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PROGRESSIVE VIDEO POKER PART 11:

The More Things Change

by Frank Kneeland

Frank Kneeland was the manager of the largest progressive video poker team in Las Vegas, and has authored a book about his adventures entitled, "The Secret World of Video Poker Progressives". You can get the book as well as some extra info about Kneeland on his website www.progressivevp.com. Also, there you'll find a show archive from his radio show on pro-gambling that he co-hosted with Bob Dancer for six months.

I think someones been giving me fake placebos lately. ~FK

A few months ago, I told you all of a new bank of progressive video poker machines at M, entitled 'Max-Royals,' that I had a hand in creating and getting management to install in their casino. At that time, I saw this as a possible indication of a trend reversal by casinos, signaling possible bluer skies ahead for video poker players. Apparently, the more things change, the more they stay the same.

Late last month, the 'Max-Royals' progressive machines were unceremoniously removed from the casino floor. I was asked by Henry Tamburin (editor of the BJI) to detail the events leading up to its demise, and I must say for the first time in a long time I was at a loss for words. As the Vorlons say, "Understanding is a three edged sword. My side, your side, and the truth."

I have access to only one of those sides and it has already cut me. Much of what I will tell you is conjecture; most of it was based on what I was told directly. To judge its veracity, we'd have to know who told the person telling me and why, all the way up the chain. However, none of that is within my purview, so I'll do the best I can and don't quote me...I just work here!

A Boy and His Progressive

I had a dream. Nothing special, a normal pro-gambler dream, involving a casino putting in a progressive that actually gets playable more often than once a year, a couple of pretty cocktail waitresses...oh, and a talking cat named Raul. The surprising thing about this dream was that it all came true (well, except for the cat, whose named turned out to be George).

After being asked by a vpFREE poster to see if I could convince a casino into putting in better progressives, I was shocked when the casino said, "Sure." The pitch was to put in a progressive with low base-return games and enough meter-rise to bring the return to slightly over a 100%. The house's rake would come only from playersí errors. To assure the casinos would generate some profit from errors, we selected eight really different video poker games on this linked bank, where playing one game increased the meter on the other games. It should have been next to impossible to play eight very different progressive strategies flawlessly. Without playing errors, the machines would return 101%. I predicted that with playing errors factored in, the casinoís overall edge should be around half a percent.

Two months went by and low and behold the machines were retuning a half a percent, which was, unfortunately, less than what the casino expected. Therefore, they decided to downgrade the pay table on the games, and then later they decreased the meter rise percentage for the royal flush, and made the machines ineligible for point multipliers. Not too unexpectedly, play fell off and thatís when they made the decision to remove the machines.

Notice that I expected a half percent hold and thatís what they held (a miracle that I got it spot on). Yet, somewhere in the chain of command, expectations were not met. I also predicted that the bank would generate tons of free publicity along with bragging rights for M ("Fastest Progressive in Las Vegas"), and after getting my seventh request for an article about it, and possible TV appearances, felt my plan was coming together flawlessly. What went wrong? There may have been several factors working alone or in combination. I'll share what I know and you can draw your own conclusions. Consider these theories:

The Change Theory

And no we arenít talking about menopause. Penn National took ownership of M in October 2010. Technically, they were already the owners when the progressive bank was put in, but there hadn't been major management changes yet. The changes occurred one month after the bank's inception. It is entirely possible that the bank's alteration to Max Progressives and subsequent removal were nothing more than the standard machination associated with apple-cart overturning, common to all corporate takeovers.

Bad Math Theory

Due to some sort of odd accounting error in the reports that are inherent to the tracking system used by their slot department, for the first month the bank's hold was overestimated by a huge margin. All Royals hit were counted as though they were hit at reset. At the beginning of month two, the only thing on their minds was how to add more machines, and there was even talk about increasing the meter-rise. This period of overestimation may have raised expectations and made the reality less palatable when the boo-boo was noticed. Even though the bank met my expectations both in return and publicity value, by this time the fantasy of 5% hold games with constant heavy coin-in had already ruined the less exciting reality.

Bad Communication Theory

The 'Max-Royals' greatest value to M was in its marketing potential. Apparently, from what I could gather, the slot department and the marketing department do not communicate much and have different agendas. Marketing has a budget and is required to show that the money they spend is bringing in customers. Therefore, free marketing generated by another department is perceived more as a threat than an asset. They also employ the logic that anything that can't be quantified on a spreadsheet, doesn't exist. Meanwhile, the slot department doesn't even have a place on their balance sheets to show the value of any advertising (free or paid) and actively discounts it. The left hand not only doesn't know what the right hand is doing, it doesn't care.

The Perfect Storm Theory

Due to a convergence of random chance, seven royals got playable and hit on a day when M was offering triple points, causing a temporary reduction in projected earnings. This once in a lifetime event was assumed to be a trend and the bank's overall long-term potential was underrated.

Voodoo Accounting Theory

Due to another quirk in their accounting system, free play downloaded on a machine is counted as a reduction to the bank's drop. It's hard to explain, but they look at free play without factoring in the coin-in required to generate it.

The real reason for the removal of the Max-Royals progressive at M may have been due to one, some, all, or perhaps none of these factors. We will likely never know for sure. I would not wish to dispel the mystery completely, as mysteries once solved are never quite so interesting.

Next month I'll be starting a short series of articles on the psychology of gambling.

P.S. Do you know anyone who would like to own a talking cat named George?

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