March 15, 2008
Pokie machines have an almost inexplicable attraction to some people and Nelson psychologist Philip Townshend is at the frontline of trying to understand why. He talks to Geoff Collett .
AT A GLANCE
The money-go-round
Total fed into pokie machines in a year: $2.4 billion.
Total retained by the machines: $1.02 billion.
Total paid back to punters: Unknown, but no more than $1.37 billion.
Proportion of the total spent that has been "recycled" (ie, winnings fed back into machines): Unknown.
Total turnover of pokie machines: $7.5 billion (most of this is "virtual money", ie, uncollected credits).
Total pokie proceeds distributed in community grants: $304 million. Total pokie proceeds paid in tax: $331 million.
Total pokie proceeds retained by venues and machine owners: $385 million.
Information taken from the first three months of data obtained by the electronic monitoring of pokie machines (these figures are based on the monitoring returns for May-July 2007, then extrapolated out to 12 months).
Proportion of New Zealanders who say they play the pokies: 19 percent.
Proportion who say they play the pokies regularly: 5 percent.
The main denominations for playing the pokies are $20 notes (the highest denomination the machines can accept); and $2 coins (the denomination winnings are paid out in). Electronic monitoring data suggests that over the course of a year, the number of $20 notes fed into the machines is equivalent to 1.2 times all the $20 notes in circulation (of which there are about 60 million); while the number of $2 coins that get put into pokies is the equivalent of six times the total of all the country's $2 coins (72 million). _
Source: Problem Gambling Foundation/Philip Townshend.
Given that it is all but impossible to avoid the things, it is strange to think how little most of us really understand about those weird, clattering, trilling, clanging, blaring devices we so familiarly know as pokie machines.
Of course, we know they're a mug's game. We know they are blamed for all manner of social ills, perpetrated by those tragic souls who find their lure irresistible and end up in dire straits as a result. We also know the argument that they at least partly compensate for the damage they do by feeding precious dollars back into the always- needy charity sector.
But get beyond those surface sort of generalisations and it has to be said that pokie machines - and especially the real effects they have on their host communities and their target markets - are arcane things indeed.
Meeting Nelson psychologist Philip Townshend both reinforces that sense of mystery and, partly at least, dismantles it. Townshend is one of our leading researchers on the effects of pokies, under the auspices of the Problem Gambling Foundation, of which he is research director, but also as a long-time counsellor of problem gamblers.
If his decade or more at the front-line of the psychology of problem-gambling has taught him one thing, it is that it has to be seen as a relationship between man and machine - and that the relationship can be decidedly opaque.
Townshend also knows that, as he puts it, "data is power". The more that can be gleaned, understood, analysed from both man and machine, the better equipped society is going to be to start tackling the pokie machine's deleterious effects.
For a man who has seen more than his share of the damage wreaked by gambling - especially by addiction to the pokies - Townshend is surprisingly non-zealous about his area of expertise. He is not, he says, on a crusade. He is pragmatic about the proliferation of gambling. So when he says, "I think pokie machines are like a parasite", it is with a decided absence of venom. He elaborates: "They're a parasite that's under huge evolutionary pressure. A machine that's not profitable is culled and replaced by one that is profitable . . . So they're like a parasite that's evolving to be a more efficient parasite, " through ever-more finely-tuned programming and design.
"I know there's a lot of stuff about people who say they (pokie machines) were invented by psychologists, and to a certain extent that's true, but actually, I think why it's so efficient is that there's been an evolutionary process." He's referring to the extremely and ever-increasingly effective way pokies can hook into an individual's instincts - particularly, he says, the hunting instinct, the one that thrills to the chase and responds voraciously to the pokie machine's willingness to offer up a near-win. "We're hard- wired for that kind of stuff and that kind of pressure . . . so it's not particularly about weak- willed individuals who make poor moral choices, or poor people who can't do maths, or that kind of stuff that you hear about gambling. It is a product that is evolving to exploit us better and better." Behind the bells, whistles, clattering and trilling is a cold piece of software designed only to part punters from cash at a pre-determined rate.
But if evolution has so far been on the side of the machine, the data is starting to catch up. Last week, Townshend was presenting some conclusions from the first substantial information to be captured from one of the new sources in the study of the pokies industry, to an expert advisory group on gambling. The first three months' facts and figures gleaned from a new regime of electronic monitoring of the machines, introduced by the government, has provided a whole new level of detail - and still, for that matter, is not entirely black and white in its meaning.
The numbers are nothing short of mind- boggling (see sidebar), and it is hard to follow aspects of the money chain, particularly given how much money is recycled through machines, and that most of the "turnover" that goes through the pokies is only ever virtual money - nothing more than credits played and lost over the course of a session.
But the confusion, Townshend argues, is part of the point. "You can't understand this kind of gambling by looking at the machines. You have to look at the human-machine relationship." For instance, it's fine to say that an individual pokie is programmed to pay out about three-quarters of every dollar fed in; but that doesn't account for the player's willingness to feed that pay- out straight back in again, and so inexorably erode the true amount players recover.
The early findings from the electronic data monitoring raise as many questions as they appear to answer, including around the distribution of machines, and how popular the machines are in different socio- economic areas (the assumption that they are more popular in poorer areas appears only partly accurate). But to researchers like Townshend, such information is gold, or at least gold-rich ore.
"The more we know about it, the more power we give the individuals who are involved in it, " Townshend says. "That's what really motivates me about the research." He points to a Canadian study which suggests that if people have sound information about how much they are winning and losing over a period of time, it affects how much they will spend. Not surprisingly, machines are designed not to give you that information. Give it to the punters and you're giving them power, Townshend argues.
But it is not solely about understanding the machines. Townshend emphasises the human part of the equation. Talking to gamblers about how they behave, studying their behaviour (closed-circuit television footage has proved useful in one recent project), even researching the neurobiology is all unravelling the mysteries of how and why the pokie machine's pull has proved so powerful for some.
But Townshend's pragmatism shows through again when asked what, for him, the end game should be. Surely getting rid of the things? He doesn't think so. Get rid of them and there'll be a hole in the market. Every product has its life, he points out, and when that life expires a vacuum appears for purveyors of gambling products to fill.
Already, one potential substitute is clear on the horizon if and when pokies have had their day: Internet gambling, as in the variety which allows anyone to play a game of chance through the World Wide Web, staking their money via a credit card. It hasn't yet caught on in New Zealand - various theories are put forward, including Kiwis' innate distrust of using their credit cards online and the relatively poor quality of broadband access here. It is not a given that it will ever catch on, but its potential is hair-raising. For one thing, whereas pokies are supposed to primarily exist to make money for their host communities (through the pay-out of profits as grants), Internet gambling is purely about making profits for off-shore operators. But beyond that, "imagine your wife coming out of the office at home saying, 'by the way honey, we have to move'. It could happen."
It is the next focus of Townshend's research, thanks to a Churchill Fellowship he has recently secured for travel to Europe. Internet gambling's social effects are poorly understood the world over; preliminary research suggests "that there's widespread confusion" about what is going on. Townshend intends to make Internet gambling clients the priority in his studies in the UK later this year.
When the law surrounding pokies was drastically liberalised in 1998, a flood of problem gambling was triggered, with the punters responding to the new, more lax rules in unforeseen ways. Support networks and regulators have been playing catch-up since. Townshend thinks New Zealand has done pretty well overall in getting to grips with the affliction brought about by the love affair with pokies. But if the next wave of problem gambling is to arrive via the Internet, he hopes the country can be a little better prepared. Nelson Mail
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