The semi-legal game faces potential regulation, and parlor operators may have to compete with new casino resorts.
Sometime this fall, Japan may finally allow casinos—a move expected to bring in new revenue for a country with a sluggish economy and big bills to pay for new infrastructure related to the 2020 Summer Olympics.
Such a decision could also bring legitimacy to one of Japan’s most popular vices, pachinko.The pinball-like game, in which a single player turns a handle and watches silver metal balls bounce off the machine’s pins as they trickle down to determine the player’s payout, has long existed in a legal gray area.
Popular in Japan since the 1940s, pachinko has managed to avoid being classified as a gambling activity thanks to a complex cash-claiming process in which the winner obtains tokens at the parlor, then takes the tokens to a third-party store where they are traded for Yen. Prizes—alcohol, pens, electronics—can be claimed inside the actual parlors, however.
It appears as if the game’s popularity peaked around the same time as the country’s economy. According to Reuters, pachinko revenues have been dropping across Japan’s estimated 12,000 parlors since 1995; from ¥ 31 trillion to ¥ 19 trillion this year. Parlor attendance, according to Businessweek, is down 60 percent since the mid-'90s. Worried that a new generation of Japanese are less interested in playing, the pachinko industry is trying to change with the times, designing machines and facilities that attract more young people and women to typically older, male-dominated parlors.
Classified as an “amusement” activity, pachinko operators don't pay a gaming fee, but legislative discussions over casinos this year have led some officials to consider the revenue potential of taxing pachinko. According to a Reuters report last May, two proposals, one by a gaming-industry lawyer and another by a pachinko lobbying group would both give the state an extra $2 billion in annual revenue.
While a full legalization of pachinko timed to coincide with the introduction of casinos could add social legitimacy to the old pastime, parlor operators will likely struggle to compete with full-scale casino resorts run by gaming giants like Caesar's or MGM.
Earlier this summer, Reuters photographer Issei Kato photographed some of Japan's pachinko parlors, venues that, despite their diminishing popularity, remain a big part of the country's landscape today.