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A slot machine (American), fruit machine (British), or poker machine (Australian) is a casino gambling machine with three or more reels which spin when a button is pushed. Slots are also known as one-armed bandits because slot machines were originally operated by a lever on the side of the machine (the one arm) instead of a button on the front panel, and because of their ability to leave the gamer penniless. Many modern machines still have a legacy lever in addition to the button.

Slot machines include a currency detector that validates the coin or money inserted to play. The machine pays off based on patterns of symbols visible on the front of the machine when it stops. Modern computer technology has resulted in many variations on the slot machine concept. Slot machines are the most popular gambling method in casinos and constitute about 70 percent of the average casino's income.^[1] It is estimated that thirty percent or more of the profits from gambling machines come from problem gamblers.^[2]

Contents 1 History 2 Description 3 Terminology 4 Pay table 5 Technology 5.1 Random number generator 5.2 Virtual Reels 5.3 Payout percentage 5.4 Linked machines 5.5 Fraud 6 Regional variations 6.1 United States 6.1.1 Native American casinos 6.1.2 Slot machine classes 6.1.2.1 Class II game characteristics 6.1.2.2 Class III game characteristics 6.1.3 Slot clubs 6.2 Australia 6.3 United Kingdom 6.4 Japan 7 Skill stops 8 See also 9 References 10 Bibliography 11 External links

[edit] History

Sittman and Pitt of Brooklyn, New York, U.S. developed a gambling machine which was a precursor to the modern slot machine. It contained five drums holding a total of 50 card faces and was based on poker. This machine proved extremely popular and soon many bars in the city had one or more of the machines bar-side. Players would insert a nickel and pull a lever, which would spin the drums and the cards they held, the player hoping for a good poker hand. There was no direct payout mechanism, so a pair of kings might get the player a free beer, whereas a royal flush could pay out cigars or drinks, the prizes wholly dependent on what was on offer at the local establishment. To make the odds better for the house, two cards were typically removed from the deck: the ten of spades and the jack of hearts, which cut the probability of winning a royal flush by half. The drums could also be re-arranged to further reduce a player's chance of winning.

The first one-armed bandit was invented in 1887 by Charles Fey of San Francisco, California, U.S., who devised a much simpler automatic mechanism.^[3] Due to the vast number of possible wins with the original poker card based game, it proved practically impossible to come up with a way to make a machine capable of making an automatic pay-out for all possible winning combinations. Charles Fey devised a machine with three spinning reels containing a total of five symbols – horseshoes, diamonds, spades, hearts and a Liberty Bell, which also gave the machine its name. By replacing ten cards with five symbols and using three reels instead of five drums, the complexity of reading a win was considerably reduced, allowing Fey to devise an effective automatic payout mechanism. Three bells in a row produced the biggest payoff, ten nickels. Liberty Bell was a huge success and spawned a thriving mechanical gaming device industry. Even when the use of these gambling devices was banned in his home state after a few years, Fey still couldn't keep up with demand for the game elsewhere.

Another early machine gave out winnings in the form of fruit flavoured chewing gums with pictures of the flavours as symbols on the reels. The popular cherry and melon symbols derive from this machine. The BAR symbol now common in slot machines was derived from an early logo of the Bell-Fruit Gum Company. The payment of food prizes was a commonly used technique to avoid anti-gambling laws in a number of states, and for this reason a number of gumball and other vending machines were regarded with mistrust by the courts. The two Iowa cases of State v. Ellis^[4] and State v. Striggles^[5] are both used in classes on criminal law to illustrate the concept of reliance upon authority as it relates to the axiomatic ignorantia juris non excusat.^[6] In these cases, a mint vending machine was declared to be a gambling device due to the fact that by (internally manufactured) chance the machine would occasionally give the next user a number of tokens exchangeable for more candy. Despite the fact that the result of the next use would be displayed on the machine, both courts ruled that "The inducement for each play was the chance that by that play the machine would be set to indicate that it would pay checks on the following play. The thing that attracted the player was the chance that ultimately he would receive something for nothing. The machine appealed to the player's propensity to gamble, and that is [a] vice."^[7]

In 1963, Bally developed the first fully electromechanical slot machine called Money Honey. The new electromechanical approach allowed Money Honey to be the first slot machine with a bottomless hopper and automatic payout, of up to 500 coins, without the help of an attendant.^[8] The popularity of this machine led to the increasing predominance of electronic games, and the side lever soon became vestigial.

The first video slot machine to offer a second-screen bonus round was Reel 'Em In developed by WMS Industries Inc. in 1996.

[edit] Description

A person playing a slot machine purchases the right to play by inserting coins, cash, or in newer Ticket-In, Ticket-Out machines, a bar-coded paper ticket, into a designated slot on the machine. The machine is then activated by means of a lever or button, or on newer machines, by pressing a touchscreen on its face. The game itself may or may not involve skill on the player's part — or it may create the illusion of involving skill while only being a game of chance.

The object of the game is to win money from the machine. The game usually involves matching symbols, either on mechanical reels that spin and stop to reveal one or several symbols, or on simulated reels shown on a video screen. The symbols are usually brightly colored and easily recognizable, such as images of fruits, numerals or letters, and simple shapes such as bells, diamonds, or hearts; newer video-based machines use animated cartoon characters and images of popular actors or singers (in the case of themed slot machines, as described below).

Most games have a variety of winning combination of symbols, often posted on the face of the machine (or available on a different screen, accessible by touching a button on the main touchscreen, on video slot machines). If a player matches a combination according to the rules of the game, the slot machine pays the player cash or some other sort of value, such as extra games.

There are many different kinds of gambling slot machines in places such as Las Vegas (as well as casinos modeled after those in Las Vegas, including those operated on Native American reservations). Some of the most popular are the video poker machines, in which players hope to obtain a set of symbols corresponding to a winning poker hand. Depending on the machine, players can play one, 100, or more hands at one time.

Becoming more popular since the 1990s are the multi-line slots. These slots have more than one payline. Reel slots commonly have three or five paylines, while video slots have 9, 15, 25, or as many as 100 different paylines. Most video slots are themed slots, some of which feature graphics and music based on popular entertainers, motion pictures or TV programs (The Addams Family, I Dream of Jeannie, Happy Days, etc.) with a bonus round. Most accept variable amounts of credit to play with 1 to 15 credits per line being typical. The higher the amount bet, the higher the payout will be.

There are also standard 3 - 5 reel electromechanical slot machines, of various types. These are the typical "one-armed bandits". Since about 2005 there have been hybrid machines introduced, which combine elements of both video slots and traditional electromechanical slots.

One of the main differences between video slots and reel slots is in the way payouts are calculated. With reel slots, the only way to win the maximum jackpot is to play the maximum number of coins (usually 3, sometimes 4, or even 5 coins per spin). With video slots, the fixed payout values are multiplied by the number of coins per line that is being bet. In other words: on a reel slot, it is to the player's advantage to play with the maximum number of coins available. On video slots, it is recommended to play as many individual lines as possible, but there is no benefit to the player in betting more than one credit per line with regards to calculating the payout amounts. There are some isolated cases where a video slot machine requires the maximum number of credits per spin to be inserted to win the largest payout, but those are the exception.

As an example, on the "Wheel of Fortune" reel slot, the player must play 3 coins per spin to be eligible to trigger the bonus round and possibly win the jackpot. On the Wheel of Fortune video slot, the chances of triggering the bonus round or winning the maximum jackpot are exactly the same regardless of the number of coins bet on each line.

Larger casinos offer slot machines with denominations from $.01 (penny slots) all the way up to $100.00 or more per credit. Large denomination slot machines are usually cordoned off from the rest of the casino into a "High Limit" area, often with a separate team of hosts to cater to the needs of the high-rollers who play there.

Slot machines common in casinos at this time are more complicated. Most allow players to accept their winnings as credits, which may be "spent" on additional spins.

In the last few years, new multi-denomination slot machines have been introduced. With these slot machines, the player can choose the value of each credit wagered (the stake) from a list of options. Based upon the player's selection, the slot machine automatically calculates the number of credits the player receives in exchange for the cash inserted and displays the amount of available credits to the player. For example, a player could choose to wager one dollar per game on a nickel slot machine. This eliminates the need for a player to find a specific denomination of a particular slot machine; they can concentrate on simply finding the machine and setting the denomination once they decide to play.

Recently, some casinos have chosen to take advantage of a concept commonly known as "tokenization," where one token buys more than one credit. A casino can configure slot machines of numerous different denominations to accept the same type of token. For example, all penny, nickel, quarter, and dollar slot machines could be configured to accept dollar tokens. This significantly reduces a casino's inventory costs and coin handling costs. A tokenized slot machine automatically calculates the number of credits the player receives in exchange for the token inserted and displays the amount of available credits to the player. When a player chooses to collect his credits (by pressing a "Cash Out" button), the slot machine will automatically divide the number of credits on the credit meter by the value of one token and return the result to the patron. Any remainder is known as "residual credits" and cannot be collected. Residual credits must be either played or abandoned.

[edit] Terminology

Bonus is a special feature of the particular game theme, which is activated when certain symbols appear in a winning combination. Bonuses vary depending upon the game. Some bonus rounds are a special session of free spins (the number of which is often based on the winning combination that triggers the bonus), often with a different or modified set of winning combinations as the main game, and often with winning credit values increased by a specific multiplier, which is prominently displayed as part of the bonus graphics and/or animation. In other bonus rounds, the player is presented with several items on a screen from which to choose. As the player chooses items, a number of credits is revealed and awarded. Some bonuses use a mechanical device, such as a spinning wheel, that works in conjunction with the bonus to display the amount won.

Candle is a light on top of the slot machine. It flashes to alert the operator that change is needed, hand pay is requested or a potential problem with the machine.

Carousel refers to a grouping of slot machines, usually in a circle or oval formation.

Coin hopper is a container where the coins that are immediately available for payouts are held. The hopper is a mechanical device that rotates coins into the coin tray when a player collects credits/coins (by pressing a "Cash Out" button). When a certain preset coin capacity is reached, a coin diverter automatically redirects, or "drops", excess coin into a "drop bucket" or "drop box". (Non-functional coin hoppers can still be found even on games that exclusively employ Ticket-In Ticket-Out technology, as a legacy vestige.)

Credit meter is a visual LED display of the amount of money or credits on the machine. On video reel machines this is either a simulated LED display, or represented in a different font altogether, based on the design of the game graphics.

Drop bucket or drop box is a container located in a slot machine's base where excess coins are diverted from the hopper. Typically, a drop bucket is used for low denomination slot machines and a drop box is used for high denomination slot machines. A drop box contains a hinged lid with one or more locks whereas a drop bucket does not contain a lid. The contents of drop buckets and drop boxes are collected and counted by the casino on a scheduled basis.

EGM is used as a short-hand for "Electronic Gaming Machine".

Hand pay refers to a payout made by a slot attendant or cage, rather than the slot machine. A hand pay occurs when the amount of the payout exceeds the maximum amount that was preset by the slot machine's operator. Usually, the maximum amount is set at the level where the operator must begin to deduct taxes. A hand pay could also be necessary as a result of a short pay.

Hopper fill slip is a document used to record the replenishments of the coin in the coin hopper after it becomes depleted as a result of making payouts to players. The slip indicates the amount of coin placed into the hoppers, as well as the signatures of the employees involved in the transaction, the slot machine number and the location and the date.

MEAL book (machine entry authorization log) is a log of the employee's entries into the machine

Low Level or Slant Top slot machines include a stool so you can sit and play. Stand Up or Upright slot machines are played while standing.

Optimal play is a payback percentage based on a gambler using the optimal strategy in a skill-based slot machine game.

Payline is a straight or zig-zagged line that crosses through one symbol on each reel, along which a winning combination is evaluated. Classic spinning reel machines usually have up to nine paylines, while video slot machines may have as many as one hundred.

Rollup is the process of dramatizing a win by playing sounds while the meters count up to the amount that has been won.

Short pay refers to a partial payout made by a slot machine, which is less than the amount due to the player. This occurs if the coin hopper has been depleted as a result of making earlier payouts to players. The remaining amount due to the player is either paid as a hand pay or an attendant will come and re-fill the machine.

Taste is a reference to the small amount often paid out to keep a player seated and continuously betting. Only rarely will machines fail to pay out even the minimum placed bet over the course of several pulls.

Tilt In the old mechanical days, slot machines had tilt switches. While modern machines no longer have tilt switches, any kind of mechanical failure (door switch in the wrong state, reel motor failure, etc) is still called a "tilt".

Theoretical Hold Worksheet is a document provided by the manufacturer for all slot machines, which indicates the theoretical percentage that the slot machine should hold based on adequate levels of coin-in. The worksheet also indicates the reel strip settings, number of coins that may be played, the payout schedule, the number of reels and other information descriptive of the particular type of slot machine.

Weight count is an American term, referring to the dollar amount of coins or tokens removed from a slot machine's drop bucket or drop box and counted by the casino's hard count team through the use of a weigh scale.

[edit] Pay table

Each machine has a table that lists the number of credits the player will receive if the symbols listed on the pay table line up on the pay line of the machine. Some symbols are wild and will pay if they are visible in any position, even if they are not on the pay line. Especially on older machines, the pay table is listed on the face of the machine, usually above and below the area containing the wheels. Most video machines display the pay table when the player presses a "pay table" button or touches "pay table" on the screen; some have the pay table listed on the cabinet as well.

[edit] Technology

[edit] Random number generator

It is a common belief that the odds on a machine have something to do with the number of each kind of symbol on each reel, but in modern slot machines this is no longer the case. Modern slot machines are computerized, so that the odds are whatever they are programmed to be. In modern slot machines, the reels and lever are present for historical and entertainment reasons only. The positions the reels will come to rest on are chosen by a Random Number Generator (RNG) contained in the machine's software.

The RNG is constantly generating random numbers, at a rate of hundreds or perhaps thousands per second. As soon as the "Play" button is pressed, the most recent random number is used to determine the result. This means that the result varies depending on exactly when the game is played. A fraction of a second earlier or later, and the result would be different.

Some professional gamblers observe that the RNG actually produces quite predictable sequences of "random" numbers. This behavior is due to poor algorithm design. All RNGs (so-called pseudorandom number generators or PRNGs) must in theory eventually repeat their number sequence (see Art of Computer Programming Vol 2 Chap 3), but it is easy to build PRNGs with periods (that is, the length of a sequence before it repeats) that are so long that no computer, however fast, could complete a single period before the end of the universe. Having access to the PRNG code and seed values Ronald Dale Harris, a former slot machine programmer, discovered equations for specific gambling games like Keno that allowed him to predict what the next set of selected numbers would be based on the previous games played. However, this is impossible for most machines, because the RNG picks numbers even when the machine is not being played, so the player cannot tell where in the sequence they are.

[edit] Virtual Reels

Old mechanical slot machines had a set number of reels containing a set number of symbols, each equally likely to appear on the payline after each spin. In the 1980s, however, slots makers incorporated electronics into their products and programmed them to weigh particular symbols. Thus the odds of losing symbols appearing on the payline became disproportionate to their actual frequency on the physical reel. In 1984 Inge Telnaes received a patent for a device titled, "Electronic Gaming Device Utilizing a Random Number Generator for Selecting the Reel Stop Positions." International Gaming Technology IGT bought the Telnaes patent and now all slot manufacturers using what has come to be known as Talneas mapping or reel mapping must license the patent from IGT. The 1984 patent granted on this technology (United States Patent No. 4 448 419) states: “It is important to make a machine that is perceived to present greater chances of payoff than it actually has within the legal limitations that games of chance must operate.” ^[9]

The other advantage of a virtual reel has to do with the number of stops. The original slot machine had three physical reels with 10 symbols on each reel. Although the number of stops was increased over the years to about 22, the mechanical device still limited the number of possible outcomes. A virtual reel can have up to 256 virtual stops per reel. The physical reel has only 10³=1,000 possible combinations. The manufacturer is limited to the maximum payout that he can offer since it could happen every 1,000 plays. If the jackpot paid 100:1 then the machine will have already used 10% of the outcome space on this one win. The original machine kept 25% as the house edge. The virtual reel with 256 virtual stops has 256³ = 16,777,216 final positions. The manufacturer could choose to offer a million to one payout confident that it will only happen every 16.7 million plays.

[edit] Payout percentage

Slot machines are typically programmed to pay out as winnings 82–98% of the money that is wagered by players. This is known as the "theoretical payout percentage" or RTP, "Return To Player". The minimum theoretical payout percentage varies among jurisdictions and is typically established by law or regulation. For example, the minimum payout in Nevada is 75%, and in New Jersey, 78%. The winning patterns on slot machines—the amounts they pay and the frequencies of those pay-outs—are carefully selected to yield a certain fraction of the money played to the "house" (the operator of the slot machine), while returning the rest to the players during play. Suppose that a certain slot machine costs $1 per spin. It can be calculated that over a sufficiently long period, such as 1,000,000 spins, that the machine will return an average of $950,000 to its players, who have inserted $1,000,000 during that time. In this (simplified) example, the slot machine is said to pay out 95%. The operator keeps the remaining $50,000. Within some EGM-development organizations this concept is referred to simply as "par". "Par" also manifests itself to gamblers as promotional techniques: "Our 'Loose Slots' have a 93% pay-back! Play now!" It is worth noting that the "Loose Slots" actually may describe a very few anonymous machines in a particular bank of EGMs.

A slot machine's theoretical payout percentage is set at the factory when the software is written. Changing the payout percentage after a slot machine has been placed on the gaming floor requires a physical swap of the software or firmware, which is usually stored on an EPROM but may be loaded onto non-volatile random access memory (NVRAM) or even stored on CD-ROM or DVD, depending on the capabilities of the machine and the applicable regulations. Based on current technology, this is a time-consuming process and as such is done infrequently. In certain jurisdictions, such as New Jersey, the EPROM has a tamper-evident seal and can only be changed in the presence of Gaming Control Board officials. Other jurisdictions, including Nevada, randomly audit slot machines to ensure that they contain only approved software.

The return to player is not the only statistic that is of interest. The probabilities of every payout on the pay table is also critical. For example, consider a hypothetical slot machine with a dozen different values on the pay table. However, the probabilities of getting all the payouts are zero except the largest one. If the payout is 4,000 times the input amount, and it happens every 4,000 times on average, the return to player is exactly 100%, but the game would be dull to play. Also, most people would not win anything, and having entries on the paytable that have a return of zero would be deceptive. As these individual probabilities are closely guarded secrets, it is possible that the advertised machines with high return to player simply increase the probabilities of these jackpots. The casino could legally place machines of a similar style payout and advertise that some machines have 100% return to player. The added advantage is that these large jackpots increase the excitement of the other players.

The table of probabilities for a specific machine are called the Paytable and Real Strips sheet, or PARS. The Wizard of Odds revealed the PARS for one commercial slot machine, an original International Gaming Technology Red White and Blue machine. This game, in its original form, is obsolete, so these specific probabilities do not apply. He only published the odds after a fan of his sent him some information provided on a slot machine that was posted on a machine in the Netherlands. The psychology of the machine design is quickly revealed. There are 13 possible payouts ranging from 1:1 to 2,400:1. The 1:1 payout comes every 8 plays. The 5:1 payout comes every 33 plays, whereas the 2:1 payout comes every 600 plays. Most players assume the likelihood increases proportionate to the payout. The one mid-size payout that is designed to give the player a thrill is the 80:1 payout. It is programmed to occur an average of once every 219 plays. The 80:1 payout is high enough to create excitement, but not high enough that it makes it likely that the player will take his winnings and abandon the game. More than likely the player began the game with at least 80 times his bet (for instance there are 80 quarters in $20). In contrast the 150:1 payout occurs only on average of once every 6,241 plays. The highest payout of 2,400:1 occurs only on average of once every 64³=262,144 plays since the machine has 64 virtual stops. The player who continues to feed the machine is likely to have several mid-size payouts, but unlikely to have a large payout. He quits after he is bored or has exhausted his bankroll. ^[10]

Despite the fact that they are confidential, occasionally a PARS sheet is posted on a website. They have limited value to the player, because usually a machine will have 8 to 12 different possible programs with varying payouts. In addition, slight variations of each machine (i.e. with double jackpots or five times play) are always being developed. The casino operator can choose which EPROM chip to install in any particular machine to select the payout desired. The result is that there is not really such a thing as a high payback type of machine, since every machine potentially has multiple settings. From October 2001-February 2002, columnist Michael Shackleford obtained PAR sheets for five different nickel machines; four IGT games Austin Powers, Fortune Cookie, Leopard Spots and Wheel of Fortune and one game manufactured by WMS; Reel 'em In. Without revealing the proprietary information, he developed a program that would allow him to determine with usually less than a dozen plays on each machine which EPROM chip was installed. Then he did a survey of over 400 machines in 70 different casinos in Las Vegas. He averaged the data, and assigned an average payback percentage to the machines in each casino. The resultant list was widely publicized for marketing purposes (especially by the Palms casino which had the top ranking).^[11]

One reason that the slot machine is so profitable to a casino is that the player must play the high house edge and high payout wagers along with the low house edge and low payout wagers. In a more traditional wagering game like craps, the player knows that certain wagers have almost a 50/50 chances of winning or losing, but they only pay a limited multiple of the original bet (usually no higher than three times). Other bets have a higher house edge, but the player is rewarded with a bigger win (up to thirty times in craps). The player can choose what kind of wager he wants to make. A slot machine does not afford such an opportunity. Theoretically, the operator could make these probabilities available, or allow the player to choose which one so that the player is free to make a choice. However, no operator has ever enacted this strategy. Different machines have different maximum payouts, but without knowing the odds of getting the jackpot, there is no rational way to differentiate.

In many markets where central monitoring and control systems are used to link machines for auditing and security purposes, usually in wide area networks of multiple venues and thousands of machines, player return must usually be changed from a central computer rather than at each machine. A range of percentages is set in the game software and selected remotely.

In 2006, the Nevada Gaming Commission began working with Las Vegas casinos on technology that would allow the casino's slot manager to change the game, the odds, and the payouts remotely. The change cannot be done instantaneously, but only after the selected machine has been idle for at least four minutes. After the change is made, the machine must be locked to new players for four minutes and display an on-screen message informing potential players that a change is being made.^[12]

[edit] Linked machines

Often machines are linked together in a way that allows a group of machines to offer a particularly large prize, or "jackpot". Each slot machine in the group contributes a small amount to this progressive jackpot, awarded to a player who gets, for example, a royal flush on a video poker machine or a specific combination of symbols on a regular or nine-line slot machine. The amount paid for the progressive jackpot is usually far higher than any single slot machine could pay on its own.

In some cases multiple machines are linked across multiple casinos. In these cases, the machines may be owned by the manufacturer, who is responsible for paying the jackpot. The casinos lease the machines rather than owning them outright. Megabucks may be the best known example of this type of machine. Megabucks Nevada starts at $10,000,000 after a jackpot. (Prior to September 2005, Megabucks Nevada reset to $7,000,000.) The new penny Megabucks video game also has a jackpot that starts at $10,000,000.

[edit] Fraud

Mechanical slot machines and their coin acceptors were sometimes susceptible to cheating devices and other scams. One historical example involved spinning a coin with a short length of plastic wire. The weight and size of the coin would be accepted by the machine and credits would be granted. However, the spin created by the plastic wire would cause the coin to exit through the reject chute into the payout tray. This particular scam has become obsolete due to improvements in newer slot machines.

Modern slot machines are controlled by EPROM computer chips and, in large casinos, coin acceptors have become obsolete in favor of bill acceptors. These machines and their bill acceptors are designed with advanced anti-cheating and anti-counterfeiting measures and are difficult to defraud. Early computerized slot machines were sometimes defrauded through the use of cheating devices, such as the "slider" or "monkey paw" used by notorious slot cheat Tommy Glenn Carmichael. However, more recent attempts at defrauding slot machines involve manipulating the EPROM, such as by directing microwaves toward it to disrupt its proper functioning. Casino insiders such as Ronald Dale Harris have also been discovered manipulating the software in slot machines in order to defraud casino operators.

[edit] Regional variations

[edit] United States

In the United States, the public and private availability of slot machines is highly regulated by state governments. Many states have established gaming control boards to regulate the possession and use of slot machines. Nevada is the only state that has no significant restrictions against slot machines both for public and private use. In New Jersey, slot machines are only allowed in hotel-casinos operated in Atlantic City. Several states (Illinois, Indiana, Iowa, and Missouri) allow slot machines (as well as any casino-style gambling) only on licensed riverboats or permanently-anchored barges. Since Hurricane Katrina, Mississippi has removed the requirement that casinos on the Gulf Coast operate on barges and now allows them on land along the shoreline. Delaware allows slot machines at three horse tracks; they are regulated by the state lottery commission. For a list of state-by-state regulations on private slot-machine ownership, see U.S. state slot machine ownership regulations.

[edit] Native American casinos

Native American casinos located in reservations are not permitted to have slot machines unless the tribe first reaches a pact with the state in which it is located (per Indian Gaming Regulatory Act). Typically, a pact entitles the state to receive a fraction of the gross revenue from slot machines.

[edit] Slot machine classes

The following statements are generalities, not actual laws for every jurisdiction. There is no federal law governing slot machines, so these classifications may vary from state to state.

Some states have restrictions on the type (called "class") of slot machines that can be used in a casino or other gaming area. "Class III" (or "traditional") slot machines operate independently from a centralized computer system and a player's chance of winning any payout is the same with every play. Class III slots are most often seen in Nevada or Atlantic City and are sometimes referred to as "Vegas-style slots".

"Class II" slot machines (also known as "video lottery terminals" or "VLTs") are connected to a centralized computer system that determines the outcome of each wager. In this way, Class II slot machines mimic scratch-off lottery tickets in that each machine has an equal chance of winning a series of limited prizes. Either class of slot machines may or may not have a player skill element.

In general a game must have all characteristics of a Class II game to be a Class II game. Any characteristic of a Class III game makes it a Class III game. The casino pays a fee to the state for each Class III game and can only purchase so many Class III licenses. There is no such restriction for Class II games. Class II games are not so tightly regulated by the state.

[edit] Class II game characteristics

1. The player is playing against other players and competing for a common prize.
2. There is not necessarily a winner in each game. The game continues until there is a winner.
3. In a given set there are a certain number of wins and losses. Once a certain combination has occurred it cannot occur again until a new batch is initiated. This is most obvious in scratch-card games using cards that come in packs. Once a card has been pulled from a pack, the combinations on that card cannot occur again until a new pack of cards is installed. One game is dependent on previous games.
4. The player must be an active participant. They must recognize events as they occur and must recognize when they have won and announce their winning. Bingo is an excellent example here.
5. All players play from the same set of numbers as the numbers are announced.

[edit] Class III game characteristics

1. The player is playing against the house.
2. Each game is independent of previous games. Any possible outcome can occur in any game.
3. Wins are announced automatically.

[edit] Slot clubs

Many American casinos offer free memberships in "slot clubs," which return a fraction of the amount of money that is bet in the form of comps (complimentary food, drinks, hotel rooms, or merchandise), or sometimes as cash or a promise to pay cash at a later date. These clubs require that players use cards that are inserted into the slot machines, to allow the casinos to track the players' "action" (how much each player bets and for how long), which is often used to establish levels of play that may make players eligible for additional comps. Comps or "cash back" from these clubs can make significant differences in the maximum theoretical returns when playing over long periods.

[edit] Australia

Slot machines in Australia are generally referred to as "video poker", "poker machines" or "pokies", but are officially termed Gaming Machines. Australian-style gaming machines frequently use video displays to simulate physical reels, usually five. These machines have additional bonusing and second-screen features such as free games and bonus levels. They also allow for multiple lines (up to 50) or multiple ways (up to 243) to be played.

The laws regulating the use of gaming machines in Australia are a matter for State governments, and as such they vary between States.

Gaming machines are found in casinos (approximately one in each major city) as well as pubs and clubs in some states (usually sports, social, or RSL clubs). The first Australian state to legalize this style of gambling was New South Wales in 1956 when they were made legal in all registered clubs in the state. There are suggestions that the proliferation of poker machines has led to increased levels of "problem gambling"; however, the precise nature of this link is still open to research.^[13]

In 1999 the Australian Productivity Commission reported that Australia had nearly 180,000 poker machines, more than half of which were in New South Wales. This figure represented 21% of all the gambling machines in the world, and on a per capita basis, Australia had roughly five times as many gaming machines as the United States. Revenue from gaming machines in pubs and clubs accounts for more than half of the $4 billion in gambling revenue collected by state governments in 2002-2003 ^[14]

In Queensland, gaming machines in pubs and clubs must provide a return rate of 85% while machines located in casinos must provide a return rate of 90%.^[15] Most other states have similar provisions.

Western Australia only permits the use of particular forms of gaming machine in Burswood casino, and no gaming machines may be used elsewhere. This policy (the most restrictive in Australia) had a long historical basis, and was reaffirmed by the 1974 Royal Commission into Gambling:

“	...poker machine playing is a mindless, repetitive and insidious form of gambling which has many undesirable features. It requires no thought, no skill or social contact. The odds are never about winning. Watching people playing the machines over long periods of time, the impressionistic evidence at least is that they are addictive to many people. Historically poker machines have been banned from Western Australia and we consider that, in the public interest, they should stay banned.	”
—Report of the Royal Commission into Gambling 1974, p. 72

No Pokies was the name of an independent ticket in the South Australian Legislative Council which elected Nick Xenophon at the 1997 state election in South Australia on 2.9 percent, and again at the 2006 election on 20.5 percent of the statewide vote (or 2.5 quotas), which was unexpected by political commentators. He was elected to the Australian Senate at the 2007 federal election, again from the same pool of voters in South Australia, however he only received 14.8 percent. This was still over one full Senate quota, gaining election without the need for preferences. With current numbers in the Senate, Nick Xenophon is a balance of power Senator. Whilst his original 1997 platform was No Pokies, he since has been an advocate in many other areas.

[edit] United Kingdom

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The provision of slot machines is covered by the Gaming Act 2005^[16].

Slot machines may be called fruit machines, one-armed bandits and AWP (Amusement With Prizes) in the United Kingdom. Fruit machines are commonly found in pubs, clubs, arcades, and take-away food shops. These machines commonly have 3 reels, but can be found with 4 or 6 reels with around 16 or 24 fruit symbols printed around them. The reels are spun, and if certain combinations of fruit appear, winnings are paid from the machine, or subgames are played. These are very similar to slot machines seen in casinos and elsewhere around the world, but the term "fruit machine" is usually applied to a type of machine more commonly found in pubs and arcades. These games have lots of extra features, trails and subgames with opportunities to win money, usually more than can be won from just the reels. However, the jackpots from these fruit machines are strictly limited. An old-fashioned word for these machines can be 'Didlers'.

Slot machines in the UK almost universally have the following features, generally selected at random using a pseudorandom number generator:

• A player (known in the industry as a punter) may be given the opportunity to hold one or more reels before spinning, meaning that a held reel will not be spun, but instead retain its result from the previous spin. This can sometimes increase the chance of winning.
• A player may also be given a number of nudges following a spin (or, in some machines, as a result in a subgame); a nudge is a single-step rotation of a reel of the player's choice.
• Cheats can also be made available on-line or through emailed newsletters for subscribers. These cheats give the player the impression of an advantage, whereas in reality the pay out percentage remains exactly the same. The most widely used cheat is known as Hold after a nudge and is a high chance the player will win following an unsuccessful nudge. The cheats give the player an incentive to play the latest games.

Currently in the UK, the cost of an individual game (i.e. a single spin of all of the reels, together with the playing of any subgame that may be triggered by the result of it) may not exceed 50p^[16]. The maximum payout for an individual game depends on the type of machine and its location, but is typically £35 in pubs where people under the age of 18 are (generally) not allowed entry. It is known for machines to pay out multiple jackpots, one after the other (this is known as a streak or rave) but each jackpot requires a new game to be played so as not to violate the maximum payout. The minimum payout percentage is 70%, with pubs often setting the payout at around 78%; takeaways and other businesses with much passing trade will generally set it lower. Clubs requiring membership are allowed "club machines", which have higher jackpots and are allowed to charge more each game.

These machines also operate dirrerently from American slot machines. The latter are programmed to pay a percentage over the long run. There is no reason why a jackpot cannot be paid straight after one has already been won, or that it must be paid because it has not been paid in a while. The probability of getting the jackpot in each game is independent of any other game, and these probabilities are all equal. In fact this is a consequence of the regulatory Act, since otherwise it turns from a game of chance into a game of skill (i.e. the skill of picking the right time to play), and is governed differently. Games requiring skill (for example quiz machines) are called SWP (skill With Prizes) machines, but games of chance are AWP (Amusements With Prizes), the legal fiction being that people play mostly for fun and not to primarily to win money.

In the UK, though, the law^[17] states that "The target percentage payout (which must not be less than the minimum agreed or defined for the machine type) shall be achieved within any 10,000 games for S.34 (AWP) machines or 100,000 games for S.31 (casino machines)." This means that, in the case of AWP, if the return for the last 10,000 games approaches the legal minimum, the machine is likely to increase the jackpot percentage to avoid ever falling below it.

This type of fruit machine is popular across Europe (in the countries where they are legal), and very popular in countries such as the Czech Republic, Russia, and Ukraine.

It has been alleged by the Fairplay campaign that UK fruit machines employ fraudulent techniques in which gambles and chances which appear to be random are in fact pre-determined and cannot be affected by player choices.^[18]

...at this point, you'll have gambled the win up to £25. However, the machine doesn't want you to gamble any further. If from the 5 you select "High", the machine will spin in a 3 and you'll lose. If, on the other hand, you select "Low", the machine will spin in a 9 and you'll lose...

Claims centre around the emulation of fruit machine hardware on Windows-based computers, which can save the memory state at any time then restart with a different choice. Although there were only two practical examples demonstrating this that the end user could replicate, there was a lot of debate between fairplay campaigners and the fruit machine emulation authors about the reliability of these claims^[18]. The authors suggested that the emulators did not have totally accurate emulation and so the claim does not lead or prove the assumption that fruit machines "cheat"; The fairplay campaign, led by Stuart Campbell rubbished these claims publicly on various internet forums. After some TV and radio coverage on behalf of the fairplay campaign on this issue, the fruit machine industry has hit back at the allegations through BACTA, releasing a statement on the issue.^{[citation needed]}

BACTA at the time^[when?] issued guidance to voluntarily provide notices in the form of a sticker for older machines or integrated on the "top glass" artwork. Most fruit machine manufacturers have done this since around 2005. It is in fact the law now in the UK^[16], and all relevant machines carry a notice informing the player that the machine may at times offer a choice in which they have no possibility of winning. Often messages on the machine also state not to reproduce the software, artwork, etc. in any way, shape or form without permission. They are covered by the usual copyright and patent laws.

The newest UK machines are called section 16s. They have 20 lines across 5 reels of 3 symbols high, and the player can pick which lines to play for a spin costing between 10p and 50p, up to £2 (which is 10p for all 20 lines).

[edit] Japan

Japanese slot machines, known as pachisuro, are a descendant of the traditional Japanese pachinko game. Slot machines are a fairly new phenomenon and they can be found in mostly in pachinko parlors and the adult sections of amusement arcades, known as game centers.

The machines are regulated with IC chips, and have six different levels changing the odds of a "777". The levels provide a rough outcome of between 90% to an astonishing 160% (200% if using skills). Indeed, the Japanese slot machines are "beatable". The parlor operators naturally set most of the machines to collect money, but intentionally place a few paying machines on the floor so that there will be at least someone winning, encouraging players on the losing machines to keep gambling, using the psychology of the gambler's fallacy.^{[citation needed]}

Despite the many varieties of the machines, there are certain rules and regulations put forward by the "Security Electronics and Communication Technology Association", an affiliate of the National Police Association (NPA). For example, there must be three reels. Also, all reels must be accompanied by buttons which stop these reels, the reels may not spin faster than 80 revolutions per minute, and the reels must stop within 0.19 seconds of the button press. In practice, this translates to "the machines can't let the reels slip more than 4 symbols". Other rules include the following: no more than 15 coins can be paid out per play, credit meter can't go higher than 50, 3 coin maximum bet, etc.^{[citation needed]}

Although a 15 coin payout may seem ridiculously low, the regulations allow "Big Bonus" (~400–711 coins) and "Regular Bonus" modes (~110 coins) where these 15 coin payouts occur nearly continuously until the bonus mode finished. While the machine is in bonus mode, the player is entertained with special winning scenes on the LCD display, and energizing music is heard, payout after payout.

Three other unique features of Pachisuro machines are "Stock", "Renchan", and tenjō (天井^?).　　On many machines, when enough money to afford a bonus is taken in, the bonus is not immediately awarded. Typically the game merely stops making the reels slip off the bonus symbols for a few games. If the player fails to hit the bonus during these "standby games", it is added to the "Stock" for later collection. Many current games, after finishing a bonus round, set the probability to release additional stock (gained from earlier players failing to get a bonus last time the machine stopped making the reels slip for a bit) very high for the first few games. As a result, a lucky player may get to play several bonus rounds in a row (a "Renchan"), making payouts of 5,000 or even 10,000 coins possible. The lure of "Stock" waiting in the machine, and the possibility of "Renchan" tease the gambler to keep feeding the machine. To tease him further, there is a tenjō (ceiling), a maximum limit on the number of games between "Stock" release. For example, if the tenjō is 1,500, and the number of games played since the last bonus is 1,490, the player is guaranteed to release a bonus within just 10 games.

Because of the "Stock", "Renchan", and tenjō systems, it is possible to make money by simply playing machines on which someone has just lost a huge amount of money. This is called being a "hyena". They are easy to recognize, roaming the aisles for a "Kamo" ( "sucker" in English) to leave his machine.

In short, the regulations allowing "Stock", "Renchan", and tenjō has transformed the Pachisuro from a low-stakes form on entertainment just a few years back to the hard-core gambling it has become in 2006. Many people may be gambling more than they can afford, and the big payouts also lure unsavory "hyena" types into the gambling halls.

To address these social issues, a new regulation (Version 5.0) has been adopted in 2006 which caps the maximum amount of "stock" a machine can hold to around 2,000–3,000 coins' worth of bonus games. Moreover, all Pachisuro machines must be re-evaluated for regulation compliance every 3 three years. Version 4.0 came out in 2004, so that means all those machines with the up to 10,000 coin payouts will be removed from service by 2007. Only time will tell how these changes will affect the Japanese Pachisuro industry.

[edit] Skill stops

Skill stop buttons predated the Bally electromechanical slot machines of the 1960s and 70s. They appeared on mechanical slot machines manufactured by Mills Novelty Co. as early as the mid 1920s. These machines had modified reel-stop arms, which allowed them to be released from the timing bar, earlier than in a normal play, simply by pressing the buttons on the front of the machine, located between each reel.

'Skill stop' buttons were added to some slot machines by Zacharias Anthony in the early 70s. These enabled the player to stop each reel, allowing a degree of 'skill' so as to satisfy the New Jersey gaming laws of the day which required that players were able to control the game in some way. The original conversion was applied to approximately 50 late model Bally slots and is the first known use of the skill stop on slot machines. Because the typical machine stopped the reels automatically in less than 10 seconds, weights were added to the mechanical timers to prolong the automatic stopping of the reels. By the time the New Jersey Alcoholic Beverages Commission (ABC) had approved the conversion for use in New Jersey arcades the word was out and every other distributor began adding skill stops. The machines were a huge hit on the Jersey Shore and the remaining unconverted Bally machines were destroyed as they had become instantly obsolete.^{[citation needed]}

[edit] See also

• List of probability topics
• Pachinko
• Progressive jackpot
• Quiz machine
• Video Lottery Terminal
• Video poker
• United States state slot machine ownership regulations
• European Gaming & Amusement Federation

[edit] References

[edit] Bibliography

• Brisman, Andrew. The American Mensa Guide to Casino Gambling: Winning Ways (Stirling, 1999) ISBN 0-8069-4837-X
• Grochowski, John. The Slot Machine Answer Book: How They Work, How They've Changed, and How to Overcome the House Advantage (Bonus Books, 2005) ISBN 1-56625-235-0
• Legato, Frank. How to Win Millions Playing Slot Machines! ...Or Lose Trying (Bonus Books, 2004) ISBN 1-56625-216-4

[edit] External links

• HowStuffWorks: Slot Machines
• How Slot Machines Work
• Slot Machines explained
• Slot Machines database from 1898 to today