Could Japan Capitalise on the Popularity of Pachinko?

Pachinko is a popular pinball-like game in Japan and its origins are said to date as far back as the 15th century, although the Japanese only started to put their unique spin on it in the late 1920s by creating the early pachinko machines.

Pachinko first came about in Nagoya and the game began to become popular in the 1940s once the production of machines resumed after the war. Although the game has based itself on European games that have progressed throughout the ages, pachinko has become quintessentially Japanese. Nowhere else is it as popular as it is in Japan.

Playing games with the authorities

Except for horse racing, betting on some motor- and vehicle-based sports and lotteries, the Japanese authorities frown upon gambling (anyone who runs a gambling house runs the risk of up to five years in prison). The game's connections to the Japanese mafia certainly don't help matters; nevertheless, pachinko and pachi slot machines are legal, even though some in society would consider it a form of gambling.

If you like pinball machines or slot machines, the chances are you'd take to pachinko and pachi slots. The object of pachinko is to use the wheel on the machine to deposit as many ball bearings as possible in the hole in the middle. You can then exchange a coupon that displays your winnings for a prize at the hall; however, it's possible to get around this and convert the coupon into cash instead. Despite being a bit of a grey area, it's legal. All the prize winner has to do is take the coupon to a cashier based close the parlour but not actually in the parlour building itself.

This might be going on right under their noses, but the authorities aren't going to let the parlours have it all their own way. Recently, they legalised gambling casinos, which are sure to cut into the pachinko industry's share of the gambling pie. They also imposed restrictions on the amount of pay-outs in parlours, which could drive players away. None of this is stopping pachinko parlours investing in their businesses, though: each year, 1.5 million machines go to parlours.

That's not to say the casinos have the last laugh either. The Japanese government is anxious not to let citizens become hooked on gambling. These concerns have led them to make it the law that local residents can visit casinos no more than three times per week. They'll also have to pay to get in. Not that some of this will bother the casinos. Experts have predicted they'll earn billions of dollars in profit and, likewise, bring in plenty of tax revenue.

If only they had online slots...

The Japanese love gaming. That's clear. If they're this eager to get around gambling laws in the way they do so, they'd probably enjoy the online slots, which are particularly popular in the UK. In the UK, players can game and gamble without worrying whether the eyes of the law are on them or not. Online slots are a popular pastime in the Western world and as they're similar to pachi slots, pachinko players could also find them tremendous fun.

Why? Well, firstly, there are no complicated rules. In the case of the pachinko machines, you just have to put the ball bearings in the hole; in the case of the pachi slots, you insert your money, place your bet and activate the pay lines, then play to get a line of symbols that will pay out. Best of all, you can control when the different reels stop, which has the potential to increase your chances of winning.

Secondly, they're just so exciting. The player doesn't know what those reels hold or how they're going to fall. There's a constant element of challenge as well in the pachinko games. The player will always strive to get more ball bearings in the hole.

Thirdly, online slots give you an opportunity to practise. Walk into a pachinko parlour and there's no trial run. You just start putting your money into the machine and learn as you go along - which can be from your wins or losses! Enter an online casino for the first time and you can get some free credit and/or you can learn how the slots work and get familiar with them before you start playing with real money.

Lastly, there's the question of the pay-outs. Whereas the Japanese authorities have placed restrictions on the amount a player can win at pachinko within a 4 hour timeframe, the online slots offer players much more freedom. Jackpots are large, creating opportunities to win big, and slots also feature extra benefits such as bonus games and chances to win extra or play for longer.

Missing a trick?

One in every 11 citizens plays in a pachinko parlour once per week - and the nation is spending no small amount on the game. Citizens are popping $200 billion into the machines each year, which could be why the Japanese government aren't coming down as hard on the industry as they might do, despite the official line on gambling.

To put things into extra perspective, this amount is more than 30 times the amount of revenue generated from gambling in Las Vegas, the casino capital of the world. It's also double that of the country's export industry. If you're from New Zealand, prepared to be staggered even more: it's more than your country's entire gross domestic product (GDP).

There might be fewer parlours than in 2005 — a third fewer, to be precise — and the industry may have resorted to appealing to younger consumers, but the statistics above show there is still a large appetite for gambling in Japan. If the authorities were to say yes to online gambling, they'd set the nation's coffers up for a substantial amount of revenue. They should note that online gambling sites encourage responsible gambling, which would help to allay the Japanese government's concerns about addiction and could lead to an arrangement that suits them, the citizens and the casinos. Everyone could win.

• Japan Zone guide to Pachinko