Another illuminating observation by my friend who is in one
of the biggest card rooms on the strip. Since this is not
strictly videopoker, please indicate whether you rather I do
not post such info:
As for the poker machines, I feel that they'll have a VERY limited
appeal and as such a somewhat limited market.
The places where you will see these machines will be in those
jurisdictions that limited human dealers, markets that have
intermittent demand, and finally events that don't pay to have a
human dealer. I believe that in the long run, the majority of the
player market will take a live dealer over a machine the vast
majority of the time.
Let's look at the three instances I cited::
Jurisdictional limits. There are some Indian casinos that are limited
by state compacts to machines. The ignorance in the state's negotiation
limits the way a game can be played and not the device or method of
play. So, first you saw states (I think South Dakota was one) that didn't
want dice or roulette in their Indian casinos. So, the compact was
written to limit play to machines as gaming devices--but the state never
said what games could or could not be played on the devices. Enter video
roulette and dice. Some states (Wisconsin for example) specifically
limited the type of game played. For them, a machine is mute.
Intermittent demand. That would be cruise ships. Or, possibly
small-time casino operators and bar owners. When demand doesn't
warrant a full-time dealer and staff, operators will opt for the machines.
This way they can get the play and marginal profit without the overhead
of a full-time operation that will sit idle for the majority of the time. The
big markethere is in the two-man table. Bar owners will put them in their
bars for (nudge, wink) "amusement purposes only", but you know damn
well that the guys will drop a $20 for a two-man freeze out.
The final category may well be the market that will make these machines
profitable: small profit events. Take a page from internet poker's
playbook. There is something call micro-limit play. These super-small
buy-in or blind structures cannot produce the profit margins to allow a
brick and mortar casino to offer them. So, when the B&Ms stopped or
didn't offer them, the internet operators found that they could. For mere
pennies, the internet allowed players to buy-in for $10. The players got
value fortheir little bankrolls and the operators got a profit where one was
not available before. The small profit events in the casino are
satellites. Satellites are small buy-in events that allow the winners to move
into the larger events. There are even satellites to get into satellites to get
into the main event!
A typical small satellite would have a $30 buy-in, paying our $200 and
leaving $100 for the house. The standard blind structure for a
satellite will have the event last and average of 90-120 minutes providing
$66 to $50 per game hour revenue. This game revenue figure is 40% of
what a live game would produce in the same spot. So, poker rooms are
reluctant to spread those satellite. Now, replace the dealer with the tables
and the small events now become feasible.
My feeling on the machines is this (and I think it was pointed out by
one of your correspondents): given a choice, people will still prefer live
play with a live dealer--mistakes and all. But, if economic necessity
limits live play, machine tables will be a good alternative. I too saw the
machines in the poker room at The Hard Rock Casino in Hollywood FL.
There we 15 games in the room, all live. The four electronic tables sat in
the corner of the room collecting empty drink glasses. I think that is their
fate.