- May 03, 2023
For decades, Japan has been a country that strictly bans physical casinos. Despite their popularity around the world and the potential revenue they can bring to any country, gambling is still seen as a taboo activity in Japanese culture. However, the plan to establish a physical casino in the country has already been proposed years ago. But because of the pandemic, the plan has been halted.
Now, Japan is looking forward to the first-ever casino in 2029. In this article, we explore what this could mean for Japan’s gambling industry, the online gambling industry, and the other benefits that it will bring not only to Japan but to Southeast Asia and Asia as well.
Osaka: The Future Gambling City
Japan will soon open its doors to not only pinball machine players but to other types of gamblers as well. The new mega-resort complex worth US$8.1 billion, opening its doors in 2029, will be situated within Osaka’s Yumeshima. It is an area currently being developed into a commercial hub filled with shopping centers, hotels, and other attractions, based on the 2017 government plans.
The casino is said to feature what are currently illegal gambling games like poker and baccarat. Additionally, the complex will feature the first casino along with hotels, restaurants, spas, theaters, a conference center, shopping malls, a museum, a ferry terminal, and a helicopter pad.
The purpose of opening the first-ever casino in Japan is simply to generate money from the casino. Clearly, the pachinko market is not enough. Thus, the Japanese government decided to enter the gambling market in a different way.
Current Pachinko Gambling Market
Japan is no stranger to gambling. However, these gambling activities are mostly regulate to pachinko parlors. In pachinko parlors individuals can win other things besides cash by playing slot-like machines. With more than 9,000 pachinko parlors established in Japan, indeed, the pachinko market size in Japan is big. In 2019, the pachinko parlor market generated about JPY20 trillion (US$150 billion).
Unfortunately, this number will not continue to increase for the following years. The pachinko parlor market size drastically decreased in 2020. From JPY20 trillion (US$1450 billion), it became JPY14.6 trillion (US$106 billion). And 2021 wasn’t even kinder to Pachinko parlors. The market size did not increase or decrease. There was also a decrease in pachinko parlor operators by the end of last year, 2022. From around 2,347, there were only 2,053 pachinko parlor operators left.
Moreover, the number of pachinko parlors operating in Japan has also decreased. From around 9,000, by the end of 2022, only 7,365 pachinko parlors were operating. This is the reason why the pachinko gambling market is no longer enough for Japan.
Southeast Asian and Asian Gambling Market
Due to the introduction of the 5G technology, users could have a seamless gaming experience. Operators in Southeast Asia decided to partner and invest in 5G worth US$ 40 billion. Moreover, the increase in internet penetration in the region, plus the low prices of smartphones in both urban and rural areas, helped with the growth of the gambling market, especially the online gambling market.
As a result, the Southeast Asian gambling market is expected to increase by 8.6% annually up until 2025, with online gambling being the one to increase the most. Hence, online gambling in Southeast Asia is expected to reach US$1.08 billion by the end of this year. Conversely, the whole Asian gambling market is forecasted to reach US$11.218 billion by the end of this year.
But with the first casino in Japan, the Southeast Asian and Asian gambling market can expect another reason for growth. The first casino will serve as a new gambling establishment for gamblers in Japan and other people from Southeast Asia and Asia.
Benefits to Japan
Attract Domestic and International Tourist
According to the Mayor of Osaka, the opening of this casino will be the turning point of the city. It’s estimated that upwards of 20 million visitors, both locally and internationally, may pass through its gates each year. This will bring in around US$3.8 billion per year. The mayor of Osaka itself stated that this would be the turning point of the city as it may attract not only the locals but some other neighboring Asian countries, like China, Singapore, South Korea, and the Philippines, that love to gamble as well.
With more people visiting the gambling city or the casino itself, the Japanese government may look forward to collecting more tax revenue in the near future. Any legal establishment, like a casino, operating in a country must pay its taxes diligently. Now, these taxes can be used by the government to fund the country’s other projects.
With new types of work means, there are new workers needed to operate the establishment. This gives employment opportunities for unemployed people in Japan.
There are already many resort casinos in the world. All of which have already made a name in the industry. With the first-ever resort casino in Japan, the country will have the opportunity to compete with these bigwigs in the gambling industry and increase its reputation as well.
Benefits to Online Gambling Industry
As for the gambling industry, we can expect that as more gambling establishments are being opened to the public, more people will become interested in gambling. This also includes online gambling as well. This Osaka's first casino will allow Japanese citizens to gamble but for only a limited amount of time. Therefore, expect that more people will seek more ways to gamble.
As a result, the online gambling industry must prepare for the possibility of an increase in gambling interest. And they can grab this opportunity to create an online gambling platform for them, wherein they can conveniently place their bet and withdraw their winnings.
All things considered, launching Osaka's first casino in 2029 should prove beneficial both regionally and nationally in terms of the economic gains brought forth. Not only will the first-ever casino in Japan be beneficial to the gambling industry, but to the white label iGaming industry as well.
The opening of a new casino can create opportunities for white label iGaming companies to expand into new markets. For example, if a casino opens in a new country or region, white label iGaming companies may be able to enter the market by offering their services to the casino or partnering with local businesses.
Moreover, as previously mentioned, a new casino can increase interest in gambling. Some of which may find online gambling more interesting. White label companies can benefit from this increased customer base by offering their products and services to casino customers.
Finally, white label companies may be able to form partnerships with casinos to offer their products and services to casino customers. That said, choose TC-GAMING White Label iGaming to enter Japan’s gambling market. With its 16 years of experience in the white label industry, TC-GAMING provides market information and market analysis because of its deep understanding of the online gambling industry.