertainment will completely merge. But there certainly are some things that interpenetrate each other,” says Trafimovich.

Social casinos as a strategic investment

The rise of social casinos, with their massive loyal player base and impressive retention rates, is understandably drawing the attention of major iGaming companies. SOFTSWISS, a leading technology provider of software solutions for iGaming, has recently announced a stake acquisition in Ously Games GmbH, the driving force behind the fastest-growing European social casino, SpinArena.net.

Ivan Montik

“Anticipating the development of social casinos, SOFTSWISS made strategic investments to diversify its portfolio,” says Ivan Montik, SOFTSWISS founder, on the company’s strategic plans in this sphere. “Together, we aim to create a comprehensive platform for social casinos, enriching the robust ecosystem of iGaming products provided by our company.”

“By developing a B2B platform with our new partner, we are confident that our combined resources and expertise will soon enable us to offer the market a top-notch, highly scalable B2B solution with a high degree of customisation,” says Ously Games GmbH founder Jochen Martinez.

Social casinos represent a strategic opportunity for B2B enterprises to diversify and enhance their portfolios, offering a viable alternative to traditional gambling. They are also a gaming environment where players are notably more inclined to spend money. According to Statista.com, social casinos generate over 76 per cent of their revenue from in-app purchases and only 24 per cent from advertising, showcasing one of the highest rates of in-app purchases across all mobile game categories. This robust financial performance underscores the growing appeal and economic potential of social casinos in the digital gaming market.

For more information, please visit www.softswiss.com