Australia's Gambling Industries - Productivity Commission

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How gaming machines work
This appendix sets out how gaming machines work. This is important because the
technology and how it works is at the heart of some gamblers’ cognitive errors
about their gambling. Moreover, the technology can play a role in harm
minimisation, but appropriate measures require an understanding about how the
machines function. As Global Gaming Services noted:
Most forms of venue gambling are technology based. I observe with interest that noone
involved in the problem gambling industry reference groups (eg NSW) would
appear to have any appreciation of the design theory and technology behind the
gambling devices. Probably most know that the devices make money, but do they know
why? (sub. D189, pp. 1-2).
The appendix also describes some of the consequences of differing playing styles,
and how the playing styles adopted by problem gamblers are likely to affect the
outcomes.
It also considers the persistent myth that the history of outcomes affects future game
results — the so-called ‘gambler’s fallacy’.
Finally, as some industry representatives have questioned whether the
Commission’s calculations in respect of Black Rhino (in chapter 16) are correct, it
sets out the calculations for assessing the likelihood of the highest jackpot on this
game.
U.1 How do poker machines work?
Modern poker machines are electronic ‘chance’ machines. Their central component
is a program embedded in a chip. This program uses random numbers to generate
random outcomes, which in turn determines the outcomes visible to the player.
Most Australian machines have five ‘reels’ and three visible rows. These are
displayed on a video unit. Each ‘slot’ on each reel depicts some icon, such as a tree,
a card, or some other readily identifiable symbol. Certain combinations of symbols
generate payoffs for the player.
Machines in widespread use in Australia employ virtual reels, rather than electromechanical
reels as used in older machines, and still often used in some countries,
HOW GAMING
MACHINES WORK
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