You might remember a scene in the movie Casablanca where Rick has his croupier rig the game so that a particular player could win a certain amount of money.
The house gets its edge by paying out winnings at less than the odds of winning.
I’ll use roulette as an example since we were just discussing it in the context of Casablanca.
The bet pays off at 35 to 1.
See the difference?
Here’s what it means mathematically, though:
- Let’s say you play a mathematically perfect 38 spins, making the same single number bet on all of them. And let’s also say that you’re betting $100 per spin.
- You lose 37 times, for $3700 in losses. You win once, for $3500 in winnings.
- The casino’s profit is $3700-$3500, or $200.
- That $200 in casino winnings can be amortized over all 38 spins. $200/38 is the same as $5.26 per bet.
- That indicates the house edge. And since we were talking about betting units of $100, we can say that this game offers the house an edge of 5.26%.
Honnest casinos with slots, roulette and Live dealers[portholes included_tags=”12,42,521,5″]
All of the bets at an American roulette table have the same house edge (except for one).
Let’s look at one of the even money bets as an example. Let’s say you’re betting on black.
The roulette wheel has 18 black spots, 18 red spots, and 2 green spots. That means the odds of winning are 20 to 18. (You have 20 ways to lose and 18 ways to win.)
You place $100 bets on 38 spins, and you lose 20 times for a net loss of $2000. You win 18 times for a net win of $1800. (This bet pays even money instead of 35 to 1.) Again, you’ve lost $200 in 38 bets, or $5.26 average per bet.
All casino games work in a similar manner. You place a bet, and you get paid off at a certain amount when you win. But the odds offered by the payoffs are always less than the odds of winning.
You might argue that this constitutes rigging the game. You might be correct. But it’s not the same type of rigging that most people think of when they talk about rigged games.
The casinos have no control over who wins or loses on a particular spin of the roulette wheel. Their blackjack dealers aren’t card sharps. They’re not using loaded dice.
They don’t have to.
The math is in their favor.
And this is just as true of an Internet casino as it is of a traditional casino.
In fact, casinos have an incentive not to cheat. Since they have nothing to gain—the math’s already rigged in their favor—they have to consider what they have to lose. In the case of Internet gambling, reputation is everything. And gamblers talk.
If an Internet casino cheated with the results of their games, they’d get caught.