Casinos are businesses like any other business based on the same principles: providing a service to people and making a profit in return for that service. They are not places that give away “free money”, nor do they leave things to “chance”. A casino is a business guaranteed to make a profit because all its services (games) are designed to give it an edge. Most gamblers, even experienced ones, find this concept hard to grasp.
In other words, no matter how skillful, lucky or tactical you are, the house eventually wins. For example, let’s say you are playing roulette. You can see a list of tested strategies on the Roulette77 platform and try them all. Some of them may indeed give you an advantage, but if you keep playing, you will always leave the casino with less money than you had at the beginning. So, how does this business model work, what risks does it involve, and how does it guarantee a profit?
The Basics of Operation
A casino’s expense items are standardised, which means that it is possible to know in advance exactly what they will be. To put it simply:
- Overall costs of the building where services are provided,
- Costs of game tables,
- Expenses for people working at the gaming tables and in the casino.
Of course, there are sub-categories of all of these; for example, the training and certificates that employees need to obtain will have a certain cost, too. But no matter how long you extend the list, payouts to players are not one of the expense items. Because the casino rarely pays players with its own money. So, what does this mean?
Other Players Finance the Payouts
Suppose 1,000 people visit a Las Vegas casino, each buying 100 units worth of chips from the cashier. The casino starts the night with 100,000 units in its safe. In this example, we assume that the casino only offers European roulette. This simply means the following:
- At the end of the night, the casino will pay out 97,300 units to the players, no matter how lucky they are.
- The casino already had 100,000 in its safe, and this wasn’t its own money. So, it made a profit of 2,700 units that night.
We know what you’re thinking: couldn’t a lucky player walk out of the casino having won more than he deposited? Of course he can, but that’s not what you should focus on here. It is possible that out of 1,000 people playing there that night, 100 walked out with more money than they started with. However, the payouts to these lucky players are financed by the other unlucky players: the casino doesn’t pay with its own money, and no matter how many lucky players there are, the casino is guaranteed to make a profit. To understand why, we need to take a closer look at how casino games work and the concept of RTP.
Casino Always Has an Edge
Every casino game, regardless of its type and name, has an RTP (return to player) rate that is never 100%. Here are the average RTPs of the main game types:
| GAME | AVERAGE RTP |
| Single zero roulette | 97.30% |
| Double zero roulette | 94.74% |
| Slot machines | 95.00% |
| Blackjack | 99.00% |
RTP indicates how much of the player’s invested money they can win back. Take, for example, European roulette, which is also the subject of the example above: its RTP rate is 97.30%. For every 100 units a player bets on this game, he can win back 97.30 units in the long run. The casino will always make a profit of 2.70 units on this investment. Since the RTP is never 100%, no player will ever get a full return on their investment. And since it never goes above 100%, it is also impossible for the player to make a profit in any way.
Once again, we know the question on your mind: Some players leave the casino after making a profit, right? Yes, but they all come back. They use their profits to play again (in the hope of winning more), and this time, they are not so lucky. The only way to win at gambling, if you are lucky enough to make a profit, is never to come back again. Not many people can do this, and this is the main reason why you don’t see people getting rich from gambling.
The only risk of such a business model is cheating players. By cheating, you can increase the RTP rate on any game to over 100%. That’s why casinos invest heavily against cheaters: even in the smallest casinos, you can find state-of-the-art camera systems and managers keeping an eye on every table. Since customers (players) are never paid more than their deposits (or even 1:1), and other players fund all payouts, casinos are businesses guaranteed to make a profit – they are unique in this respect.
