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What is Pachinko?

pachinko

Pachinko (パチンコ)

Pachinko is a game invented in Japan and sometimes described in English as “Japanese pinball.” Some new ideas and devices have been added to pachinko machines such as incorporating the function of a slot machine. Most people play pachinko just for fun, but some do it for a living. Pachinko is not a gamble in law. If you collect a lot of silver balls, you can exchange them for prizes. But some of the prizes can be exchanged for cash at another place. So it’s actually gambling. Taking advantage of legal loopholes, the size of the industry amounts to 20 trillion yen (As of 2019).

<Overview of the pachinko industry>

The pachinko and pachislot market accounts for a large percentage of Japan’s leisure market. According to the Leisure White Paper 2019 published by the Japan Productivity Center, the pachinko and pachislot market accounts for 28.8% of the market size, representing a market size of approximately 20 trillion yen.

The market for pachinko machines is approximately 672.4 billion yen, which is larger than the domestic home game console market of approximately 434.3 billion yen. The game apps market is approximately 1,166 billion yen. 
(cf. Yano Research Institute Co., Ltd. “2019 Pachinko Related Manufacturers’ Trends and Market Share,” and “Famitsu Game White Paper 2019” by KADOKAWA Game Linkage Co.)

The number of pachinko hall or parlor establishments nationwide was 9,639 at the end of 2019. Although the number of parlors is on a downward trend, the number of pachinko machines has remained largely unchanged, resulting in a trend of decreasing small parlors and increasing large parlors.

Pros about Pachinko: 

  • It’s a large industry with a market size of 20 trillion yen per year, so it greatly contributes to the Japanese economy.
  • The fact that Japanese machine technology has been refined through the manufacture of pachinko machines.
  • The use of manga or anime characters in promotions and the licensing market has been revitalized.
  • It’s a psychological lift that relieves stress, distracts from loneliness, and other such mental issues.
  • Legally, it’s lumped in with the leisure industry.

Cons about Pachinko: 

  • The fact that it’s practically a gamble makes it gambling and addictive.
  • Some people are financially bankrupt by playing too much.
  • Some say it’s a hotbed for money laundering because of the purchase of pachinko balls with cash.
  • The store may not have reported the taxes properly due to the cash transaction only.
  • Many Korean companies in the pachinko industry have ties to the underworld, Japanese mafia “Yakuza.”
  • Inside the pachinko parlors, the air is bad, the noise is loud and unhealthy. Some of them do not have separate smoking areas.
  • Even though pachinko is categorized as a leisure industry, if you spend 10,000 yen, it will be gone in less than 30 minutes if you lose.
  • In the past, even if you lost, you could play for much longer if you had 10,000 yen. Hence, it is no longer realistically already a leisure activity.

Incidentally, Maruhan Corporation, the largest operator of pachinko parlors, is a Korean-owned company. It is a giant corporation with sales of 1,463.27 billion yen (as of March 31, 2020) and operating income of 24.385 billion yen (as of March 31, 2020), and employs 12,230 people.

The number of South Koreans in Japan has been decreasing every year, and as of December 31, 2019, the number was as follows:

Total number: 474,460

  • South Korea: 446,364 people
  • North Korea: 28,096 people

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