Could Blockchain Technology Ever Replace TITO?

First, what is TITO?
A system for slot machine play through the use of a barcoded paper ticket. The ticket may be purchased in advance of slot machine play or issued from the slot machine if there are credits remaining at the conclusion of the patron’s gaming session. When the patron has completed his play, balances on the ticket can be redeemed for cash at a kiosk or the casino cage or used for further play at the casino that issued the ticket.

Where did it come from?

In consideration of the potential use of blockchain to phase-out the TITO, we must understand the nuances around which TITO was adopted. This entails understanding how TITO helps to solve the problem of data collection in the casino industry.

Ticket-in, ticket-out (TITO) machines are used in casino slot machines to print out a slip of paper with a barcode indicating the amount of money represented. These can, in turn, be redeemed for cash at an automated kiosk, or be used for gameplay at other slot machines. The machines utilize a barcode scanner built into the bill acceptor, a thermal ticket printer in place of a coin hopper (some rare machines are set up to pay with coins if the payout is less than the payout limit, and to print a ticket in situations where a hand pay would normally be required) and a network interface to communicate with a central system that tracks tickets. MGM was in the middle of construction of its major hotel in Las Vegas and invited several gaming machine manufacturers to join a consortium for its Cashless Casino experiment. In the group were Bally Gaming, IGT, Sigma Games, Universal, and several others. They were all presented with the MGM UIB Protocol documents and were aided in the realization of the protocol on their gaming platforms. The first trial of the system was actually at the Desert Inn property. MGM Had situated several trailers in the parking lot where the manufacturers could bring their gaming devices for test before being installed on the Field Trial at the Desert Inn.

On or about March of 1992 Applied Computer Technology began evaluating software that was developed for Five Star Solutions and subsequently sold to MGM Grand Hotels, Inc. for a slot monitoring and accounting system. Applied Computer Technology began to modify the software and specify a new hardware platform for MGM to use in order to implement its designed system and to allow expansion of its current capabilities at the time. On June 30, 1992, Applied Computer Technology, Inc. issued a quotation to MGM Grand, Inc. to engineer and design a Universal Interface Board or UIB for MGM Grand to be installed into slot machines for the purpose of monitoring critical machine status and components, displaying messages to the user of the slot machine, reading magnetic strip cards and communicating messages to and from a host mainframe computer. On or about July of 1992 the quotation was expanded to include the printing of Bar Codes on a receipt ticket printer manufactured by Star Micronics Inc, model #sp300. MGM Grand provided them with a model printing algorithm in BASIC source code as an example of how to print the ticket which they used to develop the algorithm. This saved a lot of development time since the code they provided already had been developed. They were also presented at that time with a sample ticket. On or about August of 1992, they received word from MGM that they had located a bill validator that was capable of reading the tickets that Applied Computer Technology was currently printing, and for ACT to start writing preliminary code for the validation of tickets to and from the mainframe computer so that when the unit did arrive ACT would be ready in a short time to test their protocols. On or about October 22 of 1992 ACT received a prototype Bill Validator from MGM Grand hotel who had received it from Pat Green of Triad Design. The Bill Validator was special in that it not only was able to validate currency but also to validate coupons with bar-coded tickets on them. Mr. Green was using a second parties Bill Validator outfitted with his own special circuitry which incorporated a laser bar code reading system.

The following in an excerpt of the very first functioning version of the code

As can be seen by the above section of the program highlighted in blue and titled Revision History, an entry was made on June 5, 1992, repairing a section of the program with the function name do_sds_pend(). This section upon further examination shows that the program at that time was capable of handling pending transactions for cashouts, and jackpots whereas the program would receive a cashout signal from the gaming device, transmit the amount of cashout or handpay to the mainframe computer, and await a command from the mainframe to print a ticket worth a set amount of credits/coins and finally signal the gaming machine after the ticket was printed that the pending state was complete and to continue its operations as normal.

TITO USE
The concept of Ticket In / Ticket Out (TITO), as described above was a boon to the Casino Slots Departments and the estates they manage. TITO enabled the phase-out of mechanical machine hoppers, prone to jamming, and requiring constant replenishment which tied up considerable sums of cash which were open to theft as it crossed the casino floor instead of being secured in a vault.

Today, the TITO voucher is ubiquitous and the ability to track them across the gaming floor is increasingly prized in its ability to address:

When there is theft, to rapidly determine who the perpetrator is for swift apprehension.
To issue alerts when more than a certain value, or vouchers in a certain combination, are cashed in.
To detect patterns of activity when vouchers close to expiry, or multiple small “remainder” values are cashed.
To track the preference of players who move from machine to machine and measure time of play.
However, for all the benefits TITO brought to the casino floor, it is not without its pitfalls and weaknesses which provide opportunities for improvements in the system or, potentially a phased replacement of the entire TITO system.

TITO VULNERABILITIES
Partial Payouts: A partial payout occurs when a ticket is inserted into a machine, with an amount that is not supported by the denomination. For example, a ticket valued at $148 is inserted into a $10 per spin slot. In this instance, the machine will print a ticket for the remaining $8.00. Quite often, patrons unfamiliar with the process will assume the machine is out of order, taking the $8.00 and leaving.
Ticket Theft: At first, this may seem rare. However, in the casino environment, designed to distract patrons and guide their eyes elsewhere and combined with comped alcohol, it happens more often than assumed. This is not just theft from the patron, however. Ticket Theft uses casino resources as they are often asked to investigate lost or stolen tickets. A stolen ticket for $20 to a patron, may cost a casino $75 in labor to resolve.
Money Laundering: Casinos have always been an ideal location to change illegal money. With the advent of TITO, it’s never been easier. Though FinCEN has tasked gaming operators with the responsibility of reporting suspicious transactions, with so many events happening on the casino floor, this activity remains difficult to prevent. Suspicious activity involving TITO usage can be any, all, or hybrids of the following two examples:
a. Placing currency in a slot machine, then cashing out after minimal or no play and redeeming the TITO ticket at a kiosk on the gaming floor (“bill stuffing);

b. Patrons pass a large number of chips, cash or TITO tickets between themselves in an apparent effort to conceal the ownership of the chips, cash or TITO tickets; if patrons are closely related, such activity may not be seen as suspicious.

Employee Collusion/Reprinting: Employee theft accounts for the majority of loss throughout all industries, and casino gaming is no exception. Most lost or stolen tickets are reported, but some remain unclaimed. Each TITO ticket is created with an expiration date. If they are not redeemed within 60 days of their creation, the funds are returned to the house. Employees with sufficient access are able to run reports of unclaimed tickets which are about to expire then reprint and pass them to a non-employee for redemption.

Theft of Time: TITO incidents are frequent. The investigation on them is time-consuming. Each time a ticket is inserted into a machine, the system generates a new ticket number. A single TITO ticket may have a dozen or more events. Manually referring to slot location, time of ticket event, and pulling up the correlated video takes dozens of man-hours each week.

Exploiting reporting times in ticket creation with the mainframe disseminating the ticket information to the slot control system and kiosk systems allows a window for patrons to copy and cashout a ticket more than once.
Tickets are often counterfeited with advanced processes or fake tickets are created and sold at a discount to unknowing patrons. While this doesn’t seem to affect the casino, it does, as any money a player loses on the street, is money the casino loses an opportunity to win on the house edge.

CASINO ANALYTICS IN THE PAST
Understanding the why, behind the advent of TITO requires a bit more knowledge of how operations in both cash handling as well as data was collected during the past. To start, as late as the 1980’s, the ubiquitous presence of computers and smart-phones with which we are all so familiar were unknown because, for the most part, they did not exist. This meant that most analytics were done manually, if at all. Typically, this meant that they were not really done, and people relied upon superstition verging upon Witchcraft and "gut feel" for the decisions that they made. There was no data available to help in this decision making and no simple way to analyze or to interpret it even if the data had been available.

Back in the day, "the Count", where one emptied the Gaming Table drop boxes and counted out the money and checked out the Fill and Credit paperwork, was critical. Only at these times was the Operation really aware of what they were winning and losing and until the money was actually counted then everything else was little better than guesswork.

By the time the 1990s rolled around, we might term the epoch the near past. In the near past, computers existed and within a few years after mobile phones of the most basic sort were becoming common. By this time, Microsoft Office had revolutionized office productivity and Excel actually meant that a normal person could produce graphs that looked professional.

Indeed, by this point, a huge share of the (still very small amount) data analysis conducted was processed in Excel while simple Access databases accounted for much of the rest. There were, of course, more complex analytic tools out there, but my they were not commonly employed and were all but invisible to the majority of employees.

At least some of this was due to the staff still employed and rising to the top ranks of the industry. With some notable and far-sighted exceptions, the majority had "grown-up" in the Gaming Industry, especially the Table Games portion of it, without analytics and reliant upon the "gut feel" method of working out what was going on; many of them distrusted technology and of the work and training they would need to be able to get the most out of even the basic tools available to them at this time.

The analysis was lacking in almost every aspect of the Table Games Operation. This could, of course, be contrasted with the Slots Departments who were beginning to reap the benefits of mechanization and the analysis that could be applied to the early electro-mechanical and increasingly purely electronic slots systems. So, in Slots, you could say there were the beginnings of the "Siloed systems", that is systems that gathered data and allowed analysis solely within their own bounded confines (or with Excel); while for Table games there was nothing...unless enterprising staff entered the data themselves.

CASINO ANALYTICS IN THE PRESENT
If we skip forward from the 1990s, to around 2011 when Galaxy Macau opened, a cornerstone of the largest and most vital Table Gaming market the world had ever seen, much had changed. By this time, analytics systems, even for Table Games had become ubiquitous and pioneering companies were beginning to go further and to promise real, timely, actionable intelligence from the deluge of data that had flourished in the sixteen years between these dates.

Indeed, it is easy to argue that the actual collection of data, the easy bit, had completely outstripped the ability to suitably organize, analyze and act on the data being recorded and stored: the hard bit. The growth of data and the formation of the silo systems themselves seemed almost designed to stymie efforts to draw anything meaningful from the awful weight of what was being collected.

This is not to denigrate the Silo Systems in use at the time. Indeed, this whole era might be handily subtitled the Silo Systems Age even as the period before this could be considered the Data Dark Ages. The silo systems had been spectacularly productive in what they were designed to do and, in earlier periods of this age, had given unprecedented insight into operations, within the siloed data itself. While data flows were, relatively speaking, low and what needed to be known or understood strictly circumscribed they worked very well indeed.

But the very strength of systems designed to store data within limited parameters and to analyze and interpret this data inevitably meant that these systems could not consider data from outside their silo. Nor, as it increasingly became apparent, were they entirely well suited to the increasing data flows coming from larger and more data-intensive operations and from the increases in the areas from which data was being collected. The answer to this always seemed to be to add more independent siloes, but it seemed that as quickly as these were added, they were being filled up by what data was being collected and they were being superseded in what Operations Management wished was being collected.

To even attempt to consider data across the growing numbers of siloes in use, it was back to Excel for the enterprising staff member brave, or foolhardy, enough to try to sift the deluge of data for the nuggets of information buried within. It was a period that could, for our nascent data explorer, be characterized by the printout and the highlighter pen.

Forests of print outs for the siloed data were produced; much of which could not be extracted in any other way as this feature had never been considered when the silo was constructed. Then the explorer sat down and tried to impose order upon the chaos of the data and to consider events on printout "A" that might illuminate detail on printout "B" before typing everything into Excel and trying to graph or pivot table it.

CASINO ANALYTICS IN THE FUTURE
The future will be a world without siloed systems. Or rather, since it will take a while for the currently siloed systems to be replaced, it will become like that after having gone through a transitional period where there are overarching systems binding the siloes together and taking data from all of them.

We have already reached a stage where cross-silo systems exist and are looking at data, and more importantly the connections between data in different siloes collected for different purposes, in new and illuminating ways. There are some very exciting technologies out there that are examining data in entirely new and unprecedented ways; giving insights into things people have long believed and confirming some ideas even while they debunk others. Now data can be examined from IoT style devices on the gaming floor and combined with data from Ratings and Food and Beverage systems to give a far more detailed and nuanced picture of a Patron and their interaction with the Operation.

Similarly, data can be taken on dealer performance and ratings to determine how they interact with Patrons, how efficiently they perform their duties and even such things as how they impact upon Patron dwell tie at their tables.

In a business such as Casino Table Games where rewarding Patrons through reinvestment has to be balanced against making sure that they actually add value to the Operation by their wager amounts and style of play and where customer service must be balanced against sufficient game-pace to make margin there are myriad areas where data analytics can be beneficial.

Bringing this data together from the siloes within which it is stored and analyzing it in context can already provide incredible business insights. The idea that there has to be only one provider, that one company, supplier or organization can do everything end-to-end, is a holdover from the Silo Age.

The Future of Gaming Analytics will be one of the best-of-breed suppliers of the basic building blocks of data collecting feeding into similar providers of data analytics and the entirety of this analysis and output being available on whatever medium best suits the individual planning to consume it.

OK, BUT NONE OF THIS HAD ANYTHING TO DO WITH BLOCKCHAIN...
Well, it does now - and it's under the guise of how Casinos know their players - be patient...

Without knowing your players, there is no real way a casino can best serve them. They can’t be sure what it is they like, or how they are expected to play. The concern is that if the competition has a better grasp on player identity and behavior, there is every reason for a casino’s players to defect to another property. When this occurs, and it does, casinos begin to “buy their business” by offering higher promotional levels in an effort to entice the return of their once-loyal players.

So, how can technologies be deployed to aid a casino in their quest for information regarding their players and understanding what they like and what their actions are on the casino floor? There is, unsurprisingly, considerable overlap with the data that is used to determine the best optimization of Table Games.

Rating data as it currently exists is the obvious starting point. This gives the casino a picture of what their staff and systems believe is happening, and while it may not (and almost certainly isn't) completely accurate it does do a very good job of determining Gaming Preference.

What do patrons prefer to do?

Data from smart IoT enabled devices, such as Smart Shoes are currently determining the actual game pace, determining what is really going on at the Gaming Table level. Next Generation sensors, already in "real world" deployments, can determine both the location of any wagers made and with increasing accuracy the cash values of these wagers. Data from Venue, Hotel and POS systems can be linked to create a Patron profile of what they are doing when they are not wagering on the Gaming Tables. Where are they interacting with the broader Casino offering? How are they paying for this interaction? What are their non-gaming preferences? Geo-location sensors can be deployed, via opt-in applications, to track Patron movements about the property. Where are they going when they do not interact with the wider offering?

From the sum of this data, again gathered from across the various siloes in which it currently resides, a more complete and more holistic picture of the Patron as an autonomous actor can be determined.

A combination of bet recognition and game pace can determine their real, as opposed to assumed, value to the operation. What is meant by this is the real House Advantage maintained by the Casino against their play (for any Table Game type where this can be a variable). It can issue alerts when play exceeds certain thresholds or changes in marked ways.

For the first time, an accurate appraisal of what they like to do in addition to their Gaming can be determined. This enables enhanced market segmentation and a fuller picture of the likes and dislikes of the patron in question. If he or she only goes to the seafood restaurant, why would a casino send them a voucher for a steak? If they like the Spa, why reward them with a buffet voucher?

Offers can be made "on the fly" when the Patron is in proximity with something a casino now recognizes that they enjoy doing. Subtly rewarding them for brand loyalty to the casino and explicitly discouraging them from gaming somewhere that does not know them as well.

An increasingly non-siloed, data-rich and free data environment is a picture of the future when customers are more reliant on technology. So while no-one knows for sure in what precise direction technology will shape how the Casino Industry will face the future, the broad trends are sufficiently established to be knowable. What is required therefore is the ability to do this, before the competition does?

AGAIN, WHAT ABOUT BLOCKCHAIN?
Any Blockchain solution company, in evaluating the potential for casino penetration should take into heavy consideration the history of TITO, how and why it was developed, and the continued lean on knowing the players. Combining that with how a wallet/ledger solution would solve the 7 identified TITO vulnerabilities above will give you a solid approach in both development and marketing efforts. It should be obvious to those of us involved in Blockchain tech how, the implementation of an enterprise-level, patron utilized wallet which communicates with not only slots but casino credit mechanisms would be of a tremendous asset in combating fraud while generating new player data casinos have never had access to. The value proposition lies within cost savings, player retention, player information and habit knowledge, and anti-theft.

The question is not will Blockchain replace TITO, but who is willing to step up and begin that process?