These are the three criteria, all of which must be met to be considered gambling:

-prize (they have to get paid money or something of value)

-consideration (they have to pay to participate)

-chance (so skill games are exempted i.e. chess)

If any of those is missing, it is not gambling.

Zynga Poker does not have a prize but they have consideration and chance, thus it is not gambling. There are legal subscription poker sites (i.e. clubwpt.com) that do not require people to pay, so no consideration - but they have chance and a prize. Not gambling.

We ran a leaderboard contest last month to get some more alpha testers and gave $500 to the top 10. It was free to participate (no consideration) and our game is (we think) a game of skill, not chance. So we were confident it wasn't gambling and thus was legal.

Consult your attorney before making any business decisions, but thats the gist of it.

> -chance (so skill games are exempted i.e. chess)

What about games that have an element of chance which can be greatly reduced with a high skill level?

The Dominant Factor Test is what most U.S. states use in determining what is and is not a game of skill. The Dominant Factor Test was defined in the 1973 Alaskan case Morrow v. State. The four qualifications as defined by the court in Morroware:

- Participants must have a distinct possibility of exercising skill and must have sufficient data upon which to calculate an informed judgment.

- Participants must have the opportunity to exercise the skill, and the general class of participants must possess the skill.

- Skill or the competitors efforts must sufficiently govern the results.

- The standard of skill must be known to the participants, and this standard must govern the results.

I think the idea is that Betable lets you do real gambling, but for games of chance. Not sure how it works with their platform to make it legal, but that's what the article claims their service is

Only players in places where gambling is legal can participate. So a US developer could make a game using Betable's API, but it won't be US players gambling.

That is correct dminor :)

Great answer. Thanks.