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Best of Alan Krigman

Gaming Guru

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What Would You Give Up to Get a $5 Game?

14 October 2003

Most casino buffs have been spoiled by perks. Free beverages on the floor. Comps for the all-you-can-eat buffet. Gifts of ice scrapers, Schmutz Schmasher vacuum cleaners, and whatnot. Yet, simultaneously, they gripe about the high minimum bets at the tables. Thinking, wrongly, that everything's paid for by the sad sacks who lose -- when, in fact, the money is squeezed from their own cumulative wagers under the pressure of the statistical edge.

So high limits don't mean the bosses are greedy. Well, not just that they are. Rather, solid citizens, especially "regulars," have become too wise for casinos to afford low-limit games. Rollers high and low gravitate to the joints reputed to offer the least edge, then play in a way that pares house advantage to the bone. And, those whose bring-in fanny packs seem stuffed to them but spare to the casino demand extras once reserved for the rich.

Consider a casino's expected hourly gross at $5 blackjack. This minimum virtually guarantees a full table. With, say, six spots in action and nobody dawdling over decisions, a competent dealer can get 60 rounds per hour manually shuffling an eight-deck shoe. If everyone bets $5, that's 360 hands times $5 each or $1,800 wagered per hour. With a typical mix of player skill levels, the edge might average 0.75 percent. The house's theoretical gross would be 0.0075 x $1,800 or $13.50 per hour. This won't cover dealer and supervisor salaries and benefits, a share of the general operating overhead, and various amenities. So the table loses money. Sure, some bettors will exceed $5, but others will retard the pace, and the lowest-limit tables are usually assigned to the slowest dealers anyway, so the $13.50 won't be far off.

You see the dilemma. Many aspiring blackjack players haven't the bent, bankroll, or belly for bets of $10, $15, $25, or more. But the casinos go in the hole offering them a shot for less. A possible solution would be to raise house advantage. This is one reason why you see entirely new games, variations on the rules of the old standbys, and elective side bets whose big payoffs make them appear attractive. All are high-edge propositions.

Caribbean Stud, Three-Card Poker, and others of that ilk could be run profitably as low as $2 per round but are rarely even found at $5. Would spreading these games at low limits draw additional patrons or the same clientele more often, boosting earnings at the margin? Would existing customers simply cut their bets given the opportunity to do so, especially on games with jackpots where they could still fantasize about banging 'em for big bucks? Would folks already loyal to an establishment shift from slots to these table games, ultimately hurting the casino because a dollar in tokens pumped into a machine has greater potential than $5 or $10 in chips bet at a table during the same period owing to the larger edge, higher decision rate, and lower operating cost? If you're in any of these categories, how would you respond?

Here's another situation. Make believe you want to play blackjack, but find yourself outpriced. You hear there's a $5 pit at Penny Pincher's Palace. The rules are standard except that uncontested blackjacks win 1-to-1 instead of 1.5-to-1. Do you play, figuring these don't occur too often and you only sacrifice half a unit when they do? Would your decision change if you had to pay for beverages at those tables, and didn't get rated for comp credit? What if you learned that this seemingly minor change in rules raised house advantage for perfect basic Strategy from 0.5 to 2.75 percent, and for a typical player to about 3 percent?

Ask a hundred people and you'll get at least a hundred answers. And, that creates a major conundrum. The casinos don't know, and on the whole hesitate to commission studies or run tests, trying to find out. Because "gaming," as opposed to "gambling," is a business. And in most businesses, less blame is cast for doing nothing (the error of omission that nobody may notice, or won't mention because they didn't want to stick out their own necks either) than for trying and failing. The poet, Sumner A Ingmark, took a chance and got it right when he wrote:

I've abandoned ideas, have forsaken a lot of 'em,
Knowing if they were good, someone else would'a thought of 'em.

Alan Krigman

Alan Krigman was a weekly syndicated newspaper gaming columnist and Editor & Publisher of Winning Ways, a monthly newsletter for casino aficionados. His columns focused on gambling probability and statistics. He passed away in October, 2013.
Alan Krigman
Alan Krigman was a weekly syndicated newspaper gaming columnist and Editor & Publisher of Winning Ways, a monthly newsletter for casino aficionados. His columns focused on gambling probability and statistics. He passed away in October, 2013.