Ask the Slot Expert: Can casinos lower the payback on video poker?

Question: I hope I am asking this question the right way, but think it’s a simple and straightforward question that everyone wants to know.

If I am playing an 8/5 Double Double Bonus video poker machine anywhere in the United States, is the expected statistical payback the same?

In other words, since it is all based on the random number generator, and the expected payback is, say, 90%, can any state or casino lower the expected payback to their favor in any way?

Answer: Let's step into the Wayback Machine and go back -- OMG!! -- almost 30 years. Frank Scoblete's book Victory at Video Poker is about to come out. Frank told me that he learned something about the video poker regulations in New Jersey that might make me think twice about playing video poker in Atlantic City.

New Jersey modeled its gaming regulations on Nevada's with some nonsensical, provincial additions (e.g., cocktail servers cannot explicitly offer alcoholic beverages ["Coffee? Tea?" not "Drinks?"], casinos can't promote slot payback percentages) and one notable omission -- the regulations do not treat video poker machines explicitly. Video poker machines are just another electronic gaming device (EGD) under New Jersey's regulations.

In Nevada, any EGD that mimics a live-action game must have the same odds as the live-action game. Electronic roulette must have the same odds as the table with the spinning wheel. Electronic blackjack must have the same odds as the table with the dealer. Video poker must be dealt from a fair deck, as if you were playing at your kitchen table.

The lack of the real-world-simulation regulation meant that video poker machines in Atlantic City technically only had to meet the requirements applicable for other EGDs, like minimum payback. They did not have to use fair decks. Casinos could conceivably have machines with long-term paybacks not dictated by their paytables.

Around the same time, other gaming writers said that video poker players don't have to worry. Any video poker machine manufactured in Nevada must follow Nevada's regulations, even if the machine is destined for another jurisdiction.

I tried googling various phrases to find citations for this regulation and maybe even the regulation itself, but I came up empty handed. If anyone remembers when this was written in a column or in a book, particularly if the writer cites the specific regulation, please send me the citation.

A similar question was the Question of the Day about three years ago on the Las Vegas Advisor site. This writer asked if it was true that in order for a manufacturer's video poker machines to be approved in Nevada, "the same randomness must be found in all machines [even those in other states]?" The writer assumed it to be true. "That is why I do not trust any machines with names not seen in Las Vegas."

The LVA staff also did not find any regulation referring to machines operated in other states in Nevada's Regulation 14 with the catchy subtitle "MANUFACTURERS, DISTRIBUTORS, OPERATORS OF INTER-CASINO LINKED SYSTEMS, GAMING DEVICES, NEW GAMES, INTER-CASINO LINKED SYSTEMS, ON-LINE SLOT METERING SYSTEMS, CASHLESS WAGERING SYSTEMS, MOBILE GAMING SYSTEMS, INTERACTIVE GAMING SYSTEMS AND ASSOCIATED EQUIPMENT; INDEPENDENT TESTING LABORATORIES".

The LVA's answer quotes the Nevada Gaming Control Board (GCB): "We base our approval solely on gaming devices meeting Nevada regulatory requirements." Nevada GCB doesn't care about machines in other states as long as the machines in Nevada meet its requirements.

Even if Nevada did have a regulation stating that any machine manufactured in Nevada must meet Nevada's standards, what's to prevent the distributor in another state from replacing the software in the machine with software that is legal in that state even if the software would be illegal in Nevada?

The bottom line is that you have to check the regulations for a jurisdiction to be 100% assured that a video poker machine is dealing fairly. And, as far as I know, even though New Jersey and Mississippi and then other jurisdictions modeled their regulations on those that came before, Nevada is the only state with the real-world-simulation regulation.

That said, I think you can be 99% certain that video poker machines in other states deal fairly for these reasons:

• It's ridiculously easy to write the program that deals cards from a fair deck. Even though in high school Basic programming class they gave an example of shuffling a deck of 52 cards, there's no reason for a video poker machine to go through such shenanigans and shuffle a virtual deck of cards (even though I frequently say that the machine is constantly shuffling its virtual deck).
  
  Here's the video poker machine deal/draw algorithm: Get a number from 1 to 52 from the RNG. Remember it. Get another number. If it's the same as the number you already have, get another number. Repeat until you have five unique numbers. This is the dealt hand. Display the cards corresponding to the numbers. When the player presses deal, get five more numbers using the same process. Use the new cards to replace any cards discarded. Pay the winning hand or display (wah, wah) Game Over.
  
  It's more difficult to write a program that does not deal fairly.
  
  
• I've seen some pretty lousy paytables on video poker machines. There's no reason for these machines to be lousier still by not dealing fairly.
  
  I would be very suspicious, though, if I found a positive expectation machine outside of Nevada. Many jurisdictions have regulations prohibiting any EGD from having a long-term payback of 100% or more.
  
  
• Most states use independent testing laboratories for game certification. I'm sure the labs would be more than happy to test machines using a state's proprietary requirements, but it's cheaper for the state to accept the lab's own requirements.
  
  I think Gaming Labs International, which started not too far from where I lived in New Jersey, is the largest independent testing lab. It has the real-world-simulation requirement in its Standards for Gaming Devices.

I'm long overdue with my standard disclaimer: My statements apply only to Class III machines. Class II machines in tribal casinos may look like video poker, but they're not.

Finally, I want to point out that it's not the use of an RNG that makes the machines fair. It's what the program does with the values from the RNG that makes the machines fair.

If the machines are required to deal fairly, then each card is equally likely to be dealt or drawn. You can calculate the long-term payback and optimal strategy from the paytable.

If the machines are not required to deal fairly, then the software could implement some sort of weighted cards system like the weighted reels in reel-spinning slot machines. On the slot, each symbol is not equally likely to land on the payline. On the unfair video poker machine, some cards could be less likely to be dealt/drawn than others.

Machines that deal fairly and the machines that don't deal fairly use the same RNG. There are no fair/unfair or loose/tight RNGs. RNGs merely generate a stream of numbers.

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