2011 Super Bowl Breakdown

The Nevada Gaming Control Board has released the unaudited figures for this year’s Super Bowl, and in spite of early reports that the books took a beating, they actually came out slightly ahead. Here’s a quote from the press release:



The release also has a table indicated the results for the past ten Super Bowls:

The low hold, as you can see, is a bit of an anomaly. But even if the books had lost money, the casinos would have made money over the weekend, thanks to more action in the casino, even if you discount the bump from the Chinese New Year.

I wonder what role in-running bets had on keeping the win up–with more betting during the game, there were more decisions, which theoretically should get a hold percentage closer to 5.45% over time.

The real story, I think, is that the handle is trending up again. That’s a sign that people are gambling more money, which in the end will be good for Nevada gaming.

Gaming insider talks in Vegas Seven

The latest Green Felt Journal in Vegas Seven is out. In it, I profile long-time Gaming Control Board inspector Patrick Wynn:

Many Nevadans have transitioned into new jobs and even careers. Patrick Wynn is one of them. The former Nevada Gaming Control Board deputy chief of investigations, who recently retired after more than 31 years of service, sees his new role as more of a shift in position than in mission.

Wynn, no relation to the casino operator, started his career with the Gaming Control Board after getting tired of living in Los Angeles. Looking to expand beyond his job—he was an accounts payable manager with Union Oil—Wynn got a position as an investigator. The division remained his home for the next three decades, minus a yearlong “sidestep” into enforcement.

via Gaming insider moves to the outside | Vegas Seven.

I had a ball listening to Wynn talk about his career. Naturally, he couldn’t share names or details with me, but it’s clear that he knows as much about the gaming industry–and particularly the financial side–as anyone else in the state.

It’s really fun getting to do these profile pieces. I don’t get to look at their hard drives or bank statements, but, like Wynn, I get to learn a little bit about what makes the subjects tick.

Casino cyber security in Vegas Seven

This week in Vegas Seven‘s Green Felt Journal, I take look at an interesting letter Randall Sayre sent last month that, I think, we’d all do well to read:

According to the letter from then-Gaming Control Board member Randall Sayre on Dec. 15, the board has investigated “numerous incidents” where databases containing personal and/or financial information had been compromised. Further, the board acknowledged that as the amount of information in those databases increased, they would become an even more inviting target.

While most players wouldn’t be happy if the world discovered just how much time they spent on Kitty Glitter, there is much more at stake: The personal and financial information sitting in casino databases represents a potential gold mine for cyber criminals.

via Serious about cyber security | Vegas Seven.

This is a really, really serious issue that deserves further investigation. Casinos are entrusted with an enormous amount of sensitive information, and the security of that information is of paramount importance.

I remember hearing about the Cisco incident last summer, but this is the first I heard about the Desert Rose breach.

Hopefully we don’t have to see a major breach of a casino database before everyone in the industry takes this as seriously as Sayre is suggesting.

3-card Poker Creator in SF Chronicle

All of you aspiring casino game creators (and those who are interested in how games are created) might want to read this piece in the SF Chronicle:

Webb, who splits his time these days between Las Vegas and Darby, England, likens the process of getting casinos to license the game to “pulling teeth,” and notes that it was one of the toughest challenges of his career.”I never intended to become a traveling salesman, but effectively, thats what happens,” he says. “One of the challenges of inventing is that you have to wear multiple hats to make it work.”Webb invented the game in his native United Kingdom in 1994, but before he was allowed to sell it to casinos there, the British Casino Association required that he head overseas to provide some statistics on performance. With that, Webb headed for the United States in 1996. His goal: to license the game to enough casinos to get the requisite stats

via Derek Webb: man behind 3-card poker.

Coming up with a new game idea is definitely the easiest part of the process. I’ve spoken with many, many people who think they have the next Three-Card Poker, and I haven’t seen any of their games on the Strip. A lot of them are smart, creative people who have great ideas…but getting games into the casino is really, really hard.

For your edification, here are the fifteen steps towards getting a new game approved for testing in Nevada, courtesy of the Gaming Control Board:

An applicant must include the following items for the submission of a new game:
1. A letter requesting game approval.
2. Four (4) copies of the table layout. (The layout must be submitted as it will appear in the casinos.)
3. Rules of play, with specific examples.
4. A proposed payout schedule.
5. A statistical evaluation of the new game’s theoretical percentages.
6. Items 1–5 must be submitted on a CD-ROM in Word or PDF Format.
7. A copy of the rack card that will be available to players during the field trial.
8. A copy of the filing receipt from the United States Patent and Trademark Office in reference to the new game patent.
9. A letter from a Non-Restricted Group I licensee, agreeing to display and monitor the new game’s field trial.
10. A notarized document that contains the following statements:
a. That the requester agrees, if a field trial is approved, the casino conducting the field trial will receive 100% of the revenue produced by the game, during the course of the field trial.
b. That the requester agrees to pay all costs for shipment, inspection, and incidental costs documented by the Gaming Control Board (GCB) in connection with the examination and evaluation of the new game.
c. That at least one working model is available or will be available immediately, should the game be approved for field trial.
d. Of the applicant’s and developer’s intentions as to how a profit is expected to be made from the submitted game, when/if the game is approved for play in Nevada.
11. A Personal History Record completed by all applicants.
12. “Request to Release Information,” “Release and Indemnity of All Claims,” and “Affidavit
of Full Disclosure” forms, notarized and signed by the applicant(s) and developer(s).
13. A percentage of ownership with reference to the applicant’s/developer’s company/corporation.
14. Five thousand dollars ($5,000) on deposit with the GCB, or a check in that amount made payable to the Treasurer, State of Nevada. The account created by this deposit
is used to pay investigative costs, as listed below. Additional deposits may be requested during the course of the investigation. Final satisfaction of all expenses incurred by the Gaming Control Board must be paid before the game is heard before the Gaming Control Board for approval.
a. Enforcement Division investigative hours bill at $80 per hour.
b. Technology Division bills at $150 per hour for completing the game evaluation.
15. A list of names, and telephone numbers, with whom the GCB may discuss aspects of the game.

Submit the package of all 15 items to the Enforcement Division of the Gaming Control Board. After the package has been reviewed for completeness, the statistical evaluation will be forwarded to the Technology Division for analysis and verification. Failure to submit all items will result in a denial of the application and the submitted packet will be returned.

Gaming Control Board: Agency Forms and Applications

So you need some deep pockets and a lot of patience to get a game approved for trial, let alone accepted by a casino on a permanent basis. Bear in mind that before you go through this 15-step process, you need to have a casino agree to let you test the game in their casino for 90 days. I imagine that there’s a pretty high bar for that, since a manager can ask, “Why should I take a blackjack table that I know will make $1,400 a day and put in a game nobody’s ever heard of?” (That guesstimate, BTW, was made possible by the July 2009 Gaming Revenue Report)

Still, if nobody ever tried anything new we’d still be sitting in caves eating carrion tartar for breakfast. I will say this: the application system ensures that only the most dedicated inventors see their dreams come true.

State of the state of gambling

Like me, you’ve probably got town hall fatigue from this grueling election season. But here is a town hall-type meeting you might want to attend:

A panel discussion on the ins and outs of the gambling industry will be held October 14, from 10 a.m. to noon, at UNLVs Paradise Campus. Admission is free.

Mark Clayton of the Nevada State Gaming Control Board, Carol OHare of the Nevada Council on Gaming Addiction, and Alan Feldman from MGM-MIRAGE will discuss the states economic reliance on gaming, how the state controls the gaming industry, and the impact of gambling addiction. Jon Ralston will be the moderator.

At 851 East Tropicana Avenue, room 133. Hosted by the Osher Lifelong Learning Institute in the Division of Educational Outreach at UNLV. For more information call 895-3394.

News 88.9 KNPR – Nevada Public Radio – Public Service Announcements.

I did a talk for OLLI today about gambling history and casino security (sort of a blend of my interests) and judging from the questions it should be a lively panel.

Unrestricted not so easy

A few months ago I listed the myriad things that you need to disclose when applying for a non-restricted casino license. Apparently Chet and Karla Cox aren’t regular readers, because they applied for a license without getting an attorney, and hit a few roadblocks. From the LV Sun:

Although Silver State would handle the filling, emptying and repairing of slot machines, regulatory reporting and player disputes would fall to the Coxes’ son, a college graduate with construction experience but little gaming experience.

Though C.J. Cox pledged to be on call at all hours, board member Randy Sayre said the young man still would be operating “under a learner’s permit.”

Clayton, noting that third-party operator Golden Gaming had been running the Coxes’ slot machines for more than a decade, raised another key question about the couple’s proposal.

“If the experience hasn’t been learned over the past 14 years, how can we be comforted that it is going to be learned in the next couple of years under this arrangement?” Clayton asked.

The Coxes also made omissions and mistakes on their license application.

The errors seemed innocent enough. They failed, for example, to disclose lawsuits that gas station managers handled and forwarded directly to insurance carriers without involving the Coxes.

They also neglected to mention a property they owned: a home inhabited by Chet’s mother that, for all intents and purposes, belonged to her even though it was in her son’s name. Then there was the fact that their company hadn’t notified Clark County’s Business License Department when it began operating slots at gas stations. And the Coxes also erred when they transferred ownership of a location without first seeking the board’s approval.

After receiving multiple notices from the board regarding the problems, the Coxes hired a gaming attorney midway through the licensing process to correct the mistakes and patch things up with regulators.

Mom and pop roughed up in gaming license bid – Las Vegas Sun

This has been a real week for me hearing about the license process. Last Friday, I was on a panel with former GCB member Bobby Siller, who talked about his time on the Board and his role in the licensing process. Mr. Siller is a great guy who, as I was flattered to learn, had actually read some of my work. That’s gratifying because I’ve been a big fan of his for years–to the extent that you can be a fan of a state regulator. Talking with him for a few minutes reminded me why–he has a real sense for the big picture of Nevada regulation, which is about more than statues and minimum internal control standards–it’s about the net effect on the community. Super nice guy, too, but I wouldn’t want to walk into a GCB hearing unprepared on his watch.

Then on Tuesday I moderated a panel with current GCB member Randy Sayre, who gave his perspective on the process. Member Sayre (I learned that’s what you call GCB members, particularly in a juridicial context) has had a 27-year career with the GCB, and had pinpoint accuracy on a wide range of administrative and regulatory issues.

After a question about reciprocity between the gaming boards of various states, I hit Member Sayre with a follow up: What about Columbia Sussex, which has been denied a license in one jurisdiction and is scuttling quickly out of at least one more?

Sayre responded that the GCB was taking the issue seriously, and that there was a process for determining if another state’s license denial was justified or unjustified. There’s been a history of Nevada allowing licensees that New Jersey has denied–Hilton Hotels (circa 1985) & Caesars World (circa 1979), for example. As one 1 of 8 people (3 GCB members, 5 Gaming Commission members) in the process, Member Sayre wasn’t about to publicly talk about the specifics of the case before the process was finished. Likewise, without having access to the material that they do, I can’t say whether the GCB should make a recommendation one way or the other–though I think it’s certainly worth investigating. I get the sense that this is going to be a process that is ultimately fair to everyone, particularly the people of Nevada.

With tax season just behind us (unless you got an extension), many of us feel intruded upon. But trust me–you’ve got nothing on people who need to go before the GCB and get (or keep) a gaming license.

2007 NV gaming digest posted

For you short attention-span Gaming Abstract junkies out there, Christmas came a little early this year. I’ve completed and posted a convenient 1-pdf breakdown of the 2007 Nevada gaming win. If you don’t want to click through, here are some high points:

Total money gambled:
Slots: $138.7 billion
Tables: $32.3 billion
Total: $171 billion

Casino win:
Total slot win: $8.5 billion
Total table win: $4.2 billion
Total gaming win: $12.8
(They don’t add up because of rounding)

The collective house only kept about 7.5 cents of each dollar gambled.

There were fewer gaming positions in 2007 than 2006, but handle (amount wagered) was up by $1 billion and revenues were up by abut $200 million. So people gambled more on fewer machines. Let’s call it an increase in gaming efficiency.

I know that the GCB released the numbers last week, but I’m doing much better this year than last: I didn’t get the 2006 totals posted until June last year. The funny thing is that I started getting calls and emails in the first week of January wondering when the new breakdown would be posted.

My hat’s off to the numbers-crunchers over at the GCB. They’ve got to work with data coming in from hundreds of locations, not all of which place as high a priority on the revenue reports as we do.

Handheld relief coming soon to Nevada casinos

I know that the thing that bugs me most about Nevada casino resorts is how hard it is to gamble. You often have to walk several feet to get to a slot machine. Luckily, the Gaming Control Board is on top of the problem and, thanks to Cantor Fitzgerald, a solution is on the horizon: From the LV Sun:

Come mid-2006, casinos will be able to offer the small devices to allow customers to play the slots, blackjack, craps or baccarat while they’re in lounges, swimming pools or restaurants.

The state Gaming Control Board on Tuesday held its final public hearing on a regulation to allow operation of “mobile gaming systems” in casinos.

“We see an appetite by a generation of people that have grown up using mobile devices,” said Joseph M. Asher, managing director of Cantor Gaming, whose company is going to manufacture the mobile devices. “Everybody has a cell phone. People have their BlackBerries. Systems like Nintendo and Xbox — entire generations have grown up with these things.”

Control Board Chairman Dennis Neilander said the regulation would be ready for full board consideration in January at a meeting in Las Vegas. The commission could give final approval in February or March.

Cantor Gaming has already applied for a state gaming license. After the regulation is adopted, Cantor would submit its system to the Control Board for review to check for security and other issues. If cleared, it would go into a casino for a 60-day or more trial period, after which it could be licensed.

“Each system will have to go through full board and commission scrutiny,” Neilander said.

The Control Board and the Nevada Gaming Commission would establish where the devices could be played.

Michael Wilson, chief counsel for the Control Board, said the devices would not tie into the Internet.

Cantor, which has an office in Las Vegas, now makes the devices for off-track, horseracing bettors in the United Kingdom. Other companies are expected to manufacture the systems to get a foot in the door to what may be an emerging industry.

Under the proposed method of operation, a player would deposit up-front money or use his credit at a casino to get one of the devices. A customer would have to show a driver’s license, passport or other identification before a unit would be issued. The casino would have to make sure the person was 21 or older.

“I certainly think you will see people in various areas of the resort, whether it’s out by the swimming pool, convention center or shopping area or whatever areas the system will be able to be used, maybe playing a few hands of blackjack,” Asher said. “It’s about making the gaming experience more convenient.”

The regulation would prohibit operation in parking lots, garages and hotel rooms. They could be used only in casinos with nonrestricted licenses with at least 100 slot machines and a table game.

Las Vegas SUN: Handheld gaming devices might find way into casinos
I’m a bit ambivalent about this story. On one hand, this fits right in with my thesis that gambling continually evolves along with society. Since a growing number of Americans can’t take cell phones out of their hands, the Nevada gaming industry is rationally moving to offer gaming on handheld wireless devices.

On the other hand, I can’t help but feel that R&D is a finite resource. Would we, as a society, be better served by allocating resource dollars to a higher purpose than making gambling more convenient?

Conversely, research into convenient wireless gambling might have some sort of spinoff that does help society: maybe the instantaneous sharing of medical data among hospitals, or something like that.

The Internet, after all, is a fantastic communications medium that can break down borders, but it is mostly used for spam, gambling, and porn. Then again, who’s to say that giving otherwise-frustrated guys an avenue for free “material” isn’t a higher social purpose than ivory tower academics like me emailing powerpoint lecture slides to each other?

As may frustrate some readers, I have many questions, but few easy answers.