Pachinko: The Industry with Balls of SteelJuxtapoz // Saturday, 05 Dec 2009
Although many kids these days grow up with a controller virtually strapped to their hands, before the days of videogames there were pinball machines. In a step up from the classic pinball, Helen Soteriou explores the fascinating world of Japanese Pachinko Parlors.
I feel as though I’m in Las Vegas, although this is Tokyo not Vegas and this vertical pinball-like game brings in a staggering amount of money compared to its equally flashy slot machine cousins in sin city.
The first thing that hits me when I walk into a Pachinko parlor is the deafening sound the small metal balls make as they hit the pay-out trays at the bottom of each machine.
The layout, machines, bright lights and noise are all much-of-a-muchness as enter and get asked to leave a dozen or so parlors for taking photographs.
Pachinko originated in Nagoya, Japan in 1945 where military aircraft manufacturing firms were thinking of ways to use up ball bearings left over from WW II.
It was marketed as form of entertainment for the Allied Forces. It took off when highly sought after commodities such as tobacco and chocolate began to be used as prizes.
Players pay money and they rent ball bearings which they propel into a maze by flippers. Arrays of small nails guide the path of the balls.
When a ball enters a scoring slot 3 dials begin rotating and if all three symbols / numbers line-up the winner takes the jackpot, otherwise the balls fall into the gutter at the bottom of the machine.
When a jackpot is hit, Pachinko balls fill up a plastic little box, which is placed at the base of the machine. The tray is then placed though a ball counting machine and a customer can choose a prize according to the number of balls won.
More than 95% of players don’t bother with these little prizes and just wait until they have enough token prizes to exchange for hard cash at a discreet independent hole-in-the wall near the premises.
The prizes purchased at the counter are then sold to a prize wholesaler who in turn sells the prizes back to the parlor owners.
The National Police Agency regulates the price of the ball bearings, the shooting speed and the probability of repeated jackpots.
There are no official statistics on the amount of money it brings in but an estimate by the Entertainment Business Institute for 2007 was that the industry was worth 2.8 trillion yen in revenue (win). Handle was about 27 trillion yen. Value of handle refers to the total sum of Pachinko balls bet to play.
Pachinko is also a murky industry in the eyes of the law but this could be set to change soon.
Gambling is currently outlawed here but according to official legal interpretation Pachinko is ‘not gambling’. It is the cash exchange of Pachinko wins that is illegal, which is why players exchange prizes at independent booths off the premises.
Political parties are currently debating the possible legal structures of the introduction of casinos in Japan, and whilst it will not be within the next year or so, it has brought the issue of gambling to the surface.
“It will force the police authority to define more clearly what is Pachinko’ states Professor Toru Mihara, an expert on Japanese gaming law.
“We need to start to discuss. We are obliged to corner the police authority to define themselves, which means the police authority will go to the industry and control them more severely’.
“That will lead to a lot of transparency in the industry.”
In terms of the casinos being a threat, both industry and analysts feel that Pachinko does not need worry in the short term, as the market and clientele are sufficiently different; although the Pachinko industry would not mind a slice of this pie as well.
Professor Mihara states that, “Some Pachinko machine manufacturers are interested because they have a stake in the outside world, but they are not speaking loudly because it is forbidden, because it is illegal in Japan.”
“It is difficult to get companies to say ‘Hey, I want to be involved in casinos’. It is difficult under the current social circumstances for big companies to raise their hands.”
There is also speculation and disagreement as to whether Pachinko can successfully jump on to the internet bandwagon.
Chief researcher at the Entertainment Business Institute, Takashi Kiso states the market is very limited in Japan but goes on to say, “To be popular for online-Pachinko in Japan, more game element and tie-up content with other media (TV shows, animations, video games etc.) will be needed. Those factors will make Pachinko popular in Japan. However, the major manufactures who are able to develop such Pachinko machines will never get into the online market because it is illegal in Japan.”
Western analysts are far more cautious of virtual Pachinko.
Ed Barton, analyst at Screen Digest stated that he has not heard of much interest from Western operators. “I would argue that if Pachinko is online, it’s not Pachinko. Defining characteristics of the game include the visceral, physical, and random nature of the metal balls working their way through the machine.”
“Of course Pachinko inspired online games could and probably have been offered online in the West - after all slot machine online games do very well. I cannot think of anything I have heard indicating that Pachinko will take off online in Western markets. Given the widespread cultural lack of familiarity with the concept outside Japan, I would be surprised if it ever does.”
So for now the balls will continue to clang and the tills continue to ring in this mind-bogglingly lucrative industry. –Helen Soteriou