Electronic Slot Machines Using Pari-Mutuel Wagering 

 

 

A new slot machine platform has been developed that may be useful to casino operators, as they work to interest millennials in gaming and try to mitigate the problems presented by Internet gaming.

A founding partner of Holch & Erickson LLP, Niels Holch, has been issued three U.S. patents on a slot machine system that uses pari-mutuel payouts for casino games, replacing the typical fixed-odds pay table.  Under this system, games are played using a pari-mutuel wagering format, in which players compete against each other for winnings from a digitized wager pool that is created and funded through a central computer that interfaces with numerous cashless player terminals. 

Technological advances have now made it very easy to offer electronic casino games with pari-mutuel payouts, once players deposit funds in a wagering account on a central server.  Players can designate individual wager amounts for each game and the system can create an electronic wagering pool on a central computer—all in a matter of seconds.  The house can then take a share of the wager pool, based on a predetermined takeout percentage.  After the wager pool is formed, a casino game with a pari-mutuel payout can be played, with the winnings disbursed to the account of the winning player (or to multiple winners), depending on the rules of the game.  

 

While “player-against-player” poker is probably going to be the most popular game that can be played on this type of slot machine system, almost any traditional casino game can be converted from a fixed odds pay table to a pari-mutuel payout scheme.  Instead of competing for the somewhat modest winnings provided by a pay table, slot players can compete against each other for much higher dollar amounts that more resemble the excitement of a game with a progressive payout.  However, these games can be played more quickly than a progressive game and the casino has less exposure than with a banked game, as it takes its share from the wager pool before each game is played.

              

Replacing fixed odds payouts with pari-mutuel payouts opens up opportunities to develop hundreds, and potentially thousands, of different electronic casino games using this system infrastructure.

A pari-mutuel slot machine system can help operators attract and retain players in their brick and mortar casinos.  Games in which players play against each other will attract millennials and also help to offset the spread of Internet gaming by keeping patrons in the casino. 

Niels Holch is also the co-inventor of the first cashless gaming system to be installed in the United States--in 1995 at the Turning Stone Casino operated by the Oneida Indian Nation of New York.  This gaming system has received five patents (Cashless Computerized Video Game System and Method, U.S. Patent Nos. 5,674,128 (Oct. 7, 1997); 5,800,269 (Sept. 1, 1998); 6,089,982 (July 18, 2000); 6,280,328 (August 28, 2001); and 7,329,187 (Feb. 12, 2008)).

For this new "player against player" gaming platform, Mr. Holch is interested in collaborating with a manufacturer, under a licensing arrangement, to develop a pilot and bring these pari-mutuel games to market.  

On April 7, 2020, the National Indian Gaming Commission issued a game classification opinion, approving the first one of these games, Pari-Mutuel Draw Poker, as a Class II game under the Indian Gaming Regulatory Act.

Pasted below are links to the three patents issued for this pari-mutuel gaming platform: 

Cashless Computerized Video Game System and Method, U.S. Patent No. 8,579,703 (November 12, 2013): http://media.wix.com/ugd/677d54_4579c0b3919c43c6a33ae037b6bcac3c.pdf

 

Cashless Computerized Video Game System and Method, U.S. Patent No. 8,235,805 (August 7, 2012): http://media.wix.com/ugd/677d54_8eb49d30d25345b8aebd91026e47a21c.pdf

 

Cashless Computerized Wager Pool Game System and Method, U.S. Patent No. 7,695,366 (April 13, 2010): http://media.wix.com/ugd/677d54_2d40a4be017147518990f034e5d4e648.pdf

 

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