An Introductory Guide to Online Gambling — A Basic Presentation of the Industry

Posted by Andrew Price
2WinPower Partner, owner of the gambling establishments network.
2020/09/11

When an entrepreneur decides to start working in the gambling industry, there are two main directions to choose from. First of all, it is a land-based sphere. Nowadays, a lot of countries allow building brick-and-mortar establishments, but it is a rather time-consuming process that requires significant resources. On the other hand, the online gambling industry is an accessible direction that even low-budget businessmen can go for.

The experts at 2WinPower are glad to give another comprehensive guide on the basics of online casino management. This in-depth walkthrough includes every single aspect of the internet gambling world and is understandable even for people with little experience in the industry. We care about your time and offer only relevant information backed up by examples.

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Differences between Land-Based and Online Casinos

Differences between land-based and online casinos

The casino industry is actually as old as time. The first entertainment establishment of this type was built in 1638 in Venice. Its name could be interpreted as “a little house for gaming.” At first, the Casino di Venezia was created to please the huge amount of prominent visitors who were trooping into the city during the local carnival season.

Land-Based Casinos

The key distinction between a land-based establishment and a casino website is the atmosphere. A real-life facility is much more than just gambling and games — it is all about a night out for the majority of visitors. On top of that, a few other distinctive differences make land-based entertainment particularly unique:

  • a land-based casino has many more table games (poker, Blackjack, roulette, etc.) in comparison to an average gambling website where slots usually prevail among the activities;
  • very few internet gaming platforms have age verification upon accessing, while no land-based establishment will allow an underage to enter the premises of the facility and enrol into gambling;
  • the gambling revenue is not the only way for a brick-and-mortar casino to make money since they can provide other entertainment (dancing shows, concerts, theatres etc.), foods, beverages since they are usually attached to huge hotels and shopping malls.

Online Casinos

The first online gambling website was registered in 1996 that was actually quite recently. Its crucial advantage over the land-based direction is much wider service offering. Gaming websites are not limited to physical space. While an average real-life casino can offer 100-150 slots and 15-20 table games, a gambling portal can have thousands of different entertainments.

A few other distinctions of the online industry of this kind include:

  • endless accessibility to the website that people can go to from their PCs, laptops, and even mobile phones wherever they are;
  • it is easier for players to start enjoying the gaming content due to the lack (or later) age verification procedure.

Despite a much wider offering possibility and huge potential, the online gambling industry still falls behind on the revenue share. According to the latest statistical analysis of the European market, the internet sector makes up only 26% of the profit in comparison to brick-and-mortar, which has 74%.

Two years ago, these numbers were different (23% to 77%). The rise of online gambling is mainly caused by steadily changing legislation background in the countries of the EU. A vast majority of them have already installed dedicated regulation for internet gaming activities.

Another huge upshift towards internet entertainment of this type has recently been observed due to the global pandemic reasons. The inability to enter land-based establishments made a lot of punters shift towards gambling websites, thus increasing the general revenue share of the direction.

Online Casino 101: What a New Operator Needs to Know

The internet gaming industry is a complex direction with dozens of variables that we are going to cover. Regardless of how difficult it may sound, after a clear understanding of each aspect, it will be pretty easy for a new operator to start working on a gambling career.

Slots

Slots: payout to players

This is a popular type of entertainment where a player tries to get a winning combination (usually from left to right) of the same symbols. Many settings allow configuring the cost of a spin (that determines a winning multiplier). Each game is supposed to have a playtable that explains how much the game will payout if you have a certain amount of symbols in a row.

In some games, symbols do not have to be displayed in a row. It depends on how many lines a game offers. While the most common variant is still 3, there can be up to 10. In this case, a combination can be matched in different variations (diagonals, snake-like, etc.). Also, a lot of slots offer bonus games. They are usually accessed after collecting a certain number of unique symbols.

In reality, a slot machine might have billions of possible outcomes. Let us “build” a simplified slot to understand the underlying maths, random number generator, the house margin, and the return to player.

Every time a player makes a bet, a computer generates a random outcome. However, a slot machine is built in a way so that if each outcome came in once, the casino would win. It means that the house will not win every bet, but rather if all potential outcomes would come in exactly once, the casino will win money.

Our “slot” has 10 possible outcomes:

  • 7 outcomes of no return;
  • 1 outcome of 5 times the bet;
  • 1 outcome of 3 times the bet;
  • 1 outcome of 1 time the bet.

Providing that a player bets $1 every time, the payout to players (RTP) will be calculated as follows:

7 * 0 = 0

1 * 5 = 5

1 * 3 = 3

1 * 1 = 1

0 + 5 + 3 + 1 = 9

9 / 10 = 0.9 = 90%

It means that on average, out of every single dollar that a player bets, a casino will receive 10 cents of revenue. On average, most slot games have low volatility nature. It means that players have a lot of chances to win their bet or get small hits. It encourages them to continue spinning. Usually, slots have an RTP between 92% to 97%. This balance allows keeping the revenue high and the players satisfied with their winnings.

In comparison to land-based industry, slots in online gambling have higher RTP. However, the gaming process is faster, meaning the pace of losing money will be on the same level in both directions.

Also, another integral feature of each slot is a jackpot. Out of every bet, a casino takes a jackpot contribution from the house edge. Usually, those are local savings. However, some online casinos can cooperate and have shared jackpots that increase the amount (as well as people’s thrill) significantly.

Table Games

This type of gambling activity is based on the actual land-based casino games. The most popular ones are Roulette, Blackjack, Baccarat, etc. In the online industry, principles of the games remain the same. However, they are based on the random number generator.

Roulette

It is a table game of chance that is played with a wheel with 37 possible outcomes (0-36). Also, it is possible to bet on additional variables such as red/black, higher/lower than, even/odd. So, what are the main peculiarities that a new operator should be aware of?

Aspect

Condition

Example

Payouts

Correctly guessed number pays out 35 times of the bet

If a player bets $1— $35 is a win and $1 of an initial bet is returned

Correctly guessed colour, multiplicity factor, or higher/lower value pays out 1 time of the bet

If a player $1 bets — $1 is a win and $1 of an initial bet is returned

Odds

Correct number outcome is possible in 1 out of 37 spins

Correct additional outcomes are possible in 1 out of 2 spins minus the 1/37 chances of hitting 0

House edge/ RTP

The house edge is 1/37 that is 2.7%

The RTP is 97.3%

If a player bets $1 on each number, the total amount spent is $37, while the winning will be $35 and $1 of an initial bet is returned

Even though it may seem that betting on colour, multiplicity factor or higher/lower seems more beneficial for a player. However, the house edge is always the same.

Imagine placing $1 on red and black. 36 out of 37 outcomes will be successful. However, 1 out of 37 will be losing since the roulette can hit 0. Consequently, the house edge is still the same 1/37 — 2.7%.

The same concerns multiplicity factor and higher/lower than bets. 0 is not considered in any of these variants, so the house edge remains unchanged.

Blackjack

It is a popular card game that is usually played against a dealer. If a player hits a blackjack combination (a face card and an ace), the winning amount is 1.5 times the bet. In any other victorious outcome, a player doubles the bet. The odds of getting a blackjack combination is about 1 to 21. However, the odds of winning a hand depends on the current hand, the dealer’s visible card, and player’s decisions.

The house edge and RTP values can be different. With perfect mathematical decisions, in standard Blackjack, the house edge is around 0.5%. Usually, only professional players who understand the essence of the game will get the RTP of 99.5%. In other cases, the house edge will be around 3%.

The Main Things about Basic Casino Games

Basic online casino games

Every new operator requires significant knowledge of the gambling sphere from all of its sides. Even if the information seems redundant, it is still better to ensure it is clear to avoid mistakes in the future. Today, we have covered the material on the basic understanding of the online gambling industry and its main differences with the land-based sphere. Also, we have reviewed the three most popular entertainments that visitors of the gaming websites play most of their time. The key aspects of them are:

  • all of these games are driven by a random number generator (RNG) that creates either winning or a losing outcome for a player;
  • slots are extremely fast-played games that imply creating the winning lines and have the return to player percentage of around 92% – 97%;
  • roulette is a simulated game that can have 37 outcomes and has a house edge of 97.3%;
  • Blackjack is the most complex game that professional players can mathematically take advantage of and increase their RTP to 99.5% while the average house edge is usually around 3%.

In the next article, we will discuss other gaming opportunities for players, including live casinos, bingo, poker, and others. Apart from that, we will overview the role of software providers in the online gambling sphere and try to understand how to make the right choice of a manufacturer.

The best experts of the 2WinPower company are ready to create a lucrative gambling environment for you on a convenient turnkey basis. So, if you have any questions or want to make your first order, contact our customer support team in any convenient way.

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