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Best of John G. Brokopp
Table Games Do Disappearing Act6 November 2002
Does it seem to you as if there are fewer table games at Chicago-area casinos in Illinois than when riverboat gambling in this state began a decade ago? Do you perceive an inflated casino marketing emphasis on slot machines while table games such as blackjack, craps, and roulette are for all intents and purposes ignored? If so, it’s not your imagination.
Table game positions at Illinois casinos have been doing a gradual disappearing act through the years. Space on casino floors once devoted to the tables has been filled with slot machines, which have become the game of choice for a majority of people who patronize casinos. It’s a trend that has made casino owners and operators very happy.
Slot machines are much more lucrative for the casino gaming industry. There are no dealers to pay, no benefits to offer. What’s more, the amount of money that’s "churned" through the machines and the time that people spend playing them creates much greater profit potential for the casinos than their green felt cousins. First let’s examine some facts:
In 1995 at Illinois casinos there were 472 table game positions that attracted wagers totaling $1.85 billion dollars. Last year the number of positions had plummeted to 305 while wagers dipped to $1.7 billion. As of June of this year, table game positions had decreased even further, down to 291. That’s a decline of nearly 39 percent in less than seven years.
There were 7,742 slot machines in Illinois casinos in 1995. Those machines generated a total handle (amount wagered) of $13.1 billion. Last year the number of machines had risen to 9,255 while wagers on them skyrocketed to $24.3 billion. Figures available through June of this year reveal slot machine numbers have increased even further to 9,540.
The bottom line for both the state and the casinos themselves is obvious. In 1995, table games accounted for 31.3 percent of revenues or $368,380,581. Slot machines, meanwhile, accounted for 68.7 percent of revenues or $809,931,246. Last year, revenues generated from table games sunk to 16.3 percent ($291,014,759) while revenues from slot machines rose to 83.7 percent ($1.5 billion).
What exactly does this trend mean to consumers? It means that even though people have indicated that they prefer the machines to the tables, they are paying a hefty price. The increase in the number of machines hasn’t included a greater and improved video poker product, which can be much more advantageous to the players (and less lucrative to the casinos). Rather, the increase has been primarily in the form of nickel slot machines, which have become the casino industry’s best friends.
In June of this year Illinois casinos were home to 2,199 nickel slots that produced adjusted gross receipts of $25,966,353, an amount greater than the adjusted gross receipts of ALL 291 table game positions. Nickel slots ranked third in adjusted gross receipts behind dollar slots ($46.2 million from 3,029 machines) and quarter slots ($37.5 million from 3,233 machines).
The insidious aspect to playing nickel slots is the fact the machines are predominately the video variety that accept up to 90 coins ($4.50) per play. Couple this with the fact that nickel slots have a much higher "hold percentage" (amount of money the machines retain) than their quarter and dollar counterparts and you have the makings of a casino dream come true.
During the month of June 2002, for example, the 2,199 nickel slot machines at Illinois casinos averaged 9.85 percent in adjusted gross revenues, ranging from a high of 12.84 percent on 234 machines at Harrah’s Joliet, 11.75 percent on 230 machines at Hollywood Aurora, and 11.81 percent on 207 machines at Empress Joliet, to lows of 7.54 percent on 274 machines at Jumer’s Rock Island, 7.73 percent on 251 machines at the Casino Queen in East St. Louis, and 7.93 percent on 334 machines at East Peoria.
Compare this to the 7.03 percent average hold on 3,233 quarter machines statewide and the 5.28 percent average hold on 3,029 dollar machines statewide.
People play table games at a much slower pace than slots, which decreases the amount of time their money is subjected to the house "grind". Table games such as blackjack and making the best bets at craps also reduce the house edge gamblers subject themselves to dramatically, around the one percent range, which means casinos make less money from them.
Is there any question now why slots, particularly the nickel variety, are the game of choice and the "fair haired boy" of casino marketing?
This article is provided by the Frank Scoblete Network. Melissa A. Kaplan is the network's managing editor. If you would like to use this article on your website, please contact Casino City Press, the exclusive web syndication outlet for the Frank Scoblete Network. To contact Frank, please e-mail him at email@example.com.
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John G. Brokopp
John G. Brokopp