How Do Online Pokies Work? A Primer

Chloe Wilson - EditorChloe Wilson - 25 November 2020 in Features

How Do Online Pokies Work?

Online pokies are one of the most popular ways to gamble on the internet. The sheer number of different titles available at online casinos is testament to this. Thanks to advances in computer-generated graphics and the creativity of pokie developers, there are thousands of variations on the online pokies today. Such variety consistently keeps players coming back for more.

Despite differences in appearances, online pokie games broadly function in the same fashion and, in many ways, they operate just like real-world pokies. In this article, we’ll be looking under the hood of free pokies to see exactly how they work.


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How Do Online Pokies Work: The Basics


The basic functioning of a real money pokie is quite simple. Players choose how much they want to bet per spin and hit the Spin Button. A digital representation of reels will animate and appear to be spinning. When they stop, those symbols landing in view may form winning combinations along one of the predefined win lines.

In this respect, an online pokie is the same as a real-world one. The only real difference is the use of a digital random number generator, rather than the mechanical one you’d find on traditional, physical pokies. When you load an online pokie up, a digital random number generator starts up. Each time you hit Spin, the machine takes a snapshot of the random number generator. It then represents the random outcome on the reels.

Just like a real-world pokie, each digital reel has a predefined sequence of symbols on it. Digital reels usually feature many more symbols than a physical machine but in terms of their functioning there is not much difference. The random number generator is constantly going through its sequence of symbols and when the player hits stop, wherever it’s up to is the combination of symbols that will appear. The same dynamic occurs across all reels to produce a combination that may or may not result in a pay-out.

The pokie’s pay-table will show different pay-outs for different combinations of symbols. There will be fewer instances of higher paying symbols scattered across the reels, reducing the probability of creating a combination with those symbols. The precise composition of symbols, the prizes they award, and the probability of them landing on a win line all contribute to the pokie’s overall return-to-player rating. More on this shortly though.


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How Do Online Pokies Work: The Maths

 

Just like any company, the best online casinos for pokies are trying to make money. Their business model relies on what’s known as a house edge. Essentially, almost every game offered favours the house. At a basic level, this means that the player is mathematically expected to lose over the long-term.

 

  • How Do Online Pokies Work?Return-to-Player Rating

    Online pokies feature what’s known as a return-to-player rating (RTP). This percentage figure is an average of the amount of money that a player will win or lose over the course of thousands of spins. The higher the return-to-player rating on a pokie, the less a player should lose to the casino over many games.

    For example, a machine with a 98% return-to-play rating should pay out £98 for every £100 put through it. However, if it did, there wouldn’t be much to enjoy about playing the game. You’d just lose a little bit on every bet. There’d be no thrills of dropping a big win – just a slow bleed of your bankroll. To understand how casinos ensure their profitability whilst still offering entertaining games, it’s important to appreciate how exactly casinos generate profits.

  • How Do Online Pokies Work?How Casinos Make Money

    What some players don’t realise is that every bet a casino accepts is essentially a gamble for the house. They’re risking the pokie paying the player, thus reducing the casino’s own balance. The reward for taking the risk is the player losing and the house realising the player’s stake as profit.

    However, because the pokie, and almost every other game for that matter, is built to give an edge to the casino, this is a gamble that the house is happy to make. In gambling parlance, such a gamble is known as advantage betting and casinos do it on a massive scale.

    To understand how online casinos make their money, think of a simple coin toss game and how different pay-outs impact expected value. First, consider our game as costing one coin to play. When you guess the outcome correctly, the game returns the staked coin and gives another back as a prize. When you guess wrong, you lose your stake.

    The probability of a coin landing heads or tails is 50/50. If you played twice and you won once and lost once, which is mathematically expected, you would receive two coins when you won and you’d lose a coin when you lost. After playing twice, you’d still have the exact amount of money you started with.

    Now, consider a change in the rules that will greatly advantage the player. We’re going to pay you two coins plus your stake when you win but only take your stake when you lose. Imagine we played the game two more times with one losing outcome and one winner. This time, you end up with a profit of one coin.

    Of course, outcomes don’t converge with probability over such a small sample size. It’s entirely possible that you’ll win or lose both coin tosses. However, if you were to play the game many thousands or even millions of times, you’d end up much better off playing our second ruleset than our first. The greater the number of games, the closer the actual outcome should come to the expected one.

    This is exactly the principle a casino uses to ensure its profitability. The probability of each combination of symbols on an online pokie landing is carefully calculated and the payment size versus the stake that each combination represents is lower than the probability of it occurring. A basic example would be a winning combination that paid £100 for every £1 bet. The developers of the pokie will have ensured that this winning combination is only expected once every 101 spins or more. The greater the difference between the pay-out odds and the probability of the event occurring, the larger the house edge (or smaller the return-to-player rating).

    Whereas players are only interested in their own individual bets versus the house, the casino is playing a much larger game. It doesn’t care if one player wins or loses because it will have hundreds or thousands of members each betting on games that always favour the house.

    Just like our coin toss example, outcomes do not reflect probability after one of two games. However, casinos accept huge numbers of bets in total. The casino’s profits quickly converge to expected value over such large sample sizes. Individual players can still win over their comparatively smaller sample sizes. This ensures that games are enjoyable but still favour the house. In addition to the workings of pokie games, new casinos also offer no deposit bonuses and free spins to entice players.

  • How Do Online Pokies Work?Volatility

    Related to the concept of house edge and return-to-player ratings is that of volatility. pokie designers will often label their titles as being low, medium, or high volatility. This refers to the size of payments relative to the frequency of them occurring.

    A low volatility pokie will pay out more frequently than a high volatility pokie. However, the average prizes will be smaller on the machine that pays more often. By contrast, high volatility pokies won’t reward players as often but the prizes will be larger.

    Two pokies can have exactly the same return-to-player ratings but very different volatility ratings. You’ll find that the lower volatility game should average out to its expected value much quicker than the highly volatile one. However, over the course of millions or more spins, they should both return the same figure overall to players.

    An extreme example would be a comparison between a pokie with close to the absolute minimum volatility alongside the maximum possible. Imagine each game has a return-to-player rating of 98%. On pokie A, the low volatility one, the game pays out 1:1 on 49 spins out of 100. The other 51 spins are losers.

    Pokie B, on the other hand, only pays on average once every 100 £1 spins. However, it pays £98 when it does. Clearly, your odds of losing are greater when playing pokie B. Yet, some players prefer the “go big or go home” style of pokie B.

 

How is Integrity Retained?



One thing that’s remained a constant over the online casino industry’s relatively short existence is suspicion about online pokies. Many players continue to think that a pokie on the internet is more likely to be rigged in favour of the house. However, this just isn’t the case.

Firstly, it’s important to realise that the casino’s operation is specifically formulated to favour the house on every bet it accepts. This is achieved through house edges and less than 100% return to player ratings.

The only thing this business model requires to ensure profitability long-term is for players to actually bet real money on the game. The numbers of players willing to do would decrease dramatically if there was any suspicion that the site was crooked.

Put simply, it’s very much in the casino’s favour to provide a fair service. In fact, regulated iGaming venues spend big money on establishing player trust. We consider some of the ways they do so below.

  • How Do Online Pokies Work?Operators Can’t Configure Pokies

    Firstly, it’s worth noting that different casino operators cannot actually configure pokies from third-party developers. Companies like Quickspin and many others build the games and then lease the rights to offer them to different iGaming operators. The inner workings of pokies, including the pay-out percentages versus the probability of certain outcomes landing, are all set by those building the pokies and not the casinos.

  • How Do Online Pokies Work?Third-Party Testing

    When producing new pokie games, designers work closely with third-party testing agencies. Companies and organisations like eCOGRA, iTech Labs, Gaming Associates, and many others rigorously scrutinise online pokies before they ever make it to online casinos.

    These agencies look at the software itself versus the claims of those building it, as well as historical data from real players using different titles. Those titles deemed fair receive an agency’s seal of approval and eventually make it to online casinos.

  • How Do Online Pokies Work?Licensing Authorities Keep Industry Safe

    Overseeing the entire licensed iGaming industry are casino licensing agencies. They work with both casino operators and game design companies to ensure that players are treated fairly. Agencies like the UK Gambling Commission, Malta Gaming Authority, and others check just about every process at an online casino to ensure that no players get scammed by shady operations.

    Operators and companies failing to uphold their licensing commitments receive financial penalties and may be ordered to shut up shop entirely. These days, this is quite rare since established online casinos have a strong incentive to treat customers well. Casinos do often receive sanctions from such agencies though. However, they’re more likely to be related to failings to observe anti-money laundering commitments, rather than duping players.

 

Some Online Pokie Myths Dispelled

 

  • How Do Online Pokies Work?Online pokies are riskier than real-world ones

    Licensing, testing, and an incentive not to cheat players means that this just isn’t true. In fact, thanks to lower maintenance and overall overheads, online pokies usually offer more competitive return-to-player ratings.

  • How Do Online Pokies Work?You can be good at pokies

    Every time you hit spin when playing an online pokie, you create a new random event. The game has no memory of previous outcomes. There is no such thing as an online pokie running hot or cold. However, confirmation bias may well make it appear as if you’re on a winning or losing streak.

  • How Do Online Pokies Work?Online pokies never pay out

    There is loads of evidence showing that online pokies pay out to plenty of lucky customers.

 

Staying Safe Playing Pokies

 

Although the players can’t really control the outcome of a pokie machine, there are decisions they can make that will help protect them from losing money unnecessarily.

  • How Do Online Pokies Work?Understand RTP Ratings and Volatility

    Reading this article is a great start. If you fully understand what you’re letting yourself in for when you play different volatility and RTP rated pokies, you’re better positioned to judge if you’re willing to take the risk it’s offering.

  • How Do Online Pokies Work?Money Management

    Money management is important in all forms of gambling. When you’re playing pokies, consider the size of your bets versus the amount of money you have in total and the length of time you want to play for. With all that in mind, you might favour different machines based on their average RTP rating and volatility.

  • How Do Online Pokies Work?Play Smart

    Although there are no strategies that you can really take when playing pokies that will improve your chances of winning, there are a few things you should be aware of that could decrease your chances of busting out:

 

  • Play with the maximum number of win lines active. Usually, dropping the number of win lines decreases the RTP rating of the game.
  • When playing with a bonus, avoid pokies that don’t contribute 100% to wagering. If you play games contributing 50% to wagering, you effectively double wagering.
  • If a bonus has cash-out restrictions, avoid playing progressive pokies. The top prize will far exceed the maximum you can win with the bonus. Meanwhile, you’ll be contributing to the progressive prize pool. This reduces your effective expected value.
  • If attempting to complete wagering, low volatility games are best. You might want to spike a massive win with bonus cash early or right at the end of wagering on but when it comes to grinding through a playthrough requirement, little wins often are preferred. You’re less likely to bust out.

 

Get Out There and Start Spinning

 

Well, there you have our guide to how online pokies actually work. It can be a bit confusing but remember that working out how different probabilities versus pay-outs isn’t the punters’ responsibility. Massive and highly experienced companies, checked by third-party agencies, and licensed by international regulators ensure that everything is above board in that department.

Behind all the fancy bonus features and showy graphics, there’s really not a huge difference between online pokies and their real-world counterparts. Now that you fully understand how they work, are you not ready to hit the reels yet?

For more information about pokie machines, visit our interesting article about how the modern slot machine was invented in Australia.

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