Question of the Day - 07 July 2023

To trace the history of video poker, we have to back up a little and look at poker itself. Though the origins of poker are obscure, it’s generally agreed that the modern game originated in Louisiana in the early 1800s and spread quickly throughout the eastern and Midwestern United States via riverboat and train. Thus, poker had been in existence for decades when video poker made its debut in 1891 in Brooklyn, New York.

That year, a penny-arcade peep-show machine maker, Sittman and Pitt Company, introduced the first coin-operated gambling machine. The player inserted a coin in the slot and pulled a handle to spin five drums with ten cards each attached. When the drums stopped spinning, a five-card poker hand lined up on the payline. Winning hands earned drinks and/or cigars.

Sittman and Pitt reduced the odds against hitting the highest-paying hand, the royal flush, by 50% by removing the 10 of spades and jack of hearts from the deck. This established the house edge; it also protected profits against players inserting counterfeit coins and slugs in the machine.

Charles Fey, an adventurer, scientific-instrument maker, and inventor, perfected the three-reel slot machine in San Francisco in the late 1890s. (The life of Charlie Fey, the 21st and last offspring of a German family, could fill a book of its own — and certainly a separate QoD.) In 1901, capitalizing on the American poker craze, he introduced a machine called Skill Draw. Similar to Sittman and Pitt’s game, it had five drums with 10 cards each; however, Fey’s Skill Draw had a hold function, which enabled the player to improve each hand by discarding from one to five cards and drawing the same amount on a second spin.

This draw feature, as the name of the machine indicated, allowed the player to exercise some skill in the game. Sittman and Pitt copied Fey’s invention and these original poker machines took the country by storm in the early 1900s. But the ensuing Progressive era, earmarked by alcohol Prohibition, put an end to legalized gambling in the U.S. for decades.

Fast-forward to the early 1970s, when casinos, still confined to Nevada after 40 years, became more and more popular, with mechanical slot machines proliferating on the gambling floor. In the ’70s, the explosion of electronics and microchips led slot machine manufacturers, such as Bally Gaming, to greatly expand the variety and capacity of the "bandits."

In the early 1970s, Dale Electronics introduced the first electronic video poker machine, Poker-Matic. This machine was very popular; rows and rows of them crowded the Vegas casinos.

But it was William "Si" Redd, a distributor for Bally Gaming, who really put video poker on the map. (Like Charlie Fey, Si Redd is legendary in the pantheon of gaming innovators.) Redd took the idea to Bally, which not only rejected it, but also allowed Redd to keep his patent on the machines. Redd quickly joined up with a Reno slot maker, Fortune Coin Company, to introduce Draw Poker in 1979.

Si Redd and Fortune formed a new company, Sircoma (short for Si Redd’s Coin Machines). When it went public a year later, it was renamed International Game Technology and Reno-based IGT remains one of the world’s largest slot manufacturers (although it merged with Italy-based lottery giant GTECH Holdings in 2014 in a $6.4 billion buyout and is now headquartered in the UK).

The lowest payout on this early version of Draw Poker was for two pair. When IGT changed that to a pair of jacks or better, video poker started attracting hordes of players. Throughout the 1980s and ’90s, the game’s popularity increased steadily, as casino enthusiasts found it less intimidating than table games and more fun and challenging than slot machines.

At the same time, mathematicians figured out that, unlike slots, the return percentage ("expected value" or "EV") of a VP machine could be determined by its paytable. In the early 1990s, they began developing strategies that could be used to extract the most value from the available machines.

At first, there were only a few versions of video poker, so it was easy to find the best game and learn the accurate strategy for it. But within a few years, the machine manufacturers began to introduce many new games, or variations of existing games, all with unique pay tables. When Lenny Frome, one of the first gambling writers to report the new strategies, published Winning Strategies for Video Poker in 1998, the book covered 60 games — with 60 different strategies.

Today, even Lenny, who has since passed away, would be astonished at the variety of VP games, especially with the advent of multi-line, multi-game, and multi-denomination machines, all thanks, to answer the second question directly, the imaginations of the hordes of game developers working for the machine manufacturers supplying the casinos, the tech to support the diversity of proliferation of games, and the popularity of video poker, which creates an insatiable demand in the casinos and beyond.