How the World Became a Casino (With Natasha Schüll)

0:00Natasha Schüll:If you are constantly betting on this, how many times is a politician going to say a certain word or how long will they shake someone's hand? You're not really listening fully to what they are saying. You're listening for those little words. And it's like, oh, ding, ding, ding.

0:20Hello, and welcome to the 4-4 Media Podcast, where we bring you unparalleled access to hidden worlds, both online and IRL. 4-4 Media is journalist-founded and needs your support. To subscribe, go to 4-4media.co. As well as bonus content every single week, subscribers also get access to additional episodes where we respond to their best comments. And they get early access to our interview series too. Get access to that content at 4-4media.co. This week, we're joined by Natasha Shull. Natasha is a professor and anthropologist at New York University. She is also the author of a book called Addiction by Design, Machine Gambling in Las Vegas.

1:08This book was published in 2012. I stumbled into it while I was writing about social games and Facebook games while these were all the rage. And I stumbled into that book in the way that many journalists and researchers who want to study addiction and compulsive behavior that is not associated with drugs, but with technology. We all end up reading this book by Natasha because it is brilliant. Natasha basically spent years in Las Vegas talking to the people who play slot machines, the people who design slot machines, the people who design casinos, and really laid out the way that technology, specifically our phones, work today and beautifully, expertly described what she calls the zone, which is this area of behavior and brain activity where you're in this flow state of playing a game that describes a lot of the addiction that I think we all feel today to some degree.

2:26Natasha's work is always relevant, but the reason I reached out to her is we've been covering prediction markets more often on 4.4 Media, Polymarket, and Call Sheet. and this is something that she is interested in as well because it obviously feeds into her research. So I was very happy to have her on. Please check out her book if you haven't already. Again, it's called Addiction by Design, Machine Gambling in Las Vegas. I hope you enjoy our conversation.

3:03Natasha, thank you so much for being here.

3:05Natasha Schüll:Thank you for having me. I think it would be very useful for our listeners to hear a little bit about your research into slot machines that you wrote about in your fantastic book, Addiction by Design. There is so much to that book. You go into it in great detail. I highly recommend everyone read it or listen to it. There's also an audiobook. But to just give an example of how digital user interfaces and design can really change behavior and gambling behavior specifically, I was wondering if you can talk about this pivotal moment in Las Vegas and slot machine design specifically, where they changed from physical reels that are spinning in machines to more digital interfaces.

3:57What that did for gamblers and what that did for casinos. Right.

4:03Natasha Schüll:So when you had the physical reels or the analog reels, we could think about them as, there was 22 positions per reel. And so you'd have three of them spinning, and you were really constrained in terms of the mathematical outputs, or we can think about those as algorithms, by these 22 per three reel positions. So there was really only so much that you could do with that. In the 80s and then even more so in the 90s when we saw digital technologies and capabilities and computerization coming on board and being wedded to the slot machine, you saw this explosion of new possibilities for designers, particularly the designers of the math.

4:49Natasha Schüll:So each of those reels, even if you continued to see it spinning in front of you, even as it continued to be physical that you were interacting with, was actually virtual with hundreds of stops on them that you could mathematically program to. Most of those virtual stops would be mapped to blank spots on the reel. So they were heavily weighted toward the blank spots. you would see physically in front of you exactly what you saw in front of you on the physical machines. And, you know, if you imagine someone sitting for 24 hours in front of a machine, whether or not you're mathematically competent, you do get some sense of what the odds are by interacting with the symbols that are in front of you.

5:39Natasha Schüll:But what digitization did was completely divorce what you see in front of you with what the odds actually are. The easiest way to describe what virtual reels did for physical slot machines is to use the analogy of weighting the dice. So just as you would like drill silver into the corner of a die to weight it more toward one position, you were mapping most of the blank, non-paying, non-winning spots to the blank spots on the reel. That was like waiting the reels. Right. And that allows both the casinos or the designers of the machines to better design the outcome for their profit, but also for the enjoyment of the players, right?

6:28Natasha Schüll:Yes. Because you could, you know, if we think about the old one-armed bandit, the limitations that those 22 times three stops gave you also meant limitations in the kind of experiences that you could have and the kind of time you could spend there. This is why one-armed bandits most often did not have seats in front of them. They were very volatile in the sense that you would either double or triple your winnings or you would lose it all. And this would happen pretty quickly. So if you drew it on a graph, it would be very, very spiky in terms of your winnings over time. And you would quickly zero out your time.

7:10Natasha Schüll:When you had these computerized models that could be manipulated to dispense rewards at a kind of continuous pace, but small little tiny rewards over time, you were able to sort of manipulate that graph and give people much more quote unquote time on device. And this really was a shift from a profit model that had to do with let's get all their money right away. Let's fleece the consumer and then they can be on their way to let's actually let the consumer sit there much, much, much longer. Let's give them more time for their money and let's take their money much more slowly because what we see in terms of revenues is that machines that do that ultimately earn much more money from them.

8:04Natasha Schüll:So instead of that spiky graph zeroing out in time, you saw a much more slow, gradual line down to zero. And some of these machines that would dispense tiny little bits over time were so sort of relaxing in the way that they felt to play. one of the one of the designers of them drew it on a napkin for me and he pointed to that slow curve down to zero and he said we want you to recline on our math model the way you recline on a comfortable couch I guess I do have to say to to explain how this happens you do need to go beyond the three reel so the three reel virtual reel machine that was sort of the first step toward computerization and virtuality.

8:58Natasha Schüll:What gave even more possibilities and this sort of comfortable couch that you can recline on, that kind of algorithm, that depended on what's called multi-line slots. These are the slots that you will still see today in casinos or in online casinos. And basically, it's a video screen. There are no physical reels. It's a video screen with many, many symbols all over them. And typically you can bet on 50, 100 lines and you can bet pennies, right? So you put in your$5 and you're betting pennies on each line. Because there are so many lines, you're going to win back pretty often on at least one or two or three of those lines.

9:44Natasha Schüll:And guess what? It's going to say, ding, ding, ding, ding, you won on this line, but that's a net loss. So this idea of what are called false wins. So slowly taking your money, you're slowly losing. But as you're slowly losing, you're experiencing that as winning every time. So you do this research in the 90s, early 2000s, and that is long before the ubiquity of social media and mobile games and loot boxes and all this stuff but i'm sure anyone who is listening to you immediately recognizes all these incentive models from their day-to-day lives these little hits of dopamine an algorithm that is trying to solicit a certain type of behavior and time on device, a term that technologists use, social media companies use, makers of mobile devices use.

10:45And you wrote an introduction, a new introduction to your book in 2024, where you kind of talk about how relevant the book became over time and all these journalists reaching out to you, policymakers, some of the people from these companies that are actually implementing these type of designs. and it seems like we've come around full circle in a way like the philosophy was adapted into all these other industries but now but now they're now we're just like back to gambling uh and you say uh you wrote near the end of the introduction actually i want to quote this uh you mentioned kalshi at the very end kalshi being the the prediction market where like polymarket people can bet on the outcome of real world events.

11:31You say, the convergence of future markets and lay betting is not caused by digital technology. The two were intertwined from the start. Digital technology has, however, made the activity widely accessible to anyone with a mobile device, easy to perform, and designed to hold attention. I want to start with that first part. Can you talk about how future markets and lay betting were always intertwined? Because I thought of it historically, there was like a research aspect to it. And people actually use experts to bet on real world events in order to get good predictions. What do you mean by that?

12:10Natasha Schüll:I'm not a historian. But what I mean by that is that back in the early days of stock markets, which weren't necessarily even called that back in the early days, you saw those activities activities that today we identify as investing and trading as considered betting. And even some of the same laws I'm talking about, like back in England and this kind of thing. I think to anyone today, it's sort of absurd that prediction markets would say that they aren't betting in some way. I always like to say the absurdism of the claim that Calci and Polymarket, etc., etc., are not gambling rests on another absurd claim, which is that there is a big difference between things like day trading and things like gambling.

13:03Natasha Schüll:You can go to history to see that link. And for the second part of that statement, when you talk about how accessible this has become, when you see a Kevin Hart commercial for a casino app, a slot machine app, or you see commercials on TV for betting apps and prediction markets, what's your reaction to that? How do you think machine gamblers that you've talked to or people that you talked to in Vegas at the time that you were researching your book and talking to a lot of gamblers, how are they responding and receiving those ads, do you think? I imagine that they're sort of appalled. And I mean, it makes one very cynical, but there really isn't a sort of not only an explosion of gambling, but an explosion of normalized forms of gambling.

13:53Natasha Schüll:Even more shocking to me than seeing the ads by celebrities and others on TV are the increasing adoption by media of these metrics and sort of referring to prediction markets as they kind of tell the news. And we've already seen the news take the sports news, especially really taken over by mobile sports betting. And I think we're in danger of having news in general taken over by prediction markets, which is really speaks to this normalization of betting on things. This is something I wanted to ask you about. I'm not sure how to phrase it. So forgive me as I stumble through this thought. But slot machines is a form of betting that is totally abstract.

14:46There's no subject to the thing that the bet is being placed on. You can say the same for most card games, roulette tables. I think even something like the stock market or crypto, they correspond to things in the real world. But the system that you're betting on is so diffused that it's hard to connect a single bet to a single outcome. And sports betting and things like Kalshi and Polymarket, especially, it's kind of like a one-to-one. I was looking at Kalshi before this interview, and some of the bets that I saw is, what will Justin Bieber perform at Coachella on April 11, 2026? Will Meta release Llama 5 this year?

15:38How will Tyson Fury, who is an MMA fighter, say? What will he say during his final press conference? Have you thought about that at all? What is the impact of betting doing two reality, two real world events, if everything is a bet, if we're betting on everything?

15:56Natasha Schüll:Yes, I have been thinking a lot about this lately, but in a number of different ways. There are a few different kinds of bets that I can see on prediction markets. There are these event contracts that are very linked to specific outcomes, like an election or a game. And for those, I think what it does is just taking those two examples. Let's take an election as an example. it really changes the way that you orient towards not only the election, but how you are a citizen in a way. If you are constantly betting on this and checking in to see what the price is doing, you're sort of orienting to what used to be a much more civic-minded, socially -oriented decision in this granular, you know, gambling-type way.

16:55Natasha Schüll:I think that that can change maybe even how we feel about politics, especially when you get to things like attention markets and how many times is a politician going to say a certain word or how long will they shake someone's hand? You're not really listening fully to what they are saying. You're listening for those little words. And it's like, oh, ding, ding, ding. So I think it changes the way that we listen and hear. I think it could also change literally the way we listen to music instead of just listening for what do you like and what do you respond to, what songs. You're kind of vigilant if you're engaged in prediction markets.

17:40Natasha Schüll:You're very vigilant to which song is most likely to be like the pick or to rise to the top according to the population. So you're listening differently. You're not listening as a music connoisseur. you're listening as someone who's on prediction markets and has a stake in them. And then in terms of a game, it's very similar to the politics in the sense that it changes the way you are a fan. You used to place your bets and then participate in the game, supporting one side or the other. But now you have money on the game in all of these fragmented, choppy little ways. So you may be watching for tiny things.

18:25Natasha Schüll:You may be watching for what a specific player does. You may even bet against your own team because the betting becomes more important than the being a fan. So I really think having money on things and gambling, especially in these sort of granular ways, changes so much about who we are and how we are in the world. Yeah, I think it is clear from your interviews with machine gamblers that it causes a change in behavior that extends beyond just like the moment of gambling. It's just like your perspective of the world maybe shifts a little bit if you're obsessed with gambling in that way. Something I really liked about the book and something that I think we tried to do in our own reporting is the book is very respectful of gamblers.

19:15And you say that you learned so much about how all of this works from them. And it's very clear that they are very aware of what they're doing. They're not being fooled. They know the odds. They know how the machines work. You talk to a woman who got a very deep education in how they work and are constructed. And I found that to be fascinating and to be a huge benefit to your findings. And then on the other hand, despite all this awareness, gambling addiction has a higher suicide rate than other addictions. and it appears that machine gambling addiction works faster and is more of a problem from an addiction perspective than other forms of gambling.

20:11And I was wondering how are, like, those seems contradictory, like the self-awareness and the lack of control. Like, how do you reconcile that? How are both of those things possible at the same time?

20:23Natasha Schüll:I think that we sometimes talk about self-delusion with addiction in general, but I also think we understand and addicts understand addicts of all kinds. They sort of know themselves and know what's going on. And even if they have that knowledge, even if they've been through the programs, it doesn't mean that they're not going to be pulled back into it. So I don't know that machine gamblers are so unique in terms of a spectrum of addictions in that. And in terms of how to reconcile that, I mean, I don't think it's hard for any of us to understand how knowing that it's time to go to bed and stop scrolling, you know, doesn't make us stop scrolling and go to bed.

21:12Natasha Schüll:And I don't mean to trivialize addiction through that analogy. I just mean that I do believe that these behaviors, that addiction is not something completely other to who we all are. I think we're all on a spectrum somewhere, right? And I do think that every one of us, it's hard not in the contemporary world of digital media, it is hard not to have a glimpse of what gamblers call the machine zone and to understand its hook and its hold. So I think to answer that question, we just need to ask ourselves, what is that? When we know we should be doing one thing, but we're doing another. I don't have the answer.

21:55Natasha Schüll:If I had the answer to that question, I'd have it made.

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27:36Reporting on technology over the past 10 years, there have been instances where, like with Uber, for example, it feels very much like we're reporting on a company that is running ahead of regulation. And that regulation will one day catch up with it. And in many cases, that is what happens. I get that feeling about the betting markets. It feels like it's a new technology. It's a new type of business. They are making as much money as they can. But eventually, another shoe will drop. There's going to be some horrible story in the news about how this has impacted people. And we'll see regulators come down on these companies.