Page 6 - September 2008 • Southern California Gaming Guide

Bill Burton: About Gambling
TPlaying for Pennies
he gaming industry nationwide has watched revenues decline for seven straight months. Poker, table games and slot machines are all generating less money than they did in the past, but there is one small segment where there has been an increase in revenue. While
overall slot revenue is down, penny slot machines are bringing in a bigger percentage of pro t. What does that mean to players?
Traditionally, lower denomination slot machines are tighter and pay back less to players. If you look at slot payout percentage charts in some slot magazines, you will see that in most jurisdictions the di erence in payouts between penny and quarter machines is about four percent.
Theoretical Loss versus the Fun Factor
e average payouts around the country seem to be about 88 percent for penny and nickel machines and 92 percent
coin on a reel-spinning slot is about as exciting as watching paint dry.
Many of the new slot machines resemble video games that o er interactive screens, high-resolution graphics and bonus rounds that allow players to win additional money. Players are nding that those slots are more fun to play because they have a much higher hit frequency than the standard reel machines. Even though you might win back less than the amount of your initial spin, you are getting something back
games that o er million dollar life-changing jackpots. You are only eligible for the jackpot if you are playing the maximum amount of coins. I call these penny machines a “Wolf in Sheep’s Clothing” because even though the denomination is a penny, you have to risk
several dollars per spin.
A perfect example of this is the penny Megabucks®
game that advertises that you can win millions for playing pennies. If you look at the machine, you nd that you must bet the maximum 300 coins ($3.00) per spin to be eligible for the top jackpot. If you play the dollar Megabucks® machine you must bet the maximum three dollars per spin to collect the jackpot. Your cost is the same regardless of the denomination of the machines.
Most players, however, are not switching to penny machines and playing maximum coins in search of a progressive jackpot. ey are looking to stretch their dollars on a game that will allow them to play longer and get the most entertainment from a small initial investment. With casinos seeing an increase in pro ts from these machines you will see even more of them on the casino oor in the future.
Until next time, remember: “Luck comes and goes... Knowledge Stays Forever.”
Bill Burton is the Casino Gambling Guide and columnist for the Internet portal About.com, located at http://casinogambling.about.com. He is the author of 1000 Best Casino Gambling Secrets and Get the Edge at Low Limit Texas Hold’em available online at www.billburton.com. He is also an instructor for Golden Touch Craps, http://www.thecrapsclub.com.
for the quarter slots. A majority of penny video slot machines have nine to twenty play lines. Some have more lines, of course, but for this example let’s use a 20-line machine that you play at the rate of 500 spins per hour. If you were to wager a penny on each line per spin, you would be betting $100 per hour (20 cents times 500). With a payout percentage of 88 percent on a penny machine, your theoretical loss would be $12 per hour.
“Many of the new slot machines resemble video games that offer interactive screens, high- resolution graphics and bonus rounds that allow players to win additional money. Players are finding that those slots are more fun to play because they have a much higher hit frequency than
the standard reel machines.”
that enables you to play longer.
Players who want to risk less can always choose a game with fewer pay lines such as the ve- or nine-line games, but not all players switching to penny machines are looking for bargains. Over the last few years slot makers have been adding more lines and increasing the number of coins that can be played on each line. e new games can take so many
If you were to play a regular three-reel quarter machine for a single coin you would be risking $125 per hour. With a payout percentage of 92 percent your theoretical loss would be $10 per hour.
is slight di erence in return has not stopped players from switching from quarter slots to penny machines because most of them are looking at the entertainment value they get from the new video slot machines. Players are willing to give up a little in return to play an entertaining game. Playing a single
coins per spin that it has become cost prohibitive for many players to play maximum coins at the quarter or even nickel level, so they choose to play penny machines.
Pennies Aren’t Really Pennies
e cost of playing the maximum coins per spin on some of the new penny games can far exceed playing maximum coins on a three-coin dollar machine. is is especially true of some of the new progressive penny
Page 6
SOUTHERN CALIFORNIA GAMING GUIDE
September 2008
About Gambling with Bill Burton