9 Jan

History of Gambling in Sydney — Developments, Trends and Outlooks

Sydney’s gambling history really began in 1956, when gaming machines were legalized across the state of New South Wales. Gambling had existed in many forms until then, but for a state (and indeed a country) that would become so obsessed with gaming machines, this was an important year.

Prior to that, most of the gambling in Sydney was illegal, although the police were often paid-off and so there was little threat of arrest or prosecution for those that participated in such activities. These illegal dens were full of hedonistic pleasures, from drinking to poker, bookmaking and more. One of the most famous of these was the Forbes Club, which operated illegally and freely for many years, despite the fact that it was openly signposted and was located just around the corner from a police station.

This was a time before modern slot machines, where nothing but the most basic of machines existed, but there was still plenty of gambling to be done. In later years, slot machines began to take over, becoming by far the most popular method of gambling in Sydney and across the country. In the 1960s, there was a lot of speculation that the slot machine developers were backed by the mafia, and there were also suggestions that it was the mafia who first tried to bring these machines into the country. Rather than raising questions about their legitimacy, this merely proves that the mafia saw the money making potential of these machines very early on, a potential that was realized by others in the years that followed.

Slot machines began to pick up in the 1980s. Prior to that they consisted of just three reels and the payouts were often very small (certainly by today’s standards), but in the 80s the first video poker machine was released and the obsession truly began. These were much more attractive, much quicker to play (requiring players to push a button, as opposed to pulling a lever) and the jackpots they offered were much bigger. Computer chips then became common practice in pokies, and eventually slot machines became entirely computerized with the invention of online slot machines.

These days Sydney, and its state New South Wales, generates more profit than any other. Half of all of Australia’s pokies are located in New South Wales, with a huge number of them in Sydney. These machines have grown in popularity over the last decade; even with the inception of online gambling, pokies have increased both in popularity and number. It’s not just the casinos that make money in Australia either; in 2003, in the clubs and pubs of New South Wales, there were nearly 76.000 pokies. These turned-over close to $35 billion, which created nearly $500 million in tax revenue and around $3 billion in profits, compared to the $500 million or so in profits that the casinos received.

To this day, the clubs and pubs still make more money than the casinos, with 3 out of every 4 of the state’s slot machines located in a club. Pokies have been on top for a considerable time, and nowhere is this more apparent than it is in Sydney. The future of these machines is unlikely to be as bright and prosperous as their past though, as they are raising a great deal of problems. There is a very high percentage of problem gamblers in Australia and in Sydney, and as this number climbs even higher, it will surely be a matter of time before the government steps in.

There was a suggestion that the government understood the potential for harm in 2001, when they passed the Interactive Gambling Act. This banned real-money gambling companies (such as online casinos) from advertising their services to Australians. Despite this law, it was estimated that in 2009 7 out of 10 Australians gambled, with most of them hitting the pokies. This makes it clear that it doesn’t matter whether the companies advertise or not, because pokies and gambling are so ingrained into the culture of Australia that it comes second nature to them. By default, problem gambling is also second nature, which might just spell the end of such accessible gambling at some point in the near future, certainly in Sydney.