The House Edge and “Par”

Electronic gamine machines make lots of money for the house. The object of the player, obviously, is to have the machine make money for the casino guest instead. This might happen in the short run, as people really do win payoffs and jackpots. In the long run, slot machines have a negative expectation for every player.

“House edge” is used to describe the house advantage when playing against a player, as in roulette or blackjack. The equivalent concept in electronic gaming machines is “payback,” also sometimes called “par.” A quarter slot machine, for example, might receive on average 40,000 quarters in the space, say, of a month. Thus it receives $10,000 per month. If it pays out on average $9,000 per month in payoffs, then it has a 90% payback, or its “par” is 90%. In Nevada, this “theoretical payout” or “par” can not be lower than 75%. In practice, machines pay back between 82% and 98%.

Many casinos promote themselves as having “loose slots” or the “loosest slots in town.” When pressed, they may explain that there is at least one slot machine on their premises with perhaps as high as a 92% payback. There is no way to examine a machine and know if it is the one with the 92% par. Any way it is sliced, slot machines have no edge for the player.

Many players believe in a myth that the casino can change the “looseness” or “tightness” of a machine to accommodate the day of the week or the hour. The Nevada Gaming Commission does not permit this and the technology to do this is still not widely available. The Nevada Gaming Commission has been working on a regulation concerning the reprogramming of slot machines by remote means. Reprogramming while a player is playing is not permitted, even if it were to become feasible. Temporary reprogramming according to the time of day or week is also not permitted. As the minimum legal payout for slot machines is 75%, and players seldom know the payout of the machine they are playing, the myth that the casino can control the player’s game should be rejected.

Competition of Las Vegas with other locations and competition amongst Las Vegas casinos tends to make the slot machines about as generous as they are going to get.