Gaming Machines
A Player's Guide For the Northern Territory

Gaming Machines - A Summary

Gaming machines are designed as recreational amusement devices on which people can spend money. They are not designed to enable people to supplement their income.

In general, players can only 'get ahead' of a machine on a short term basis at best. Many players will experience sessions of play when prizes won exceed the amount spent. In the long term, however, in all but the most unusual and extraordinary circumstances, this outcome is virtually impossible. ( See "About the Machines" below)

To play a gaming machine is to play a game of chance. This means that CHANCE ONLY determines the outcome of any game. Therefore, there is no play method or play pattern that can have any effect on whether a game is a winning or losing one. (See "How the Machines work - Chance" below )

Modern gaming machines use computer technology to control and operate all functions from coin or note insertion, bets, buttons use by players, and so forth INCLUDING determining the outcome of each game.

Determining the outcome of each game involves what is called a Random Number Generator. This is a mathematically based program (i.e. a computer program)

The outcome of each game, irrespective of any other factor, is UNPREDICTABLE and is ALWAYS UNPREDICTABLE. (See "How the Machines work - Randomness" below)

The chances of winning prizes advertised on gaming machines in any one game range from extremely rare to relatively frequent. Generally, the higher the prize, the more unlikely it is to occur. (See "Player Return Percentage" below)

The following table describes some of the odds of an event happening and enables comparison of some gambling odds to odds of other possible life events.

Hints

• The gaming venue's have the rules in their favour, if you lose, expect it.
• Don't bet money you can't afford to lose. Set a limit on the money you're prepared to lose and the amount of time you're willing to stay and stick to your limits. Don't chase lost money.
• Although you'll lose in the long run, your money is likely to go up and down like a roller coaster in the short run. So, quit while you're ahead.
• There is no system that can beat a game of pure chance (see "How they work" below).
• Machines are designed for entertainment and to return a profit to gaming venues, not to solve players financial or personal problems.
• People who drink alcohol, or are intoxicated while playing are likely to spend more time and money
• Keep a record of the money you spend.
• Be aware of any lucky thinking, lucky thinking may encourage you to spend more then you can afford to lose.
• Have fun - if it is hard to walk away from the machine at will, it may be best not to play at all!

  (See "Myths" below)

About the Machines

Design/Types

There are a huge variety of gaming machines, they differ in appearance, game type, denomination and player options. Designs can vary from the ornate scrolls of older machines, to the computer generated artwork and sound effects of modern machines. Generally, they are made to look as attractive as possible with bright lights and a fun atmosphere. Machine appearances and sounds can be varied to best match the preferences of the playing population. The average interval between prizes is clearly an important design feature, frequent payouts are designed to keep players interested. The features are designed to encourage players to enjoy playing, remain at the machines longer and thus keep spending money.

Gaming machines are not designed to enable people to supplement their incomes. They are designed as recreational amusement devices on which people can spend money.

Use of gaming machines should accordingly be careful, moderate and within the limits of each individuals discretionary spending.

It is possible to win money on the machines. In fact, the machines are set to return to players a proportion of all moneys bet. This characteristic needs to be properly understood (see section on "Player Return Percentage").

In practical terms, however, players can only 'get ahead' of a machine on a short term basis at best. Many players will experience sessions of play when prizes won exceed the amount spent. In the long term, however, in all but the most unusual and extraordinary circumstances, this outcome is virtually impossible.

How the machines work

Chance

To play a gaming machine is to play a game of chance.

Tossing a coin involves chance - there are two outcomes each with an equal chance of occurring (that is, 'Heads' or 'Tails'). In the language of chance, we say that the chance of 'Heads' is one in two (1:2), or 0.5, or 50% - they all mean the same thing.

Gaming Machines have far more than two possible outcomes. The chances of getting any particular prize outcome can vary markedly for each game. In addition, not all machines or games have the same number of possible outcomes.

One essential element that all machines (other than skill based games) share is that the outcome of any particular game is determined by CHANCE ONLY.

This CHANCE ONLY characteristic is extremely important to a proper understanding of how the machines work.

Because CHANCE ONLY determines the outcome of any game, the following statements are absolutely true:

1. There is no play method or play pattern that can have any effect on whether a game is a winning or losing one.
2. Machines do not 'adjust' to compensate for a string of losing games or for a string of winning games. In other words, machines do not become 'due' to 'loosen up' or 'dry up' because of past events.
3. It is not possible to predict the outcome of the next game.

Randomness

Modern gaming machines use computer technology to control and operate all functions from coin or note insertion, bets, button use by players, and so forth INCLUDING determining the outcome of each game.

Determining the outcome of each game involves what is called a Random Number Generator. This is a mathematically based program (i.e. a computer program) which selects a group of numbers that, in turn, determine the selection of the symbol that will stop on the line that shows the winning or losing combination. The important effect of this process is that:

1. Each symbol selected is chosen quite randomly; and
2. The selection process is not influenced by any outside factors such as:
   - previous selections
   - winning or losing history

In short, the selection of all symbols that appear at the end of each spin of the reels is the result of chance and CHANCE ONLY.

As noted above, the outcome of each game, irrespective of any other factor, is UNPREDICTABLE and is ALWAYS UNPREDICTABLE.

This is a constant. It is always the case, no matter how many games have been played, no matter what previous wins or losses have happened, no matter how fast or slow the player chooses to play, no matter how many coins have been bet or how many lines are played. Nothing can influence the chance selection of symbols that appear when the reels stop spinning.

Player Return Percentage

Standard gaming machines have an expected player return rate.

This means that, of the total value bet, a certain proportion is expected to be returned to players in winning.

This expected proportion of wins to bets is known as the "Player Return Percentage". Note the use of the word 'expected' - it underlines a very important concept in understanding how machines work.

Government regulations in Australia set this expectation at a minimum of 85% in some jurisdictions while others set the figure at 87% or higher. In practice, most venues operating the machines have them 'set' at a higher level than the regulated minimum.

In the Northern Territory clubs and hotel are required to have the Return to Player of a minimum of 85% and the casinos are required to have the Return to Player at a minimum of 88%.

This 'setting' is not a rule or an outcome that will always be perfectly satisfied for play sessions.

Care should accordingly be taken in dealing with the figure and the concept.

Gaming machines function in this regard on the basis of PURE CHANCE. The Player Return 'setting' is an expectation that comes from the rules of CHANCE - it is not a guaranteed outcome.

To say that a machine is 'set' to return 90% to players simply means that the game mathematics are structured in a way that gives the EXPECTATION that over a long period of time the machine is likely to average a return to player of 90% of the total bets made on the machine.

For individual games, the figure is not very useful. This is because of the enormous number of possible outcomes that occur in any one game on a gaming machine.

If we look at a simple game of tossing a coin, there are only two possible outcomes.

It might be expected that after 100 'games', or tosses of the coin, "Heads" will tend to have occurred in half the outcomes.

Using the rules of chance, "Heads" can be expected to have occurred at a rate of 50% because there are two, equally likely, possible outcomes.

There is no guarantee that 50 "Heads" will occur. In fact, it is easily possible to get more than 50 or less than 50.

The CHANCE factor simply means that, if a sufficient number of trials of 100 games take place, "Heads", as an average over all trials, will have tended to occur in 50% of the results.

For gaming machines, however, the total possible outcomes are almost astronomical by comparison.

For a game with, say, 144 million different possible outcomes, there can be no reasonable expectation that it will be tending to operate according to its average in 100 games - or even 1,000 games; or even 10,000 games.

An individual player will almost certainly not play a sufficient number of games to have any reasonable expectation of experiencing the 'set' Player Return Percentage.

How does one objectively evaluate gaming machines against other forms of gambling?

One of the matters that players need to be aware of, to make informed decisions when choosing to spend money on different forms of gaming are the relative player return percentages.

It must be stressed that these player return percentages are long term averages: individual players are accordingly unlikely to achieve these percentages.

However, the following table is considered a useful independent guide to the place that gaming machines occupy in the range of average player return percentages:

The following table gives an indication of how players will fare on a typical machine.

Win - Loss Table

The table should be read carefully, and the following points should be borne in mind:

• Players whose experience is described in columns C, D and E, are players who lost money.
• Each gaming machine is as unique as a fingerprint in respect of the experiences it will generate for players. The above is merely typical. It does not describe the characteristics of all games.
• The table estimates SINGLE sessions of play only. The unalterable rule is that the more sessions a player engages in, the lower the chance becomes of winning more than is staked. In fact, it tends to become impossible to win more than is staked as play sessions increase.

Chances of Winning

The chances of winning prizes advertised on gaming machines in any one game range from extremely rare to relatively frequent. Generally, the higher the prize, the more unlikely it is to occur.

The following table describes some of the chances of winning on a typical five reel poker machine. This information will be made available either in leaflet form or on screen for each machine in the NT region.

Machine Designation

The Long -Term Average Player Return for this game, as approved by the Regulatory Authority is: 90.31%

Caution

All the values shown are averages. It is likely that significant variations to these will happen during any session of play.

If the machine you are playing is a linked machine, the chances of a prize or combination occurring and the long term average return to player will be different to those above (but can only be better)

Myths

Myth 1:

Slot Machines are programmed to go through a cycle of payoffs. Although the cycle can span thousands of spins, once it reaches the end, the outcomes will repeat themselves in exactly the same order as the last cycle.

Wrong. Every spin is random and independent of all past spins. Like the flip of a coin, a present flip does not depend on the result of the last flip. The flips are completely independent of each other.

Myth 2:

Gaming venues place the machines that payout more regularly close to the front doors and at the edge of the aisles to attract more attention/players.

Not true, placement of machines is generally based first upon appearance.

Myth 3:

Machines are 'loosened' or 'tightened' on the weekends and holidays.

The player return percentage in the NT is set at a minimum of 85% in clubs and hotels and 88% in casinos. Venues often choose to purchase machines set with higher return rates. Strict regulations and compliance monitoring makes it impractical for venues to alter the return rates on their machines.

Myth 4:

If a machine hits a big jackpot, stop playing that machine as you won't win any more.

The winning of a jackpot is a random event, therefore the next jackpot can occur anytime and has an equally probable chance of going off on the next spin.

Myth 5:

If I had played that machine for a bit longer, I would have hit the jackpot instead of him

This is not true. Random number generators are operating constantly, regardless of whether the machine is being played. To have achieved the same result you would have had to have pressed the spin button at the exact same millisecond (1/1000 of a second!) as the other player did.

Myth 6:

Machines are rigged by maintenance workers

No. The payout schedules are pre-set at the factory and programmed into the machine's random number generator.

Produced by
Amity Community Services: HABIT WISE
amity@octa4.net.au

Supported by:
Racing ,Gaming & Licensing
Dept Industries and Business
Northern Territory Government
Lasseters Hotel Casino

References:

Hing,N Breen,H.&Weeks,P.(1998) Club Management in Australia: Administration Operations and Gambling. Melbourne: Hospitality Press
Productivity Commission 1999,(July) Australia Gambling Industries,Draft Report Canberra
Levez B., 1995, Teach Yourself Successful Gambling
Hodder & Stoughton Educatioal, London