The casino gaming industry is a pretty big business in the US. It generates billions of dollars in revenue and gives employment to millions. But what keeps casinos afloat financially is not the classics like Blackjack or Roulette. It’s the slot machine that generates the biggest portion of revenue for the casinos.
Slot machine revenue can be as high as 89 per cent of the total revenue. They leave other table games like Blackjack or the Video Poker machines far behind.
What makes the slot machine so popular? Are they easy? Or is it just a myth? One thing is true, though; they are big-time earners for the casinos.
Price of a slot
The important fact to notice about the slot machine is that most players do not know the true value of their wagers. You cannot calculate the odds of winning or what you are putting at stake.
Casinos usually use the house edge in place of the actual price of the wager. Each player has an idea of the house edge on his bet. All the earnings from the slot machine are based on keeping the players for a longer duration. For a newcomer, the price is very different compared to a seasoned player.
Take an example of a slot machine that gives a 10 per cent house edge to the casino. This means that over a long period, the game will earn the casino 10 percent of all the bets that have been made on it. If total wager over a long period comes out to be $100,000, then, $10,000 of it would go to the casino that owns the game, and the rest $90,000 will go back to the players in the form of payouts.
The actual price of the bet, however, depends on the payout. If a player bets $5 and wins nothing, the price is $5, not 50 cents, as he calculates as 10% of $5. The mobile casino uk gives, in the form of house-edge, the necessary information to the player. But in order to find the actual useful information i.e., the price of the bet, he has to make the calculation. Most players do not. Casinos take advantage of this fact.
The player thinks that even if he loses the bet, he can recover if he plays for a longer duration. The player may or may not win, but the casino always wins in the long-term.
In order to understand the workings of the slot machine, let’s take an example. If a man who has $100 to spend inside an hour on a slot machine, there are just 3 outcomes possible: he may lose almost everything, he may hit the jackpot, or he may lose or win a small amount and walk away with almost the same money he had in the first place.
The most common outcome is the first one i.e. total loss. And it is important for a slot machine because without many losers there is no single winner. The small amount of money lost by all the losers is what is paid out to the jackpot winner. There is no other source of money. And of all these losses of players, the casino company takes away a fixed percentage.
So talking about the most probable case, most players are going to lose money. Another important fact is that long-term players are a small percentage. It rarely happens that a newcomer happens to win a jackpot on a slot machine. When a long-term player wins a jackpot, he is technically only winning back what he has lost. But the promise of winning the jackpot early is what keeps them playing.
Raising the price
Another reason for the big revenue from a slot machine is due to the variance in the slot machine’s paytable. The list contains all the winning combinations and the credits awarded for every combination. The paytable is visible to the player, but the probability of winning for that combination remains hidden. Probabilities are important in making a smart, calculated risk and without that players have no realistic way to predict.
Another reason is that even though casino players claim to refrain from increasing house edge, saying players can detect it, even the seasoned players do not mind a slight increase in the house edge. The slight increases from time to time thus making a big increase over a long-term.