So whats his stuff about "loose" and payout?

I've no particular idea why I am so averse to "one arm bandits". Perhaps I just view it as being merely reel gambling rather than real gambling. I've never seen much difference between loose, looser and loosest but it seems everybody in town claims to have the loosest slots, with one off-strip casino claiming until a few weeks ago that the odds were in the players favor!

All a slot machine does these days is slice a second into about 12,000 split-seconds and generate a "random" number for each of them, using the most recently generated number whenever that handle is pulled. (Okay... most don't even have handles anymore they just have that red button. And, yeah, I know... the Random Number Generator does not really generate random numbers, its merely a pseudo random number generator but the casinos seem to think its random enough for them even if it can't be proven to be random enough for the purists).

The trouble is that in calculating this "looseness" percentage, there seems to be a step where they compare money taken in to money paid out. We all know that some trivial payout of a few quarters just gets fed back into the machine and is not really a payout at all. So can anyone tell me what an average slot machine's percentage is based on substantial payouts? (I would never consider a five or ten dollar prize on a million-dollar lottery to be part of the payout).

Say its a dollar slot machine (if thats a convenient figure to use) ... whats the payout percentage based upon prizes of 100.00 or more. I know the casinos rarely actually have quarters dropping into a noisy metal tray anymore, but a few of those quarters dribbling back in shouldn't be counted as payout, since players just add them to their bucket.

I just rely on the fact that I'm not going to play any game where an idiot has the same chances as me. If it can't be played badly, it can't be played well. I stick with poker tables and video poker, where there isn't necessarily a house edge.

Quote: RayMills

If it can't be played badly, it can't be played well. I stick with poker

I am living proof that poker can be played very, very badly.

I understand what you mean though about the idiot who is merely pressing a red button: no skill involved at all. Atleast at craps you have the "skill" to avoid listening to that darned stickman's patter. Thats about all.

Quote: RayMills

I just rely on the fact that I'm not going to play any game where an idiot has the same chances as me. If it can't be played badly, it can't be played well. I stick with poker tables and video poker, where there isn't necessarily a house edge.

Well, there IS a house edge at poker. The rake, isn't it?

Quote: wernerw

Well, there IS a house edge at poker. The rake, isn't it?

I don't think the rake, blinds or customary tips are considered a casino edge. A player's skill and sobriety seem to be the only edge at poker.

The 1X and 2X small payouts are considered part of the "payout percentage" of the machine. And yes they are almost always put back in the machine.
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One of the illusions that slot machines use is that people automatically assume that risk and payouts are somehow proportional. That is true in games such as craps which are played with dice. If the payout is 10 times as much, the odds of hitting it are close to 10 times as hard. However, in craps there is a higher house edge for bigger payouts. Roulette is similar.
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However, the slot machine can be programmed in any way the company wants. The Wizard did explain one slot machine in detail. The odds of getting 1X and 3X were fairly high, and the odds of getting 10X and 20X were very low. The odds of getting 80X were relatively very high (something like once every 200 spins). That payback is the excitement builder. It is high enough to get you excited, but not high enough to make you quit. But the probability of hitting a 200X or something higher were very low (roughly once ever 6000 spins).
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Every aspect of the machine is designed to play on your psyche.

Small wins that get bet again ARE considered part of the payout. They are considered part of your total coin-in when calculating comps too.

When ever I hear somebody that won say that they are betting with the casino's money, I want to slap them. Once you win it, it's YOUR money!

Quote: DJTeddyBear

Small wins that get bet again ARE considered part of the payout. They are considered part of your total coin-in when calculating comps too.
When ever I hear somebody that won say that they are betting with the casino's money, I want to slap them. Once you win it, it's YOUR money!

What you've said here is all good and true and sensible, but I was more asking for a Real World approach.

In theory each and every slot player absolutely totally and completely knows that if he gets two quarters to drop into that metal tray, that he can pick them up and put them in his pocket rather than in his bucket of quarters. (Yeah, I'm using old time terminology but you can translate it all to the modern world of red buttons and bar codes.) Its just that in reality no one ever pockets those trivial payouts. Everyone just feeds them back into the maw.

Its the same thing with money which has been successfully wagered. The payouts are known by the player to have been earned by him as part of his having put the funds at risk. However, the players feel that "its the casino's money" and so the player can be more risk prone than he otherwise might be.

I was trying to get a REAL WORLD approach. A slot machine's payout (to me) refers only to the more substantial sums that might be disgorged. If the return on investment comes as dribs and drabs... then the payout is zilch. Only the lawyers would say that was a "payout".

The churn in slot machines is extraordinary. It is the easiest thing in the world to take the credits that you've won and continue playing them down to nothing. Most people don't have the discipline to "walk" when they are up a small amount. (It's easier to do in blackjack or craps since there is the physical motion of putting the chips on the felt and waiting for the deal or throw). Therefore, people will only "walk" when they've hit a substantial payout -- usually $100 or more for your average minnow slot player. This is one reason why penny slots have such a great win number. Instead of substantial payouts, you win a small amount equal to or less than your bet every three or four spins or so. It's just a relentless grind. At least on the quarter slots at $0.75 a throw you had the possibility of a 500 or 1,000 coin payout which was not that rare.

Sorry, that is a long way of sidestepping your question. I also have no attraction to slot machines, although I do find them fun. When I was playing slots to earn comps at the Harrah's chain, I only played enough to earn 23 points, and then quit, no matter if I was up or ahead. I played three-reel, three quarter slots. I actually came out pretty close to even.

Even if a player decided to cash out before grinding it to zero, what happens next?

More likely than not, he takes that ticket to a different machine and tries the grind again.

Unless the player tracks the coin in and out on every spin, the only accounting of a player's payout, would be when he gets home, counts his wallet, and subtrats from the starting bankroll.

Quote: FleaStiff

I've no particular idea why I am so averse to "one arm bandits".
The trouble is that in calculating this "looseness" percentage, there seems to be a step where they compare money taken in to money paid out.

I'd like to mention that today's (07/07/10) online version of the Las Vegas Sun has a story featuring the replacement of chips in selected slot machines at South Point casino. Mentioned is the fact that as a single-owner casino he has no stock holders or committees to deal with. Also mentioned are his comments about players not being fully aware of statistics but certainly being aware if there money doesn't last as long as it used to.

Some of the statements seem strange: how is a machine that pays out at 97 better for the player than one that pays out at 99? And of course he is not revealing which particular machines have looser chip settings now.

South Point’s Michael Gaughan gambles on looser slots (Heavily Excerpted)
Liz Benston Tuesday, July 6, 2010 | 2:01 a.m.

As sole proprietor of South Point, Michael Gaughan directed technicians to open up a few hundred so-called penny slot machines and replace their computer chips with chips programmed to pay back 1 to 2 percent more of gamblers’ wagers over time. He thinks the change will translate into higher revenue as a result of players losing less money in the long run.

“I think, over time, that people can tell” whether a machine is “loose” or “tight,” he says. “They’re not always right, but they can sense when there’s something different, when they used to come in and play for four hours and now they’re playing for two hours with the same amount of money. Then you look around and wonder where your customers went.”

Terms like loose or tight can have dramatic public relations consequences, yet are tricky to grasp in the practical sense.

Machines that pay back 97 percent of wagers may be better for gamblers than 99 percent machines if they have a lower standard deviation — a statistical term meaning that game outcomes are less volatile and trend toward the preprogrammed payback percentage more than those with higher standard deviations.

That’s according to Tony Lucas, a casino management professor at UNLV who says a slot machine’s theoretical payback percentage has little to do with how long the player’s bankroll will last, the factor that most concerns casino managers and their customers.

Lucas has conducted multiple studies to determine whether such a correlation exists, including one in which his team lowered the theoretical payback on a bank of slot machines by more than 10 percent over time, while at the same time lowering the volatility of the games.

Bankrolls diminished more rapidly when playing higher-payback slots that were also more volatile, an indication of an inverse relationship, if any at all, he says.

Players frequently complain about “tight” machines that in fact have more favorable outcomes over time — at least on paper, Lucas says.

Gaughan wouldn’t give the payback percentages of the machines he was changing. But while raising the payback of a slot machine from, for example, 98 to 99 percent might not sound like much, it represents a 50 percent reduction in potential revenue, as the casino’s “hold” is cut in half. That’s why Gaughan’s slot manager initially opposed the move — and why Gaughan says some casinos are going in the other direction, acquiring higher-holding games that can boost revenue in a way that isn’t always noticeable to players.

By all accounts, Nevada casinos are squeezing more profit out of their slot machines these days. Slots, in aggregate, are keeping a higher percentage of player wagers than they were a few years ago.

Although Lucas doubts the effectiveness of Gaughan’s slots exercise, he says it’s understandable in a time of experimentation and uncertainty.

I certainly agree that players have, at best, only a vague understanding of the mathematics involved. I would also agree that most players go by impressions of how long their money lasts which ofcourse can be a very subjective and inaccurate measure.

I do think that Vegas casinos have to do SOMETHING and this is one of the things they should all be trying.

I think it would be EASIER and QUICKER for them to simply beef up their Slot Rebate Programs and make them really worth some sizable rewards. That would be simpler than making actual chip adjustments which involve paperwork, fees, security, auditing, etc.

Although a step in the right direction, its really only about ten percent of the machines that were changed. The major emphasis was probably the publicity rather than the actual change. And the tightfisted attitude in the craps pit of 2x odds continues unabated.
So although its the right act for a casino to take right now, its mainly hype rather than true substance.

I recently encountered a review of a slot machine known as Rockin' Olives which apparently has really fancy graphics hand-painted by some artist in Las Vegas. Its a type of slot machine wherein there are frequent, but of course modest, payouts, lots of qualifying for frequent bonus rounds, ... its sort of a very visually demanding game.

Now it is obvious that if a machine dribbles out a few quarters every third or fourth spin, it ain't gonna be doleing out no Super Gigantic Jackpot even if you have maximum coin in and are qualified for the progressive function.

For over a decade the Time-At-Play in return for one dollar has been diminishing until a buck is worth sixty-five cents.

The reviewer loved the machine and particularly loved its graphics and other visual features. It was described as being fun to play. Now most people play slots so they can win big. This Rockin' Olives machine can't really win big, so one would think it has lost its major feature for even existing. Admittedly the reviewer was rather wealthy and therefore might not care about bang for her buck but I fail to see how even the non-wealthy tourists are going to utilize a machine just because it has cute graphics and keeps leaking tiny amounts of quarters.

Rockin' Olives Video of Guitar Battle. The machine looks like a very charming penny machine. The payouts go up to $3K on 2 cents (you can't get much higher than that). Almost all slot machines come with five or six different settings that determine the cash back.

I've played Rockin' Olives at Majestic Star Indiana. It was just too weird to pass up.

Quote: pacomartin

The 1X and 2X small payouts are considered part of the "payout percentage" of the machine. And yes they are almost always put back in the machine. That payback is the excitement builder. It is high enough to get you excited, but not high enough to make you quit.

Thats the problem right there! THEY consider those piddling little payouts as part of the payout percentage, but I refuse to accept such a paltry "teaser" sum as being significant financially. Its the functional equivalent of a lottery ticket giving you a payout of three dollars. Its a teaser sum, its not a payout.

>But the probability of hitting a 200X or something higher were very low (roughly once ever 6000 spins).
True. Peter Svoboda would say that anyone playing a slot machine for fewer than 6,000 spins is therefore not playing at the mathematically derived house edge because the math pre-supposes a player bankroll sufficient to go through all 6,000 spins.

Its the same with craps. He claims a mathematical house edge of 1.414 percent on the PassLine but 40 percent in reality based on the average bankroll being insufficient to allow the full 1980 rolls.

His calculations yield a house edge at MiniBacc of five percent. Again, no math is supplied on this.

Now I'm not entirely sure of his logic. After all, even that very first spin of a slot machine can stop on 777 and win the jackpot. You don't have to go thru 6,000 spins to have that first one be a winner.

If you need the math on this ask the first baseman. WHO ? Naturally

Well, if its about Table Games, I sure can't ask Dotty!!

Its just that with one-armed bandits, I think how much you are likely to win might not vary much between if you are putting maximum coin in or if you are just walking by on the way to the buffet. Certainly your odds of winning the jackpot seem about the same.

And as for this 1.2 percent at MiniBacc mathmatically but 5 percent at MiniBacc realistically, I'd sure like to see some of the math. (Just not too much of it).

Quote: FleaStiff

Thats the problem right there! THEY consider those piddling little payouts as part of the payout percentage, but I refuse to accept such a paltry "teaser" sum as being significant financially. Its the functional equivalent of a lottery ticket giving you a payout of three dollars. Its a teaser sum, its not a payout.

In Jacks or Better VP, the High Pair and Two Pair (1x and 2x) payouts account for over 47% payback. Add in Three of a Kind (3x) and that jumps to more than 69% payback.

I would note that the piddling little payout of 2x (1-to-1) on the passline in craps accounts for *all* of the 98.6% payback for that wager.

Quote:

Peter Svoboda would say that anyone playing a slot machine for fewer than 6,000 spins is therefore not playing at the mathematically derived house edge because the math pre-supposes a player bankroll sufficient to go through all 6,000 spins.

I don't know who Peter Svoboda is, but he's wrong about not playing "at the mathematically derived house edge" unless 6000 spins transpire. With a few minor exceptions, the house edge on a slot game is the same for every spin regardless of whether you play 6 or 6000 times.

Yes, I see what you mean about piddling payouts being a significant portion for certain games.

I was thinking more along the lines of the lottery that offers a 25 million dollar prize ... and then tries to say that these three dollar payouts are significant.

A person with a two red chips on the PassLine is not really expecting to wind up with enough to own the casino. He may want that much and may dream of that much but he has no legitimate expectation of turning his ten dollars into mega millions.

Its the same thing for the slot machine: people play them for the mega prizes, the jackpots, the progressives, the whopping sums that will have flashbulbs popping and a bottle of champagne brought out (well, maybe not the champagne). And its sort of strange to think of two dollars in quarters falling into that metal tray and making a racket as a win.

If I were to walk by some "average" slot machine, I'd want to know my chances of hitting it for ten grand or more. I'm not interested in my chances of being one of the ten thousand bettors who happen to win one dollar.

Quote: FleaStiff

If I were to walk by some "average" slot machine, I'd want to know my chances of hitting it for ten grand or more. I'm not interested in my chances of being one of the ten thousand bettors who happen to win one dollar.

The Wizard shows you a PARS sheet for a real machine (which is a somewhat classic machine).
It had a
1 in 8 chance of returning your initial bet (payout 1:1)
1 in 33 chance of returning 10:1
1 in 2320 chance of returning 20:1
1 in 219 chance of retuning 80:1
1 in 6242 chance of retuning 150:1
1 in 6242 chance of retuning 200:1
1 in quarter million (2^18) chance of retuning 2400:1 (Jackpot)

I always remember the basic philosophy behind the design of this machine. The "ringer" is the 80:1 payout which comes a little less than 3 times the payout (exactly three times the payout would be 1 chance in 240 ). The payout of 80:1 is enough to get the player excited, but not enough to convince him to quit. If he is playing 25 cents, it just means he gets his $20 back that he started with.

Some payouts are essentially there for window dressing, like the 20:1 payout.

But the higher payouts are disproportionately harder to hit relative to the size of their payout. The 150:1 and 200:1 are much harder to hit than the 80:1 . In fact, it is easier to hit 80:1 than it is to hit 20:1. Finally, the Jackpot is actually very small if you consider how unlikely it is to hit.

Without any insight into the design, you don't know what the true probabilities are, but it is almost obvious that they have been set up to fool your basic sensibilities. At least with dice you know what the probability of getting boxcars is, relative to it's payout.

Quote: FleaStiff

The trouble is that in calculating this "looseness" percentage, there seems to be a step where they compare money taken in to money paid out. We all know that some trivial payout of a few quarters just gets fed back into the machine and is not really a payout at all. So can anyone tell me what an average slot machine's percentage is based on substantial payouts?

Here is a study on the subject:
http://www.casinoenterprisemanagement.com/articles/january-2011/real-cost-free-play

As it shows, the overall retention for slots is mostly in the 40%-60% range, depending on volatility. It's a simulation, however. For some reason I haven't seen actual figures anywhere.

Quote: FleaStiff

Its the same thing for the slot machine: people play them for the mega prizes, the jackpots, the progressives, the whopping sums that will have flashbulbs popping and a bottle of champagne brought out (well, maybe not the champagne). And its sort of strange to think of two dollars in quarters falling into that metal tray and making a racket as a win.

If I were to walk by some "average" slot machine, I'd want to know my chances of hitting it for ten grand or more. I'm not interested in my chances of being one of the ten thousand bettors who happen to win one dollar.

Using the genuine Red White and Blue slot machine described in the Wizard of odds, here is the complete pay table. You can tell it's an old fashioned machine because it pays nothing 83% of the time, and most slot players expect a lot more feedback today.

Payout	One in:
$2,400	262,144
$1,199	87,381
$200	6,242
$150	6,242
$80	219
$50	1,456
$40	1,248
$25	694
$20	2,320
$10	607
$5	33
$2	123
$1	8
$0	83%

This machine would certainly be termed as tight because it only returns 86.6% (it was in a public area in Netherlands).

Now you could loosen the machine up by the following equivalent moves
(a) Making the payout for $2 to one in 16 instead of one in 123
(b) Increasing the jackpot from $2400 to $30,914

In either case the payback would now be 97.45%.

Which would you choose?

Quote: pacomartin

Using the genuine Red White and Blue slot machine described in the Wizard of odds, here is the complete pay table. You can tell it's an old fashioned machine because it pays nothing 83% of the time, and most slot players expect a lot more feedback today.

Payout	One in:
$2,400	262,144
$1,199	87,381
$200	6,242
$5	33
$2	123
$1	8
$0	83%

This machine would certainly be termed as tight because it only returns 86.6%.
Now you could loosen the machine up by the following equivalent moves
(a) Making the payout for $2 to one in 16 instead of one in 123
(b) Increasing the jackpot from $2400 to $30,914
In either case the payback would now be 97.45%.
Which would you choose?

I know that the current thinking in slot machines is to make the two dollar payout more frequent. (Think perhaps of that Rockin' Olives machine that is so popular: every three rolls something gets disgorged . However, my thinking would be to raise the ultimate jackpot.

I don't know who Peter Svoboda is, but he's wrong about not playing "at the mathematically derived house edge" unless 6000 spins transpire. With a few minor exceptions, the house edge on a slot game is the same for every spin regardless of whether you play 6 or 6000 times.

Some casino's even alter this in my perspective. At The Mardi Gras in Blackhawk I have seen a row of new games intoduced, then after a week or two the chip inside them is changed. Gaming is there, it's usually a slow night like Tuesday. I doubt there are changing from a lower payout chip to a higher one !!!

Another way to do this is to sort the original table by probabilities from most likely to least likely. You'll note that the payouts have no strong correlation with the likelihoods.

You can compare them to craps bets. A bet of any craps has a chance 1:9 of happening and it pays $7 to $1. In the slot game it will happen 1:8 times and pays $1 to $1. A boxcar bet has a 1:36 chance of happening, but it pays $30 to $1. In the slot game, the bet that has a 1:33 chance of happening pays $5 to $1.

Of course, the slot game forces you to play all 13 of the possibilities at once, instead of letting you choose your own, like in craps.

One in:	Payout
83%	$0
8	$1
33	$5
123	$2
219	$80
607	$10
694	$25
1,248	$40
1,456	$50
2,320	$20
6,242	$150
6,242	$200
87,381	$1,199
262,144	$2,400

A total of 74% of the money that is returned to you in the form of winnings will come back on the $1, $5, and the $80 payout.
The $80 payout alone will return 42% of the money that comes back to you. It is the part of the design that will keep the player interested.

Quote: pacomartin

One in:	Payout
83%	$0
8	$1
33	$5
123	$2
219	$80
...	...
87,381	$1,199
262,144	$2,400

The $80 payout alone will return 42% of the money that comes back to you. It is the part of the design that will keep the player interested.

One might say that its the part of the design that will keep the player fooled or perhaps even "hooked".

Quote: buzzpaff

I doubt there are changing from a lower payout chip to a higher one !!!

I'd say there was an almost equal chance they were raising the payouts. If people were avoiding the machine perhaps they were raising the payout to get more interest. There is some payout percentage that will maximize casino revenue, and it is not always the lowest payout, or all casinos would choose that number.

They seek a mix of types and payouts so as to meet trends in player's desires and to lure customers with the inevitable stories about having done well there. South Point lowered its machines payouts, but only on ten percent and didn't say anything about which ones.

One downtown casino recently lowered the house edge and identified which machines it was.

These machines were getting lots of play and were in a high traffic area,

Quote: FleaStiff

Quote: pacomartin

The $80 payout alone will return 42% of the money that comes back to you. It is the part of the design that will keep the player interested.

One might say that its the part of the design that will keep the player fooled or perhaps even "hooked".

I fully understand that the casino is there to make money and that their goal is to not only turn a profit but to maximize that profit, the problem is that just as we impose a somewhat arbitrary difference between alcohol and "pot" we also impose a difference between invitation and coercion.

If a slot machine is deceptive that is different than being merely one of a low payout rate.

A certain burden should be on the player to learn the basics but also a casino should have an obligation to disclose what the machine is designed to do.

A statement of a certain payout rate is simply insufficient information on which to base a valid decision. Payout is a term that should be defined from the perspective of a reasonable player's expectations and perceptions. Casinos know that two quarters dribbling from a machine will be put back in and are therefore not a payout, merely a delay designed to induce continued player attention. Therefore those two quarters should not be tabulated as "payout".

I'm afraid I have to disagree. I believe they should. Is the single unit win in BJ not a payout? Is the half-unit win in PWT-BJ not a payout?

Yes, these small payouts usually get fed back - but if they weren't there, you would notice your sessions being far shorter for the same amount of money. They may be not as much a prize as the machine taking less of your money, but that still counts just the same. If you want big payouts only, you can go straight betting on roulette.

Whether or not the player considers the small payout as a "win", this issue is a hot potato in the state of Ohio as they are getting ready to roll out their new casinos. The big deal is where to apply the tax rate due to the state. The casinos want to be only taxed on their net take on slots and the state wants to tax them on coin in. So, if you start with $20 in..... win, lose, win, win, lose, win, etc. and recycle that money to the tune of $100 "coin in" and eventually cash out $20, the casino says they will pay no tax...it's a net of zero in their books. The state says, "no, we're taxing the $100 that was played through". It will be interesting how this plays out.

Quote: MathExtremist

I don't know who Peter Svoboda is...

Petr Svoboda was a defensemen for a number of NHL teams, most notably the Flyers. Peter Svoboda I've never heard of.

Perhaps my ignorance will show by asking, but is "loose" really a big deal? We're talking about a few percentage points which theoretically wouldn't be met but with a remarkable number of hours played. I know in a math sense, yes it matters. But in a real world sense, don't the "loose" and the "tight" have about the same short term chance of winning? In the course of my career I was taught that the payback percentage was the return of the machine over the course of the lifetime of said machine. If that's the case, isn't griping about 5 percentage points kind of pointless as your play would be but a eye blink on the lifetime of that machine?

Edit: is it a big deal OTHER than the mental influence on gamblers.

Quote: Face

Edit: is it a big deal OTHER than the mental influence on gamblers.

I tend to think that "loose" and "tight" slot machines are virtually meaningless adjectives and are most often misdescriptions based on psychological perceptions. I would think that crossing the street to get to a "looser" machine would hardly be worth it, but this "mental influence on gamblers" is a big deal and perhaps becoming even more of a factor as casinos begin to disclose payout rates on individual slot machines in a more informative manner so as to have a competitive edge over other casinos.

The worst slot machines can still be a draw if the rooms are nice and the drinks are frequent. Its simply that one keeps hearing and seeing comments about "loose" or "tight" machines.