How Do Casinos Make Money?
It is well known that casinos fawn over big gamblers – winners and losers alike. The more you gamble, the better you are taken care of.
But are big gamblers the way casinos make all of their money? Where the Money Comes From
Quite simply, casinos make money because they pay winners at less than true odds. A roulette table, for example, has 38 slots – or 38 opportunities to win. If 38 people play, each person playing a different number, one person will win and 37 will lose. Odds on the roulette table are 35-1. The winner will make $35 dollars for a dollar bet, plus keep his original bet. A truly even bet would be 37-1, and the winner would leave the table with $38. The uneven odds allow the casino to make a commission on each round of each game. If everyone at the table loses, the casino makes a 100% profit.
But people won’t gamble if the house wins every time. Plus, some games lend themselves to being easier to win than others. So, casinos had to come up with a way to encourage people to gamble but still make money. Uneven odds are the way they’ve done it. Casinos will try to hide the uneven odds, trusting that most gamblers will not take the time to figure out the true odds. Some games are set up specifically to improve the house odds. The American version of the roulette wheel, for example, has 38 slots. The European version, however, has only 37. If the odds on the game are the same, the American roulette wheel will give the house a bigger profit by sake of that one extra number.
Using sports betting is another way the casino makes money. Sports bets throw in a charge on top of the original bet. Someone who is betting $100 on a game is actually paying $100 plus their charge (usually about $10). If the person wins, he receives his original wage and charge back, plus his $100 in winnings. The profit comes from the $10 charge from the other betters who have lost. Large jackpots mean that many people are betting. The losers’ money goes into the casino pockets, but because of the uneven odds, the casinos are earning their commissions off the winners.