With its absurdly low payout odds and hassle-free upkeep, no gambling machine pickspockets like the fruitmachine. And no country does them like Britain – with 261,000 machines feeding hungrily off the recession, we are also one of the world’s biggest manufacturers and exporters. Phil Robinson reports on the small army of pure mathematicians, psychologists and graphics experts that have made us so skilled in the art of taking £1…and giving 70p back.
Positive spin? Each outcome is determined by a random number generator. Every time you play the odds are the same.
Three am in a central London casino. Somewhere over the other side of the cavernous room a slot machine is paying out wildly. I hear a cascade of coins banging, apparently endlessly, into a payout tray. As tired as I am, the sound is too much to resist.
I arrive at a point deep inside the casino and hear it again. It’s the sound of success. But I’m on top of the noise and there’s no one here; just row after row of vacant machines. Now I can see that one of them is merely taking its turn in the rota to run on ‘attract mode’ – when no one is playing it, the machine issues a cacophony of musical chirping and bleeping, the loudest of which is the noise of the payout celebration, which says: come, putative investors – someone is winning… and why shouldn’t that someone be you?
It seems so facile – that such a ruse (and in the pkv fruit-machine industry there are many, as I’m to discover) should be so effective. But effective it is, and to such an extent that if anyone is celebrating, it should be the people who created this avenue of misfortune. The gaming-machine industry is thriving in the UK despite of – or possibly, because of – the recession. The total fruit-machine market is up almost 15% in the past year. It was up the year before, too, from 234,000 to 261,000 machines.
Parked in pubs, kebab shops, amusement arcades, cab offices, your local British Legion branch or a casino such as this, they collectively made their owners £2.17bn.
Many are not even large cabinets as we know them. Imitations are on your computer, your satellite TV box, even on your mobile phone. Games are playable anywhere, on just about any device and with unlimited jackpots. Last November, a 49-year-old man won the largest UK jackpot ever – playing an online slot machine. His take was £2,086,585.
This, despite what we know to be a universal truth: slot machines are the worst bet of them all. They take much more than they give. The maths, the science and the psychology are all against you. By law, a machine must be capable of paying a jackpot on every spin. Manufacturers mitigate this by designing games to return to the gamblers a set percentage of the money gambled over the life of the machine.
In the UK, manufacturers claim most machines are set at 95% but many pay out less – as low as 70% in certain pubs and at motorway service stations, where the odds are worst of all; the transient clientele will not be around long enough to realise what an ungenerous fellow their fruit machine is. A row of them in the corner of a UK pub will often make a landlord more money than the beer sales. In the US, games must pay out no less than 75% by law. In the UK, there is no minimum payout; simply an obligation to print somewhere the payout percentage.
It’s why the machines are the darlings of the casinos: they generate between 60 and 80% of all casino profit. According to figures collected by Las Vegas-based gaming expert Michael Bluejay, the return percentage makes the cost of playing fruit machines outrageously high in comparison to other forms of gaming. Games such as blackjack or baccarat give the casino a 1% edge over the player. A slot machine set at a relatively high 90% offers the casino a whopping 10% edge.
According to Bluejay, a player on a one-dollar slot machine will on average lose $800 in a ten-hour session. This is money ground away by the machine as winnings are fed back into the machine. The same player over the same time period will lose only an average of a tenth of that ($79) playing a low-intensity game such as roulette. You still lose money at roulette, blackjack and baccarat, but you lose it more slowly; so you enjoy a longer night out.
There is no other form of betting that allows you to throw your money away with such intensity and rapidity. The slots player is the biggest loser of all the players in the casino. He’s paying for the light fittings, the waitresses’ wages and the carpets to be cleaned. And who in the world makes these wonder machines that are guaranteed to make a fat profit? The answer is close to home, in Britain: where quite simply, nobody does it better.
The headquarters of fruit-machine manufacturer JPM are in an unassuming business park set in the leafy Midlands countryside. JPM specialises in making themed machines, based on hit quiz shows such as The Crystal Maze and Who Wants To Be A Millionaire?
As we walk in we pass through a workshop where newly built machines are broken down for bug tests. A technician links his laptop into the system and runs diagnostic programmes while cabinets blink and flash like Wurlitzer jukeboxes. On the floor above, JPM employs a 25-man team of bons – mathematicians, computer programmers, engineers and professional gamers. They will handle the intellectually demanding work of designing mathematically complex games to fit inside electronically complex cabinets. It’s not Bletchley Park but like the F1 industry, which also has its heart in the Midlands, this is the kind of advanced manufacturing in which Britain used to lead the world. Indeed, Britain, the US and China are the world’s biggest exporters of gaming machines. In the boardroom, director Duncan Cheadle says that it will take his team a year to design and test a game. In an average year they will make about 8,000 machines and sell them for about £4,000 apiece in ten countries around the world.
(If you can’t see the text on this graphic scroll to the bottom of the story to read it.)
fruit machine tips
‘If we are designing a game for Spain, we have professional gamers on the payroll who will travel to the country and play the games there. They’ll come back and we will storyboard our own game. After that the statisticians and programmers will create the maths, then the artists will work on the look and the graphics. A software developer will create the actual game play. It costs about £250,000 to research, develop and fund a new game.’
These machines are far removed from the first slot machine created in America in 1895 by Charles Fey and which, fittingly, looked like a large cash register. Named The Liberty Bell, it was a simple three-reel machine that paid a jackpot of 50 cents when the reels showed three bells in a row. These early machines were nicknamed one-armed bandits, based on the commonly held belief that you were robbed each time you pulled the lever.
Here in the UK, strict laws against pure slot machines led to the development of a variant called a ‘fruit machine’. These machines paid small jackpots for small stakes with frequent prizes and were required by law to build in a secondary ‘skill’ game. Old machines had large spinning wheels that held picture strips of symbols such as bells and cherries. Now the mechanical guts of the machine are gone, to be replaced by LCD screens, and a computer is doing the job of the reels.
In JPM’s meeting room, development director John Le Burn agrees to give me a glimpse inside one of JPM’s newest machines that has been designed for the Spanish market. The artwork depicts a Pocahontas-style female character and a skill game that involves lighting up a trail of axes embedded in a tree. Le Burn points out that the reels no longer decide the result. Instead, they simply display the results generated by the random number generator on a control chip. The reels are ultimately meaningless. There are many myths about fruit machines. People talk about strategies, like watching as punters pump in money then hovering like a vulture to move in if it doesn’t pay out for him. But random number generators have no memory for the past or plan for the future. They do not make decisions.
‘The way any machine works is that a random number generator will pick random numbers and map them to a position on the “reel strips” in the computer memory,’ says Las Vegas university professor and actuary Michael Shackleford. Known as the Wizard of Odds, Shackleford has designed more slot machines than anyone else on the planet.
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‘The machine’s outcomes are determined by random numbers and every time you play a machine the odds are exactly the same. It’s a myth that the slot machine will tighten up after it has hit the jackpot, or that it will be loose if it hasn’t been paying. This is not true. It’s like spinning a roulette wheel. Every time you play the odds are the same.’
By controlling how often certain symbols that pay out money appear, manufacturers can mathematically control how much money the machine will pay out over its lifetime. Most manufacturers and players agree that machines set to pay out below 75% are far too stingy to maintain player interest, though they certainly exist.
Most people misunderstand the percentages, according to US expert and author Frank Legato. ‘People think that because it’s a 98% machine that it should pay back 98 cents in every dollar they gamble. No, several hundred people over a couple of months will have got back 98% of everything that was put in that machine.’
He claims that even a 98% return machine will make $200 to $300 a day for a casino.
According to psychologists the familiar façade, the look and feel of the fruit machine are what tempt us. Mark Griffiths, Professor of Gambling Studies at Nottingham Trent University, claims that fruit machines don’t cause addiction but various ‘structural characteristics’ in their design feed this behaviour in susceptible human beings. ‘The most important structural characteristic is “event frequencyî. You can’t become addicted to the National Lottery because there are only two chances a week. On a common or garden slot machine you can gamble 12 times a minute. On the internet there are slot machines you can gamble on 40 times in a minute.’
What about the light and sound generated by the machine? ‘We found that if you have background music that was playing at high beats per minute in the background then people gambled much faster than with either no music or chill-out music,’ says Griths. ‘Background music of over 140pm leads people to gamble faster – which in the gaming industry means more profit. We also know that people gamble more and make bigger bets under red light than under blue. Lots of slot machines have red, orange and yellows lights – these are fast, arousing colours.’
Is there a reason people carry on playing if they continuously lose so much? ‘Gamblers do not continuously lose, they continuously nearly win. A key structural characteristic to do this is the “near miss”. They create near-win situations where the winning result is just above the pay line.
‘It’s about impression management. The high-frequency gambling, plus near misses, plus the lights and colours and sounds and noises… all contribute to a person staying on the machine.
‘Why is there a metal payout tray? So that when coins fall into the tray, you hear the “kerchunk, kerchunk, kerchunk” and it emphasises the win. You go into a casino and there might be 1,000 machines but you’ll hear the 20 that are paying out and the coins hitting a pan. What you don’t hear are the 980 machines that are losing at the same time.’
Back in the casino, an elderly man feeds notes into a machine. Every ten minutes or so he gets a win. But it’s never enough to replenish the original money supply. Appearing at his shoulder are wraith-like figures who have observed money going in and not a lot coming out.
Now the elderly punter feels impelled to continue betting. Suddenly the row beyond his bursts into the sound of pound coins hitting the payout tray. He settles deeper into his stool and pulls another note from his wallet.
Want to lose money more slowly? Avoid the bonus game. It’s a part of the percentage payout: it’s there both to tempt you into losing what you’ve won and buy the machine more time to get its money back.
Those fast, upbeat tunes blasting away at 140bpm and more the moment you walk into an amusement arcade are there for a reason. Researchers who work for the fruit machine companies have found that gamblers part with their money faster if the music is more energetic.
NEAR WIN LINE
Tantalisingly, a winning result is often shown just above the win line to encourage gamblers with the basic strategy of ‘continuous near-win’ psychology.
If a machine hasn’t paid out for a while, don’t fool yourself that it’s just about to. Symbols are created by a random number generator, so every time you play the machine, the odds of winning remain exactly the same.
Each fruit machine sells for about £4,000 but will cost the makers £250,000 to research, develop and put into production. The whole process takes at least 12 months. JPM expects to design four of them in 2009 and sell up to 8,000 in a year.
Those bright colours aren’t there just to make the machine stand out in the casino. Scientists have found that gamblers will make bigger bets under red light, hence the proliferation of reds and oranges. You won’t find blue – that has the opposite effect, apparently.
Payout is usually set between 95% and 75%. But in service stations, where there are no regular players to notice, it can drop to 70%.
It’s metal, to send a clarion call to punters with its ‘kerchunk, kerchunk’ payout sound. The effect is is especially good in arcades or casinos, where no one will realise only two machines out of 30 are paying anything.