Skill-based slot machines won’t take over the casino floor

Let’s be clear from the outset: The Strip casino of the future isn’t going to look like your child’s Xbox or PlayStation.

But gaming industry leaders seemed unified in an opinion expressed over the four-day Global Gaming Expo in Las Vegas — changes have to be made in the slot machine floor over the next few years if casinos are going to attract a younger customer base.

It’s not going to be a wholesale change.

“We’re just looking for a small space, not the whole floor,” said Eric Meyerhofer, CEO of Gamblit Gaming, whose Glendale, Calif.-based company has been at the center of bringing a new type of slot machine to casinos.

Customers who love the core slot machines, such as Blazing 7s, Buffalo and Wheel of Fortune, will still find those time-tested games.

At the G2E trade show inside the Sands Expo and Convention Center, the old standards were displayed. But the games were updated with flashy graphics, including 3-D symbols and images, and high-tech features, such as capturing player’s photo and inserting it into the game. The slots will come in streamlined, modern cabinets with surround-sound speakers built into custom-designed chairs.

Slot machine developers continue to produce games based on popular pop culture themes, television shows and movies, hoping to attract fans of the products, such “House of Cards,” “TMZ,” “Orange is the New Black,” “Ted 2,” “Game of Thrones,” “The Simpsons” and “The Big Bang Theory.”

However, don’t be surprised in the next few years if slot machines resemble giant smartphones and tablet PCs, or are the sit-down video games that Baby Boomers played a generation ago.

G2E attendees found themselves sampling potential gambling devices with themes similar to “Guitar Hero,” “Space Invaders,” “Angry Birds” and “Candy Crush.” International Game Technology offered an electronic video version of the classic pinball game as a bonus round feature on its long-standing “Texas Tea” spinning reel slot machine.

In some ways, the G2E was a sign of the casino industry’s destiny — sort of Bellagio meets Dave and Buster’s.

“The slot machine needs a face-lift if it stands a chance to appeal to the next generation of players,” Deutsche Bank gaming analyst Andrew Zarnett said. “Younger players dislike them, as they seem primitive to the exciting games that millennials play on their cellphones.”

Defining a game of skill

Regulations covering skill-based slot machines were approved by Nevada gaming regulators in September. Technical standards for the games are still being written. New Jersey also has skill-based gaming laws in place.

Slot machines in the United States are now based on chance. The new regulations define a game of skill, a game of chance and a hybrid game that incorporates both elements. Most of the skill-based technology is found in common video games — “Space Invaders” and other arcade-style products — and social games, such as “Angry Birds” and “Words With Friends.” There may soon be slot machines that award points for movie trivia.

Analysts, after walking the G2E floor, said skill-based games are in the early stages of development. Actual testing and approval of the games may take to six to eight months as rules and technical standards are clarified.

“While the time will eventually come for a skill-based product, the industry is not there yet,” J.P. Morgan gaming analyst Joe Greff said. “We saw several new technologies aimed at creating a more engaging player experience, including hand motion sensors, (and) eye-tracking technology. Companies also highlighted a slate of new titles, brand extensions and a host of new cabinets.”

The major manufacturers worked to have some type of skill-based product in their G2E booths. Scientific Games Corp. displayed “Space Invaders Evolution,” a video reel slot machine where the bonus round offered an option to play a traditional game of space invaders. Players use their skill at shooting down aliens and avoiding missiles to earn jackpot points.

“This is our first product, but it gives our customers an idea of what we’re looking to do with this type of slot machine design,” said Greg Colella, senior director of product management for Scientific Games.

IGT’s “Texas Tea Pinball” took a time-tested video spinning reel game and added traditional pinball as the bonus challenge. Skilled pinball players can cause an oil gusher and earn large rewards.

Jacob Lanning, IGT’s vice president of strategic research and development, said the company has used skill-based elements in some of its older slot machines, including video poker games based on Texas hold ’em. Pinball plays on the nostalgia of older customers.

“It was an easy game to create, and it’s a game that’s has a well-established base,” Lanning said, adding that the company is working on other skill-based games.

Meanwhile, Lanning said slot machines based on popular culture themes, such as the celebrity news website and television show “TMZ” could market to a younger casino customer. The TMZ game allows the player to snap their image and be part of the TMZ celebrity-search bus. Also, IGT added 3-D technology to 10 different slot machine titles.

Wells Fargo Securities gaming analyst Cameron McKnight said Scientific Games and IGT were taking “a measured approach” toward investment in skill-based technology.

“Manufacturers and operators are trying to determine the optimal mix of skill and randomness in game payouts,” McKnight said. “Skill-based slot machines will take several years to develop.”

Glimpse of the future

Gamblit and G2 Game Design aren’t waiting around.

The companies are developing skill-based games that are more arcade-video-social than slots.

Gamblit had a booth at the 2014 G2E, which Meyerhofer viewed as a preview. The year, he described the company’s 2,500-square-foot booth as a “pop-up casino” that could be inserted into casino’s floor area. The space includes some 30 to 40 multi-player games situated around lounges with plushy chairs and sofas, high-top tables and a bar area. Energetic music was pumped into the site.

“We wanted to show the casinos exactly what they would get with our products,” Meyerhofer said. “We have no intentions in taking over the whole the casino. We think this can add to what is already offered and bring in a different mix of customers.”

The bar-top games weren’t video poker. Instead, Gamblit created a tablet PC-style game titled “Smoothie Blast,” which is similar to “Candy Crush.” Players match fruit that ends up in a blender. Payouts off the initial wager are determined by the smoothie’s contents.

Other games displayed have origins from popular social games. But the company is also creating its own products.

In “Grab Poker,” up to four players pay an entry fee and try and create the best poker hand by grabbing cards as they rapidly appear in the center on the table. The winner collects the pot.

Meyerhofer said other states are considering copying the Nevada regulations, which would open new markets for Gamblit. He just wants to get the games on the floor and prove their value.

“We’re right there,” Meyerhofer said. “It’s an exciting time.”

G2 Game Design CEO Gregg Giuffria previously made his name in another field: He was the keyboardist for album-oriented rock bands Angel, House of Lords, and Giuffria in the 1970s and 1980s. He then went into slot machine design, creating games based on the magic of David Copperfield and the Las Vegas-located cable channel show “Pawn Stars.”

Now, he’s looking to bring skill-based gambling games to casinos that feature popular arcade games, including tank battles and airplane dogfights. Naturally, music is another product.

Working in partnership with Next Gaming, the companies want to launch a gambling version of “Guitar Hero,” where players win bonus points and jackpots as they successfully hit notes on a guitar as a song plays. Players can chose from a menu of popular songs, including a few Giuffria wrote during his long-haired musical days.

“These are the first games where the winner is not determined by a random generator,” Giuffria said. “It’s a change that the gaming industry needs to see happen.”

Numbers show a need

How quickly those changes take place is a mystery.

The numbers show the need for a change in Nevada. Slot machine wagering of $105.4 billion in 2014 was down 23 percent from the all-time high of $138 billion in 2006. Slot machine revenue, or win, in Nevada declined 5 percent in the past 10 years, from $7.09 billion in 2004 to $6.74 billion in 2014. Nevada slot machine revenue hit an all-time high of $8.4 billion in 2007, a year before the economy dipped.

Eiler Research founder Todd Eilers, after touring the G2E floor, said he doesn’t see skill-based slots having that big of an impact in 2016.

“Almost all of the major vendors had a couple games focused on the skill-based category given recent regulatory approvals in Nevada and New Jersey,” Eilers said. “However, nothing really jumped out, and we suspect next year there will be more focus on this category.”

Contact reporter Howard Stutz at hstutz@reviewjournal.com or 702-477-3871. Find @howardstutz on Twitter.

ad-high_impact_4
Business
MGM Grand Plans To Add Retail And Dining To Its Strip Facade
MGM Grand President and Chief Operating Officer Scott Sibella said executives are “discussing redeveloping that entire frontage of the building out to the Las Vegas Strip.” (Todd Prince/Las Vegas Review-Journal)
Boyd Gaming planning new corporate campus
Casino operator Boyd Gaming Corp. has filed plans to build a new corporate campus. The plans call for two 10-story office buildings and a six-level parking garage in the southwest Las Vegas Valley. Boyd Gaming operates The Orleans, the Suncoast, downtown's California Hotel and other properties. The new headquarters would be just a mile from its current main office building.
Bellagio Conservatory transformed to celebrate Year of the Pig
The Bellagio Conservatory Team transformed the 14,000 square foot conservatory to commemorate Chinese New Year, the holiday that marks the end of the coldest days of winter. (Rachel Aston/Las Vegas Review-Journal)
CES 2019: Intro uses sound to connect people
Intro, a startup that is part of the Future Worlds Accelerator in the UK, has an app that uses ultrasonic sound to find people and companies nearby.
CES 2019 Video: CES wraps up another year
Time-lapse video of the action at CES 2019 in Las Vegas. (Mat Luschek/Las Vegas Review-Journal)
CES 2019: Create your own beauty products
Beauty Mix by BeautyByMe is a product that lets you create your own cosmetics and beauty products. (Mat Luschek/Las Vegas Review-Journal)
CES 2019: Picobrew’s home brew machine
Picobrew brings automation to homebrewing. (Mat Luschek/Las Vegas Review-Journal)
CES 2019: Surviving CES
What it's like to spend four days working the mammoth tech convention. (Jason Bracelin/Las Vegas Review-Journal)
Haier’s smart home
Haier presented smart home technology at CES 2019.
CES 2019 VIDEO: Foldimate makes laundry day easy
Foldimate has created a machine that will fold your laundry for you. Just feed it anything you need folded and it will do the rest. (Mat Luschek/Las Vegas Review-Journal)
CES 2019: Opte device corrects skin spots
Opte from Proctor and Gamble is a device for correcting spots and freckles from skin. It analyzes the area for spots and then covers them with a serum of matching skin tone. (Mat Luschek/Las Vegas Review-Journal)
Circa hotel-casino in downtown Las Vegas unveiled
Derek Stevens reveals Circa hotel-casino in downtown Las Vegas. He plans open by the end of 2020. (K.M Cannon/Las Vegas Review-Journal)
Circa, new casino coming to Fremont Street
Casino owner Derek Stevens announces his new property Circa, coming to Fremont Street in downtown Las Vegas in late 2020. (Michael Quine/Las Vegas Review-Journal)
Dreenk My Oeno makes wine suggestions
At CES 2019 in Las Vegas, the Dreenk My Oeno tells you all about wine.
Polaroid One Step Plus camera unveiled at CES 2019
Polaroid has moved into the digital age with its One Step Plus camera with Bluetooth. With the connected app, it turns your smartphone into a remote for the camera, along with filters and features.
Amazon is everywhere at CES 2019 in Las Vegas
Seemingly everything works with Amazon Alexa
LG Smart Mirror helps you dress snazzy
LG’s Smart Mirror is less of a mirror but more of an assistant to help get you looking snazzy. It takes your image and recommends clothes for you or matches existing clothes with new clothes, which can be purchased right from the mirror. (Mat Luschek/Las Vegas Review-Journal)
Underwater robots make waves at CES 2019 in Las Vegas
Robosea is a company dedicated to underwater robotics. They produce consumer robots for underwater filming as well as commercial products which can be used for underwater research. (Mat Luschek/Las Vegas Review-Journal)
CES 2019 - Victrola record players spin in Las Vegas
A new spin on an old favorite, Victrola record players are meeting a demand for retro products. The brand is also making furnitures with built-in speakers.
CES 2019: Slamtec robots ready to serve
Slamtec is a robotics company out of China whose goal is to provide solutions for laser localization mapping and navigation. They have created two autonomous robots that can be used in areas such as bars, restaurants and malls. (Mat Luschek/Las Vegas Review-Journal)
Mixologiq drink maker appears at CES 2019 in Las Vegas.
This is the Mixologiq drink maker.
CES 2019: Veritable smart garden
Let’s face it; not all of us have green thumbs. And herbs are particularly difficult to grow, considering their constant need for sunshine. Enter the Veritable smart garden from Exky, which does it all for you. (Heidi Knapp Rinella/Las Vegas Review-Journal)
Bonnie Springs Ranch near Las Vegas being sold to developer
Bonnie Springs Ranch near Las Vegas is being sold to a developer, set to close in March. Bonnie Springs, west of Las Vegas off State Route 159 — next to Spring Mountain Ranch State Park — spans more than 60 acres and was on the market for $31 million. The developer and his project partner are under contract to buy the ranch and plan to chop it up mostly into custom-home lots. The plans includes a 25-room motel, a restaurant and a 5,400-square-foot event barn.
Bone-conduction headphones form Aftershokz
Aftershokz offers bone-conduction headphones - headphones that don’t go in the ear.
CES Happy Hour party at Hangover Suite at Caesars Palace
Conventioneers mingled during the Hardware Massive CES 2019 Happy Hour Bash at The Hangover Suite at Caesars Palace in Las Vegas. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Autonomous Cars and Futuristic Aircraft Rule CES
Day two of CES was dominated by autonomous cars and futuristic aircraft in the North Hall of the Las Vegas Convention Center.
TekNekSavr fights neck problems caused by smart phones
Atiya Syverson invented the TekNekSavr to help fight neck and head problems caused by strains while typing on smart phones. (Mat Luschek/Las Vegas Review-Journal)
New eyeglasses know if you fall and call for help
The French company Abeye has created eye glasses that will detect if the wearer falls and call for help. (Mat Luschek/Las Vegas Review-Journal)
Company that creates vibrator-like device claims genders bias against CES
Lora DiCarlo is a women-run start-up that creates a vibrator-like device designed for female pleasure called the Osé. This year they were awarded the CES Innovation Award in the Robotics and Drone Category, but a month later the Consumer Technology Association, which runs CES, rescinded the award and their booth. Haddock and her team believe it is a reflection of gender bias and sexism in an industry with a long history of male domination.
CES-Wagz has new pet products
Wagz has three new products to help create better lives for your pets in a digital world. One is a collar with LTE tracking and an HD camera. Also a smart pet door that only lets your pet in and out. Lastly, a device to humanely keep Fluffy out of certain areas of your home. (Mat Luschek/Las Vegas Review-Journal)
TOP NEWS
News Headlines
Home Front Page Footer Listing
Circular
You May Like

You May Like