Published on September 16th, 2021 | by Bibhuranjan

How does a Casino Make Money?

Gambling can be a tricky and expensive endeavor. You can win big or go home broke, there is a high risk to reward ratio for both parties involved. However, the inevitable truth is this – “The House Hates Winners” and they would go to immense lengths to prevent you from winning big. This is why casinos spend big on security and the latest technologies, so that every move you make can be monitored and any chance of cheating can be eliminated. Not that its just limited to cheating, but big winning streaks can also get you kicked out as well.

Either way that doesn’t and hasn’t stopped people from going into them because everyone has an equal chance of winning and losing in most casino games (in theory at least). That being said, some casino’s would provide you with a $200 no deposit bonus on 200 free spins which can have a great impact on your overall luck and may turn the tables for you.

Given the lengths that casinos go to prevent money leakage and their huge turnovers each year, you maybe wondering just how is it that they make money.

How does a casino make money?

One might assume that the primary source of earnings for a typical brick and mortar casino would be the revenue from the casino operations and for the most part that is correct. However, the lengths that they go, to squeeze out every penny from you would be a spectacle all on its own.

First, remember that in each game the house has its edge. It maybe small, it maybe big. For example, in a game such as Blackjack where there is a high chance of card counting, the Casino’s will typically have a limit on how much you can bet, even if you are on a winning streak, which prevents card counters from making big bets. Similarly, there are deck shuffling machines that are used to shuffle the deck midway to prevent a prediction streak.

Then there is the general layout of the casinos, which are usually built around to keep you in there as long as possible. Exits are hard to find and the floor is littered with game tables and machines that are in reality just asking you to come to them.

Other than that, the slot machines [which were often known as one handed bandits] are designed to give out small wins frequently and big wins very rarely. The slot machines usually have a payout rate of 90% [the house always takes its cut] and are designed to keep you playing. It may seem unfair but it’s a business after all. The odds of winning at a slot machine is relatively moderate, unless say that you are getting $200 no deposit bonus on 200 free spins, which can put the odds back in your favor. This is why casino’s spend billions on R&D for these slot machines every year, so that every single exploit can be patched and in return the odds can be put back in their favor.

Apart from gambling, a casino can make money off services like Drinks, Dinning, Room services and so on. However, there is an exploit there as well. Say some poor old bloke is losing a lot, then the casino can re-compensate him with free rooms and services like drinks. The Idea here being that the customer doesn’t feel at a loss, even though the cost of said services might not even exceed say $200. Speaking of services, another exploit here is to keep you high on testosterone by virtue of free drinks, which generally dulls down your senses and prevents you from keeping track of time. So play more, lose more is the mantra here.

How do Virtual Casino’s make money?

Virtual casinos here refer to the gambling that is done on mobile platforms typically via mobile apps or on an online website. Virtual casinos have been in operation for a while now, the film Runner Runner, starring Ben Affleck shows us a glimpse of the same.

The mechanics of how online casino’s make their money is still pretty much the same, except from the fact that most of these online based casinos target new audiences with alluring incentives, like no-deposit games and big bonuses with minimal investment. The goal here is to make you sign up, get your deposit and then leave you to have your way with the platform.

However, since the whole show is basically running online on servers, it’s the algorithms that actually dictate how much you can win and as you might have guessed by now, the “House Edge” still exists in the algorithms. Therefore, you have as much chance of winning on online casinos as you have in real casinos, provided that the underlying algorithm is fair.

Furthermore, the allure of the offers might seem like a good thing, but remember that you need to sign up [usually with a credit/debit card] and meet their wagering requirements. This basically means that you need to bet ‘n’ number of times before you are entitled to the rewards that they promised, which lured into their platform. Then there is the sign-up fee or an upfront deposit to access the platform, which becomes necessary if you want to receive those free spins and rewards.

Because online casinos do not require them to have a physical establishment, the operating costs are significantly lower than brick and mortar casinos. This is a prime reason why these virtual casinos are popping up every day and the novelty of you not having to visit them physically is just icing on the cake.

The disadvantage that most of these online casino’s face is that they have to keep innovating constantly and keep introducing new games and offers to keep the player base interested. This is because, while conventional brick and mortar casinos can keep the player chugging away at the tables and slots, this isn’t the case for virtual platforms, where players can simply quit the app or interface when they are bored. Therefore, online gambling platforms need to maintain a higher payout or reward ratio along with the addition of new games which can keep the player engaged, for longer. Boredom is the enemy here and they invest a lot to prevent that.

Conclusion

Most inner workings of a casino are still business secrets that needs protecting. To say that the house doesn’t manipulate the results in their favor would be an understatement. However, that is not to say that you won’t ever win anything in a casino. Its purely a matter of luck or chance.

Tags: free spins, gambling, no deposit spins, online casino, slot casino, slots

About the Author

Bibhuranjan Editorial Officer, technofaq.org I'm an avid tech enthusiast at heart. I like to mug up on new and exciting developments on science and tech and have a deep love for PC gaming. Other hobbies include writing blog posts, music and DIY projects.