Alexandru Arba
Research expert covering Japan
Gambling industry in Japan - statistics & facts
Japan has a difficult relationship with gambling. Even though gambling is formally prohibited by Japan’s penal code, opportunities to gamble are ubiquitous; from pachinko to betting in various sports disciplines to lotto – the options are ample. This inconsistency between the law and reality can be explained by the fact that gambling, with the notable exception of pachinko, is directly controlled by the government or by local authorities.
Gambling in Japan is a multi-trillion Japanese yen industry mainly composed of pachinko, sports betting, and lotto. Pachinko is the largest segment and generates the lion’s share of the industry’s revenue. The penetration of gambling in Japanese society is substantial. For instance, the active player population of pachinko is in the millions, while there are tens of millions of betting participants at horse races throughout the year.
Other than horse racing, motorboat racing is immensely popular and attracts an incredible number of gambling participants. Betting turnover for motorboat racing was on the rise in the past years, surpassing two trillion yen. Betting turnover for bicycle racing and horse racing administered by NAR has also picked up significantly recently, surpassing the one trillion-yen mark. In general, the total amount wagered at sports race betting events has grown in the past years, especially after the advent of the COVID-19 pandemic.
However, this was not the case for the pachinko industry, which has been contracting for many years and was hit hard by the COVID-19 pandemic. The various advantages brought by digitalization, coupled with the restrictions caused by the COVID-19 pandemic, seem to be game-changers in Japan’s gambling industry. Whether the pachinko industry will slowly dwindle into obscurity and eventually be eclipsed by other forms of gambling, or it will find a way out of its current downward trend remains to be seen. Regardless, the era of digitalization offers new possibilities and poses new challenges to all entities involved.
Sports race betting
Sports race betting in Japan is controlled and administered by organizations affiliated with the government. There are four main sports race betting disciplines: horse racing, motorboat racing, bicycle racing, and motorcycle or auto racing. Horse racing (keiba) is the dominant discipline among betting sports in terms of the revenue generated. Horse racing is administered either by the Japan Racing Association (JRA), which operates horse racing facilities in urban areas, or by the National Association of Racing (NAR), which operates horse racing facilities in more rural areas.Other than horse racing, motorboat racing is immensely popular and attracts an incredible number of gambling participants. Betting turnover for motorboat racing was on the rise in the past years, surpassing two trillion yen. Betting turnover for bicycle racing and horse racing administered by NAR has also picked up significantly recently, surpassing the one trillion-yen mark. In general, the total amount wagered at sports race betting events has grown in the past years, especially after the advent of the COVID-19 pandemic.
Current trends in the gambling industry
An overarching trend observed even before the COVID-19 pandemic was the ongoing decline in the active pachinko player population, and the shrinking attendance at live venues at sports race betting events. The decline in visitors to venues is accompanied by the digitalization of the sports betting industry. Innovations and technology increasingly provide consumers with flexible and exciting user experiences. This strategy seems to have worked well with sports betting, reflected in increased gambling turnover despite a significant overall decline in attendances at venues.However, this was not the case for the pachinko industry, which has been contracting for many years and was hit hard by the COVID-19 pandemic. The various advantages brought by digitalization, coupled with the restrictions caused by the COVID-19 pandemic, seem to be game-changers in Japan’s gambling industry. Whether the pachinko industry will slowly dwindle into obscurity and eventually be eclipsed by other forms of gambling, or it will find a way out of its current downward trend remains to be seen. Regardless, the era of digitalization offers new possibilities and poses new challenges to all entities involved.
