discflicker
discflicker
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December 25th, 2011 at 3:16:58 PM permalink
I posted a blog about a new concept in gaming (I think its new).

Its about 4 pages long, but I think it describes the way many casinos in the near future might run their live gaming operations in order to reduce costs.


QUESTIONS for the good people at the Wizard of odds:

Can it get any better than this (for the players)?

Is this bad for the casino industry, given the state it is in right now?

Is this bad for anyone?

If a bunch of smaller casinos jumped on-board, perhaps as a last-ditch effort to reduce costs, would the larger casinos join the party as well, because that is where the entire industry is heading, (like it or not), or would they resist?

What if it started becoming really popular with only the startups, would they sign up then or say never, no way?


Is this technically feasible? YES!!!

Is this a reasonable proposal?



Tiltpoul already replied:

Can it get better than this for the players? Technically, yes. They could just be giving money away without risking any of your own, but realistically the situation you presented would never happen anyways.

Is it bad for the casino industry? Yes, since they would be offering wagers at a loss.

If every casino jumped on board because that's where the industry is heading, would they resist? In this theoretical world, probably not. You're giving a scenario where casinos will do ANYTHING to get any sort of business...

Is this a reasonable proposal? Absolutely not. Casinos would never set themselves up like that. You would also have a crazy host of gaming laws to jump through, and frankly, the state wants their cut too. There has to be some risk and I understand casinos have to make money. I don't blame them for any changes; it's a shame that's where we are, but I get it.
The difference between zero and the smallest possible number? It doesn't matter; once you cross that edge, it might as well be the difference between zero and 1. The difference between infinity and reality? They are mutually exclusive.
MathExtremist
MathExtremist
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December 25th, 2011 at 5:12:07 PM permalink
It's already being done with the exception of the competitive odds aspect. Interblock, ShuffleMaster, Digideal, and several non-US vendors sell multi terminal systems connected to central game outcome engines. I think your restriction to live gaming hurts the revenue potential, and therefore the competitive advantage, but it's still workable. If you have IP on it, those are the companies I'd talk to.
"In my own case, when it seemed to me after a long illness that death was close at hand, I found no little solace in playing constantly at dice." -- Girolamo Cardano, 1563
pacomartin
pacomartin
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December 25th, 2011 at 7:57:31 PM permalink
The cold hard reality that I see is illustrated in the following table comparing gaming revenue "On the Vegas strip" with "off-strip" having the broad definition of all the rest of Nevada.
Comment Month State Strip $billions Rest of NV
Latest reported Oct-11 $10.63 $6.01 $4.62
Low for off-strip Sep-11 $10.55 $5.94 $4.61
Low for the state Jul-10 $10.28 $5.62 $4.66
Low for the strip Oct-09 $10.38 $5.49 $4.90
Peak of market Oct-07 $12.97 $6.95 $6.03
Historic Oct-04 $10.38 $5.24 $5.14
Historic Dec-99 $9.02 $4.49 $4.53


I think it is fair to say that there is almost no competition within the Vegas strip based on House Advantage of the games. The only two exceptions are Hooters (right now) and Casino Royale, and they are extremely minor casinos in terms of revenue. All competition on the strip seems to be in terms of comps for high rollers.

The rest of Nevada does compete on House Advantage. They offer increased free odds, 9/6 video poker, and all kinds of lucrative come ons.

Since the majority of games outside of Nevada are at an extremely high house advantage (with some rare exceptions) then people should come to Nevada to outer areas of Clark County, or to Reno to seek out these games.

But the revenue of Nevada off the strip has been falling horrifically, almost as bad as Atlantic City percentage levels.
discflicker
discflicker
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December 25th, 2011 at 8:30:00 PM permalink
Quote: pacomartin

Since the majority of games outside of Nevada are at an extremely high house advantage (with some rare exceptions) then people should come to Nevada to outer areas of Clark County, or to Reno to seek out these games.

But the revenue of Nevada off the strip has been falling horrifically, almost as bad as Atlantic City percentage levels.



So the best place for the Competitive Gaming mall would be somewhere between Jerry's golden Nugget and The Joker's Wild ?
The difference between zero and the smallest possible number? It doesn't matter; once you cross that edge, it might as well be the difference between zero and 1. The difference between infinity and reality? They are mutually exclusive.
discflicker
discflicker
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December 25th, 2011 at 8:55:15 PM permalink
Quote: MathExtremist

It's already being done with the exception of the competitive odds aspect. Interblock, ShuffleMaster, Digideal, and several non-US vendors sell multi terminal systems connected to central game outcome engines. I think your restriction to live gaming hurts the revenue potential, and therefore the competitive advantage, but it's still workable. If you have IP on it, those are the companies I'd talk to.



Nice to hear from you, Math. I hope all is well with you.

Thanks, my lawyer did get a reply from the USTPO and it looks like my concurrent mapping ideas might fly. The claims were all rejected due to a percieved overlap with Asher (the guy who came up with some games mapped to the outcome of a horse race) but his claims don't specify multiple concurrency. I made a big deal out of the wording in it, I dont know if you recall, I use the term "ZERO-MAP" and MAP 1, indicating that the original game could be duplicated itself. Asher's claims don't indicate this and his wording uses the singular tense on all referals to the games being mapped, so my lawer is claiming that my pending patent is unique simply because I did strees the multiple concurerency.

I have asked my lawer specifically about the applicability of this mapping IP to the concept of "competitve gaming malls", which, BTW I introduuced publically in 2009 on my website, so I apparently can't have IP for it any more, but I have something even better... I have the working product ready to demo.

I know, "its not created by registered programmers" "its not certfied" "its not legal in Nevada", etc. however, it works great for a demo and if any companies want to look at it I can show it to them (pretty soon it will be ready, like 3 man-weeks of work) now under patent pending protection.


The reason this works goes back to my approach to treating the casino floor like its the factory floor. Do you think they shut down a $20,000 per minute assembly line every time they need to make a configuration change on a given station? My systems allow configuration changes to be made ON THE FLY in live production, and THAT is where this capability comes from. We used to call it "Warm-Start"... re-loading a new configuration while still processing live data.

Thanks for your interest and positive response.
The difference between zero and the smallest possible number? It doesn't matter; once you cross that edge, it might as well be the difference between zero and 1. The difference between infinity and reality? They are mutually exclusive.
Tiltpoul
Tiltpoul
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December 26th, 2011 at 11:53:33 AM permalink
Quote: discflicker

I know, "its not created by registered programmers" "its not certfied" "its not legal in Nevada", etc. however, it works great for a demo and if any companies want to look at it I can show it to them (pretty soon it will be ready, like 3 man-weeks of work) now under patent pending protection.


The reason this works goes back to my approach to treating the casino floor like its the factory floor. Do you think they shut down a $20,000 per minute assembly line every time they need to make a configuration change on a given station? My systems allow configuration changes to be made ON THE FLY in live production, and THAT is where this capability comes from. We used to call it "Warm-Start"... re-loading a new configuration while still processing live data.

Thanks for your interest and positive response.



But you're under the assumption that players will respond to such a network. Even if there is a live person operating the central unit, there will be naysayers in the casino who assume all outcomes are rigged, regardless of which "company" you are patronizing. Further, who's to say, in your given scenario, that a person playing for free hot dogs doesn't play a few dollars, get the hot dog, then switch to a competitor. I know they can do that now, but in the setting you provide it would be easily exploited.

Further, the more I thought about it, I stand by the feasibility of offering better than odds on a given number in your scenario (the 44-1 on the 12 for example). Competitors would suddenly have to offer better offers to outdo each other, or enter a game theory scenario where they all agree not to. Then how much better of are you in the current scenario. I think you have an interesting concept, bu the real-world practicality of it being profitable just doesn't strike me. Gaming operators are simply too self-interested to share with other groups.
"One out of every four people are [morons]"- Kyle, South Park
discflicker
discflicker
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December 26th, 2011 at 9:27:14 PM permalink
Quote: Tiltpoul

Even if there is a live person operating the central unit, there will be naysayers in the casino who assume all outcomes are rigged, regardless of which "company" you are patronizing.



No way, the shooter is right there and all players get to rotate through the list and be shooters themselfs.. In a remote video feed, I guess the asumption could be there, but I would like to just start out establishing that the entire systems is honest and acts more like an ATM than a casino.
Quote: Tiltpoul



Further, who's to say, in your given scenario, that a person playing for free hot dogs doesn't play a few dollars, get the hot dog, then switch to a competitor. I know they can do that now, but in the setting you provide it would be easily exploited.


They will figure it out, stuff like requiring a certain number of bets by the casino giving away the hot dogs, for example. How do those costs compare to having an entire brick and mortar casino to keep up and running? Must be expensive mustard.


Quote: Tiltpoul


Further, the more I thought about it, I stand by the feasibility of offering better than odds on a given number in your scenario (the 44-1 on the 12 for example). Competitors would suddenly have to offer better offers to outdo each other, or enter a game theory scenario where they all agree not to. Then how much better of are you in the current scenario. I think you have an interesting concept, bu the real-world practicality of it being profitable just doesn't strike me. Gaming operators are simply too self-interested to share with other groups.



Right, and that is why setting them against each other is the best way for the end customers get a better deal.
The difference between zero and the smallest possible number? It doesn't matter; once you cross that edge, it might as well be the difference between zero and 1. The difference between infinity and reality? They are mutually exclusive.
thecesspit
thecesspit
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December 26th, 2011 at 10:42:55 PM permalink
Where's the incentive for the casino to end up in a direct competition like you describe?

Casino's don't compete on price. They compete on the experience you get for the price. The experience is different at each joint, and I reckon that's the major differentiation between the LV casinos. Yes, some of this is price/offers, but a lot of it is surroundings and service.

I'm not your target market, but the scenario you describe sounds unappealing to me.
"Then you can admire the real gambler, who has neither eaten, slept, thought nor lived, he has so smarted under the scourge of his martingale, so suffered on the rack of his desire for a coup at trente-et-quarante" - Honore de Balzac, 1829
pacomartin
pacomartin
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December 27th, 2011 at 4:06:15 AM permalink
Quote: discflicker

So the best place for the Competitive Gaming mall would be somewhere between Jerry's golden Nugget and The Joker's Wild ?



I think you missed the point. The Vegas strip where there is no competition in gaming odds, is back to revenue from almost 3 years ago. The "rest of Nevada" is back to the revenue of almost 13 years ago. There is no evidence that competing over house advantage grows the overall market.

It may be a short term panacea for one casino, and clearly some players make out, but it's not clear that you can grow the market that way.
Tiltpoul
Tiltpoul
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December 27th, 2011 at 4:15:11 PM permalink
Okay, so I have thought a LOT about this idea. It's actually a very entertaining idea, and I commend you for thinking of it. The rest of this will be highly critical, but any ideas that help benefit the player are always a welcome sign.

1) In your given scenario, you talk about three casinos that seem to be struggling to stay alive on their own. I presume they would be able to use their current licenses and sell their properties. I can only see a few casinos that are struggling to the point where this would actually help them: Circus Circus, Riviera, Stratosphere and Tropicana for the immediate on-strip properties. Tropicana just did major renovations, and the land is valuable, so they don't seem to fit the concept. Circus Circus is still owned by MGM, and while it's not important to their main brand image (they aren't a part of the rewards club and barely advertised as an MGM property), they are unlikely to team up with others in this concept. That leaves two independent casinos that would benefit... Riviera, and Stratosphere. Also, let's say they don't shutter their casinos completely as they will become the two to offer "hotel options..."

2) The only other gaming companies who could possibly be interested in such a concept would be those without a current Vegas presence. That's a lot of small businesses, but let's narrow this group down to two larger and one smaller group: Ameristar, Pinnacle, and Full House Entertainment. Pinnacle apparently has some agreement with Wynn, as they are advertising getaways at Belterra, so they COULD have a hotel option (which will later be discussed). My feeling is Ameristar has no desire to head into Nevada, as their only juncture in Nevada is some rinky dink place in Jackpot, NV. But for the purpose of the argument, the three companies we'll explore are: Ameristar, Pinnacle and FHE.

3) Third, there would be those non-gaming companies that want to establish a gaming presence. These could be investment groups (similar to Colony Capital, or as an example, San Diego Credit Union) or private citizens with enough of an influx of cash (for example, Warren Buffet and Bill Gates). Investment groups often see casinos as a way to build equity and use it to pay out in dividends, similar to the stock market. They have no real interest in the gaming aspect but rather look at it as a way to generate revenue. Individuals may be very interested in the gaming aspect, but may not have the means to figure out how to get started. For the purpose of my example, the investment group will be San Diego Credit Union, and the individual will be a made up consortium of PaiGowDan, JerryLogan and me (Tiltpoul), hereby known as WoV.

4) Finally, the last interested parties would be those with a Vegas presence, but not necessarily a strip presence. For the sake of a simple argument, El Cortez fits nicely. I'll go into ramifications of why I'm not expanding on this later...

Okay, so now we have Riviera, Stratosphere, Ameristar, Pinnacle, FHE, SDCU, WoV, and El Cortez. All of these companies or casinos exist (exception: WoV), and all have reasons to want to take part in such a company.

First, you have to determine ownership of the building. A mall works since an outside group owns the physical property, leasing spaces to tenants. They agree to certain rules and attract tenants to the mall. The mall property takes care of maintenance of the building and providing safety, while each individual store runs their own businesses. Competition can exist because of the rules set up by the group to avoid too much of any type of business (for example, there can only be two sandwich shops).

The easiest thing would be to create a joint group to own the building, but if any one business has even 1 cent more invested in the building, that company could claim majority ownership. Simon Properties (a large mall developer) could buy the building and lease spaces, but given that all the companies would be using the same terminals and equipment and staff, that would be silly to pay a middle-man (and probably more expensive, cutting into operating costs).

Next is gaming licenses. As each operator would be independent (in the scenario you set up), each would have to apply for a gaming license. This is not cheap and rather redundant for all the gaming properties. Assuming NGC doesn't have a problem with that, the next step is approval for the games. This should be relatively easy, as it seems craps and roulette would be the games of choice. You could also, theoretically, expand to all games, although 139 hands of BJ would take a while to deal and move rather slowly. Slot machines would be a much better fit, but that's basically what the Brick and Mortars (B&M) casinos are doing with the newest machines.

You've finally jumped through all these hurdles and now you are ready to start gambling. But what about those promotions? Well to change odds on any game requires NGC approval as well. This would have to be done in advance, so each company would know what the other is doing. In your scenario (and assuming they all follow this), Riviera starts at 31-1, then Stratosphere goes to 32-1, and so on. Eventually there comes a breaking point (let's say 50-1 for one roll only). Some company out of the group will get hit badly and the rest will retreat in fear of the same fate.

I could go on, but I think what I've said should cover most of the problems with the issue. The only places I see such a venue even getting off the ground (in a true casino-type setting) are places that are competitive gaming markets. These include Las Vegas, Reno, Atlantic City, Tunica, Biloxi, Blackhawk, Detroit and Lake Tahoe. These are all markets where the casinos are so close to one another they have a reason to want to compete. However, LV Strip is saturated by two companies (Caesars and MGM). Same goes for AC and Tunica, and to a degree, Lake Tahoe. Remember the idea only works when it's true competition going up against another (meaning Luxor and Excalibur aren't competing against each other).

The only real world, potentially successful markets for this idea would be places where "Internet Cafes" or "Skill game parlors" are utilized. However, those places can operate at a much higher HE since they are probably not the most legit. Further, they only succeed in states that don't have casinos, b/c as soon as the casinos come, the state shuts them down super fast. I live in Ohio, and the Skill Game parlors are everywhere, and they must bring in some money or else they wouldn't exist. But I guarantee you two companies are not going to team up for the idea you suggested, and they do their best to keep a low profile in abandoned strip malls.

I hope you haven't put any money into this idea, because the probability of it succeeding is extremely low, in my opinion. If you have, I wish you the best, but I wouldn't get your my up.
"One out of every four people are [morons]"- Kyle, South Park

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