This looks like gambling, what is the difference?

playing cards

In regards to avoiding violating anti-gambling laws, most internet sweepstakes software companies run into trouble. This is not because they are (in their opinion) violating the law, but usually because there is confusion between the promotional game they are operating and gambling.

Unlike speed limit laws, (if you’re driving 65 MPH in a 55 MPH zone, no reasonable person would disagree that you are in fact, violating the law!) or the possession of marijuana, (where any possession is deemed illegal and there are very specific guidelines varying from state to state on what the penalty is if you are caught holding) with the emergence of newer and more advanced technology, and the blending of that technology with marketing, the lines between what is gambling and what is not have become blurred to the point of non-distinction by some.

Or as one industry expert said about a similar situation:

“Laws like these engender disrespect for the law and create a dilemma for the law-abiding business: Break the law with your skill games or your competition will eat your lunch.” Attorney Tom Fricke, Replay Magazine

This creates a very negative situation! And a very confusing one, too. For more info on this situation, click here, and read the COMPLIANCE blog!

But let’s continue on and discuss the main reason most internet sweepstakes software companies consider their product different from illegal gambling. So, what is the difference? What is illegal gambling and what is NOT illegal gambling? The difference is not as simple or as cut and dried as some internet sweepstakes software companies want you to think!

First something must be considered gambling before it can be considered illegal gambling, right?  So, what is gambling?

FOLLOW THE RECIPE!

gambling road sign

There are 3 ingredients that are most commonly used to define gambling. These are: CHANCE, PRIZE and CONSIDERATION. Have all three, and bingo! You have gambling! Let’s relate them to something more familiar, like, simple Peanut Butter Cookies!

To make the most basic Peanut Butter Cookies, you mix 4 ingredients: peanut butter, sugar, vanilla extract, and eggs. If you leave out any one ingredient, then what you end up with is not the cookies you set out to make!

In the same way, if you remove any one of the three ingredients of gambling; CHANCE, PRIZE or CONSIDERATION, then what you have is NOT gambling! Much less illegal gambling or an illegal lottery!

Let’s break down the meaning of these common ingredients one at a time, and view them in the context of our discussion.

CONSIDERATION: Something of value, given or received, to induce the exchange of goods or services.
This is generally viewed as “Pay to Play.” If you have to pay to play, and there is no way to play unless you pay, then something of value has been given and received. Thus, you would have CONSIDERATION.

PRIZE: A reward for victory or superiority; something worth striving for or valued highly.
In promotional games, prizes can be anything customers would desire and be willing to work for.

CHANCE: Something that happens unpredictably, without discernible human intention or observable cause.
If someone participates in an activity that costs them something of value, in which they have no way to know the outcome, then they are taking a chance. Generally, taking a chance means you risk losing something of value if things don’t go your way.

(PSSST! By the way, Gold Fusion eliminates chance! Want to see how???  Click HERE now!)

So, to recap: A promotional game will probably be considered illegal gambling if you can accurately make this statement:
“In order to win the prize offered, I have no choice but to give something of value to play a game of chance, where my actions or knowledge or skill have no influence on my opportunity to win or not.”

The question then is this: “How do most sweepstakes, or promotional games, try to avoid getting into trouble with gambling laws?”

Answer? Most sweepstakes companies and internet sweepstakes software companies, depend solely on FREE ENTRY to remove Consideration from the list of ingredients! After all, it is widely accepted that if a contestant can enter and play the game for free, there is no consideration involved. Even if that same customer can play more times or receive more entries with the purchase of goods or services.

Most internet sweepstakes software companies feel FREE ENTRY is a sustainable defense. It has become the commonly accepted lore in the internet sweepstakes software industry, even though it has been challenged and defeated on more than one occasion because of other factors! (We will discuss that more later, but the main reason was lack of proof!)

HANG ON ONE SECOND!!

VERY IMPORTANT!!! Please do not think that we are saying other internet sweepstakes software companies are wrong about the issue of free entry removing consideration… nothing could be further from the truth! We fully agree that true free entry eliminates chance and should be a reliable defense! The problem is in the presentation and perception! If the software you use does not allow you to make a presentation which proves free entry usage, then the usual perception is that you are not operating legally!

Assume for a moment you have a software suite like the GOLD FUSION FREE PROMOTIONAL GAME SOFTWARE, where you can prove Free Entry, prove that it is offered, used, and that people can win with it. Let’s examine this idea of True Free Entry = Not Gambling.

For a moment, let’s compare the FREE ENTRY=NO CONSIDERATION setup that most internet sweepstakes software companies offer to the setup of some things we know are gambling and see how they stack up!

State Sponsored Lotteries Are GAMBLING.

states map

(LEGAL GAMBLING, but gambling…no one disputes this, correct?)
What do you NOT get with a State Sponsored Lottery?

Do you receive?

  • Free Tickets? No
  • Free Entry? No
  • Free Entry with Purchase of Product? No
  • Predictable Outcome? No

How About Casinos?

casino

That’s LEGAL GAMBLING, right? No one disagrees, right? Gambling, but legal. What do you NOT GET from a CASINO? Do you get:

  • Free Play with No Purchase? No
  • Free Entry? No (Well, most don’t charge to come in the door, so, maybe!)
  • Free Entry with Purchase of Product? No
  • Predictable Outcome? No

Casinos, in fact, do just the opposite! If you spend enough on gambling, you can get free products & services!

When you take the time to examine the facts, it is easy to point out the difference between what is not gambling and what is gambling! If operated correctly, a free game promotional system should not be considered gambling, much less illegal gambling!

Keep in mind that while almost any internet sweepstakes software company can offer some form of free entry, only the GOLD FUSION FREE PROMOTIONAL GAME SOFTWARE SUITE gives you tools to demonstrate free entry and the use of free entry quickly and easily!

IN ADDITION, Gold Fusion does not rely on FREE ENTRY alone for their compliance! There is more! Much more!!!

To find out more about Gold Fusion’s compliance theory and tools, contact us.

Best Internet Sweepstakes Software Café Practices Part 1

In the near future we will be discussing some basic things you can do in your business that operates what is commonly known as internet sweepstakes software.

Things to do, things not to do, etc…

DON’T OFFER IT UNLESS…

One thing we feel you should always do, is be prepared to provide what you are selling!!! This author has been into internet café’s who sold “Internet Access Time” as a product, but they did not have any computer where you could actually access the internet!

It would seem basic enough… if you offer it for sale, ACTUALLY PROVIDE IT!

We will discuss this more on the next blog!

Comments and your personal experiences in this area are most welcome!

 

Compliance!

The “La Brea Tar Pit” of the Industry!

Along with all of the answers that can be found on our FAQ PAGE, we thought we should take a moment and discuss the issue of compliance in broad terms.

First, however, we must make the lawyers happy, and remind you that what you are about to read should not be taken as legal advice. We are not lawyers and we do not give legal advice. (See FAQ,: “Are Sweepstakes Legal?”)

SPECIAL NOTE: While the GOLD FUSION FREE PROMOTIONAL GAME SOFTWARE SUITE is not legally or technically a “sweepstakes” software, you will see the term “internet sweepstakes software” used many times to define the industry as a whole, in broad terms.

To find out why the GOLD FUSION PROMOTIONAL GAME SOFTWARE SUITE is not really an internet sweepstakes software, click here and then click on “ Why this is not a sweepstakes?”.

The Internet Café Sweepstakes industry, just like any other business, has risks and rewards.  Also, just like almost any other business or industry, there are rules and regulations you must follow to be in compliance. Many internet sweepstakes software companies seem to forget that!

If you have been around the internet sweepstakes software business or Internet Café business for any time at all, there are many different stories that you might have heard making the rounds. You will be glad to know that, by no means, are we going to try and touch on all of them! Now that you can breathe again, let’s get started!

CONFUSION!

One area where the internet sweepstakes software industry might differ with others types of industry is that sometimes the people charged with enforcing the laws or statutes dealing with the internet sweepstakes software are not well informed on what the law actually says. Even more often, the laws and regulations are so ambiguous and lacking in clear guidance that law enforcement either throw up their hands in frustration and do not even try to sort out the sheep from the goats, or they cry foul on anything and everything that even remotely resembles a goat and say, “Let the judge sort it out!”

This situation has led to hard feelings between law enforcement and business owners who, for the most part, are small mom and pop establishments simply trying to earn an honest living by providing a desired and needed service to the community in conjunction with a promotional game system. Whether they use an internet sweepstakes software company who does not even try to follow the rules or a system like the GOLD FUSION FREE PROMOTIONAL GAME SOFTWARE SUITE, the vast majority are just entrepreneurs, probably a lot like you, trying to provide a product and a service that PEOPLE WANT.

You can read article after article, from many sources, that reflect bias in both directions and be just as confused as you were when you started! For that reason, we are not going to try to expound on all of the various methods and plans that have been devised by internet sweepstakes software companies to thread the needle of compliance with the law over the years.

Nor are we going to lambast law enforcement for their seemingly callous and cavalier nature displayed at times when this issue has come up. Many times the issue of Freedom of Speech has been raised, but unfortunately, it seems many in the business of enforcing the law, are not really that familiar with the first set of laws they swore an oath to keep. This is not just the author’s opinion!

(For more information, click here.)

Our desire, in this next series of articles, is to give you information about the tools that the GOLD FUSION FREE PROMOTIONAL GAME SOFTWARE SUITE has built into the software suite. Tools which set it apart from other internet sweepstakes software companies, that may help you with your compliance issues.