There’s a lot to think about before launching a casino on the internet. One of the many aspects is determining what type of casino you’d like to run. At the most basic level, there are two main internet-based casino business options: a free-to-play social casino or a real money gambling online casino. There is a notable difference between these two operations. Though both can be profitable, how they are operated, what is required to operate them, and how you generate revenue is very different. In this article, we’ll discuss social casinos vs online casinos, helping you to clear up any confusions you may have about them, so you can decide which option you feel is worth pursuing as an operator.
Social Casinos and Online Casinos defined
Before learning about how they differ and how they are similar, it’s first important to start by defining these two operations.
What is a Social Casino?
A social casino is an online and/or mobile platform that offers players free-to-play social casino games such as slots, table games (e.g. poker, blackjack, etc.) and other gambling-like games (e.g bingo, scratch cards, etc.). Though the games are similar to those you can find in a casino, these games are not played using real money and real money is not paid out when a player wins. Though users can play solo, they can also play with or against other players or friends, hence the “social” aspect of this type of casino experience. The bottom line – social casinos are for entertainment purposes only.
Social casinos are not regulated and can be accessed by anyone. Social casinos are available through a computer or mobile web browser or by downloading computer or mobile apps.
Here are the basics of how social casinos operate:
- It is free to download as an app or access instantly via the web
- Players can sign up/join for free
- Players play for free using virtual coins*
- Players can win virtual coins or other virtual prizes/gifts (e.g. special awards etc.)
- Types of social gambling games include: Slots, Video Poker, Poker, Roulette, Blackjack, Baccarat, Bingo, etc.
- Social casino operators primarily make money via in-game (in-app) ads and in-game (in-app) purchases
*Players have a limited number of virtual coins. Coins can be replenished by winning games. They may also be awarded every day a player signs in to play, if a player watches an ad, etc., just like other similar free-to-play mobile games. Players also have the option of purchasing more coins.
When did social casinos start?
Social casino games are nothing new and gained popularity in the 2000s with the help of social media platforms like Facebook. The social network giant introduced hundreds of millions of users to the social casino experience, with social gambling popularity reaching new heights with the launch of Zynga Poker.
Created and launched in 2007, Zynga poker is a social game that was initially developed as an application for Facebook as well as iPhone, Android, Windows Phone, MySpace, Windows, Google+, and Tagged. The game allows players to simulate playing Texas Hold’em poker in a social gaming environment that includes the option of playing with friends.
Today, examples of popular social casinos include:
- Black Diamond Casino
- DoubleDown Casino
- Big Fish Casino
- Vegas Fever
- Lucky Play Casino
What is an Online Casino?
As you are likely already aware, an online casino is a digital real money gambling (RMG) platform that welcomes age-appropriate customers to deposit, bet, and win real money. Players wager on casino games for a chance to win cash, bonus funds (that can be used in the casino like real money to win real money) or other physical prizes. In short, online casinos essentially function using the same principles as a traditional land-based gambling establishment. The bottom line – online casinos provide gambling entertainment for players who want to win money.
Online casinos are required to be licensed and regulated and are age restricted (usually 18+). These casinos can be accessed by players via a website or mobile app.
Here are the basics of how online casinos operate:
- Players can sign up and register an account for free
- Players must provide personal information that must then be verified to prevent underage gambling and fraud
- For a chance to win a real money prize, players must make a real money deposit using an available payment method (e.g. credit card, debit card, eWallet, etc.)
- Players can take part in special promotions for the chance to win real money or other prizes such as free spins, bonus funds, physical prizes or even trips.
- Types of online casino RMG games include: Slots, Progressive Jackpots, Video Poker, Scratch cards, Roulette, Blackjack, Poker, Baccarat, Craps, other table and card games, Slingo, Bingo, Keno and Live Casino games.
- Online casino operators make profits via each game’s RTP (Return to Player)/house edge, from player losses, and commissions (rake).
When did online casinos start?
Online casinos have been around since the mid-1990s with gaming software company Microgaming credited as launching the very first true online casino in 1994. Interestingly, it was also Microgaming who launched the first mobile casino software in 2004.
Today, there are tens of thousands of online casino operators across the globe and hundreds of software developers. Examples of popular online casinos include:
- Dream Vegas
Seeking more information about running your own iGaming operation. Learn how to start an online casino business.
What Are the Main Differences and Similarities?
Though there are some obvious differences between these two types of casino software platforms, in some ways, they share distinct similarities as well. Here’s a closer look at both.
- Social casinos do no require a gambling license – Since real money is not required to play social casino games and real money cannot be won, social casino operators and game developers do not require licenses from gaming control boards, such as the Malta Gaming Authority or UK Gambling Commission, to operate. However, to operate a legitimate RMG online casino, you require the appropriate remote gambling license from the jurisdiction where you offer your services and must adhere to regulatory compliance. Failure to do so can result in stiff penalties and even closer of your business.
- Players bet real money and can win real money at online casinos – Although registered players at online casinos can usually demo the games in a free mode and play without betting real money (and also not winning real money), for as long and as often as they like, primarily, people play at online casinos for the thrill of a chance to win money. At a social casino, players never bet real money or win real money. If they ever decide to spend real money at a social casino, it is only to purchase more virtual coins or other virtual perks.
- Social casino games are not age restricted – Even though many social casino apps are rated for teens and publishers state that the games are for players 18+, etc. the reality is that anyone (of any age) can download or play these games. Online casinos on the other hand, are age-restricted. They are required to do KYC (Know Your Customer) checks, such as requiring customers to provide proof of identity and proof of residence (e.g. valid driving license, passport, utility bill, etc.) to prevent minors from engaging in gambling activities.
- It is often easier to find success with an online casino – Although you could start your own social casino if you find the appropriate software or create your own social games, the reality is that the social casino market is already heavily dominated by the likes of software companies like Zynga, AGS Interactive, Big Fish and Playtika. Moreover, it is a business driven by hits that requires operators to stay on top of the latest content trends, gamification (challenges, tournaments, leveling-up), and user acquisition. Although there is no guarantee of success when starting an online casino, there are more software platforms that can help you get your foot in the door with different solutions, including white label casino opportunities.
- Both incentivize players to continue playing – Online casinos have bonus systems designed to keep players engaged with bespoke promotions, tailored offers, and gamification features. They also have welcome offers for new players as well as VIP and loyalty programs that offer exclusive perks. Social casinos also incentivize through similar gamification features (e.g. leveling up, challenges, missions, etc.) to keep players returning (and buying more in the app).
- Both can be profitable for operators – With the right marketing tactics to acquire and retain users, reliable support, popular and unique content, and seamless play, both operations have the ability to rake in revenue.
- Both can be addictive – It’s a known fact the real money online gambling can be addictive. However, the same can be said for social casinos, even though no RMG takes place. According to a report published by Gambling Research Exchange Ontario, social casino games can have a significant impact on gambling behaviors. For some people, these games, though free-to-play, can act as a “gateway” to online gambling. Additionally, social gambling has been linked to increasing the frequency of betting in gamblers.
Social Casino Vs Online Casino Conclusion
The most obvious difference between social casinos and online casinos is the real money gambling factor. Though there are some similarities between the two, ultimately, they are very different money-making operations that require very different strategies in order for operators to turn a profit.
Keen to get started on planning your own online casino business? Check out our online casino software reviews or get in touch with the TCS team!