How many casinos are too many?

Hello, John,

I am kind of new to the gambling scene. So I will probably ask some questions you have already answered. What does RNG stand for? I live in Oklahoma so our slots are tied to a bingo card. I think you called these Class II machines? Anyway, are the odds any different for these than the ones in Las Vegas?

Thank you for your time and expertise.

Otto

Dear Otto,

RNG stands for random number generator.

You're right. Slots tied to bingo cards are Class II gaming machines. The odds on these machines aren't necessarily any different from those on the slots in Las Vegas. Both types of machines offer many payback percentage programs. It all depends on the percentages that the different slot directors have ordered.

Best of luck in and out of the casinos,
John

Hi, John,

I've read your column for quite a while now and think it's great.

My questions are more like comments than questions but here goes.

How in the world will all the casinos across the USA keep their doors open as time goes on? My point is, casinos are popping up across the country like convenience stores did a few years back. We must be at the saturation point. How long will people keep losing their hard-earned dollars to watch those wheels go around to blank after blank after blank while the casinos are raking in billions of dollars?

Most casinos brag about how much they have paid out but their percentage of take is usually not mentioned. I have heard that 80% (interview on the travel channel with Mr. Wynn) is the max payout and that includes comps and all giveaways like cars, trips, rooms, etc. It wasn't said exactly that way. It was said that his new casino operates on 20% of the take. Therefore, if this is true, the slots have to be down to about a 70% or less payout when you consider other prizes and comps. However, I don't think most casino will ever admit that.

I'm perplexed with where all these billions are coming from that are being lost at the casinos.

Regards,
Jim

Dear Jim,

You raise a number of very good points. Let me comment on them, working my way up from the bottom of your letter to the top.

Where does the money come from that is lost at the casinos? That's easy. From my wallet, your wallet, and the wallets of all the other players in the casinos. But keep in mind also that casino operations are no longer the overwhelmingly dominant source of casino company profits. Rooms, retail, restaurants, and convention space are now profit centers too. Not every dollar of revenue that casino companies report was won on the casino floor.

I'm not sure what you mean by "percentage of take," but the numbers you're looking for may be available in the quarterly or annual reports. I also don't exactly what Mr. Wynn meant with his statement, but I'm pretty sure it was MBA-speak that went over both of our heads. I think he was talking about what his company does with the money after it has been won from the players. All the house edges have already been applied. The "take" is what the casino has won from players, not the action they've given. And a slot with a 70% payout would be illegal in Nevada because the payout is below the statutory minimum.

Where is the saturation point? We may never know. In a completely free market, companies would be free to open as many casinos as they want. Once an area goes beyond the saturation point, casinos will fail and close. The market would determine the number of casinos an area can sustain.

But casinos are not a free market and they are heavily regulated. Jurisdictions control the number and locations of casinos. Still, we do occasionally see casinos fail, but it is difficult to determine whether the failures were due to oversaturation or poor management.

How long will people keep playing? As long as casinos keep giving people a reason to play, by providing games they want to play and good time while they play.

Thanks for the kind words about my column.

Best of luck in and out of the casinos,
John

Hello,

My wife and I are going to France and I see that they have some casinos there. Any tips you can give me?

Thanks,
Patrick

Dear Patrick,

I've never been to a French casino, so I can't offer any tips. If any readers have any tips to share about French casinos, please send them to me and I'll post them.

Best of luck in and out of the casinos,
John

Send your slot and video poker questions to John Robison, Slot Expert, at slotexpert@comcast.net. Because of the volume of mail I receive, I regret that I can't send a reply to every question. Also be advised that it may take several months for your question to appear in my column.