The cost of playing “short pay” video poker

April 8, 2019

Traditional “full pay”  or “9/6” (based on their payouts for the full house and flush on a single-coin bet) video poker pays back 45 coins for a full house and 30 coins for a flush  including the return of an original five-coin wager (as explained in earlier posts, a wager of five coins is necessary to be eligible for the enhanced royal flush payout).  Combined with the returns for other winning combinations (which usually but not always remain the same on all machines), the overall average return for full pay jacks or better is 99.5% of all moneys wagered when played using optimum strategy at full coin.  This overall return takes a long time to achieve, since part of it is based on hitting a royal flush, which on average occurs only once in some 40,000 hands, but it’s a useful measure nonetheless.

While full pay jacks or better machines do still exist, they are becoming rare, especially outside competitive gaming markets such as Las Vegas.  Particularly at lower denominations, most jacks or better machines in our area pay 8 coins for a full house and 5 for a flush.  The overall return (again, based on optimum play at full coin, over a long period of time) is 97.3%, or some 2.2% less than full pay.

While 2.2% doesn’t sound like much, it can add up fast.  Let’s assume play on a dollar machine (a level at which full pay machines are available at Mohegan Sun and Foxwoods; the best dollar machines at Turning Stone are somewhere in the middle, some returning 9 for a full house and 5 for a flush and others 8 for a full house and 6 for a flush).  At max coin, that’s $5.00 a spin.  While experienced video poker players can achieve speeds of up to 1,000 hands per hour, and average 600-800 hands per hour, let’s assume a leisurely pace (which I recommend) of 400 hands per hour. That means the player is pushing $2,000 an hour through the machine, which amount is exposed to a house edge of 2.7%.  On average, the house therefore will retain $44 of that amount.  On a full pay machine, with a 0.5% house edge, the house will retain, on average, only $10 — more than three times less.  The average hourly cost of playing a $1.00 short pay jacks or better video poker machine is $34 more than a full pay machine.  As we used to say in Brooklyn, “that ain’t nuttin'”.  And if you’re playing a $5.00 machine ($25.00 per spin), the extra cost per hour is quintupled, to $240 per hour.

Whether to accept the extra cost is, of course, up to you.  If you have a very limited budget, and must play at the $.25 level, you really have no choice —  8/5 machines likely are the best available to you in the northeast (and beware of those paying even less).  At the dollar level, if you live in Albany, the nearest full pay machines are two hours farther away than the nearest 8/5 machines.  At the $5.00 level and above, Turning Stone offers full pay jacks or better, as do the casinos in Connecticut.  Be aware that, regardless of short term results, the more you play, the more your results will skew toward the average return.

Ironically, one of the major responses of the gaming industry to increased competition has been to lower the return to players on its games.  The reasons for this are many, including increased taxation and other items of overhead (New York’s taxes on its non-native American casinos is, not surprisingly, among the nation’s highest, and that money has to come from somewhere).  However, a major reason for for the payout reduction is that it works.  Consumers who normally would boycott a store charging four times more than its competition for a given item accept the gouging, usually out of ignorance.  If you know the cost, you — and only you — can decide whether the convenience, amenities and other factors justify playing the short pay machine.



Before you go to Rivers

February 2, 2017


Its February 8 opening imminent, the Rivers Casino’s public relations operation is flooding the area with advertising and press releases.  The photos I’ve seen of the casino portray a modern, tastefully appointed property that reminds me of some of the nicer off-Strip properties in Las Vegas, such as the M Resort and Red Rock Station.  The restaurants look inviting.  But is it a place where you will want to spend your hard-earned money?

Casinos operate on the principle that they pay out less than the true odds on their games.  An illustration will explain this:  A fair coin, over a large number of tosses, will result in an equal number of heads and tails.  In a game in which you bet on the outcome, the true odds would be even.  Thus, if you bet a dollar on each toss, and lose your bet on heads, but win a dollar on tails, you are paid true odds, and the casino (and the player), in the long run, would break even on the game, which is not a sustainable business model.  Instead, for your dollar bet you may be paid 85 or 90 cents when you win (the casino keeping your dollar if you lose), the difference between the payoff amount and the dollar that would represent fair odds going to overhead and profit.  The difference between true odds and actual payouts can be roughly expressed as the “house edge.”

So, if virtually assured a long term loss, why would anyone gamble?  There are many answers to that question.  However, for the sake of simplicity, let’s choose the most common one – one gambles because of the possibility of “getting lucky.”  While the coin toss will result in equal numbers of heads and tails over a long run, the results are “streaky” — they may come in bunches of heads and bunches of tails, some fairly long.  This volatility can make players winners in the short run.  A well run casino recognizes the necessity of volatility and the winners it produces, and often advertises those who hit large slot jackpots, hoping to persuade others to try their luck.    Because the casino is dealing with a large number of players over a long time, volatility is not nearly as much a factor for it, and it will profit despite the short term winners if its business model is sound.

The more often one gambles, and the more one bets, the more one moves from the short term to the long term.  Volatility recedes in influence, and the house edge asserts itself more consistently.  This is why the educational materials addressed to problem gamblers and potential problem gamblers emphasize that “chasing losses” by continuing to bet seldom works and most often leads to more losses.


A great truth almost never addressed by casinos, their regulators or the general news media is that not all casinos are alike.  In addition to offering different games and amenities, casinos have a wide latitude in adjusting their house edge on many games.  On some games, the player can calculate the house edge.  As I have written, video poker is one of those games. Similarly, the house edge in blackjack can be computed.  Other games, notably slot machines other than video poker, do not readily yield their payoff percentages or volatility.  As I previously wrote, the video poker offered by other casinos run by the company that manages the Rivers has relatively high house edges, and I expect the same here, given the high taxes and fees the Rivers must pay the State.  A recent check of the Rivers web site reveals that its single and double-deck blackjack games will pay 6:5 on a blackjack, which sends the house edge for those games into the unplayable stratosphere (the casino also will offer “shoe games” using more decks that will pay the traditional 3:2 for blackjacks; depending on the other factors, those games may or may not have a reasonable house edge).

If you have guests arriving for dinner in a few minutes, and suddenly find yourself out of something you need to finish the meal, you will go to the nearest store and pay whatever the cost, so that you can return in time to have the meal ready when your guests arrive.  That’s the principle behind convenience stores.  However, for your weekly shopping, particularly if you have a large family, you are likely to be more price conscious, even if it means a longer drive to a larger store.

From the presently available evidence, I predict the Rivers will be on the convenience store end of the spectrum.  If you are a casual, low stakes gambler, and the location is convenient, the comps and offers generous (which remains to be seen) and the atmosphere enjoyable, you can enjoy a day or night out at a reasonable cost if you limit the amount you bring, prepare to lose it, and leave the ATM card at home.  However, if you are a more regular gambler, you may wish to take it easy until you have an idea of how you may be expected to do compared to at the venues you presently frequent.





Too loud and too sweet

August 12, 2015

I just returned from a trip to, among other places, Las Vegas, and I was very bothered by the volume of sound in several places I visited.  While I may be over-sensitive, I can’t believe that ear-splitting sound levels are good for the health of either the patrons or the employees of these loud establishments, and I question whether they are good for the bottom line.  When time permits, I’ll look for studies, but I find it hard to believe that sound levels I find uncomfortable to be present in are enjoyed by anyone.  Loud noise in other public places has become endemic — in addition to the dreaded airport CNN monitors, about which I’ve previously written, I often find televisions — usually competing with other background music — blaring in restaurants and bars.  In an age when everyone has a smart phone or other device that allows them to listen to whatever they want, is it really necessary for airports and other public places to bother those of us who prefer silence?

My trip exposed me to another of my pet peeves — screaming babies on airplanes.  Ear plugs are not a complete solution; what also would help would be to ask families who travel with young children, in exchange for the preferred boarding and the ability to bring infants along for free they now get, to sit in the last few rows of the plane.  It astounds me that Southwest, the airline I usually fly, will require a “Customer of Size” to purchase an extra seat if he or she intrudes on the space of one other passenger (the cost of which is reimbursed if not every seat on the plane is taken), while a screaming infant can terrorize dozens of people with impunity.  If the airlines really care about the comfort and well-being of their customers, they will pay more attention to the screaming baby issue.  I for one will gladly shift my patronage to any airline that does.

Further on the theme of too much, why is everything over-sweetened?  I have read that a can of regular Coke contains the equivalent of 10 teaspoons of sugar, which seems objectionable on health grounds.  Why not offer an alternative containing about half as much sugar, which might be more pleasing to adult palates and less objectionable than artificially sweetened alternatives, most of which also are cloyingly sweet.  Reduced sugar drinks would appeal to those watching their calories and would result in good public relations for their makers, something the soft drink industry could use right now.

Oscar Wilde admonished “everything in moderation, including moderation.”  Time to return to the time when moderation is the general rule and not the exception.

Another issue for casino regulators in New York

April 10, 2013

Casinos often run promotions to boost attendance and gambling activiy at their properties.  Often, these consist of free gifts, “point multipliers,” coupons offering free play in a certain amount, or the like.  Other common promotions include “tournaments” with prizes for the top finishers.  Usually, the cost to the casino of a promotion can be projected, so that it will not exceed (or at least not exceed by much) the extra business it should bring in.

Sometimes, however, things go very wrong.  A few years ago, for example, Mohegan Sun ran a promotion for 24 hours during which a blackjack player could triple any bet (and receive one more card) up to $250 per hand (usually, the most a player can increase a bet is to twice the original amount).  By tripling bets in advantageous situations, a player could easily achieve a theoretical advantage over the house.  Many well-financed players, including me, descended upon the property for the 24 hours, and many of us were successful.  During my play, I heard that the casino had suffered losses in the millions, but, despite the usual “weasel words” in the advertising for the promotion warning that it could be discontinued or canceled at any time, Mohegan Sun, to its great credit, allowed the promotion to run the full 24 hours.

Not so recently at the Palms in Las Vegas, where, for four consecutive days starting on a Monday, from noon to 5:00 pm, the house was offering a 6:5 payout on all initial winning hands (winning double and split hand bets were excluded) of up to $100 on its single deck blackjack games.  This usually terrible game (where blackjacks are paid at 6:5 and all other winning hands are paid at even money) became, for the promotional period, very advantageous for the player.  Fortunately, I was in Las Vegas during this promotion, and it was brought to my attention before it began.  I was able to play through the first full day, and I managed, despite terrible luck that would have bankrupted me without the promotion, to turn a small profit.  The next day, I returned but could not get a seat (unlike the Mohegan Sun promotion, which applied to all that property’s dozens of blackjack tables, the Palms promotion was limited to two tables).  I was unable to return on Wednesday and Thursday, but I heard from a player who tried to take advantage of the promotion that Thursday that it had been shut down some time the day before.

No doubt the reason it had been shut down was that the casino suffered greater losses than it had expected.  The question is whether, having advertised a promotion of given duration, and possibly having enticed players to incur large expenses in time and money to take advantage of it, the casino should unilaterally be allowed to pull the plug when it realized it had made a mistake.

I don’t know whether Nevada requires gaming commission approval before a promotion like the Palms’ can be run.  I suggest that, in New York, it should, and that, once approved, the promotion be required to run its full advertised course unless the commission grants permission for it to be discontinued.  Requiring permission to run promotions would provide a check on casino stupidity (I can hear the staffer in charge of processing promotion applications asking a casino boss, “Are you sure you want to do that?”), but would also protect the player who, having identified a potentially valuable opportunity, forgoes others and incurs costs to take advantage of it.  Allowing the casino to petition for permission to discontinue a promotion — if such permission is granted sparingly — would protect casinos from truly egregious mistakes that could hurt their ability to continue in business.  Absent an impending disaster, however, a casino should be stuck with its poor bets, just as it requires its customers to be stuck with theirs in the ordinary course of business.

New OTB facility

January 1, 2012

Having read about the soft opening today of OTB’s new facility at 711 Central Avenue, I swung by to have a look.  Like the old facility, the new one is divided into two areas — “grandstand,” where admission is free and payouts are subject to the 15% surcharge, and “clubhouse,” where admission is subject to a fee, but payouts are at track prices, and where there are dining options.

The grandstand was small, and obviously meant as a convenience for those stopping in to cash or buy tickets, though it did have seating and a number of large, flat-screen television monitors.  It also had, unlike some other OTB facilities, men’s and women’s rest rooms.  Were it not for the 15% surcharge, I’d rate this an acceptable outlet for racing fans.

The clubhouse was very nice — it had areas with tables, many individual carrels, and a bar, as well as an adjacent restaurant.  The look was not unlike one of the nicer Las Vegas race books, which was the goal.  If only admission, past performance information and drinks were free, as they usually are in Las Vegas, the place would be a dream come true.  Even without the freebies, though, the clubhouse looks like a convenient, pleasant place to spend a few hours enjoying horse racing and wagering and a drink or two and a meal.  I didn’t think the old Teletheater, which the clubhouse replaces, was that bad, but this definitely is a step up.

Whether it will be enough to attract new horse players, or keep existing ones, in the face of new competition for the gambling dollar we can soon expect in New York, remains to be seen.  The newspaper story announcing the opening speculated that some of the tables in the clubhouse may give way to slot machines, and I think that’s a real possibility.

Better gambling at home than in Las Vegas?

December 23, 2010

I’m in Las Vegas on vacation. As readers of this blog know, I’m an avid player of video poker. I also enjoy blackjack and, not so much any more, betting on horse racing. In my last few trips here, I’ve come to the sorry conclusion that in many cases, there are better gambling opportunities for me at home than here.

There are video poker machines here that are better than anything in the northeast – in fact, some here pay over 100% on average with perfect play. Many of these can be found just off the Strip at the Palms, which is filled with blue hairs enjoying them during the weekdays and with hipsters and thugs on the nights and weekends. It’s a nice, interesting place, only I think it would do better to match the music with the crowd, rather than play piercingly loud thug music all the time. But I digress – I’m really talking about the Strip hotels and 9/6 Jacks or Better, which is the “standard” video poker game in the US. It returns about 99.5% with perfect play, and it’s readily available at Mohegan Sun in Connecticut at the $1 level. The only place I’ve found it on the Strip at this level is at the new Cosmopolitan (a nice place, but also infected with bad, loud music). I’ve heard New York New York also may have it at the $1 and $2 level, and it comes and goes without notice at other places. It is available off the Strip, at Hooters, the Hilton and some but not all of the locals places, but that may not help you if you don’t have a car or if taking time to travel off Strip just for gambling is not a priority.

Far worse yet is the blackjack situation. Not all blackjack games are the same, and some are remarkably bad. There are four main ways a casino can increase its edge on blackjack games: reduce the payout on blackjack, require the dealer to hit, rather than stand, on soft 17 (a hand containing cards totaling 6 and an ace that can be counted as 1 or 11), increase the number of decks in play, and restrict when a player can double the initial bet.

The first and worst innovation employed in Las Vegas was reducing the payout for blackjack in many games from 3:2 to 6:5. If you are at a $10 game playing the table minimum at 6:5, this means you will be paid $12 (instead of the $15 you would get at a 3:2 game) each time you get a blackjack. If you get five blackjacks an hour (a conservative estimate), this one rule costs you an additional $15 an hour. The 6:5 payout is found mostly in single deck games and in other games where it is dealt by scantily clad dealers or in areas near pole dancers and the like. Fortunately, the public is catching on to the 6:5 ripoff and, though still available and “enjoyed” by suckers, most casinos realize they also have to offer something a little better (an exception is O’Shea’s, a low roller joint that pays 6:5 on all its blackjack games). If you ever go to Las Vegas and intend to play blackjack, the most important thing to remember is that you’d be far better off playing a $10 or $15 “shoe” game (a six or even eight deck game where the cards are dealt out of a plastic “shoe”) than a $5 6:5 single deck game. Incidentally, the local gaming regulations require prominent display of blackjack payouts (usually found on the sign displaying the minimum and maximum bets allowed or on the felt surface on the table), so if you find yourself shorted on a blackjack, ask to see where the payout is displayed. If it isn’t, tell the supervisor you expect to be paid the regular 3:2 or you will complain to the gaming authorities.

Increasing the number of decks employed in the game increases the house advantage (why it does so is complicated and not worth explaining here), all other things being equal. That’s why you won’t see any single deck games on the Strip (except those paying 6:5, which more than makes up for the difference between single deck and 8 deck, the most I’ve seen used). What’s distressing is the number of 8 deck shoe games on the Strip, where the standard used to be six. The difference in house advantage isn’t that great, but it’s another way they take a small bite out of the unsuspecting player.  The number of decks used in a shoe game usually isn’t displayed.  If you’re not sure, ask, and don’t hesitate to express displeasure if the answer is eight.

Next in the quartet of blackjack ripoffs is requiring the dealer to hit soft 17, which increases the house edge on a typical shoe game by about .2%. That may not seem like a lot, but when the house edge without this rule is only about .4%, it’s a 50% increase in the cost of playing the game. Unfortunately, it’s almost impossible to avoid hit soft 17 games in Las Vegas unless you play for $25 and up per hand. The MGM Strip properties probably still have the most stand soft 17 games, but they are becoming a rare breed.

I have seen almost no 6:5 or hit soft 17 games where I play in the northeast, though I’ve heard that hit soft 17 is becoming the norm in Atlantic City (and perhaps is another contributor to that city’s decling gambling revenue, especially since Pennsylvania mandates that all blackjack games stand on soft 17). I understand that it’s a subtle rule change that probably eludes most casual players, and that’s why casinos do it. However, a player who gets burned by this rule will not like it.   A few years back, Caesars Palace in Las Vegas changed its mid-level ($25 and $50 six deck shoe games) from stand to hit soft 17.  I recall a customer who had taken out a $3,000 marker to play (meaning she had a line of credit at the casino) getting beaten by a dealer’s three-ace-three-three when she had 18 or 19. That brought the change to her attention, and she was not shy about expressing her displeasure, unfortunately to no effect. I hope she voted with her feet and found a stand 17 game elsewhere, as I did.

The last Las Vegas ripoff – another rarely found in the northeast – is restrictions on doubing one’s bet. In blackjack, there are two situations in which a player may increase his bet after seeing his initial two cards, and these opportunities, if employed correctly, can decrease the house edge on the game. If dealt a pair (two cards of the same value), a player may add a second bet and split the pair into two hands. If dealt two cards (whether a pair or not) that look like they have the dealer beat, the player may “double down” – add a second unit to the bet, and receive only one additonal card on that hand. Traditonially, a player is allowed to double her bet after receiving the second card on a split hand, which is known as a double after split. Many Strip casinos do not allow double after split, which of course is to their advantage. However, when this restriction is displayed (and, at most Strip casinos, to their credit, it is, though it is not required to be), it sends a message to the customer that he is being ripped off. Even a player who does not understand the effect of the rule must assume a sign that says “no double down after split” is prohibiting him from doing something he otherwise would want to do. Why tell a customer “no” if you are running a customer service business? The most exciting blackjack hands are those in which a player has multiple bets down because of split hands and doubles. When a player wins such a hand, tips for the dealer often result, and excitement rules. The bean counters in Las Vegas just don’t understand that. Even worse is when the restriction applies but no warning is given. This happened to me a few years ago at Main St. Station, an otherwise nice casino downtown (not affiliated with the local chain of Station casinos), where my attempt to double on a split hand was rebuffed by the dealer, despite the absence of a sign noting the prohibition. Why an establishment would do this is beyond me.

Too many people think all gambling depends only on luck, and that it doesn’t matter where they play or what they do. That’s why, I suppose, slot machines are so popular, though their payouts are secret and there’s nothing the player can do to increase his chance of winning. However, if you like games of skill, where decisions do matter, such as video poker and blackjack, finding a game with reasonable rules and full payouts is as important as learning how to play the game. If you play the best games well (and there are plenty of strategy guides available), you will stay in action longer –maybe even long enough to overcome the house edge and score a victory.