LAS VEGAS - The long-held distinctions of what constitutes gambling will continue to shift as younger players increasingly view real-money and free-to-play games as a single entertainment form, industry figures said at a gaming industry conference Monday.
Key Takeaways
- Industry leaders at G2E said younger players increasingly see gambling and gaming as blended entertainment, not distinct activities.
- Free-to-play and social casino platforms are booming despite growing legal scrutiny across several states.
- Experts predict continued growth in digital, skill-based, and self-competition games as the definition of gambling evolves.
Online gaming has grown from digital versions of traditional casino games to a massive industry generating hundreds of billions of dollars in handle and encompassing free-to-play and peer-to-peer games. As state and national governments wrestle with how to handle these games, many players don’t view them as gambling.
This is altering the entire gaming industry and opening it up for further growth, said Meredith McPherron, CEO of Drive by DraftKings, a gaming-focused venture capital firm backed by the eponymous online gaming company that invests in developing online gaming platforms. Speaking at a panel Monday during the Global Gaming Expo, McPherron said online gaming is in its “early innings” as a growing number of players embrace the wide variety of novel gaming avenues.
“A big part of this is the normalization of betting and gaming,” McPherron said. “It was in the shadows for many years, and it was considered a bad thing.”
“Now people view games as something they can play and get a payout, and that’s just part of the experience.”
New gaming ventures take shape
Online sports betting has been approved in 39 states, Washington D.C., and Puerto Rico in the past decade, altering the relationship between sports and fans and helping usher in an American populace that now recognizes gambling as a credible entertainment form after centuries as a taboo vice. Though real-money online casino gaming has been limited to seven states as lawmakers fear gambling addiction and lost revenues to brick-and-mortar gaming establishments, there have been ample digital gambling - or gambling-adjacent - avenues to take its place.
Hundreds of free-to-play social and sweeps casinos are now available across much of the country. These sites advertise online and on television, allowing players to play without depositing cash while offering the chance to earn prizes.
The argument that these are offerings are not gambling has been used by many of the games’ proprietors as justification for their legality and continued operation. This business model has come under increasing scrutiny in at least a dozen states, with legislative efforts passed by state legislatures in New Jersey, Louisiana, and California with more states likely when the 2026 legislative season begins.
In the meantime, many still operate, generating billions in revenue each year.
This comes as prediction markets offer a growing number of event contracts, including on sporting events. Regulated gaming leaders at Monday’s conference, not surprisingly, decried these offering as explicitly illegal, but their fate remains undetermined as they face legal battles in multiple states.
As many of these platforms face increasingly legal scrutiny, free-to-play daily fantasy and pick’em sites remain entrenched in the gaming sphere with millions of customers across most U.S. states. They are accompanied by a growing number of contest-driven platforms such as Triumph, which offer entry fees on skill-based games and payouts for winners.
For a significant number of players, this distinction is irrelevant, industry stakeholders say. Stock trades, gaming, and a host of other rapidly growing digital verticals can, in a sense, replicate gambling, blurring the lines between what is a bet and what is merely any other form of entertainment.
McPherron said even the integration of health apps into daily lives reiterates the proliferation of gaming; people are, indirectly, betting on themselves on improving their health, so it's increasingly similar to betting with real money.
“We can gamble, we can bet on ourselves, but when you put, whether it's 10 cents or $10 down or whatever it is, it’s viewed like it's competitive entertainment, and that's how I think more people will view it,” McPherron said.
