Do Strong Players Ruin It for Everybody Else?

I received an email from Deke Castleman with the Las Vegas Advisor asking me if I’d answer the following QOD (Question of the Day):

The QoD on Station Casinos giving zero player points on some video poker
machines generated lots of strong reader comments.  One opinion is that
Advantage Players are one contributing cause for lessening, even ending,
player points on VP machines.  As a big-time video poker advantage player,
might Bob Dancer have some cogent thoughts on this topic?

I definitely have some thoughts about this — people regularly disagree about how cogent those thoughts are. Since my answer was going to be long, I thought it more suitable for a blogpost rather than a QOD.

Local casinos often have slogans such as, “We Love Locals,” or “We ♥ You More,” among many others. These slogans are geared towards making you believe these are benevolent organizations run by grandfatherly types just looking for ways to make your life better.

In fact, casinos are money-making businesses — or at least they are trying to be. They are offering games that they hope will induce players to come in and leave some money behind.

In the slot department, which includes video poker and certain other games, machines are evaluated by daily hold. Let’s say in a particular casino that the average hold of machines is $100 per day. That’s not all profit, of course. Perhaps $80 of that goes for the various expenses necessary to run a casino.

Since Station Casinos was mentioned in the question, let’s look at the Double Double Bonus games they have. They have some 10/6 games returning a tick more than 100% to the perfect player, 9/6 games returning about 99%, 9/5, 8/5 and perhaps even worse. For a competent dollar player playing a modest 600 hands per hour, the 10/6 game will allow him to break even, the 9/6 game causes him to lose $30 per hour on average, the 9/5 game $70, and the 8/5 game about $100.

All of these numbers have big fluctuations. Sometimes the player hits one or more royals or aces with a kicker and wins several thousand dollars. Usually, he doesn’t hit one of those fairly-rare jackpots and loses. But on average, the amounts given are averages for strong players. Not-so-perfect players lose much more, of course.

The skill of the players is very important. Six hundred hands per hour means 600 decisions are required. There are occasionally hands where there are two plays returning the same amount, such as with 2♠ 4♥ 5♣ 6♦ 8♠ it doesn’t matter EV-wise whether you hold 2456 or 4568, but most hands have one best play. Even in the hand mentioned where you have two equivalent correct choices, a number of not-so-strong players throw everything away, which is quite a bit worse. 

On the 100% game, let’s assume it makes $50 a day for the house. There are enough imperfect players that the house still makes some money, but less than the house average and less than the break-even number the casino needs to survive. The casino now has a number of choices — of which there are basically an infinite number of variations:

1. The casino can live with making less money on these games. They might figure that players who play these games also bring in friends who don’t play so well. Or these players might also bet on basketball while they’re there and the house makes money on that. Or maybe advertising these games as “loss leaders” can bring in players, not all of whom will correctly play the loose games.
2. They can reduce the “extras.” Casinos offer slot club points. Often casinos have policies such as loose games take more coin-in to earn a point than tight games do. Or loose games aren’t eligible for point multipliers. Or loose games get points, but the players playing them get no mailers. 
3. The games themselves are tightened. The 10/6 games become 9/6 games. These games have a 1% hold and the casino can make money on these games — IF players still play them. Players, of course, always have the choice of whether to play or not.
4. Players who only play the loosest games and do so successfully are restricted. Lots of ways to do this as well, and there are mild restrictions and severe restrictions. There are temporary restrictions and there are permanent ones.

One could argue that if there were no strong players, the house would make plenty of money and not need to resort to any of the measures listed. And that’s probably true. (But not necessarily. Even if casinos could increase their daily hold to $150 per machine per day, most competent slot directors would be exploring ways to increase that to $200.) Just as the casinos are trying to make money, players have similar incentives. Players figure out that if they get good enough, they can support themselves playing in casinos. That’s a lot more attractive way for some of us to go through life than working at a of “regular job.” 

The players who aren’t so competent at the games can certainly bemoan the fact that good players force the casinos to take countermeasures. And these players can also blame people like me for teaching others how to do well playing these games. 

If skillful players didn’t figure out the game and some of us teach others, then it would definitely be much, much easier many more players to win in casinos. And that “easy money” would cause people to work hard to get that money. That’s the way capitalism works — and you can probably find similar incentives under other economic models as well. You find an area where you can make money and you go do that. If that doesn’t work, you try something else.

Complaining about those who are further along the “skillful player path” doesn’t do much good, however. The facts of life are that if you want to succeed at gambling (or anything else for that matter), you have to learn how to play the game, and then play what you have learned. If you’re not willing to do that, it’s much easier to resort to blaming others for your misfortune.

Whether it does them much good or not, there will always be players who play the blame game. That’s just the way some people are wired.