Skill-based slots signal big changes for casinos, players
Slot machine rules approved this month in Nevada could set the stage for games that revolutionize casino gambling throughout the United States.
The Nevada Gaming Commission adopted guidelines for skill-based games, which allow players to win based on their skill at arcade-style attractions such as pinball, shoot-’em-ups and maze-running rather than relying on pure luck, as traditional slots do. Like many other gambling regulations, the Nevada rules will be a template for other states, including Pennsylvania. A bill to allow skill-based games in the Keystone State is one of several pro-casino measures before the Legislature.
Offering machine games that pay off for skill is a fundamental shift for casinos and players, says Aaron Hightower, vice president of game technology for NanoTech Gaming in Las Vegas.
“Very few understand the full magnitude of the changes that are on the horizon,” he says.
“The whole reason to have skill-based gambling isn’t so people can push different buttons while they’re experiencing their game. The reason is so they can challenge themselves inside their brain and have a different type of experience that has a reward tied with their performance. When you do better, you get rewarded.”
Marcus Prater, executive director of the Association of Gaming Equipment Manufacturers, which represents slot-machine makers, said skill-based gaming will be the talk of the Global Gaming Expo, which opens Sept 29 in Las Vegas and attracts casino-industry representatives and regulators from around the world.
“The content that you will see over time will be incredible,” Prater says. He cites interactive tables being tested by MGM Resorts in Las Vegas. Four to six people can sit at a table that is basically a super-sized touchscreen allowing them to compete against each other or play separately. For now, it offers only play-for-fun games.
Although NanoTech and some other companies have exhibited skill-based games, none is likely to be in a Nevada casino before spring 2016, Prater says. Nevada regulators have 60 days to write technical standards governing the detail of skill-based games.
Prater says it might take five years for skill games to become common in casinos.
“You can’t have a transformation of gaming if it’s only taking place in Nevada and New Jersey,” he says. “This type of gaming is not allowed in other states or countries.”
The Nevada rules approved Sept. 17 allow games “in which the skill of the player, rather than luck, is the dominant factor in affecting the outcome of the game.” That’s markedly different from traditional slots, in which randomness — in other words, dumb luck — determines all outcomes. The rules also allow hybrid games, which combine skill and luck.
Hybrid games are a new concept for slots but not new to casinos. Hightower says video poker and blackjack qualify as hybrids because players can use strategies that reduce the house edge, or even give skilled players a long-term advantage.
“The players are the ones that really need to understand” skill-based machine games, Hightower says. Casinos must meet regulations, but “the really hard part is being fair and transparent to the player so they understand how their skill turns into money.”
NanoTech offers two skill-based games, a virtual pinball game called Vegas 2047 and a maze game called CasinoKat. The company also developed a game system that allows skilled players to gain a mathematical edge on a game without cutting into the casino’s overall take.
The system, which can be used in games developed by other companies, allows players to adjust three factors before playing a game: bet size, potential win and degree of skill involved in the outcome. The machine displays the chance of winning as the player changes the factors before the game.
Advantage player and game developer Jeff Hwang says casinos must price the games so gamblers have an incentive to learn the skills. If a $1 slot player can get a 97 percent payback for a game with no skill, he says, then a player at a skill-based slot with a $1 average bet must be able to get a higher payback rate.
Prater says operators will pick the range of payouts on skill-based games, as they do for traditional slots.
“These early games have to be attractive to players in all different ways, including (payout) percentage,” Prater says. He expects payout rates for a skill machine to range from the Nevada minimum of 75 percent up to 110 percent, which means some skilled players would have an edge over the casino. A machine’s overall payout rate will be less than 100 percent.
Hightower says adapting to skill-based games will require a learning process.
“This isn’t just about the success of one game or one company,” he says. “This is about expanding gambling to be more culturally acceptable, more responsible, more ethical. It’s really a huge, transformative change.”
Mark Gruetze is administrative editor for Trib Total Media. He can be reached at 412-320-7838 or [email protected].