Slots vs Table Games

I know that for years, Casinos have been pushing their slot machines as the bread and butter for their income as opposed to table games. But does anyone know what the percentage break downs are for slot machines vs table games?

Pacomartin mentioned that the reason why some casinos have posted good monthly gains is due to baccarat. How has the slot machines been doing during the recession?

In Nevada very badly. They have dropped over 22% on the Vegas strip. The "recession" which began in October 2007 hit blackjack first. About 6 or 7 months later slots and baccarat and other table games began to drop. Baccarat only went down for 7 months, then began to turn around. Slots have been dropping until the last recorded month.

The return in Pennsylvania on slots broke $200 million for the first time in February. In a few days when the revenue numbers are reported for March in Nevada, there is a possibility that slot revenue for the strip will drop below that of PA. Slots on the strip only earned $208 million in February.

I actually don't think it will happen, but it will be reasonably close. PA may have to wait to open the Sugar House in downtown Philadelphia later this year until it passes the Vegas strip. With the surge in Baccarat, table games now surpass slots on the Vegas strip.

Casinos know that slots can be gold mines. They work without sleep, desires, or the need for tips or bathroom breaks. The new ones are much more reliable and require very few repairs. They come with a box of circuit boards, and you can change their settings to increase HA without anyone knowing. With blackjack you have to change rules, or increase the number of decks and players are very aware that the game has been changed. They can be programmed to titillate the psychological points that motivate compulsive gambling (like near misses, high rates of payout that are often less than you gambled in the first place).

There is less and less interest in coming to Nevada to play a slot machine. The only part of the state where slot revenue is growing is in the eastern part of the state, within driving distance of Salt Lake city which is growing with retirees living on the ski slopes.

The problem of course, is everyone knows this, and the number of slots keeps proliferating. I think there are over 190 thousand in Nevada. I don't know how many are in the entire country.

When Steve Wynn opened the Encore casino he added an additional 800 slots, and I think about 80 table games. Gaming revenue for the two hotels went up like 2% from the single hotel. Non-gaming revenue didn't go up much either. With expenses increased by an order of magnitude the Vegas properties have not had positive operating income in over 2 years. Wynn resorts Vegas is being completely subsidized by the Macau operations.

Personally, I think parts of Old Vegas are going to be unrecoverable. Circus Circus, Riviera, possibly Sahara and the Stratosphere. Maybe the Hilton. Plaza Casino downtown. Much of Reno and Sparks. They are already closing the smallest casinos in Lake Tahoe. I think Primm Valley will continue to go down the tubes, as well as Jean. The number of places to play slots will keep on increasing, and the renovation of these old casinos will make less and less sense.

The table for Hooters shows table revenue in millions, and slots in dollars per machine day.

Year	Table ($mill)	Slots (per machine day)
2006	$11.0	$73
2007	$9.5	$62
2008	$8.9	$67
2009	$6.7	$49

The slots still make more money than the tables, but neither of them come close to making enough money to cover operational expenses let alone the interest on the loans they took to purchase and renovate the building. At a minimum the casino needs to make twice as much for the property to break even. While it is true that the average slot on the casino makes more than $100 per day, and the table games could easily make over $13 million on a strip hotel, the physical location of Hooters and the general poor condition of the rooms means that there is no way to make that kind of return. I am not sure how this casino is still in business.

Quote: gambler

I know that for years, Casinos have been pushing their slot machines as the bread and butter for their income as opposed to table games.

No. Casinos have not been pushing... their customers have been pulling! Back in the "old days" (substitute just about any time period you choose) slot machines were supposedly a place a man could park his wife while he did some real gambling. Now that was the attitude and to a degree it was probably reality as well, but slot machines have always been profitable. Now when you mention the word gambling many players think of slot machine. They don't have any awareness of other alternatives. And many have no desire to learn something new. A slot machine has ONE little red button, whereas a craps table requires a choice between Pass and Don'tPass. Many simply choose that one little red button because the fix comes faster and more easily.

The recession seems to have changed the number of people arriving in Vegas and the amount of money they bring with them. Perhaps the proliferation of alternative destinations has also affected those two figures. The reduced visitors and their reduced bankrolls are affecting marginal properties the most, but all properties seem to have made expansion decisions based on past interest rates.

Players may respond slowly but they seem to go upscale whenever there is the opportunity to do so. This means the casinos with the better attractiveness can survive by lowering room rates to take customers away from the more marginal casinos. Its probably a slow and inefficient process by which slot players migrate but when management pays bonuses to executives then that money can't be used to upgrade a property.

Reno loses casinos because the distant Indian casinos bleed off customers and the nearby crack houses deter what customers remain. So a Reno casino is often being valued for its real estate, not its gambling. Nobody goes to Reno to get a divorce anymore, California laws have changed. Fewer gamblers drive to Reno when there are a gadzillion Indian casinos they will drive by that offer "A Good-Enough Vegas Experience" even if the Real Vegas might indeed be better and more famous. Vegas is still a "destination" but it seems to be losing its luster. That little red button at the Indian casino is the same as the little red button in Vegas... but its a shorter drive.

Slot machines are still some of the most profitable things in a casino. On the strip a bank of 16 penny machines makes a million dollars a year. Nothing else makes money like that.

But the slot machines used to be much more profitable. On a per machine basis every category of slot has dropped dramatically. Very profitable machines like Megabucks, $25 machines, and $100 machines have dropped by over 50%. The one that has dropped the least is penny machines. Now the overall penny machine category has gone up, because the casinos have replaced thousands of the nickel, quarter and dollar machines with the more profitable penny machines.

Even baccarat revenue on a per table basis has dropped, but there are many more baccarat tables that have been installed on the strip.

The very smallest casinos probably don't make money on their pit. But people tend to walk out of slot clubs. I talked with one casino manager who manages a small casino. The previous owners took out the pit. He put 4 tables back in even though they only operate a few hours in the evening. It makes the casino look better to have some tables.

There seems to be no growth in slots. I would go further and say that the peak that was reached in October of 2007 ($3.5 billion for the 12 months leading up to October) may never be reached again. Visitors will be so used to playing slots that they will have no interest in feeding them in Vegas.

Not only are table games starting to dominate slots, but in February the baccarat revenue came within 2% of surpassing slot revenue. But the problem is that gain might be temporary, since it probably depends on primarily on 10,000 players who might just as easily go to Singapore as Vegas. In March when baccarat is traditionally low we will probably see terrible revenue figures for the strip (data released 5-6 days from now).

I pefer table games myself! Slots are mindless. Anyway, I recently read an article about new up and coming players to the casino. How new players pefer the interaction of table games over the isolation of slots.

Quote: gambler

I know that for years, Casinos have been pushing their slot machines as the bread and butter for their income as opposed to table games. But does anyone know what the percentage break downs are for slot machines vs table games?

Pacomartin mentioned that the reason why some casinos have posted good monthly gains is due to baccarat. How has the slot machines been doing during the recession?

Old thread but new perspective... Pushing isn't quite the word. The games were added as technology improved and businesses gave the people what they wanted. The percentages that Paco provided are relatively close depending on the region and property but overall gaming revenue is undoubtedly slot heavy with most properties showing an 80-20 ration in favor of slots. You have to think about it. It takes 1 dealer, 1 supervisor, and 1 pit boss to man 1 table no matter what the stakes. 1 slot attendant, 1 slot supervisor, and 1 manager can handle 50 or more with each slot unit, or seat to include tables, making nearly 7 times the revenue or more.

High end play is not simply a table phenomenon either. I could go into detail but that would take too long.

Baccarat is making a come back as many properties are pulling other "carnival" games in order to install Baccarat tables once again. Is this an asian thing and is the economy recovering more quickly for them? I think so but once again too long to explain.

My own story shows why Las Vegas Casinos need to look past slots and fast.

In 1995 I had a management conference in AC, for the entire northeast of our company. Picture Indiana, parts of Kentucky, up to PA then to NJ and all northeast points. At the time, a company having a conference in a casino was very special. After we went there was an article I saw that said less than 4% of company conferences were at casinos. And almost everyone was excited. One guy even had individual quarters he was to play for each employee and they were labled. A $15 minimum was the standard then which is like $25 today. Very few guys, and it was mostly guys, ventured to the tables.

By 2001 we were still using casinos, just we moved from the Boardwalk to the Trump Marina. I was talking to my boss about something usual and he asked if I was hitting the casino? I said maybe (I was not into AP yet) and he said I looked a little unexcited. I told him that after 6 casino meetings in 7 years playing slots was unexciting. The same $15 minimum was still out of my league.

By 2003 there were more and more casinos I would stop by. It changed from a special big thing to a several-times-a-year thing where we would go. Eventually competition lowered limits and I learned tables. I learned you need $100 to sit at a table game but that $100 will last an order of several magnitude longer than feeding a slot. To the extent I played slots from then on was either video poker or free-play. Slots? I don't need no stinking slots.

Time was many people went to vegas looking forward to playing slots for the first time, or just an annual thing. Now they can play them close to home and playing in vegas is player club points they will rarely use since they won't be back.

Slot machines don't take breaks; don't call in sick; don't hustle tips; and don't form unions. They also don't give any more excitment than pushing a button, and the younger generation doesn't like merely pushing a button.

Quote: AZDuffman

Slot machines don't take breaks; don't call in sick; don't hustle tips; and don't form unions. They also don't give any more excitment than pushing a button, and the younger generation doesn't like merely pushing a button.

Some of the modern slot machines seem to be pushing towards more interactive operation, heavily laden with visuals and almost looking more like arcade games. Which is TBH even more puzzling, since the new generation has their x-boxes with much better gaming experience. Is it the mix of gaming and slots that is so effective, or is it just about giving the new generation something they are familiar with? I'm not sure.

Quote: AZDuffman

Slot machines don't take breaks; don't call in sick; don't hustle tips; and don't form unions. They also don't give any more excitment than pushing a button, and the younger generation doesn't like merely pushing a button.

The only problem with this statement is that everyone in the world knows that slot machines don't take breaks; don't call in sick; don't hustle tips; and don't form unions. That is why there are 850K installed in the country. They are like a commodity, and you have to spend a lot of money on a design that will attract people.

The fledging increases in Vegqas strip gaming revenue in the last 13 months have all been in table games in general and baccarat in particular.

Last Month of 12 months	Notes	Tables	Poker	Slots
October 2007	peak	$3,334,729	$97,114	$3,513,60
October 2009	bottom	$2,575,812	$85,835	$2,824,471
November 2010	latest	$2,882,761	$82,174	$2,813,130

Quote: gambler

Pacomartin mentioned that the reason why some casinos have posted good monthly gains is due to baccarat. How has the slot machines been doing during the recession?

Slots fell just as much as table games in the initial 24 months of recession, but have failed to recover in the last 13 months (unlike baccarat).

Slot machines share of Macau gross gaming revenue slipped back in the first half of 2010 compared to the first half of 2009. But that probably says more about the explosive growth in table play this year than it does about slots ongoing appeal.

In the first half of 2010, 4.6% of Macaus gaming gross came from slots (3.98 billion patacas out of 85.9 billion patacas for all games of fortune) according to figures released at the beginning of August by the Gaming Inspection and Coordination Bureau, Macaus gaming regulator. In the first six months of 2009, slots overall contribution was nearly 6% (3.1 billion patacas out of 51.4 billion patacas).

In cash terms, however, the slot take for the first half of 2010 was up 29.6% on the equivalent period in 2009. Yet during that period, the number of slot machines went up by only 8.5% (from 13,509 at the end of the second quarter of 2009 to 14,659 units at the end of the second quarter of 2010).

Some of that jump in the gross may be accounted for by a small number of VIP slot players who now drop the equivalent of a million US dollars or more in a single session. Five years ago, the managements would lay out the red carpet for a slot aficionado spending US$5,000 in one go.

Away from the headlines created by Macaus small number of slot whales, much of the effort of slot managers is going into unlocking the full economic value of more modest players. That focuses initially on getting as many of them signed up for carded slot play as possible so that they can start earning benefits on their entertainment. Increasing carded play should also help create word of mouth publicity as people see what benefits and prizes their friends and neighbours have been able to get from their visits. Carded play also allows operators to market major events to players such as new jackpots. At the end of July, City of Dreams launched what it describes as Macaus Biggest Floorwide Jackpot, with the top prize starting at HK$3 million (US$386,314).

From http://www.asgam.com/categories/cover-stories/item/844-a-growing-game.html

(Inside Asian Gaming)

Quote: FleaStiff

That little red button at the Indian casino is the same as the little red button in Vegas... but its a shorter drive.

BINGO!
That's what I hear ALL the time, people ask me "Why do you drive 3 hours to Reno, when you can drive an hour to ____ (Insert about 5 different Indian Casino's)"
What they don't understand, is they're absolutely getting ZERO return on their money...of course, 99% of gamblers don't care, because they simply want to "gamble".

Quote: TIMSPEED

BINGO!
That's what I hear ALL the time, people ask me "Why do you drive 3 hours to Reno, when you can drive an hour to ____ (Insert about 5 different Indian Casino's)"
What they don't understand, is they're absolutely getting ZERO return on their money...of course, 99% of gamblers don't care, because they simply want to "gamble".

The terminology could be part of it. "Gamble." I say I go to "play." "Gamblers" say it was "luck." Players say it was "chance" or "probability." I avoid saying "luck" as much as possible. "Luck" implies some force making the wheel stop on red 5 spins in a row. "Chance" implies there are 5 cards in the deck that can make your hand with 45 unknown so getting one of them on 4th or 5th street is a 1 in 5 shot.

"Gamblers" go to TI because they like the Pirate Theme. "Players" pay $5 to go to Freemont Street because they know one blackjack will pay that investment back.

Quote: Pando

Some of that jump in the gross may be accounted for by a small number of VIP slot players who now drop the equivalent of a million US dollars or more in a single session.

Thaat doesn't seem possible. Do they have the equivalent of a $5000/2 credit slot or something even larger? And do you know their payback %?

Nevada has 200 slot machines denominated in $100; there are 152 in Clark county and 139 on the strip. I am anot aware of any machines denominated higher.

Quote: pacomartin

Nevada has 200 slot machines denominated in $100; there are 152 in Clark county and 139 on the strip. I am anot aware of any machines denominated higher.

I've seen a $500 machine in Caesar's for years. For a while it even had a seat belt attached.

Quote: JerryLogan

I've seen a $500 machine in Caesar's for years. For a while it even had a seat belt attached.

Excuse the expression (it is not directed at any person) while I say, holy shit. And I love the seat belt. I'd like to see a picture of it.

[edit]

LOL, "GOOD LUCK!"



(This is at Rivers in Pittsburgh; caption is, "The state's only $500 slot machine."

I think the one(s) at Caesar's take up to 2 credits. Who wants to play such a machine taking only one??

Tom Breitling's book about the brief 20 months that they owned the Golden Nugget in downtown Las Vegas (2004 and part of 2005) describes a whale hitting the slot machine before he cleaned up in dice.

Quote: Tom Breitling

He’d pulled up at The Nugget one night at the end of September in his $350,000 Maybach and six hours and three minutes later walked out with $4,753,200 of our money.

A week later he came back in for three and a half hours and took us for another $1.5 million. But let me give you an idea of how insane his touch had become. Before he even got to the dice pit, he sat down at a slot machine and hit a $100,000 jackpot.

Tim and I had taken the keys to The Nugget only ten months earlier. In less than ten hours, Mr. Royalty had basically wiped out what was going to be a great third-quarter profit. To us, that was more than just a figure on a spreadsheet. It was a number that told the world we weren’t just a couple of kids who got lucky and hit the jackpot during the dot-com boom. It told the world we were entrepreneurs who knew how to make a business soar.