Las Vegas Casinos Chase Higher Revenue with Skill-Based Gambling Video Games

John Locher/AP
John Locher/AP

After noting a decreased interest in slot machine gambling among young people, Las Vegas casinos plan to implement skill-based gambling with video games.

The casinos hopes to attract the younger generation, which has grown up playing video games, and the rules for this new gambling could be sent to the Nevada Gaming Commission as soon as October.

A study conducted by the Las Vegas Convention and Visitors Authority discovered that among people visiting Vegas casinos in 2014, 87% of individuals 70 to 90 years old, 78% of the 51 to 69 year-old baby boomer generation, 68% of 35 to 50 year olds, and 63% of millennials (under 35) gambled.

Nevada governor Brian Sandoval said that “this bill [to permit skill-based gambling] allows gambling manufacturers to use cutting-edge technology to meet the challenges prompted by a younger, more technologically engaged visitor demographic. Passing this legislation into law is an important step forward in providing new opportunities for this critical industry to progress while ensuring that Nevada remains the global epicenter for gaming innovation and development.”

With video game gambling, casinos hope to revive interest in Nevada gambling, which has shrunk from $12.9 billion revenue in 2007 to $11 billion in 2014, with slot machine earnings dropping 20%. But will the industry be coming out ahead, or the gamblers? The Association of Gaming Equipment Manufacturers noted that the payback of machines could increase from 88% to 98% with the introduction of skill-based games.

Greg Giuffria, a developer of these new gambling video games, said that “the next wave of people aren’t going to stand there and play slots. The industry has to change or disappear.” CEO Eric Meyerhofer of Gamblit Gaming imagines a world in which skill-based video games coexist with traditional slot machines at casinos.

Since Las Vegas is the dominant player in the gambling industry, this shift in its gambling is likely to impact casinos across the United States. While New Jersey started accepting skill-based gambling ideas last fall, just one video game has been submitted so far. But gambling law professional I. Nelson Rose remarked that “if it’s good enough for Nevada, then it’s good for everyone else.”

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