A Different Class of Gambling

If you ever play slot machines or video poker at a Native American casino, there's an important question you must have answered before you gamble your money: What "class" of electronic gaming devices (EGD) are being used at the property?

The question is important because of the Indian Gaming Regulatory Act (IGRA) written in 1988 by the federal government to provide the framework for what type of gambling the Native American tribes were going to be able to offer on their reservations.

The legislators wound up breaking gambling down into three categories: Class I gambling: Non-commercial, social gambling; Class II gambling: Bingo, lotto, punch boards, pull tabs and card games that aren't house-banked; and Class III gambling: Traditional Las Vegas style, state-regulated gambling including slots, video poker and table games.

Native American tribes are permitted to conduct Class III gambling on their reservations only if they negotiate compacts with the governments of the individual states in which they are located. Many, in fact, have done this. The others are restricted to Class II, which meant bingo was as high tech as the gaming floor was going to become.

But knowing that old fashioned bingo the way it's traditionally played at charitable events wasn't going to create a true casino-style experience and, more importantly, wasn't going to bring in the kind of dollars the tribes were looking for, they had to search for a way to turn slot machines into bingo games.

The nation's slot machine developers and manufacturers were only too happy to assist because it meant a whole new revenue stream for them. So they came up with slot machines that looked and played like the Class III devices we are familiar with at state-regulated casinos but were really versions of electronic bingo games.

The Class II games are so sophisticated in their outward appearance and play features that it's nearly impossible to distinguish them from the machines we play in state-regulated, commercial casinos. This applies to reel and video machines as well as video poker games. But inside they are really very different.

Rather than being purchased from the manufacturer with predetermined "hold" percentages, Class II games are driven by a central computer system in which electronic bingo games are played in 20-millisecond windows among all the people who make plays on the machines. Players win or lose based upon the common virtual ball draw.

There must be a final decision for each game determined by a pattern of numbers that ends the game with a winning result.

The payoffs are made in one of two ways depending upon which electronic bingo technology is being used:

Technology No. 1: When a game is completed, the central computer distributes a pre-determined number of prizes in varying amounts to the machines. For example, if a player's spin results in double blue bars across the pay line, it means that machine won a prize for x-number of coins from the results of the just completed bingo game. In this type of game, the hit frequency is always 50 percent, which means one out of every two spins results in a bingo. Payback percentage, however, is determined by the x-number of prizes in x-amounts that are in the computer program.

Technology No. 2: The odds against hitting any particular pattern among the millions of possibilities on a bingo card are figured out and matched precisely to the odds against hitting any particular paying combination of symbols on the slot. Using this technology, hit frequencies and hold percentages mirror Class III machines.

Even though Class II EGD technology is sophisticated and random, you owe it to yourself to find out what type of machines you are playing when you visit a Native American casino.