New Life Games Tech Forums

I am flat amazed by the sheer volume of technical information available here and at the archived site; I'm passing the link along to our Director of Slots as a reference source. Here's my suggestion/issue/question:

I work on the regulatory side and I have been looking sites to gain input on some of the whacked regulatory issues confronting the industry, both current and those coming in the future. Obviously, there are some wicked smart people posting to this site, but I find very little conversation in regards to regulation(s).  That said,

How about a forum devoted to regulatory issues, encompassing local, state and Federal reg? The casino I work for is regulated under 25 CFR 542 (the National Indian Gaming Commission Minimum Internal Control Standards) - some of the "hoops" we have to jump through makes a Barnum and Bailey wild animal act look like a petting zoo. I think there might be quite a bit of interest in the subject in general as the technical side of the equation and the regulatory side are woven together pretty tightly.

OR

If you-all want to maintain the "technical sanctity" of your site, are you aware of any sites that are geared to the regulatory side of the industry? I've been working on this for awhile and there just isn't a whole lot out there.

I appreciate any and all opinions/suggestions/recommendations, folks. Thanks for the help...

Welcome to the site -- we're glad to have you here, and your unique view of the industry is great.

I like the idea.  The "Gaming Industry News (http://newlifegames.net/nlg/index.php?board=9.0)" forum has traditionally had some conversation relating to what you're talking about.  Due to a recent server change, there's actually nothing in that forum, but if you look at the archive of it (http://newlifegames.net/techforum/index.php?board=92.0) you may find some posts of interest.

I don't see why another forum couldn't be added, though -- it's of course up to the site moderators to make that decision and make it happen, but posting here was the right first step in making it happen.  :)

Again, welcome.

Knagl - Thank you for the welcome, much appreciated. While I have looked through the archives my thinking was that, as this site is starting "anew", there might be an opportunity to get some fresh dialogue started. As an example, I have been corresponding with Randy Fromm (and several others) about recent advances in game design and I have been unable to form a clear "opinion" about the direction game design is taking because of the complexity of the issue. Currently, I am trying to tweak our internal compliance efforts to address problems with NIGC regs and some of the newer games available on the market. In attempting to develop the mechanism to address current problems, I can see even more problems coming to the fore with the expansion of server-based gaming and the direction IT is taking. One of the key components (in my eyes) to "getting in front of this" will involve soliciting opinions from the "technical sector" of the industry; finding people with the expertise to clear up some of the fog. And, obviously, folks in the technical sector could gain from the dialogue; I'm looking forward to being part of that, whether here or someplace else.

Anyway, thanks again, Knagl.  ;D

 

 

G2E - The gambling convetion held annually in LasVegas in November has a lot of sessions on reglatory issues. I would highly recommend you attend this. It is well attended both by manufacturers, regulators (both Tribal and non Tribal) as well as international attendees.

From a gamblers perspective I would like to see the Payback Percentage posted on every machine.

With most of the progressives I am familar with - these are not integrated into the slot. Meaning that they do not impact the hold percentages on a per platform basis.
I have recently heard that some of the new WAP games have intermixed the progressives with the paybacks and they are now community based hold. I am not sure how the accounting works on this, in other words if you had 2 different properties owned by different companies how do they manage the per property hold or if the manufacturer now takes a cut of the hold in turn for underwriting the progressive etc. This latter notion scares me as it now means that the manufacturer have a vested stake in me not winning (not that I really expect too).
Once again what I have "heard" may not be true, but any insight into this would be interesting.

Jay-

Isn't that how most WAP's work now?  Take Megabucks, for example.  As far as I knew, IGT gets a cut of each wager to add to the jackpot, and they pay out the jackpot when it gets hit.  I'm under the impression that the linked Wheel of Fortune progressives are the same deal.  In fact, I believe that's why Harrah's decided to remove Wheel of Fortune, as they weren't making as much profit on those machines as they were non-WAP games that didn't have a chunk of the money going to IGT.

That said, I don't know if IGT is profiting off the money contributed to the progressives or just acting as the banker until someone wins the jackpot.

From what I understand on Larger WAP titles... Machines are actually IGT lease machines, not casino owned. IGT "USED TO" maintain them. (See article on main page as IGT is slacking on machine maintenance now!!!) IGT get a %age of the machines take plus whatever fee if there is one. Casino pays all jackpots with the exception of the Biggie which IGT pays. These machines are in constant contact with IGT so they know if the door opens, etc. so no cheating them! This also explains why these titles rarely if ever make it out to our world!

CaptainHappy
  :95-

Unless things have changed recently, WAP games like Wheel of Fortune and Megabucks are 85% games. IGT owns and maintains them. 7.5% goes to IGT and 7.5% to the hosting property, plus another 5% off the top goes to IGT to be put in a special fund for the jackpot, which is paid by IGT, not the property. Note that they never actually part with that 5% money, just let the winner have the interest on it for 20 years. If you look at IGT's annual report (the last one I looked at was a couple of years ago) you'll see that the profit they made on this scam participation games was about equal to their profit from making machines, about $67 million that year. Participation games have always been unpopular with the casinos for some reason, though I can't imagine why, as they make more than average money off them - probably it's an emotional thing related to IGT's profits. For whatever reason, they've been throwing them out and the numbers have been steadily shrinking.

Since there was some Megabucks info being posted ... here is my addition

Wild Star RWB Megabucks SS4702 = 87.99%
Five Times Pay Megabucks SS8435 = 86.08%

That is actually a question I have had for a long time as a player...

Does it matter where I play, say, classic red-white & blue based WOF?  Since these machines are leased, are the payoff percentages the same where ever I play?  Does this hold true for both the base game, and the progressive payoff?

Rob

Well, other people have raised that question. It has been noticed that a well known wide area jackpot has famously hit on the opening night at certain new casinos with the same ownership. This has happened on more than one opening night. Once might be chance, but the odds against it happening twice would seem to be staggeringly large, and there aren't enough digits in my computer to calculate the odds against it happening 3 times on 3 successive openings. It's easy to see how the resulting publicity would be helpful both to the property and to the machines' operators, at no cost to either, since the jackpot must hit and be paid eventually. It has been suggested that maybe special game chips were put in the machines for those occasions, making the jackpot more likely. That would seem to fall under the definition of a "gaff", which would be illegal, so I'm sure there is absolutely no truth in these scurrilous rumors and I only mention them here so we can all laugh at such a ridiculous conspiracy theory.  :72-

I don't see what would prevent a site from negotiating their own rate. If they wanted to offer a higher percentage it would come out of the casino's cut, so I think that's improbable, but there may be places with lower percentages, if any jurisdictions allow less than 85% - you can't go lower in Nevada. I would imagine the jackpot long odds don't change, otherwise the regulators would object. Only the interested parties would know the truth, and obviously they're not going to say; and since the games are never sold, it's not like you can look up in a catalog to see if there are different percentage chips available.

I thought Nevada slot minimum payback was 75% and New Jersey 83%???

You're right about Nevada, I just looked it up in Reg 14. It's 75%. My mistake.

The observation by some of us, with certain games is that our IGT platforms tend to hit the big one right after a game change and possible clear.

The observation of these "new" machines to the WAP network would be consistent with this theory.

This has just been an observation and I have no statistics to back this up.

this particular phenomenon has not applied to my game changes.  :8- :8- :8-

Okay so I guess this is as close as I can come to finding an answer. I have looked through the NIGC MICS and I can't find what I'm looking for. Perhaps someone here can help me? I am wondering if a machine tech has to be present for drop. Is it necessary for them to follow the drop team? Or can they drop the machines independent of the presence of a member of the gaming machine department?

If you're working in a live casino, your boss should know this.
If not, then it's up to your boss to find out...not you.
If YOU'RE the boss, then give the gaming commission in your area, a telephone call?
The Commission in your area should know what needs to be done and
supply you with an outline of what procedure to follow.
If you don't work in a casino, why care? :97-

I don't work in a casino, but have seen a couple of drop collections and not seen a tech present (in Nevada). They don't open the main door, just the belly.

Regs over here are different but i would not imagine that a tech needs to be present - Problem is you have to follow them around and fix everything they break - Been there done that  :88-

That question is probably more appropriate at one of these sites...
http://gamingfloor.biz/forum/index.php? (http://gamingfloor.biz/forum/index.php?)
This is known as the Casino Operations Forum. Its based out of the UK

http://www.dicedealer.com/index2.html (http://www.dicedealer.com/index2.html)
Dice Dealers is a Casino Workers forum based in the US.

Not being a casino worker either, but owning several slots... it would appear that there are about 4 - 5 locks on each machine.
MPU Board, Door, Belly door, Cash can door, Cash Can

My observations is that the box changers work in teams of two or three. One guy opens the belly door, the other the cash can door and then the cash can (un opened) is placed in the cart and a empty is put in its place all the while the third guy watches cart. They go from machine to machine and then directly off the casino floor. I would suspect that they could have up to 100K in the 20 or so boxes that they have. They also put their card into the player tracking system which probably stops the cash management system from screaming.

A quick note - Standards governing drop vary widely by jurisdiction; most casinos will have a "System of Internal Controls (SIC) that will usually explain in detail what the procedure is. The SIC is usually an internal casino document, maintained by the casino with Gaming Commission oversight. Under NIGC minimum internal controls, there is no requirement for a slot tech to accompany the drop team; if you see a tech in the area of the drop team, it's (usually) because management wants to be sure the bill validators "cycle" properly - once the cans has been switched out, the tech is "around" to make sure the validator comes back into service. In our casino, it is the drop team's responsibility to be sure the validator does "cycle" properly. If the validator doesn't come back up, the drop team calls for tech assistance (and to fix stuff the drop team breaks).

The thing with the drop team inserting a card into the machine - the progamming on that card takes a "snapshot" of the lifetime-to-date meters for each currency denomination; that snapshot is used to calculate an "electronic bill drop" value for each machine. Then the count team manual currency count is compared to the electronic value to check for variances. Under NIGC minimums (for example), if the variance is $25.00US or more AND 3% of the electronic value or more, the cause for the variance must be investigated and the results documented.

Hope that helps....

I came across a Cash Can right after they had done the change outs in the AM.  I was only about 25 at the time, I kinda knew how much could have been in there but, being the honest guy I was took the can up to the cage.  You should have seen the eyeballs pop out of everyone!  They asked where I got it from, again not really knowing what I "could" have set up before me...and not wanting to be "detained" in the back room, gave them the information of the machine.  All I got in return was a "Thank You!"  What a rip.  (This was a casino in Mesquite, NV).

No cash can but it was in the early mourning. TITO was not a factor yet so every machine had the hopper full of tokens and came across an unlocked machine,always figured there tracking would notify them and they would be johnny on the spot to investigate  :68-  but guess not  :103-. I swung the door open took a good look around,  :88- smiled for the camera and not wanting to see someone get fired so I found a slot attendant and told them thinking they where just going to see the last name in the book, lock it up and get lots of free lunches from that person. The radio calls started,  :111- management was there  :68- :68- , after another 3 minutes of my time with questions I could leave and not a thank you. So if you find a machine open  :30- ,RUN LIKE HELL and let the next poor sap turn it in.

Did they ask to see your keyring with the jackpot reset and access keys??  :97- :97- :97-

 Dan (tacman)

 :97-  Told them look all I have is a 2341 key and not the door key  DUH!!!!!!   can I go now :97-

Hey, doublediamonddlx - you did the smart thing. You probably could have gotten the can out of the casino BUT, if there WAS currency in it (50/50 chance of that) and the drop variance was sufficient to warrent investigation, the casino could have eventually worked it "backwards" to the point where they could have had your face on tape; they'd have been looking for you. If you had used a player card on their floor during that day, they probably would have identified you. If you hadn't done what you did, you could have faced (depending on the jurisdiction and the value of the currency) a high misdemeanor or a low felony for outright theft or "theft by omission of action".

The "thank you" blowoff doesn't surprise me - the LAST thing a casino wants to convey is the appearance of ineptitude; they find out what happened (as best they can) and politely send you on your way. THEN they go on the "dog hunt"; somebody caught flak for that mistake. (I remember reading some case history last year - a casino [Indiana?] was fined $30,000.00 for mishandling a situation just like you describe).

The thing with the slot doors - too funny - I remember some of the "coin-op" slots we ran on our floor; Aristocrat MkIV's and some IGT PE+ - some of those cabinets were so "well used" that, if you knew where to find them, you could pop the doors with a solid smack of your hand. Used to drive techs crazy because they were constantly fiddling with them. We still have some coin slots on our floor, but the cabinets and locks have been WAY beefed up. Still doesn't stop floor personnel from leaving them unlocked (or not properly latched), but what can you do?? It's going to happen... By the way - what's a 2341 key?

To LittlePaws - Remember that NIGC MICS drop and count standards change from tier to tier; drop and count standards for Tier A casinos is 25 CFR 542.21; Tier B is 25 CFR 542.31; Tier C is 25 CFR 542.41. This still isn't really going to help you; you need to locate your Minimum Internal Control Regulations (MICR) and/or your casino System of Internal Controls (SIC). The NIGC standards are the MINIMUMS for compliance - each "step" (from MICS to MICR to SIC) should get progressively MORE STRINGENT. Your local tribal regulatory authority (Gaming Commission) should have the MICR - casino management should have the SIC. GOOD LUCK!!

"theft by omission of action"......hmm.....


You mean there's no such thing as "finder's keeper's" anymore?  :97-

Finders keepers only works when you don't know who the lost property belongs to.You're probably not gonna get too far telling the jury you didn't know who the cash can belonged to... :72- :72- :72- :72-

"But officer, I was just on my way to the gaming tables to bet the cash can... along with my bag of pot! (http://newlifegames.net/nlg/index.php?topic=837.msg21384#msg21384)":79- :97- :97-

By God, that's right - I'd forgotten that part of the finders keepers rule, not that my older brother ever paid attention to it - lost more stuff to him than I care to remember... And, you're right - ain't no judge or jury buying the "how was I supposed to know??" arguement...

I should have clarified - how do you steal by omitting an action? I first heard of this at a casino where a cage cashier paid a customer $995.00 for a TITO redemption actually worth only $9.95. The tape review showed that the customer was aware of the cage cashiers' error (body language), but the customer said nothing (omission of action). The customer collected the cash, left a NICE tip and walked out. I don't have a clue if the customer was actually prosecuted (I was out of there just after that) but that's when I heard the term. I did Google the complete term but I didn't get anywhere with it - might have been a local infraction - in terms of (almost comical) oxymorons, it ranks right up there...

I remember this one Indian casino I was in and when they scanned the TITO they had to place in a taped out square on the table...when the TITO got rung up it showed the amount on a LED board.  Cashier then had to place all money owed to the customer in a 2nd larger taped out square (including change) and you were not allowed to touch it until the dealer clapped and waved their hands...like in BJ.  Overhead camera taped the entire transaction and a 8' tall mounted camera captured you at the window.

Kinda funny how weve come along way from the cash/exchange cart rolling through the casino!

Great mechanism for insuring proper payment(s) for TITO redemption - I wonder if they still do that. The transaction I was talking about - after the paper cleared the cage for that day and I saw the (almost) $1000.00 offage, I pulled that TITO from the cage paperwork. Turned out that the bar code was incomplete - a good TITO but the bar code couldn't be scanned. The cage cashier had to manually key the validation number into the system - tape review showed that the system did in fact return the $9.95 value - the cage cashier ignored that and paid the $995.00 anyway.. Needless to say, that cashiers' career came to an abrupt and ignominious end..

So, for something a little bit "different" - if you go back to the "dawn of time" on this topic (September, 2008), I originally had intended to start some dialogue in regards to "Regulatory issues"; I'd like to "test the waters" again (Knagl, I'd love to get your opinion on this). I have an interesting problem that I have been wrestling with for quite a while now and I'd like to post it BUT the problem is purely regulatory (although it does concern itself with the intricacies of "modern" games). There is a lot of history behind this problem; the reading is, ah, dry. Thing is, I think there are folks out there (LittlePaws) who are either currently trying to deal with this problem OR WILL be dealing with this problem in the VERY near future. Do I post here or what??

You are most welcome to post, but the majority of us are not gaming professionals (home enthusiasts), most of the gaming professionals that do grace our shores tend to be more on the technical plane so the quality and quantity of your responses may be somewhat less than what you seek. We do however appreciate your participation on our forum and do invite your posts and views on all of our topics as you do appear to have some depth in areas that many of us do not.

Cheers

That was very gracious, Jay - thank you. I've often marveled over (and cursed under my breath about) how gaming regulatory oversight is perceived by the public; the variety of opinions and perceptions is amazing. Perhaps we can clear some of that up... In so far as the "technical plane" is concerned; my experience has been that, where there is a technical problem, a regulation is close by. The folks that frequent this forum may be more technically-minded, but technicians know people who know people. I've also found the technically-minded to be curious sorts; the more they know, the more they want to know. I'm counting on that.

That said, I'll work up a "test post". It will cover ONLY the biggest regulatory problem I've had recently, just to let folks dip their toes in the water. Anyone wanting to get a jump on this should Google "25 C.F.R. 542.13 (h)(18)"; that's the portion of National Indian Gaming Commission Minimum Internal Control Standards (NIGC MICS) I'm fighting with right now. Enjoy!

Thanks again, Jay...

I don't know if I qualify as a member of the public for these purposes, but I perceive gaming regulatory oversight as the morbid fear by government that someone, somewhere might be cheating them out of a nickel's tax.

How strange, that's my perception also, and I am a member of the -pub -lic. (They call me "Tater Salad" :97-)

<edit> To clarify my position, I view most government regulatoy with the same view. The government seems to vacillate between telling the public what is good for them and telling the public how they need more money to tell the public what's good for them. And when things don't go right, it's always someone else's fault, and they need more money to fix it. I'm not saying all government is bad, but rather there are many parts of it that are.

/rant off

Hmmm... I need to put more of a spotlight on my role in the regulatory scheme of things; try to dispel some notions:

I don't work for the Fed. Believe me, I don't have the kind of mind it takes to write regulatory language for the Federal government - those are some VERY SPECIAL people. 

I work for the casino, with local regulatory oversight (Gaming Commission). The role I play has to do with insuring integrity; protect the players, protect the properties, protect the industry. There are sizable chunks of Federal reg that stipulate the standards that must be met to (in the eyes of the government) insure overall integrity. I'm the guy (along with many, many others) that tries to interpret those regs and build a "mechanism" to gain compliance with said reg(s). Now, if reg calls for a mechanism to alleviate the governments' fear that tax nickles are slipping through the cracks, then I'm required to develop and build that mechanism. And, in reality, there are some regs in place out there that force properties to spend a dollar to find a nickle; it's the nature of the beast. That said, I believe that the OVERALL intent behind reg is good; if you run a regulated casino, you damn well better play by the rules - you get caught playing naughty, you'll pay DEARLY. That’s the way it should be. Consider how things might have been if there had been more focused, driven Federal oversight over investment banking and/or bond rating companies; I’m willing to bet the sub-prime mortgage fiasco would have been a flash in the pan rather than a meltdown.

That leads me to where I am now – I’m caught in a conundrum.  Casinos regulated under NIGC standards are required to evaluate the “performance” of the slots active on their respective floors to insure that the slots are operating within defined parameters (in regards to what the slots pay back to customers). Recent trends in the manufacturing,  testing and approval of slots are weakening casinos abilities to properly evaluate these newer games; those weaknesses must be addressed. More about that in a future post.

Anyway, that’s what I do and the reason I’m here, folks. Hope that helps….

It's good to have a compliance guy here. Me, I'm from the other side of the table, the design side. I've had a lot of dealings with Regulation 14 (and Mr Mader's clones thereof). Federal regulations, that's something else again, originally related to stopping casino owners helping themselves to a handful of untaxed Franklins, and more recently to stop members of the public using casinos as a tax avoidance device. But as for the regulations being there to protect the players, don't make me laugh. I think the decision of the Nevada Gaming Commission in the case  last year where a player doubled down on ace-8 and drew a 2 laid that to rest. (For those who haven't heard about it, the casino (Terrible Herbst) claimed the player's total was 11, and the NGC upheld that.)

Unless it is specifically written down and available for viewing I would be challenging that ruling in court. .... albiet I heard that Terrible is in financial trouble and being forced to see its properties... so blood from a stone comes to mind.

As a player I am more comfortable playing in a casino than a private game. First off I know that if the company is being traded publically that they wouldn't do anything to screw up their ability to remain on the market.
So when I go into a casino I feel that I do have a chance of winning on either the slot or table game. I think in absence of the oversight you would see public confidence errode.

A DESIGN GUY – Flippin’ perfect!! I’m working on a post that you will (I hope) be able to comment on.

In so far as reg is concerned – there are (in tribal gaming) two sets of Federal reg to contend with; 25 CFR 542 (NIGC MICS) and 31 CFR 103 (“Title 31”). Your references to Federal regs created to stymie skimming and close tax evasion loopholes are part and parcel of Title 31 (aka The Bank Secrecy Act). Title 31 has no bearing on the issues I am contending with – those issues arose from contending with NIGC MICS.

In so far as regulation not protecting players; try this for additional context. The NIGC MICS were promulgated to provide minimum regulatory standards across the entire tribal gaming industry; the NIGC MICS were never intended to dictate to a tribe or casino management how they would conduct themselves during a dispute between a casino patron and the casino itself. The Fed leaves resolution of disputes where it belongs – with local regulatory authorities. Insofar as the decision made by the Nevada Gaming Commission? No opinion without having read the case materials. Do regulators screw up? You bet. Thing is that many millions of hands of blackjack are dealt daily – I’d bet the country as a whole sees tens of millions of game starts on slots each day – do the math…

And, Jay - You hit a viseral point - if public confidence that casinos (Vegas or otherwise) operate "fairly" was to erode, the industry would slowly crumble. All tiers of regulatory authority safeguard that confidence.

I would cite "Scarne on Gambling" (http://www.lybrary.com/scarnes-complete-guide-gambling-p-749.html) as the authority here. As long as an establishment is permanent, it needs to protect its reputation; and given the house edge, there is no incentive to cheat a player. Nobody ever accused the old Vegas managements of cheating at play; by most accounts, players got a much better deal overall before the corporations took over.

Of course, without oversight there's no control over the house edge, but competition takes care of that. People won't play 80% games if there are 90% games next door (well, apart from Megabucks and WoF). Years ago, Harold's Club in Reno set some of its slots to 96% by accident, and their drop increased so dramatically from increased play that every other Nevada casino followed suit.

That's called..."going with the flow"... :96-

hello there mister regulator...i'm a lead tech at my casino and have been techin for nearly 7 years now so i have been working closely with our regulators for quite some time.  i'm the first person to admit that i definitely don't know all of the NIGC MICS word for word, but i do feel that it is my resposibility to make sure none of my techs are in violation at any time, therefore i try to at least have a working knowledge of the rules we must adhere to.
i read the section of the MICS you are working with right now and am totally willing to offer my views and or ideas that may help you.  as the others have said, we welcome the regulatory aspect of gaming to our online community.  :89-

So – here it is – the promised post in regards to the NIGC reg(s) I’ve been contending with. Some background: I started this chase back in June of 2008, after attending a seminar on evaluating slot hold/payback performance. Ken Moberley taught the seminar; Mr. Moberley is an educator with the University of Nevada and a former executive with IGT. I did some additional research and contacted a gentleman by the name of Don Caitlin; Mr. Caitlin is a retired educator and writes articles about gaming, with a particular slant on slot machines. Mr. Caitlin put me in contact with a Dr. Hannum, a PhD in mathematics at the University of Colorado, Denver. Randy Fromm, publisher of Slot Tech magazine was copied on most of these mails, along with Mr. Jason Buckingham, Internal Auditor for the casino where I work. I’ve included excerpts of the e-mails that I felt were relevant; I apologize in advance for the length. I wanted to be sure the “jist” of the problem is clear.

July, 2008

Hello Mr. Catlin:
 
Recently, I have taken on the responsibility of investigating slot machine actual to theoretical hold variances; I've been spending a lot of time educating myself on slot mathematics. I found your name while doing research; two articles published on the Casino City Times web-site in reference to the Inge Telnais patent and random number generators (amongst many others). I'd like to make an observation and ask your opinion on a question:
 
The observation: I've been pulling PAR sheets on games from various manufacturers as part of my variance work and I notice that some of the games we're running on our floor have huge cycles; as an example, we recently installed a game has a cycle of 943,800,000 combinations. My arithmetic (based on 60 days of accumulated game starts) indicates that this game will (theoretically) complete 1 cycle sometime in July of the year 3341. In addition, some of the reading I've done (and opinions I've heard) indicates that games with cycles in the billions (and even hundreds of billions with server-based games) will soon become common place.
 
The question: The portion of Federal reg that governs investigation of actual to theoretical hold variances for tribal gaming {25 CFR 542.13 (h) (18)} requires we provide written explanation(s) for any slot that has accumulated 100,000 (one hundred thousand) game starts and is operating outside of a +/- 3 (three) percent variance window, actual against theoretical hold. If manufacturers will not provide basic diagnostic tools; with Federal regs falling far behind industry technology (look at machines with 100,000 game starts against a cycle of 943.8 million?); with cycles that will never (theoretically) complete, what other tools can we use to PROPERLY evaluate the performance of these games?
 
Thanks for taking the time if you can, Mr Catlin. I appreciate any advice or opinion you are willing to offer.
 
July 2008

From Mr. Caitlin
 
I really don't know what one can say about a machine that is operating at 3% off its theoretical mean other than to say that the random number generator is flawed.  That doesn't seem credible, though, since I know that slot manufacturers go to great pains to make sure that their RNGs really do simulate randomness.  Sorry that I can't be of more help but I just don't know what to tell you.  You might try Robert Hannum at Denver University; his work deals with both statistics and gambling law.
 
One comment.  Slot machines spit out random numbers hundreds of times each second.  If a slot machine has an RNG with a cycle of 943,000,000 and generates 1000 random numbers per second it would cycle through every number in about 11 days.
 
Don Catlin 

August 2008

Hello Dr. Hannum
 
We are a small tribally-owned NIGC classified Class III gaming facility. Don Catlin suggested I contact you to solicit your opinion(s) in regards to some issues we are contending with and to invite you to join in some dialogue regarding the direction on the industry in general.
 
Recently, I have taken on the responsibility of investigating slot machine actual to theoretical hold variances; I've been spending a lot of time educating myself on slot mathematics. I'd like to make a couple of observations and ask your opinion on a couple of questions:
 
The observations:
 
1.) I've been pulling PAR sheets on games from various manufacturers as part of my variance work and I notice that some of the games we're running on our floor have huge cycles; as an example, we recently installed a game with a cycle of 14,505,961,008 combinations. We have another game with a cycle of 34,359,738,768 combinations. I understand that server based games have cycles in the 300,000,000,000 combination range.
 
2.) I've noted that manufacturers are becoming very stingy when providing performance evaluation tools (90 or 95% confidence tables, standard deviation, volatility indexes, etc.).   
 
The question(s):
 
1.) It appears (to me) that we are caught up in a "circular firing squad". The industry continues to submit games with monstrous cycles and they continue to be approved; casinos must purchase these games to remain competitive. Federal regulations/regulators will not budge on compliance with existing regs despite this disturbing trend nor are they attempting to control it. Manufacturers withhold performance evaluation tools from thier customers - In your opinion, what is driving this trend and where did it come from?
 
2.) The portion of Federal reg that governs investigation of actual to theoretical hold variances for tribal gaming {25 CFR 542.13 (h) (18)} requires we provide written explanation(s) for any slot that has accumulated 100,000 (one hundred thousand) game starts and is operating outside of a +/- 3 (three) percent variance window, actual against theoretical hold. If manufacturers will not provide basic diagnostic tools; with Federal regs falling far behind industry technology (look at machines at 100,000 games starts with game cycles in the billions?); what other tools can we use to PROPERLY evaluate the performance of these games?
 
I/We appreciate any opinion or advice you care to offer, sir. Thank you for your time.

August 2008

From Dr. Hannum

I’m not sure how helpful my thoughts will be (and I’m sure you are aware of much of this), but for what it’s worth, here goes.

1)      With outcomes generated by random numbers, huge cycles are possible. This gives game designers more flexibility in creating games and/or payout schedules (as well as larger jackpots). I view this as a good thing.
2)      In my experience manufacturers have always been stingy in providing certain details, including performance evaluation tools, about their games. I view this as a bad thing.
3)      In my experience gaming regulators seem to be extremely slow in implementing or modifying gaming regs to keep up with technology. Again, a bad thing. I would hesitate to speculate as to why this is but would certainly endorse this changing.
4)      Quick calculations suggest that a machine with about a 95% payback and standard deviation of 5% will should have 90% limits of roughly 92.4% to 97.6% after 100,000 pulls. The analogous limits for a machine with the same hold but a 10% SD are 89.8% to 100.2%; with a SD of 20% it’s 84.6% to 105.4%. The point is, it would not be surprising for some properly operating machines to fall outside the +/-3% window after 100,000 pulls. I’d have to give more thought as to exactly how the actual to theoretical hold evaluation should be done, but it seems to me it should be somehow tied to the machine standard deviation (variance); right now it isn’t. In addition, I would tend to increase the number from 100,000 (though might be implicitly accomplished with a revision of the evaluation that is based on the SD). Finally, I never liked the industry standard of a 90% confidence level for slot volatility analysis, inherent in the volatility index using a 1.65 z-score; in my (strong) opinion it should be at least 95% (conventional in most statistical settings).

As I said, for what it’s worth…

Cheers,
Bob

My reply, September 2008

Hello Dr. Hannum,
 
At the outset, let me express my/our gratitude that you took the time to respond to us.
 
In so far as your responses to the questions I posed:
 
RE: 1.) Further research on my part did disclose that your view is right on the money (no pun intended). Designing games with huge cycles does offer programmers tremendous flexibility. While internal policy prevents me from playing on our floor, I have taken a closer look at some of these games and I am impressed at the level of "customer interaction" they offer ("nested" bonus rounds, "players choice" bonuses, etc.). I'm gaining a better understanding of the need to manipulate pay distribution(s) and bonuses. That said, I'm still not convinced that these huge cycles are a "good thing"; please read on.
 
RE: 2.) I concur with your view that lack of performance evaluation tools is a bad thing. If I might go a bit further:
 
It is clear that game developers are capitalizing on rapid changes in technology. If I understand correctly, the "next generation" of server-based games will have the capacity to run hundreds (and potentially thousands) of games; these games will have cycles in the hundreds of billions. While it seems clear that regulatory bodies are comfortable with these advances, my feeling is that these bodies have lost sight of an important point - why the regulatory bodies exist to begin with. The research I've done up to this point tells me that the intent behind many of the regs we must contend with are represented by three basic tenets:
 
       Regulation(s) are designed to protect the properties, protect the players and protect the integrity of the industry.
 
Then I ponder the enormous complexity of software development; I invite you to follow the link below. This short power point presentation reveals some of the pitfalls of software development and engineering. It was created by Jyrki Nummenmaa (Head of the Department of Computer Sciences, University of Tampere, Finland).
 
http://www.cs.uta.fi/~jyrki/se03/motivation.ppt (http://www.cs.uta.fi/~jyrki/se03/motivation.ppt)
 
As Dr. Nummenmaa points out, some of the examples provided are pretty humorous, but the others are very serious. I understand that the parallels are a bit extreme, but I think you can see my point. Purchasers/end users of these complex games are completely at the mercy of the game developers to write "good code"; properties have no diagnostic tools "on a par" with the complexity of the game(s) to accurately evaluate their performance.
 
As an example, look at this scenario (and please bear with me; I'm a layman wading into DEEP water):
 
An imaginary casino has a $0.25 denom game running with a cycle of 34 billion combinations. Our hypothetical casino sees 150,000 game starts a month on this particular game (single coin wager, that's $37,500.00 per month in coin-in.) At a 93% theoretical payback, our casino should be seeing around $2,625.00 in theoretical net win each month. At 100,000 game starts (0.000294% of a cycle complete) let's say that the game is operating at 89% actual payback (or $4,125.00 in actual net win). That actual payback percentage is 4 percentage points away from theoretical and, based on the standard deviation tables I've seen, well within range at 100,000 game starts. This is what bothers me: 
 
Our casino is seeing a 57% increase in net win on this game and it is just BARELY operating outside the +/- 3% variance window provided by (NIGC) reg. Then calculate INSIDE the variance window - using the same scenario, with a +/- 2.5% variance actual against theoretical hold (95.5% to 90.50% theoretical payback), our game could be generating anywhere between $1,687.50 and $3,562.50 in net win each month. 
 
Now, my understanding is that theoretical payback percentages are based on a "lifetime span". Most of the standard deviation tables I've worked with are calculated out to either 10,000,000 or 20,000,000 game starts; I'm sure those game start numbers are reasonable in a volume operation. What I can't get my head around is the relevance of those game start numbers against a game with 34 billion combinations in a cycle. At 10,000,000 game starts, that's 0.0294% of a cycle complete. At 20,000,000 game starts, that's 0.1% of a cycle complete. How can we rely on a 90% confidence table (or even a 95% confidence table) calculated to 10 or 20,000,000 game starts when those game start numbers are (in my view) inconsequential when compared to the overall game cycle? In my view, given the complexity of the game(s) and the "bluntness" of the diagnostic tools currently in use, casinos could be running games on their floors for DECADES (or even longer) before a problem MIGHT show up. Hundreds of millions of dollars could be "exchanging hands" when it shouldn't be and NO ONE WOULD EVER KNOW. That concept brings me back around to the previously mentioned regulatory bodies and those three basic tenets.
 
RE: 3.) I often ponder the lack of Federal-level "spryness" in regards to changes in regulation(s). Current events (the pending Fed takeover of Fannie Mae and Freddie Mac and the whole mortgage meltdown appears to be a good example) would seem to support the theory that something catastrophic has to occur before any significant change takes place. I wonder what kind of a catastrophe would have to take place in the gaming industry to get the various regulatory bodies to take a closer look at the current trends in game development, approval procedures and performance evaluation. Food for thought...
 
RE: 4.) In conducting research to attempt to find additional evaluation tools, I stumbled across the link below. I/we would like to solicit your opinion about this utility and ask you if you are aware of any other utilities of a like nature. This utility is still a bit  blunt, but it is better than what we have now.
 
http://downloads.zdnet.com/abstract.aspx?docid=342606 (http://downloads.zdnet.com/abstract.aspx?docid=342606)
 
Dr. Hannum, again let me express my/our thanks for any opinion(s) you choose to offer. Good day.
 
NOTE: I did not receive a response back from Dr. Hannum – at this point in time, he was dealing with a “serious and on-going family emergency” (his words). I didn’t feel it appropriate to press him.

September 2008

This mail from the Internal Auditor at my casino:

Hello to all involved in this post and a big thank you to all involved,
What I see as the major problem, from a regulatory perspective, is that you have these huge cycles that players seem to love and no tools available to determine acceptable deviation from theoretical hold percentage.  I.e. game A is at 150,000 game starts and is currently holding 110% and theoretically could be at 110% for years before it should statistically come within an acceptable (profitable) range. 
I wonder how volatility is kept in check with these games?  Is it sheer volume, spread over numerous machines that will keep the risk of volatility within an acceptable range?

One important thing to remember is that we hold the power, as regulators, to allow or prohibit these types of machines on our gaming floors.  We should be demanding manufactures to provide us with the tools we need to measure acceptable deviation prior to licensing the gaming machines.  As many of you know, our compacts provide little regulatory guidance in today’s gaming world, the NIGC is also a few steps behind and seems to be more focused on creating work for gaming operations that provide little to no value, so it is up to us. 

So here comes the real question,
How do we stay competitive in today’s market while maintaining control levels that protect the integrity of out industry?

September 2008
My response to our Internal Auditor

Thanks for chiming in, Jason. The bit about possible prohibition of certain games is just what the conversation needed. I wanted to get something straight, though - You and I chatted about the lack of diagnostic tools and I came away from that conversation under the impression that GLI could provide us with deviation tables and the like, upon request. We pulled the letters of certification for the games in question, but they proved to be of no help. Can we still use GLI as a resource? Do I/we need to build some kind of formal request system, etc??

NOTE: I did not receive a response from Mr. Buckingham. It was at this point that Mr. Buckingham ah, recused himself from further comment. Mr. Buckingham left the employ of the casino shortly after this to take a position with another company.

This issue did not die after this last mail. In March of 2009, one of our Gaming Commissioners attended a conference hosted by Gaming Laboratories International, one of the leading game testing and approval companies on the planet (GLI does much of the testing for games for the Nevada jurisdiction, as an example). One of the GLI moderators forwarded this set of mails to two senior staff members of GLI at the end of March, 2009. We have received no response from them as of the date of this posting. Also, I checked both of the links included; as of this post, they were both still active. I invite you to check them out - they really help with the context of the problem (as I see it).

Time to stop and let those that have the time digest this post and ponder the implications. 

MY observations and comments:

With a high probability (100,000 starts seems high to me) of a 3% variance from the published standard deviation would imply that you would not want to have any games with a > 96% payback as it would appear that this variance could consistently imply financial losses to the establishment.

If the principal role of the regulator is to protect the casino, then you would want to take appropriate measures.

As an example ... I would calculate the average drop and subsequently determine my cost of operations as a percentage. The derivative would then allow me to ensure my hold % was greater than this number. Personally I would be inclined to add in 15 points for a decent profit margin. However knowing that this alone would put me below 85% I would need to figure out what my amortised investment cost was vs drop and ensure that I was creating value through ROI even if it only worked out to be 1 or 2 points against the drop.

As an IT professional I ensure system (and subsequent financial systems) stability by rebooting my servers once a month. Some operating systems are more stable than others but I am inclined to believe that most are complex enough to potentially have memory leaks. I defer to your referenced PPT on software engineering in this regard. The reboot frequency ensures that everything remains within operational norms. Extrapolating that to the casino, and being somewhat naive of gaming law would it be possible to put in a procedure where you do a game clear every 3 months. This would perhaps ensure that the varience would never exceed the 3%, and as such never reach the threshold of the reporting requirement. IE In SOX terms the PROCEDURE is the CONTROL that ensures COMPLIANCE with the law.

Being a novice slot operator in a home enviornment the IGT S+ PAR sheets are based on 10mm spins. This sheet only provides me the theoretical payback % to work with.  I would think that standard deviation norms of sucha a cycle would easily exceed 3%. However with the slot accounting available from the various internal counters you should be able to segment some of the values and nomalize these. The remaining samples which would then would represent out of norm charastics would be statistically insignificant. This might not work for all variences but it would help explain a good portion of them.

Finally if the slot has not completed its cycle would that not be an explanation enough as to why the slot is out of compliance.

That's a good strategy for the service provider end of the business, Jay. As someone from the QA side of the business, I try to ensure that my UUTs (Units Under Test) never get rebooted, explicitly to find the isssus you attempt to avoid with your periodic reboots. Proactive action like this on both sides of the coin ensures customer staisfaction. :3-

Shortly after we acquired one company several years ago (towards the tail end of one of their releases), we had customers find no less than 4 memory leaks in one component of the product within a week of the release. I was on the post-mortem team that assessed why this occurred, and in our research we discovered that the test team in question was rebooting their test units after every category of test cases was completed, thereby ensuring they would never find any memory leak related issues in the product.

I’ll frame my response in reverse order, Jay.

The “connection” between the completion of a game cycle and the performance of the game is purely theoretical. While the application of common sense would tell you that, as a game approaches the “end” of a cycle, the payouts from the game should also be nearing completion. That common sense application COULD work if the game program was based on a bingo or pull-tab style game – what the NIGC calls a “Class II” game. With a Class II game, each time a game start outcome is determined, whatever combination of symbols that resulted from that game start is “discarded”; it will never occur again. With the games I’m dealing with (NIGC “Class III” games), once a game start outcome is determined, that combination of symbols “goes back in pot”; that outcome could be generated again. These newer games will NEVER complete a cycle. Besides, the whole idea of evaluating actual to theoretical hold is to guarantee (as much as possible) that a particular floor is “fair”; patrons are being paid back what they should be paid  and the casino isn’t making more than is should.

You’re lucky to have the PAR sheet with a standard deviation table, Jay; I’m willing to bet, if you look, the sheets will have a volatility index, etc. The PAR sheets for the games I’m working with DON’T HAVE THEM. I/we can’t even determine if some of these games are theoretically operating within “normal” bounds. NOTE: If you check the standard deviation table on your IGT game, there probably will be a statement that says something like “90% confidence”. In essence, what that means is the spread in the theoretical payback on the game (based on XX number of game starts) is AT BEST 90% reliable.

Casino operators LOATHE the idea of booting their servers; the floor is “shut down”. In addition, (and I’ve seen this happen), there is a risk that the servers won’t come back up. Casinos do reboot servers, of course, but only in circumstances that really require it. Clearing RAM on the slots won’t work, either. There are regulatory issues and besides, the game goes back to Square 1 – letting game starts accumulate (on older games) was (and still is) effective in gauging performance (actual to theoretical hold). Thing is, those older games had cycles of a million combinations or less; a game played heavily could “cycle” in a couple of years (or less). These new games will NEVER cycle even once.

In so far as theoretical hold percentages and profitability are concerned; depending on jurisdiction, there are very strict rules in regards to what is allowed on a casino floor (in terms of hold percentages). Your opinion makes perfect sense from the profitability standpoint, but your casino would be out of business. Competition would kick your butt, you’d be in bankruptcy court or (maybe) in jail…

Lastly, I’m NOT a regulator – I don’t promulgate ANY of these regs. I work on the casino side of the scheme of things to create mechanisms to satisfy reg. That’s the whole idea of doing this; I know there are other people out there with the same problem(s) I have – I’m hoping to find them and get their ideas.

By the way, is SOX a reference to Sarbaines-Oxley??

Hope that helps, Jay…

P.S., brichter – you’re scaring the hell out of me, man. What you’re talking about is EXACTLY the kind of thing that could “get by” – From the time your customers picked up on the problem – how long until the post mortem was completed?

SOX = Sarbaines-Oxley

So, I don't believe Jay was suggesting that casinos reboot servers or machines, he was addressing points made in the presentation you linked as to why software fails. His business can schedule downtime and there are almost always failover or redundancy features built into software products marketed to enterprise-class businesses so customers don't feel the effects of planned maintenance. This is not always the case, and it seems from your post that this type of planning for outages has been not addressed by the gaming industry yet.

As far as the post-mortem goes, we released the software on a Friday as is customary, so engineers at the customer sites can upgrade over the weekend. This gives them time to recover from any issues they may find. Recovery is anything that must happen in order to get the sytem back up, including reverting to the older version of software.

Since these were memory leaks, they don't manifest themselves until the system has been in operation for some time. The first issue was seeen on Monday morning (local time for us) from a large cutsomer deployment in Europe whose system has been up all day. We assigned a developer to work with a support engineer to root-cause the issue, and by Tuesday night, we had the other 3 issues reported. Note that these were not issue with the same code module, but were different problems. At this time, we realized we had multiple pattern failures, and the PM team was assembled. Wednesday and Thursday we gathered info and presented the findings Friday morning, and had new testing procedures in place the following Monday. That was not a fun week (or weekend) for me.

There were also changes in process on the development side to enforce in-depth code reviews by peer developers. Code reviews were a requirement before the incident, but were not enforced, and as a result were either just being pencil-whipped (signoff without proper review of the code) or not being performed at all.

The 4 issues were resolved in parallel and patches issues by Thursday evening local time, and equipment was being rebooted nightly on customer sites until the patches were released.

#1, Class 3 games don't have a "cycle". That's just a statistician's sophistry to work out theoretical outcomes. Class 3 games are truly random, and in a truly random system, every possible combination of results is possible - that includes 100,000 losing plays in a row, and 100,000 jackpots in a row. The statistical probability of such an outcome is very small indeed, but it exists, just as the probability exists in quantum theory that all the atoms in a girl's clothing will simultaneously jump three feet to the left (Hitchhiker's Guide to the Galaxy). In games with a very large "cycle" it's entirely possible that some results will never show up in the lifetime of the game.

#2, in reality, however, the numbers are not as big as you think. Take a 5 reel video with 256 stops per reel. The total number of combinations (the "cycle") is 2^40, about 10^12, one trillion. However, there are not 10^12 different game outcomes, since many of them are the same. The more you increase the number of stops for the same number of outcomes, the more the outcomes tend towards the statistical mean. If you read your tribal compact you'll almost certainly find a clause that says the long odds on any jackpot can be no greater than 16.7 million to 1 (2^24), so in a trillion plays, at least 65,000 of them should be the jackpot. Jackpots should in any case be excluded from this sort of compliance test. That is, if the game is 95% and 5% goes to the jackpot, evaluate it as a 90% game and don't count any jackpot that hits during the test.

#3, playing multiple lines reduces the volatility (variance, whatever). To get results closer to theoretical, play maximum lines. To get the largest chance of variance, play single lines. The most dramatic example of this is in Action Gaming's 100-play poker. Jeez, what a yawn. Play $5 a hand, win $4.85 (+/- 25c) every time. Even hitting a couple of royals in the hundred hands doesn't make much difference.

#4, Put not your faith in GLI, or any other test lab. Maybe in the past they did full evaluations of game software, but these days, especially with the move to use third-party code and proprietary operating systems like Windows for which there's no source code, it is far beyond their capability. All they can do is test the game to see if it complies with the manufacturer's own specifications, pretty much the same as you can. Not even the original designers can know all the twists, quirks and vulnerabilities. A smart programmer could put a gaffe in there with virtually no chance of anyone spotting it - and who's to say they haven't already?

Jeez, Op-Bell - between you and brichter, I'm gonna stroke out.

Clarify something for me:


All of the training I've taken up to this point says there ARE (theoretical) cycles in Class III games. The first (elementary) training used a very familiar, very popular 3 reel, 64 stop game - cycle 262,144. NIGC classifies this game as Class III and the evaluation process I was taught translated very nicely to other games of this type (we're still running many of these games). What you're saying flies in the face of that. Are you saying that the time-tested, many times reviewed process I was taught is nothing more than smoke and mirrors?

Between the two of you (now that I'm losing my mind) - can you thumbnail the architecture of corporate software development? What I know about this you could write on the back of a matchbook in grease pencil. Sounds as though game developers (and testers) could have the same kind(s) of procedural vulnerabilities that brichter's company had.. 

All of these games that have no eval tables or volatility indexes - these are ALL high hit frequency, low volatility games. The bit about not trusting the testing labs - Op-Bel - you've got it. I didn't want to come right out and talk smack about them BUT I can't understand why we can't get ANYONE to talk to us about this. The whole "confidence in the industry" thing rides on this. What ARE the game developers and testing labs doing?? Why can't we get any answers? Who the hell do we have to SCREAM at to get something moving on this?

Thank you, gentlemen - Excuse me while I open the bottom right-hand drawer of my desk, retreive my (not supposed to there) bottle of sour mash and pour myself a couple of fingers - Jeez-Louise...


P.S., brichter - "pencil-whipped" is now part of my regular vocabulary - give folks arouind here something to ponder...

Excuse me while I open the bottom right-hand drawer of my desk, retreive my (not supposed to there) bottle of sour mash and pour myself a couple of fingers - Jeez-Louise...

Finally something I can relate to in this disscussion  :140- :154- :151- :152- :97-

Very interesting subject you have started DealingwithNIGC542, keep up the good work guys.

Ron

No, it's not smoke and mirrors, but people misunderstand it, including people who ought to know better. The "cycle" isn't a guide to actual game outcomes, but to the probability of game outcomes. In a large number of game trials, the number of times you hit an actual outcome will trend towards the probability of hitting that outcome. In an infinite number of games they will exactly match it, but you can never achieve this, because after you've tried it an infinite number of times you can still try it again, and then again after that, for ever.

Take something simpler as an example, throwing a pair of 6 sided dice. The dice have a "cycle" of 36. In any group of 36 throws, snake eyes should occur exactly once. However, it's quite likely that you'll throw a pair of ones twice, or not at all, in 36 throws. It's possible to throw snake eyes 36 times in a row - highly unlikely, but possible. If you throw the dice 36 million times, the probability is that you'll throw a pair of ones a million times, but the chances of it being exactly a million is quite small. In the short run, though, probability is full of surprises - this is why betting systems never work and casinos manage to stay in business. Take the Martingale system for Roulette. You bet red or black, and every time you lose, you double your bet. When you hit your color, you get back everything you lost, plus your original bet as winnings. Sounds foolproof! The trouble is, you can get a string of enough losing bets to break your bankroll, or take you over the house limit. Even casinos don't always win. The people who built the old Thunderbird lost the casino on opening night to a lucky craps player.

In the process of designing a game, the designers simply add together all the possible winning outcomes over the whole game cycle, divide by the number of games in the cycle, and declare that to be the percentage. In the case of our pair of dice, say we pay 10 for a pair of sixes and 4 for a total of 7. In the "cycle" of 36, we get one payout of 10, and six payouts of 4, for a total of 34. This game then pays 34/36, or 94.4%. Will you get a payout of 34 every 36 games? Try it and see. But in 36 million games, you'll get quite close to 34 million payout. No game designer, or regulatory test, can go any further than this! It's a game of chance, goddammit. Sometimes chance will favor the player, and sometimes the house. All you can say is that in an infinite series of tests, the results will trend towards the theoretical.

That's a term I learned in the military, it applies equally well to civilian life.  :89-

Hi DealingwithNIGC542,
I'm following your posts with interest and I have this to offer.
I ran a S+ through 100,000 pulls about two weeks ago.
The reel prom had a 92.85% chip installed and I cleared the ram before running the test.
After the machine completed the pulls ( I ran the machine with a "Auto-play" switch),
I calculated the % and came up with 87.34% payback.
Now, this was done with EVERY pull playing the "Max" bet of 3 coins.
And took nearly four days to complete.
This machine would definitely be out of the "standard deviation" range of +/- 3% your casino is trying stay within.
I believe that 100,000 pulls is way too short of a complete "cycle" of the newer games you're talking about.
Because slots work with randomness properties,
I cannot see how any machine could fall into the +/-3% range...that's just too tight!
Esp. when this measurement is supposed to be taken with as few as 100,000 pulls...
gee, that's almost like taking a ball and throwing it as hard you can and
see if you can hit a running deer on the other side of a farmer's cornfield.
Just my 2 cents...

Taxonomy is a wonderful thing as both of these definitions differ greatly from how I interpreted the term cycle.
My definition is closer to how SOB was explaining the sampling rate.

I was defining the cycle as the number of spins or plays needed to reach statistical norms.
In the S+ this is based on 10 million spins. While it would be a simple testing program to "play through" the RNG 10mm times the actual casino play to reach this is very high.
Over a year this would mean the machine would need  to be played 27398 times per day, 1142 times per hour, 20 times per min. Given the time it takes to complete a spin this is impossible.
To get this amount of play you are probably looking between 5 and 7 years at a busy casino.

With 128virtual stops on a 3 reel unit there are just over 2mm combos and as pointed out by opbell any particular combination may never actually hit.  

To DealingwithNIGC542 withs point it is possible that some themes (in a competitive market) have come and gone in 3 years and will never reach their statistical norm. If infact the norms are being based on larger than 10mm Ie 100mm then that time frame would be 10 fold ... 50 years.

I have always understood the term "cycle" to be the total of all possible outcomes, or the product of the number of reel stops in slot machine terms. This is what's always used to work out the percentage, and the resulting probabilities are always exact. The number of times a particular outcome appears in practice, however, is not exact - it follows a Gaussian or "normal" distribution (http://mathworld.wolfram.com/NormalDistribution.html) (warning - head-exploding maths  :12-), which is governed by a different set of probability rules. Consequently you can't test a game for an exact percentage. All you can do is run the game to accumulate a total, then see where that total falls on the distribution curve and make an judgment as to whether it's reasonable. In a Gaussian distribution, 99.7% of results lie within 3 standard deviations of the mean, so any result outside that merits further study. The related Chi-squared distribution (http://en.wikipedia.org/wiki/Chi-square_distribution) is the standard test for random number generators, but note that in this case, a perfect result is a FAIL (not random enough). It's strangely easy to achieve a fail - since mathematical RNGs have a fixed and known cycle length, you just run it over some multiple of the cycle length, and the longer the run, the more perfect the result. This has resulted in some manufacturers adopting a 64-bit or longer algorithm, so that no practical test ever gets near the full cycle.

The gaming control people in Britain used to carry out random inspections on AWP arcades. An inspector would show up anonymous and unannounced with a large bag of coins, pick a machine, play the coins through once, and count what came out. If this was too far below the legally mandated 80% he'd produce his ID and have the machine hauled away for further testing.

Of course if he hit the jackpot no one would ever hear from him again .....  :72-

 :72- haha...what a dumb way to inspect a machines' payout... :30- :30-....
I wonder how many coins he put in the bag :103-

In all these machines, the less volatile the game, the more likely you are going to be close to the theoretical holdback percentage.  Take for example Double Diamond 90.95% chip.  The volatility predicts:

                 90% CONFIDENCE VALUES     VOLATILITY INDEX =   10.524
   HANDLE PULLS     LOWER         UPPER
                  PERCENTAGE   PERCENTAGE
        1000.      57.67         124.23
       10000.      80.43         101.47
      100000.      87.62          94.28
     1000000.      89.90          92.00
    10000000.      90.62          91.28

So theoretically within 100,000 pulls you are withing your 3.x% variance.  The key if you want to stay around this number is to get games that don't have ridiculously high top awards.  Something like 800 to 1000 coins max per coin bet would get your there.  The higher the volatility, the less likely you are to get within the holdback with a smaller sample size.

I agree with you Rick,
however, DealingwithNIGC542's problem lies with the companies
giving him PAR sheets that don't even have the volatility index shown for the games he has? :52-
Also, he doesn't really have a decent way to even check if his games are in line with what the
casino's are supposed to be making with these machines he needs to stay competitive with neighboring casinos. :60-
Just about everyone he talks to passes the buck to somebody else. :97-
The problem lies mainly with slow  :58-  :149- regulatory bodies who are usually a step or two behind super fast advancing slot technology. :50-
 

To all those who have contributed - I can't thank you enough for what you've done up to this point. I have (obviously) a lot more research to do and you've provided me with some direction. I have something of a different question to pose.

I have taken pains (as much as I could) to not "point fingers" or to mention specific manufacturers or properties (including my own); there is a reason for that. Up to now, the dialogue has been focused on the technical aspects of this issue; I'd like to ask a question of a more ah, “philosophical nature”. Bear with me, I need to phrase this carefully:

Go back a little and you'll find comments that I made about the intent behind regulation(s) - protect the players, protect the casinos, protect the integrity of the industry. I’ve also alluded to what I perceive to be the “connection” between perceived effective regulatory oversight and the affect that has on patron confidence. That said:

Based on what you've all learned (and I have) up to this point, has your opinion of casino regulation changed at all? If you visit a casino, do you think you would view the operation and/or the games on that floor in a different light?

The reason I'm asking these questions: Last night as I was going home, I was pondering what real change would come from the dialogue we've been having (other than an exponential expansion of my technical background). In reality, I'm a nobody - I work in a little bitty casino on the fringe of no where (around here, they say that the only thing that separates this place from the Arctic Circle is a barbed wire fence). I don’t have the “voice” to effect any change.

Then I considered the “court of public opinion”. There are obviously a number of highly skilled, very experienced and opinionated people regularly visiting this site (last time I looked, the topic had been viewed over 1200 times). And, there was a point in time when Randy Fromm (publisher, Slot Tech magazine) indicated that he thought the regulatory issue was worth an article. I don’t hold a regular subscription to Slot Tech but the casino does; I’ve checked periodically and I haven’t seen anything. I wonder what Mr. From would think of the opinions that players (potential or otherwise) have about the issue; if that would throw enough fuel on the fire to get “folks” to pay attention. I don’t think we’ve violated any nondisclosure agreements (but I’m no attorney); no mention was made of any specific manufacturer nor of any specific game(s). GLI was mentioned, but anyone who deals with gaming knows that GLI is a key testing and approval lab. NIGC regs are a matter of public record; no harm there. Maybe the thing to do – stop by your local tribally-owned casino and inquire:

“Pardon me, but is your property in full compliance with 25 CFR 542.13 (h)(18)?”

All kidding aside (and please don’t get me wrong – I’m not trying to grab the tiger by the tail) – I’m just curious what you-all think of the idea. Opinions?? Options??

Murphy's Law dictated that you would finally post your conundrum just as I took a three-day hiatus from the forum, and between Jay, Brichter, Op-Bell and others, most of what I had to say has been said. I can't help chuckling, however, at your last comment, which appears on the second page and which, I swear, was exactly  the phrase that I uttered after reading your post. Okay, the exact phrase that I uttered was "Wow, has he got a tiger by the tail."

Since Op-Bell has covered the mathematics thoroughly, I'll table that end of it, except to say that I agree with him regarding the definition of a "cycle" of all permutations in probability mechanics, and in his distinction between the probability of outcomes vs. observed outcomes in random models.

I also happen to be a software developer (I deliberately refrain from using the term "engineer") and can only nod in agreement when reading the PowerPoint presentation that you posted regarding the catastrophic failures that can occur from the smallest programming errors and their causes. I have personally seen failures due to lack of communication between management, developers and clients, poor management, feature creep, and yes, software developers who aren't up to the task.

However, this seems to be more of an economic issue than a technical one. Computers do only what they are told to do, and people make mistakes. Theoretically, a company should tailor its level of QA against the consequence of error or failure, both for the company and for the end user. Obviously, QA in the release of a new version of a PC video game is not as critical as it is when developing software that manipulates people's money, which is not as critical as developing software that could kill thousands or millions of people should it malfunction, although one would hope that the game developers would care enough about their customers and be fearful enough of the potential loss to their bottom line to put a good QA program in place. Fear and greed are the basic drives here.

Gaming software isn't going to kill anyone, and while it affects the financial bottom line of the casinos and their patrons, it doesn't directly affect the finances of those designing it (the gaming company) unless they are participating directly in the game (WAP). It is, therefore, understandable that gaming software QA and documentation is going to be governed by the fear of loss of sales revenue due to poor product reception, and the greed and profit margins of the gaming companies wanting to produce new product at the lowest cost. They will never be as concerned about these data as you because it isn't their money that's at stake.  Their desire to minimize the costs of QA and documentation will be mitigated by the tolerance (or lack thereof) of their customers (you, and others in the industry) for accepting poorly or incompletely tested and documented software, the rigorousness with which the regulatory bodies enforce compliance, and the speed at which the laws are kept up to date. You can count on the laws always being a decade behind and the regulators being underpaid, understaffed, overworked, and slow to respond.

What that leaves are people in the industry, like yourself, doing just what you are doing. The only way that you are going to get the industry to change is to continue to be a squeaky wheel and to gather momentum and support from other casino operators, and I agree with you that the continued slacking-off of slot manufacturers producing proper testing and documentation could be a serious problem, particularly if server-based gaming takes off.

Having said that, I have to wonder if the reason that you are being stonewalled by the GLI and the manufacturers when asking for detailed volatility indexes and 90% (or 95% ?) confidence value tables is that they are simply unable to produce them and are unwilling to admit it. Last year I was briefly in touch with an Australian gentleman who had designed software to test newly developed Australian "Reel Power" slot machine games. The software was quite thorough, but one statement that he made that I took note of was that in some cases, the play and bonuses became so complex that in was not feasible to run through every permutation to arrive at a definitive conclusion as to the payback of one complete cycle. Instead, his program essentially simulated play by running hundreds of millions of plays (or more) to test the game and generate the SD and volatility data. He had also mentioned that some spreadsheets used by game designers could take over a month to setup correctly -- and that was just for an analysis spreadsheet -- which only emphasizes how complex these games have become.

To get back to the math side of it, the question might be: is it acceptable to operate class III games that are too complex to make a full analysis feasible, but that can be demonstrated to payback an expected percentage with an estimated volatility based on simulations instead of a full-cycle analysis, and if so, are we condemning ourselves an eternity to low-volatility/high hit-frequency games to keep the machines paying within a narrow range of payback percentage given that a machine may never see more than 0.1% to 1% of a complete cycle in its tenure on the floor of a casino?

DealingwithNIGC542, regarding your question, I can't say that my opinion of gaming regulation has changed -- yet, but I am glad to know that there are people like you who are conscientious enough to bring issues like this to light and to pursue them with vigor. I can definitely say that I am not pleased with the direction that slots have taken in recent years.

They've taken the psychology of gaming to its extreme, and even beyond (studies show that intermittent, random reward is much more addicting than no reward or guaranteed reward)  in that they have designed slots that pay out on almost every spin, only just not quite as much as was bet, and with numbers so large that people are duped into thinking that they've won something wonderful when, in fact, they haven't. What does a 15,000-coin win mean when it took 450 coin bets to win it? That's a win of only 33.33 to 1. I'll take my slots with top-prize odds that are slightly less than the number of stars in the universe, thank you. Give me a three-reeler with 262,144 combinations and prizes that pay over 500 to 1 that I can actually WIN. It's as Op-Bell pointed out with regards to 100-play poker. It's no fun if there is no volatility.

StatFreak - Thank you for the input (and again to everyone else). Much appreciated. To be honest, I thought I might have gone a little too far in soliciting for input on how to proceed from here. I was inspired by the responses I had received up to that point and, while I do admit I felt more than a little trepidation about taking that step, I thought I could go a little farther out on the limb. I scared myself when responses dryed up. You made my day.

I'm going to spend some time thinking over your take on this issue; you've introduced a VERY interesting perspective that I hadn't thought possible - we aren't getting the tools we need because they are too difficult to produce or too expensive to produce and (probably) a combination of the two. If there is no squeaky wheel, I'm betting you're right - these damn things will saturate the market.

The studies you referred to - are any of them available on the web? I'd like to dig through them.

Thanks again, StatFreak. I'll be back...

P.S. - After we get the problems with 25 CFR 542.13(h)(18) all cleaned up, we can chat about 25 CFR 542.13(h)(2) - evaluation of multi-game/multi-denomination cabinets - a whole 'nother can of worms.

Okay, this is actually the last article that I found, but it's the most tongue-in-cheek, the easiest read, and the least ostentatious, so I'll lead off with it!  :97- :97-
I make no representation as to the anything else that you find on this site, and the article contains some offensive language (but none that Joey hasn't used here :96-) http://therawness.com/the-compliance-recipe-part-3-intermittent-rewards/ (http://therawness.com/the-compliance-recipe-part-3-intermittent-rewards/)



One study with rats and methanol: http://alcalc.oxfordjournals.org/cgi/content/full/41/3/225 (http://alcalc.oxfordjournals.org/cgi/content/full/41/3/225)  (you will need to create an account to read their articles)



This is a patent application for a method of using non-random inverse adjustment of reward to behavior to produce a desired moderate level of the behavior in the subject. Although this is not the addictive response we're discussing, it is interesting nonetheless. http://www.freepatentsonline.com/WO2008089084.html
Here is a quote from that patent application:

I can find more if you wish.

If you were also referring to the Australian information, I'm afraid that the person in question wanted to remain anonymous, so I cannot go into any more specifics.

StatFreak - some things to pass along:

Our slot operations guy just got back from a show in Arizona and brought back some interesting news. You know that company that produced that very common, very popular 3 reel, 64 stop game? The one that has been investing in server-based games for a while now? Turns out that they have a kind of beefed up "conversion kit" hitting the market. I haven't dug for details (all I got from the slot ops guy was a thumbnail), but it appears that these folks have found a way to (my term) "retrofit" some of their cabinets to enhance performance. Any guess what kind of games they are offering with these retrofits?

The links were great - I've passed them along to some other folks; really got their attention. Some of them weren't too keen on the concept of being manipulated in the way that they are; can't say I blame them. Most of them LOVE the way that those games "play with them" - their words...

I also excerpted some of the really relevant posts and forwarded them to a member of our Gaming Commission, the one that attended the GLI forum back in March. I'm hoping to get some time with her to talk this over; try to gain a concensus about what to do next. I forwarded the same set of excerpts to Randy Fromm; he got right back to me, saying he will be in contact - maybe some renewed interest there.

StatFreak - thanks again for the wealth of information. Just out of curiosity - if you were me, what would you do next? I've looked around (not real hard) trying to find other folks that have the same problem(s), but it isn't easy. I have it in my mind that there is a lot more "let the tiger sleep" attitude out there than there is the alternative.

Thanks again StatFreak and everybody else. Talk to you soon...

P.S. - I've had the pleasure of meeting and working with a number of Aussies when I was much younger. A more quiet, reserved group of citizens you couldn't find anywhere. I'm glad you had the opportunity to chat with him and he had the almost clairvoyant sense to talk to you. Ta....

I didn't want to be the first to answer....

Pardon me, but is your property in full compliance with 25 CFR 542.13 (h)(18)?”

As a casino patron walking in I think asking this question would probably get me a blank stare from 90% of the employees. I might be told to wait while they got a floor manager who then might ask me for my credentials, for which I have none.
     (Save my Elvis Aron Presley drivers license and Hall of Justice honary membership card for sending in 15 Marvel Comic book proof of purchases... kidding).

They might give me the run around that they don't know what I am talking about, or they might tell me that is restricted information. I would equate this to walking up to the slot tech and asking him what the percetage payback was on a particular machine. Or asking him to go into statistcs mode to tell me what the last big jackpot was. The latter having been the cause of me being walked out for trying to obtain "advantage" information. Heck he was working on the machine anyways.
Its not like I used my own Key.....

Having read through this I am in some doubt that even if I got a polite "Yes" that I would NOW have some disbelief that anyone is capable of actually complying with the reg. In anycase I suspect I would be standing around for 20-30 min all the while getting the evil look from the better half with the occasional comment - "is this really necessary". 

Having participated in this post does this make me look at gaming any different ??
What I believe is that the probability of hitting the big one is low but not impossible. It has been done.
The brand name games (IGT, Bally, Knomi, Aristrocat, sigma, Universal ..,. etc) bring with them a certain amount of credibility since they are used enmass.
Publically traded casinos etc have a certain amount of profressional standards to uphold and just the relative sofistication that would be needed to "RIG" the machine so it would not pay off would make this a non-starter.

OpBell pointed out that the Casino already has the license to fleece so why steal..... excellent point.

People often say the "odds" are or it hasn't hit for a while so its "due", I usually don't spend the time to correct them that the odds are the same each and every spin
Given that I do not know, and no one will tell me expected payback, I still play the game, and this has not changed. I play for entertainment, not because I consider this gambling.
To me this is more like a lottery. Low cost to get in, and it gives me some ability to dream what IF ..... it only lasts 30 seconds.

For the most part I like to play BlackJack. The rules, odds, volitility indexs are well understood. I play the house and make conversation with the dealer.

I know this is your job (and no offense is in anyway intended), but as a technologist I see your role as a duplicated (wasteful) cost that is sholdered by the gaming public. There is no reason why all of these machines could not be "online" and report their real-time statistics directly back to the  gaming commission. This would allow them to monitor variences, compliance with % minimums, errors etc. After all it is they (he commission) who granted the manufacturer the go-ahead to sell a particular theme. There would also be no conflict of interest. IE you work for the casino, so would you turn in your employer for perhaps putting too-low a %% chip in. Whisle Blowers (think Enron) while appreciated by the public are generally not often able to find work in any industry. The manufacuter is driven by sales so if they are not permitted to sell the machines by the gaming comission, then they have to address this (the industry change you are looking for). Put the monitoring where the enforcement will be effective. At present your just a thorn in their side and the last thing they want to do is provide you the information that would perhaps interfere with a sale.

Jay - When I made that coment, I was trying to be wry - you know, facetious. A typical floor person in a tribal casino would have no more idea about what compliance to 25 CFR 542.13 (h)(18) means than they would about any other subsection of the reg. More than likely, a floor manager or exec wouldn't have a clue either. It's not something they're expected to know. What I was trying to do was solicit ideas and/or opinions about how to proceed.

Playing blackjack IS a smart thing to do if you're going to gamble in a casino. It's a game of skill - you are directly involved in the outcome of each hand.

No offense taken insofar as my "slot" (pun intended) in the regulatory scheme, Jay. To clarify, in tribal gaming, there isn't a Nevada-style Gaming Commission overseeing the entire jurisdiction (state). Each casino has it's own Gaming Commission (as provided by Federal law); those individual bodies oversee their own properties. Games approved for play in my jurisdiction must be approved by GLI, then the state clears the game for play. The state only has regulatory oversight over those regulations connected to the Tribal-State compact; these compacts are negoitiated tribe by tribe. ALL other regulatory requirements are dictated by Federal law and represent the BULK of the reg we must follow.

I'm not trying to play the role of a whistleblower, Jay. I'm trying to build a mechanism to come into compliance with a particular reg and I was (at first) looking for other people with the same problem; I know the're out there. As it turns out, the research and development of the mechanism has taken me down a path I did not expect - one that I couldn't see it. The gracious folks here helped me better understand the real nature of the problem; I thought if they could help me with that, they might be able to see a way to proceed - you know - "I know this guy who knows a guy - let me get you in touch" -  that kind of thing.

Anyway, thanks for the input all the same - I appreciate it.

You might want to take in the annual G2E tradeshow. This is the industry gaming expo. You can usually get a free ticket from Randy Fromm's slot tech mag. I was there about 3 years ago. They had several sessions that were specifically aimed at Tribal gaming, and other sections on regulation. I was too late registering but I also understand the property tours are worth the expense. Here is the link. Its Nov 17-19.
http://www.globalgamingexpo.com/images/100490/2007_graphix/index.html (http://www.globalgamingexpo.com/images/100490/2007_graphix/index.html)
Global Gaming Expo (G2E) Three-Day Conference Program
November 17-19

Highlights include:
  Casino Design 
  Corporate Social Responsibility (CSR)
  C ompliance, Law & Regulation 
  Finance
  Gaming Technology 
  Global Gaming & Development
  Human Resources 
  Indian Gaming
  Marketing  Players Clubs & Incentives
  Racino—NEW! 
  Retail, Dining & Entertainment (R, D & E)—NEW!
  Security & Surveillance 
  Table Games
  Wild Card 

Jay, I'm not sure that I agree with you completely. In theory what you say makes sense. In reality, we know that NGC, and I'm guessing GLI, are underfunded and could not possibly police casinos at this level, even with automated technology spotlighting offending machines.

DealingwithNIGC542 has already defended his position as not being that of a whistle blower. I don't see his efforts in that way, either. It is often the people "in the trenches" who are the first to recognize potential or real problems within their areas of expertise. Regulatory agencies, like most law makers, are slow to react to changes, which is, perhaps a good thing overall, but which has proven to be a serious problem when confronted with rapid advances in technology, as we have seen more than once in the last 15 years since the internet moved from geek street to main street.

If people like DealingwithNIGC542 don't bring these issues to the attention of regulators, who will? If we take his word that the PAR sheets for the newer, complex games don't have complete data, I would consider this a problem. Once the gaming companies know that they can get away with providing substandard specifications of their games to their customers, how long before they start slacking off in their due diligence when designing the games? It's a slippery slope. Consider how long it's probably going to take for the GLI (and perhaps the NGC) to address an issue like this, even with people like DealingwithNIGC542 making noise. Imagine how long it would take them to get to it if no one said anything?

As a customer, I'm already concerned about the integrity of server based gaming, and it isn't even here yet! For 20 years people like us have had to dispel the myth that the casinos could change payout percentages on a whim, and that they did this on weekends and holidays, etc. If server based gaming is introduced as it is intended to be introduced, that myth becomes reality. Do I want to be playing next to someone who gets a better payback than I do because he plays more at that casino? The simple answer is no. I won't play slots, or any other electronic game, if I can't be confident that I'm getting the same shake as every other patron who plays the same game at the same denomination as I am playing.

I realize that my rant in the previous paragraph doesn't really have anything to do with the issue at bar, except that it is yet one more way that the advances in technology that we're seeing could potentially damage the gaming industry's reputation if not implemented carefully. Most players don't know what a PAR sheet is or care, for that matter. Most of them wouldn't understand how to interpret the math even if they saw one. Even members here have that problem, particularly with regards to the confidence and volatility indexes. But what they WILL notice after a while is what happens to their bankrolls when playing.

I'd site the 6:5 blackjack phenomenon as an example. Most blackjack idiots players accepted the rule because they didn't understand how much of the overall payback in blackjack was tied to that 3:2 payout. At first, the difference in the payouts didn't seem to be much and the casinos sugar-coated the rule change by adding some other favorable rules that didn't come close to compensating for the loss in BJ payouts, but which placated the players. When the casinos discovered that the players would swallow this guff accept the rule change, it swept through Vegas like Bubonic Plague. They kept it at the low-limit tables because they are the most frequented by tourists and new players who don't know better, and because their profit margins at the higher limit tables was probably sufficient and they knew that the more seasoned players wouldn't accept the new rule. But have you noticed the trend is starting to reverse? I'm seeing more 3:2 low-limit games now. It took a couple of years, but players finally started realizing that they were losing much more than they used to when playing their old favorite. I could foresee the same rebellion happening with slot players after they realize that they never seem to be able to get ahead playing these low-volatility games.

On the flip side, as a casino operator, I would be pissed off if the gaming manufacturers could not or would not provide me with detailed analyses of the games they were selling/leasing to me. I'm also not sure that I would want a game with a cycle so large that it would see less than 1% of a complete cycle in its life on my casino floor unless the game's volatility was so low that I could be comfortable with the expected deviations from the norm given the amount of play I would expect on my floor. In other words, I would only want high hit frequency, low volatility games... and that's precisely what these multi-lined, multi-bonused monsters are.

So what happens in a few years when the casino has filled itself with these extra-low volatility games to protect itself from the extreme variations that cycles in the billions can produce and customers begin demanding the return of higher volatility games where they actually have a chance of winning something substantial in the short-term?

Jay, I'm not sure that I agree with you completely. In theory what you say makes sense. In reality, we know that NGC, and I'm guessing GLI, are underfunded and could not possibly police casinos at this level, even with automated technology spotlighting offending machines.
Stat - this is exactly my point, it should be done via vi automation - big brother stuff -  that could poll stats from all over and recognise variences between "like" machines. I know this is not done, the programs and systems don't exist but it is the way that it should be done. While I am not a proponent of server based (terminal) gaming the central collection, monitoring and analysis would be both feasable and effective not to mention cool

DealingwithNIGC542 has already defended his position as not being that of a whistle blower. I don't see his efforts in that way, either. It is often the people "in the trenches" who are the first to recognize potential or real problems within their areas of expertise. Regulatory agencies, like most law makers, are slow to react to changes, which is, perhaps a good thing overall, but which has proven to be a serious problem when confronted with rapid advances in technology, as we have seen more than once in the last 15 years since the internet moved from geek street to main street.

All I am pointing out is that if the goal is to ensure gaming purity - as in - machines working within operating parameters, protecting the casinos from fraud, protecting the gaming patron - I think it is very ultraristic to expect self compliance. First off the analysis tools and cooperation from the manufacturers are not there - so how can you gain this cooporation, as an industry regulator you force it, at the casino level you grin and bear it. .As a single casino - even if you did find a game that was particulary bad you have no insight if this is a single anomilie, or a more wide spead problem and what can you really do. Shut if off ?? If its popular or earning the casino would want it back on and at the end of the day they sign your paycheck. The position would not even exist if it was not a requirement to hold the gaming license - I can't see the casino doing anything to fund this position unless it was towards technology that would be cheaper than having to hire a second person. Once again I mean NO disrepect to DealingwithNIGC542 as this is like being between a rock and a hard place.

Over all I think if the casinos were charged xx $$ and this money then went towards a independent technology oversite group that could develop analsys technology, tools etc they would then have the power to manage some of these issues as an industry and be more effective.


If people like DealingwithNIGC542 don't bring these issues to the attention of regulators, who will? If we take his word that the PAR sheets for the newer, complex games don't have complete data, I would consider this a problem. Once the gaming companies know that they can get away with providing substandard specifications of their games to their customers, how long before they start slacking off in their due diligence when designing the games? It's a slippery slope. Consider how long it's probably going to take for the GLI (and perhaps the NGC) to address an issue like this, even with people like DealingwithNIGC542 making noise. Imagine how long it would take them to get to it if no one said anything?

No argument from me, this is needed !! - but again it is perhaps a case of lips without teeth.  The manufaturer on the other hand could look a casino owner in the eye and say " your buying 20 new machiens here - I can discount these by $1500 each if you get rid of nosiy-bob over there. Ethical ? Moral ? practiced ? - who knows - but from experience I have come to understand what is known as the Golden Rule  --- those with the gold make the rules. 

As a customer, I'm already concerned about the integrity of server based gaming, and it isn't even here yet! For 20 years people like us have had to dispel the myth that the casinos could change payout percentages on a whim, and that they did this on weekends and holidays, etc. If server based gaming is introduced as it is intended to be introduced, that myth becomes reality. Do I want to be playing next to someone who gets a better payback than I do because he plays more at that casino? The simple answer is no. I won't play slots, or any other electronic game, if I can't be confident that I'm getting the same shake as every other patron who plays the same game at the same denomination as I am playing.

I realize that my rant in the previous paragraph doesn't really have anything to do with the issue at bar, except that it is yet one more way that the advances in technology that we're seeing could potentially damage the gaming industry's reputation if not implemented carefully. Most players don't know what a PAR sheet is or care, for that matter. Most of them wouldn't understand how to interpret the math even if they saw one. Even members here have that problem, particularly with regards to the confidence and volatility indexes. But what they WILL notice after a while is what happens to their bankrolls when playing.

I'd site the 6:5 blackjack phenomenon as an example. Most blackjack idiots players accepted the rule because they didn't understand how much of the overall payback in blackjack was tied to that 3:2 payout. At first, the difference in the payouts didn't seem to be much and the casinos sugar-coated the rule change by adding some other favorable rules that didn't come close to compensating for the loss in BJ payouts, but which placated the players. When the casinos discovered that the players would swallow this guff accept the rule change, it swept through Vegas like Bubonic Plague. They kept it at the low-limit tables because they are the most frequented by tourists and new players who don't know better, and because their profit margins at the higher limit tables was probably sufficient and they knew that the more seasoned players wouldn't accept the new rule. But have you noticed the trend is starting to reverse? I'm seeing more 3:2 low-limit games now. It took a couple of years, but players finally started realizing that they were losing much more than they used to when playing their old favorite. I could foresee the same rebellion happening with slot players after they realize that they never seem to be able to get ahead playing these low-volatility games.

On the flip side, as a casino operator, I would be pissed off if the gaming manufacturers could not or would not provide me with detailed analyses of the games they were selling/leasing to me. I'm also not sure that I would want a game with a cycle so large that it would see less than 1% of a complete cycle in its life on my casino floor unless the game's volatility was so low that I could be comfortable with the expected deviations from the norm given the amount of play I would expect on my floor. In other words, I would only want high hit frequency, low volatility games... and that's precisely what these multi-lined, multi-bonused monsters are.

So what happens in a few years when the casino has filled itself with these extra-low volatility games to protect itself from the extreme variations that cycles in the billions can produce and customers begin demanding the return of higher volatility games where they actually have a chance of winning something substantial in the short-term?

Well said - when I mess with my Williams Pinball machince the manual takes great pride in explaining how the various paramaeters can be tweeked to maximize earnings - and how to interpurt the stats that are played. It seems the slot manufacturer has gone in the opposite direction and are attempting to use those comforting words - Trust Us

StatFreak, Jay - hello...

A quick post - StatFreak's vibe in regards to High-hit/Low volatility games sounds like it's coming true - I took a stroll around one of our competitors floors yesterday - they are running a bunch of the same themes - there were people (more or less) lining up to play them. Interesting note (something I'll check on when I have a chance) - some of those games were running as in-house progressives; a twist I hadn't seen. Do you think that that's how the manufacturers are "getting around" the low volatility angle - offering a shot at a progressive (the banks that I looked at offered either three or four tiers of payouts)? Sounds like something that might work (satisfy the "want" for the larger payout) ....

Jay - my casino is scheduled for a upgrade down to a new floor accounting platform in the next couple of months - been doing some reading on the enjanced functionality - It's not what you envisualized, BUT it's been beefed up quite a bit - interesting.. The G2E thing - I know we'll have people going - might have to see if I can tag along..

Randy Fromm has been in touch - he is anxious to publish something on the issue, but I'm not sure if it would be in an op-ed format or what.  I'm not sure what to think about that... I'd still like to find other folks that are having this problem if I can - see what they are doing - maybe get them to chime in...

More later - thanks, folks...

Hi

Posted a few response when you originally raised this issue on the old site.

In the previous company i worked for we used a spreadsheet to calculate the standard error from the hits and rewards (The Sw you linked to also has this feature and most manufacturers still make this info available) - This figure was captured into the online system when a new machine was commissioned. The system used this together with the machines monthly figures to calculate what we called a score (Similar to standard deviation) Anything above or below 3 we investigated.

I dont see large cycles as being a problem - Do however agree that evaluating accuracy is difficult to do and that regulations are not realistic for these types of games and that we cannot trust the manufacturers or the gaming labs to test products 100%

There was an interesting article in November 2008 Slot tech magazines about random number generators and a device which is now available that uses quantam theory to generate truly random numbers. Manufacturer is here - http://www.idquantique.com/products/quantis.htm.
i see great application for this in the gaming industry - RNG will no longer be software dependand and therefore not prone to errors that go along with SW developement.

Regards
Ian

Hey, Ian - thanks for the input - some questions:

In the previous company i worked for we used a spreadsheet to calculate the standard error from the hits and rewards (The Sw you linked to also has this feature and most manufacturers still make this info available) - This figure was captured into the online system when a new machine was commissioned. The system used this together with the machines monthly figures to calculate what we called a score (Similar to standard deviation) Anything above or below 3 we investigated.

Glad you looked at that link, Ian. I've actually used that calculator in a few instances, but the only way that calculator works efficiently is with the volatility/SD info from the par sheet - With games/par sheets with no volatility index/SD info you have to manually load all the paytables - some of these games, the tables are 20 and 30 pages long. The other thing with the calculator is that you can't save the loaded data after calculation has been completed.  It DOES work, but very, very labor intensive. That said, when you performed your investigations, how did you approach the task? Did you work with Month-to-Date data, Lifetime-to-Date? What did you consider to be plausible explanations? Say, if a game had a score of 5 and there were no major payouts out of  the game, what came next?

I dont see large cycles as being a problem - Do however agree that evaluating accuracy is difficult to do and that regulations are not realistic for these types of games and that we cannot trust the manufacturers or the gaming labs to test products 100%.

Knowing what you do (now), would you have any trepidation about running these games on your floor?

Thanks, Ian -

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Sorry folks - yellow wasn't the best color choice -

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Tip: You can click on modify instead of quote to change your own posts. There are no time limits on modifications. :71-


TZTech, thanks for the link to the Quantum RNG device.   COOL!!  :61-

Thank you, Statfreak - another lesson learned.

Just got done working up my variance reporting for March - I was dreading it because we added a dozen new machines to the floor - you know where this is headed - BUT LO!! While the new equipment did show up on the report, when I pulled the PAR sheet(s), not only did they have Standard Deviation and volatility index(s), they were calculated to both 95% AND 99% confidence intervals - did find it interesting that the game cycle WASN'T included.  Anyway, that brightened my day -

TZ Tech, StatFreak - I did skim the Slot Tech article when I first saw it, but most of it was beyond me - care to expand a bit on what this product means to game design/production? Take it easy on me, gentlemen, but I am curious....

Thank you....

You can hear the curmudgeon's view first, since I happen to be passing. It has very little relevance to game design or production. An RNG continuously running, and sampled at a random time when a player presses a button, is about as perfectly random as you can get. The only place it could make a difference is is the game software draws several random numbers in succession based off that single random time event, where there might be sequential correlation - but correlation can be avoided by hiring competent programmers who know what they're doing. Of course these cost a little more than unemployed Java hackers.

As it happens, there are OEM slot control boards that already incorporate a hardware RNG - the Acrosser range, for example. They're quite proud of it.

Hi

Hi - At the time the company had about 8000 machines across 30 sites (Sun International in South Africa). Most of the units had Senior Tech that had a statistician portfolio. The spreadsheet we used propably uses the sames formulas as the calculator you posted. (Still trying to figure out the maths to do it in excell). We had to copy across all the info from the manufacturers data but once we had a populated spreadsheet it was saved and went onto a intranet and was available to all units. I recall the older IGT PAR sheets were in word so it was easy to cut it from the doc and paste it straight into the spreadsheet (You had to do some cleanup but it worked mush faster than copying figures across manually)

Score was calculated on a monthly basis. I worked in one of the smaller units so i did not have huge handle movement so jackpots would sometimes throw out the score. Usually the game would swing on the next month cycle. There was however a case where the manufacturers had set up a machine to a different percentage than was on the system and it was picked up with this report.

Knowing what you do (now), would you have any trepidation about running these games on your floor?

Currently working in an extremely low tech environment. Some very old machines (IGT S+,PE+,Aristocrat 540, Olympic) spread out over different sites. Using coins only that get counted every 1 to 4 days depending on how busy it gets along with machine meters that get recorded and captured manually - This alone is a full time job.
In my newer shops we have some of the later IGT and Williams games on a cashless system and yes i am comfortable in running them. However i have not been monitoring performance at this level and now that i have the necessary data to my disposal i would like to start doing so. Like you i need the tools to do this - Will attempt it with excell if i do have any luck i will post the result.

Regards
Ian

So Op-Bell, I looked up Acrosser Range; this is really interesting stuff. Question (and forgive the laymans perspective): In reading the Acrosser Range product information, I got the impression that this product(s) would allow a game manufacturer to effectively eliminate the need for what I think of as an "assembly line". If I'm interpreting this correctly, the game "manufacturer" buys hardware/firmware/middleware from Acrosser and then develops/installs the game for distribution. I thought back to an earlier post of yours (quoted below). Is the Acrosser Range (and similar products) what you were alluding to? Is that correct?


TZtech (Ian) - I do not envy you - "coin-op" slots and manual meters - I had to do pieces of that myself at one time. Damn straight it's a full time job. Something that I might suggest when you get around to evaluating your newer equipment.

Even though some PAR sheets don't have eval tools provided, I took it upon myself to set up what I call a "trend" spreadsheet. For all those games that I can't properly evaluate, monthly, I record the difference between actual and theoretical hold on a spreadsheet so that I can monitor which direction the game is "trending" - is the game moving towards it's theoretical hold or away from it. What I've found (don't take this as gospel; it's just an impression from looking at data spread out over a few months) is that games trending away from theoretical hold (the casino isn't making as much as it should) tend to stay that way; games moving towards or beyond theoretical hold (the casino is making more than it should) tend to stay that way. There are SOME reasonable explanations for this "trending"; some game bonus rounds allow a player to "replay" a bonus round - they can refuse to take whatever they won in a particular bonus round and try to do "better" - features like that can affect actual against theoretical hold. Thing is, you have to really dig into the PAR sheets to figure some of that crap out and/or observe the game in play to understand how the damn thing works. Not enough hours in a day to cover all the bases. That "trending" is one of the (other) reasons I started digging into this whole mess to begin with.

And, for all - Randy Fromm sent me an interesting note - curious about your impressions:

It occurs to me that if there is no way for a machine to complete even a single machine cycle in its servicable lifetime, the casino has sort of become a gambler, hasn't it? It's not even fully "playing the odds" of a full machine cycle, it's "hoping" that the 10% of the machine cycle that they WILL play is a "good one."

Maybe I'm reading this wrong. I'm a hardware guy mostly.  

Thanks, folks....

The basic business model is Revenue - Expenses = Profit.

So in my opinion (IMHO) as long as the machine remains in the positive hold position whether it is 2% or 25% its not really gambling for the casino as long as the machine is being played.
Given that a casino would likely have 100+ machines the law of averages kicks in here and the hold balances out.
 The Gamble in this economy however is what is your revenue base ??? how many machines should you have ??

The economics stem from the cost of money ? say a machine costs 15K and is leased over 36 months at 6%. They are really paying 17.8K for the machine.
With 2.8k of that being the "cost of money". That machine must "keep" $77 per month to justify its existance....to the bankers. This doesn't cover the rent, power, a/c, maint etc.
While $77 doesn't seem like a lot at a 96% payout thats a hold of only 4% which requires $1925 in incoming revenue. Just around $70 per day in play and you have not covered any other expense.

The problem in the current economy is that there are more machines than players. In the old days you could put in 100 machines and have good play, and if you had the space for another 100 the revenue model was scaleable - today you are not getting the play. So a place like the MGM grand which has probably 2000 machines I am thinking that they are not "earning" their keep.

Op-Bell, Brichter, Jay, TZTech - a quick note - Sat through my monthly Stat Review - put everything out on the table to try and gain a concensus - I used pieces of the input you-all provided and FINALLY saw some "lights go on" around the table. We're going to work up some boilerplate text to place with each review report outlining what we know, what we're trying to do and how we'll get there. Everyone on the review panel will sign off on the text, and it goes on file. I also got the G.M. to speak a little - we are visited 3 or 4 times a year by a Field Investigator from the NIGC - kind of a courtesy "hey, how ya doin'" kind of thing. I'll get to meet with the NIGC agent, run down what the problems are and put a piece of the problem the hands of the NIGC. I know, I know - working through the Fed to correct a problem like this is like trying to push a 5 ton stone block up a sand dune with your nose - It CAN be done, but you gotta have patience and determination...

Thought you'd like to know and thank you for all your help. You expanded my knowledge base in a way that allowed me to express myself clearly and (at least in part) convincingly ... :131-

P.S. Op-Bell and the others - could you speak to the Acrosser Range products (and those like it) a little more? I'm having difficulty divining where and how these products "fit" in the overall scheme of things? Where is this technology going to take the industry?

Hi All

For those of you interested in slot math
http://www.casinoenterprisemanagement.com/articles/august-2009/vicious-cycle-part-v-variance (http://www.casinoenterprisemanagement.com/articles/august-2009/vicious-cycle-part-v-variance)

Regards
Ian

Thanks TZTech.  :3-  That's actually the last part of a five-part article.

Here are the links to all of it:
http://www.casinoenterprisemanagement.com/mp3-library/slot-mathemagician-presents-vicious-cycle (http://www.casinoenterprisemanagement.com/mp3-library/slot-mathemagician-presents-vicious-cycle)
http://www.casinoenterprisemanagement.com/articles/may-2009/vicious-cycle-part-ii-volatility (http://www.casinoenterprisemanagement.com/articles/may-2009/vicious-cycle-part-ii-volatility)
http://www.casinoenterprisemanagement.com/articles/june-2009/vicious-cycle-part-iii (http://www.casinoenterprisemanagement.com/articles/june-2009/vicious-cycle-part-iii)
http://www.casinoenterprisemanagement.com/articles/july-2009/vicious-cycle-part-iv-balancing-act (http://www.casinoenterprisemanagement.com/articles/july-2009/vicious-cycle-part-iv-balancing-act)
http://www.casinoenterprisemanagement.com/articles/august-2009/vicious-cycle-part-v-variance (http://www.casinoenterprisemanagement.com/articles/august-2009/vicious-cycle-part-v-variance)

TZ Tech, StatFreak - Hello again... Thanks very much for the article link(s) - intriguing reading. I believe I'll drop Mr. Wilson a line  - see what he thinks about the regulatory side(s) of this issue. By the way, I have found a new (read different) approach to my problem(s) - I've been keeping an eye on game revocation notices as of late - Interesting how many of them there are and how often they come through.... Thanks again, folks....