Hold percentage one of the reasons for low slots revenues

The study held by the gambling equipment industry’s association investigated the causes of the decline in the slots revenues although the games became tighter.

Recently, it has been noticed that although the slot machines have become tighter, they did not cause higher revenues.

The gambling equipment industry’s association studied this question and came to the results that the percentage of slots has increased worldwide for the last 10 years in 14.5%, but the revenues have become higher only in 1.1%.

The study came to the conclusion that the decrease in revenues is not connected with slots tightening, but with the hold percentages.

As Marcus Prater, the executive director of the Association of Gaming Equipment Manufactures, explains, “The players will not return after having bad experience.” He also tells about numerous complaints of players that slot producers and casinos are creating “too tight” games. So the decision to investigate this issue was made.

Hold percentage of a slot machine is one of the major factors that influence casino operators while choosing the machines from certain manufacturers for their establishments. There are different ranges of hold percentages the slots have. Some manufacturers sell their slots on the condition of share revenue, and some offer a pre-set hold percentage.

In 1990, when games were allowed only in three states, the slot hold was about 5.96%. And in 2014 the amount has already reached 7.7% when there were already 12 states with Florida, Ohio, Pennsylvania, Mississippi, Louisiana, New Jersey and Nevada among them. 10 from these 12 states demonstrated growth of slot hold percentages in the last 10 years.

The lowest percentage was in Nevada – 5.72% in 2004 and 6.4% in 2014. The highest was in Iowa – 9.37% in 2014. The difference is about 33%.

But the revenues in Nevada decreased by 5% during that very period – from $7.09 billion to $6.74 billion. Some of the analysts connect this with the recession of the economy.

But it is evident that gamblers are playing less now than they did in the past. Just compare the wagering in Nevada in 2014 – $105. 4 billion- with the wagering in 2006 – $138 billion. The difference makes 23%. It was also noticed that the situation has improved in many US gaming markets, but the gaming volumes proceed to contract.

Tom Jingoli, Konami Gaming Senior Vice President, explained that the study performed was an attempt “to open a dialogue” between slot producers and casino operators on the question of slot machine hold.

This study is one of the few means used to return slot machine to their position. The association also supported the legislative changes introduced this year to add arcade style video games to slots. Such regulations are now in the process of drafting by the gaming regulators of the state.