Slot Machine Payout Percentage By State

Slot Machine Payout Percentage By State – Summary: The study overturns the long-held belief that gamblers can detect differences in how much and how often certain slot machine payouts are made.

It’s a common sight on casino floors: patrons hop from slot machine to slot machine before finally landing on the game for the next big payout. But can players—even regulars visiting a particular property—really distinguish the house advantage of one game from that of another?

Slot Machine Payout Percentage By State

No. At least not according to several recent studies led by Anthony Lucas, a UNLV Hospitality College professor and former gaming industry analyst.

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In recent years, Lucas and colleague Katherine Spilde of San Diego State University have visited the casino floors of several properties in the United States, Australia and Mexico to investigate. Their results contradict long-held beliefs among casino operators about a player’s ability to detect differences in how much and how often a slot machine pays.

“I think some operators are naturally and understandably wary of new information that challenges traditional industry practices,” Lucas said. “But we need to think about how we know what we know. This is where our work takes on a Moneyball-like aspect — questioning the wisdom of widely held beliefs when the data shows that a new way of thinking might be better.

In their latest study, a UNLV-led research team compared two pairs of reel slot games at a “local” casino in suburban Sydney, Australia, where all betting is done on electronic gaming devices.

Their process is relatively simple: Take two identical slot machines in similar locations on the casino floor, but change the par value—the percentage of total coin the machine holds over time. For example, if the face value of the game is set at 10 percent, the machine is expected to retain an average of $10 for every $100 wagered over the long term. But in the short term, this rarely happens, which makes it difficult to fix.

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For this study, researchers compared the day-to-day performance of couples playing the games “Tokyo Rose” and “Dragon’s Fortune X” over a period of nine months. Pars in each pair ranged from 7.98 percent at the low end to 14.93 percent at the high end.

The researchers measured each machine’s daily earnings and its T-win, a formula that multiplies the coin and par to calculate the machine’s expected value, or its theoretical win. If average players detected a difference in pars during the nine-month test, that comparison would show whether (and by how much) players migrated from higher to lower play.

As Lucas predicted, the differences between high and low par games remained stable throughout the study, meaning there were no statistically significant indicators of game migration.

And while lower-denomination machines had more coins during the study period, T-wins were higher on average for high-denomination machines. The positive impact of increased T wins on higher denomination machine revenue more than offset the decrease in coinage on these machines.

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“Casino operators should consider T-win a significant increase, as they are responsible for optimizing revenue, not paying coins,” Lucas said.

The results were also consistent with the team’s previous research, which analyzed 11 pairs of games over 180 days at gaming facilities in the US, Mexico and Australia.

Pars is an important factor for casinos looking to optimize revenue, as the majority of slot machine revenue comes from slot machines and the lion’s share of a casino’s overall profit comes from slot machine operations. Although there are exceptions to this rule, it applies to most casinos around the world.

“The most useful thing is to know which parimeter gives the biggest win, but the optimization problem becomes more complex when the ability to identify the player is introduced.”

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This is where the industry perspective is mixed, as operators have expressed concern that short-term gains from higher ducks could lead to long-term losses as players leave the “tight” slot floor for the greener pastures of their competitors.

As Lucas predicted, the differences between high and low par games remained stable throughout the study, meaning there were no statistically significant indicators of game migration. The image is in the public domain.

To solve this problem, the researchers extended the time of the previous work from six months to nine months. They also increased the difference in pars between matched pairs from 4.9 percent in the original study to 6.95 percent in the current study.

In a concurrent study, researchers compared Australian data to four two-game doubles games in two similarly situated casinos in Mexico. The par differentials for those games were even more drastic, ranging from 7.98 percent to 8.9 percent.

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Despite these factors, however, the results in both cases found no evidence of players leaving the higher-par machines for their low-par counterparts, and the high-par games continued to generate significantly higher returns.

“Simply put, our results show that larger portions generate higher revenue without damaging the brand from ‘price’ identification,” Lucas said.

The purpose of this study is to examine how differences in the casino edge (i.e. price) of otherwise identical slot machines affect their revenue production when the price is hidden from players. The purpose of the study is to identify the ability of players to recognize differences in the hidden prices of paired machines over time. Both of these items are extremely important to optimizing slot revenue.

Using 274 daily observations, paired-sample t-tests examined whether differences in the casino edge (namely, par) of paired games affected measures of real-time performance. Time series regression analyzes were conducted to understand whether players shifted their play away from high password games over time.

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The results showed that increased casino advantages increased revenue, with no evidence of a decrease in high-stakes gaming.

The results contradicted the conventional wisdom of the industry, showing that players are not hypersensitive to price/pair increases and that such increases can actually lead to increased returns, despite huge differences.

Added valuable results to an emerging stream of research aimed at understanding mixed price/parse effects. Expanded the gaming literature by increasing the price/pair differentials of doubles titles over a longer trial period. Both conditions increased opportunities to observe changes in earnings performance and to play the transition to a low par game. Both manipulations have previously been cited as meaningful extensions of the literature. Maryland casinos are proposing to lower the state’s required minimum payouts for slot machines, according to documents obtained in a public records request. (Lloyd Fox/Baltimore Sun)

Five casinos in Maryland have asked the state to allow them to reduce payouts required from slot machines, a move that could siphon tens of millions of dollars in winnings from customers to the casinos, state records show.

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According to documents obtained by The Baltimore Sun in a Maryland Public Information Act request, the request was included in a group of recommendations that casinos recently submitted to the Maryland Lottery and Gaming Control Agency.

Under the proposal, the state would relax the requirement that each casino pay out an average of 90 to 95 percent of the money wagered on its machines during the year. Casinos want to lower the minimum payout to 85 percent, which would increase casinos’ “hold” — the amount of bets withheld from slot machines.

“Patrons would end up getting less,” said Charles LaBoy, assistant state gaming director. “The flip side is that withholding would increase. So this state has the potential to increase revenue.”

LaBoy declined to estimate how much more revenue — potentially tens of millions of dollars — the casinos and the state could receive.

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The state would win because it shares slot revenue with the casinos. Although their popularity has declined in recent years, slot machines generated $622 million at five casinos in the first 11 months of this fiscal year. The largest portion — $290 million — went to the Maryland Education Trust Fund, while casino operators contributed $229 million.

“We certainly have an opportunity to bring in additional revenue for us and for the state,” Hollywood Casino Perryville General Manager Matthew Heiskell said of the proposal.

But Heiskell and gambling analysts said casinos aren’t reducing payouts as much for competitive reasons. With five and six casinos, Maryland has become one of the most saturated gambling markets in the country. And it’s surrounded by states that want to play the game.

Currently, Maryland is “right in the ballpark” compared to neighboring states in terms of its slots average, which includes all five casinos, LaBoy said.

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According to American Casino Manager, the state’s average payout from July 2013 to June 2014 was 90.38 percent. That placed Maryland behind Delaware’s 92.23 percent, Ohio’s 91.62 percent and New Jersey’s 91.01 percent, but ahead of Pennsylvania’s 90.01 percent and West Virginia’s 89.86 percent.

“Like any place, we have a big mix,” Heiskell said of slot payouts. “You want people to know they can win with you.”

Casinos say the proposal

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