Keno

Keno /kiːnoʊ/ is a lottery-like gambling game often played at modern casinos, and is also offered as a game in some state lotteries. A traditional live casino keno game uses a circular glass enclosure called a "bubble" containing 80 balls which determine the ball draw result. Each ball is imprinted with a number 1 through 80. During the ball draw, a blower pushes air into the bubble and mixes the balls. A "caller" presses a lever opening a tube, where the balls lift one at a time into a "V" shaped tube called the "rabbit ears". The caller and a "verifier" record each of 20 balls drawn, and the computerized keno system calculates all wagers based on the numbers drawn.

Players wager by marking an "S" over the "spot" choices on a blank keno ticket form with 80 numbered selection boxes (1 to 80). After all players successfully place their wagers, the casino draws 20 balls (numbers) at random. Some casinos automatically call the ball draw at preset timed intervals regardless of whether or not players are waiting to place a wager.

Each casino sets its own series of pay scale choices called "paytables". The player is paid based on how many numbers drawn match the numbers selected on the ticket and according to the paytable selected with regard to the wager amount. Players will find a wide variation of keno paytables from casino to casino and a large deviation in the house edge set for each of those paytables. Additionally, each casino typically offers many different paytables and specialty keno bets for customers to choose from, each with its own unique house edge. No two casinos' keno paytables are identical. There are several Reno and Las Vegas casinos offering as many as 20 or 30 different paytables from which the player can choose. ^{[citation needed]}

The house edge ranges from less than 4%^[1] to well over 35%.^[2] The typical house edge for non-slot casino games is between 0% and 5%.^[3]

History

The word "keno" has French or Latin roots (Fr. quine "five winning numbers", L. quini "five each"), but by all accounts the game originated in China. A spurious legend^{[citation needed]} has it that the invention of the game saved an ancient city in time of war, and its widespread popularity helped raise funds to build the Great Wall of China. In modern China, the idea of using lotteries to fund a public institution was not accepted before the late 19th century. ^{[citation needed]}

Chinese lottery is not documented before 1847 when the Portuguese Government of Macao decided to grant a licence to lottery operators. According to some , results of keno games in great cities were sent to outlying villages and hamlets by carrier pigeons, resulting in its Chinese name 白鸽票 báigē piào, literally “white dove ticket”, pronounced baak-gap-piu in Cantonese (which the Western spelling 'pak-ah-pu' / 'pakapoo' was based on).

The Chinese played the game using sheets printed with Chinese characters, often the first 80 characters of the Thousand Character Classic, from which the winning characters were selected.^[4][5] Eventually, Chinese immigrants introduced keno to the West when they sailed across the Pacific Ocean to help build the First Transcontinental Railroad in the 19th century,^[6] where the name was Westernized into boc hop bu^[5] and puck-apu.^[4] By 1866 it had already become a widely popular gambling game in Houston, Texas, under the name 'Keno'.^[7]

Odds

Keno payouts are based on how many numbers the player chooses and how many numbers are "hit", multiplied by the proportion of the player's original wager to the "base rate" of the paytable. Typically, the more numbers a player chooses and the more numbers hit, the greater the payout, although some paytables pay for hitting a lesser number of spots. For example, it is not uncommon to see casinos paying $500 or even $1,000 for a “catch” of 0 out of 20 on a 20 spot ticket with a $5.00 wager. Payouts vary widely from casino to casino. Most casinos allow paytable wagers of between 1 and 20 numbers, but some limit the choice to only 1 through 10, 12 and 15 numbers, or "spots" as keno aficionados call the numbers selected.^[8]

The probability of a player hitting all 20 numbers on a 20 spot ticket is approximately 1 in 3.5 quintillion (1 in 3,535,316,142,212,174,336 to be exact).^[9] If every person now alive played one keno game every single second of their lives, there would be about one solid 20 jackpot-winning ticket to date. If all these possible keno tickets were laid end to end, they would span the Milky Way galaxy—and only one of them would be a winner.^[10] To this day, there are no reports of a keno player lucky enough to match all 20 numbers.

Even though it is virtually impossible to hit all 20 numbers on a 20 spot ticket, the same player would typically also get paid for hitting “catches” 0, 1, 2, 3, and 7 through 19 out of 20, often with the 17 through 19 catches paying the same as the solid 20 hit. Some of the other paying "catches" on a 20 spot ticket or any other ticket with high "solid catch" odds are in reality very possible to hit:

Odds change significantly based on the number of spots that are picked on each ticket.

Modern keno

The ball draw occurs at the "keno booth". The ball draw is typically determined by one of four devices:

1. Traditional “Rabbit Ear” blower
2. "AKV": Automated blower in which the balls are encoded, read by a computer, then sent to a computerized keno system for processing
3. Random Number Generator: An electronic number selection device approved by gaming authorities
4. “Hand Cage”: A spinning metal ball cage which rolls the numbers into a slot where they are validated by a person

"Keno runners" walk around calling, "keno!" and offer to carry players' wagers to the keno booth for processing. The keno runner is handed the wager payment and the “inside ticket” (keno wager forms filled out by the customer) and takes the wager and ticket to the keno counter for processing. The keno runner returns with an "outside" ticket, which is the official wager receipt. It is incumbent on the player to check the ticket for errors before the game ball draw is drawn. Any errors not corrected before the ball draw begins are not normally rectified and the "outside" ticket receipt governs in any disputes.

In modern keno, players are offered the option of playing multi-race keno, which books a keno ticket for a number of sequential keno races up to 1000. The races must always start on the next sequential race to be drawn. When the sequence of wagered games is finished, the player is able to redeem any winnings within the time constraints specified in the casino's rules booklet.

After picking wager numbers, recording them at the keno booth and obtaining the “keno ticket” (official wager receipt), the player watches the ball draw in progress as the spot (number) selections light either on an electronic keno board or on a video monitor. Keno displays are typically found throughout the casino and sometimes even appear on a television channel in casino hotel rooms. Nowadays, after playing keno at a participating casino, keno players can even take their multi-race keno tickets out of the casino to watch the live ball draw or check historical draw results at [www.kenousa.com] anywhere there is a computer and an Internet connection.

In the past, a winning ticket needed to be taken to the keno booth for collection immediately after the race results were posted, and drawings usually took place approximately every five or six minutes. In days of old, if the player tried to redeem a winning ticket after the next sequential race began, the ticket was declared expired and no money was paid out even if it won. Nowadays most casinos set their "late pay" window to accommodate the player, however there is great variation in the published late pay window from casino to casino. Tickets played for 21 races or more typically offer one year for collection in most major gaming jurisdictions. Tickets played for under 21 races have a great disparity of late pay rules from casino to casino. Keno players are wise to read the rules published in the host casino's keno paybook to determine when a keno pay will expire and become uncollectible. Gaming authorities require that all pay scales and keno rules be posted in a prominent location in keno areas.

An embellishment of keno is “way” keno or “combination” keno. When playing a way or combination keno ticket, the player circles groups of numbers within the spots marked and specifies combinations of groups which combine together to make different "ways". For example, if a player marks four numbers, and circles two groups of two spots each, a combination ticket could be made in which the gambler plays one 4 spot and two 2 spots (2-2). If an additional group of two were added and circled, the player could play ways 1/6, 3/4 and 3/2 (2-2-2), which at $1.00 per way would create a $7.00 per race wager. Serious keno players use great imagination on keno tickets to make complex combinations of groups and ways with varying numbers of spots in each group.

As alternatives to traditional paytables which offer the selection of 1 to 20 spots, a number of special paytables are available and are often offered as a wager choice. For example, with the Top/Bottom paytable the keno player does not select any spots. Rather, the player is betting that the ball draw top 40 and bottom 40 ball distribution will be uneven. Top/Bottom typically begins paying on a 7/13 or 13/7 ball distribution between the top half (1 to 40) and bottom half (41 to 80) of the keno grid and the payouts increase with each higher ball draw distribution disparity. The same principle is applied for the Left/Right or Odd/Even paytables. Other specialty paytables are Top Only, Bottom Only, Left Only, Right Only, Odd Only, Even Only, Parlay, Exacta, Edge, Square, or eXtra Million, which is proprietary to XpertX Keno Systems. However the traditional 1 though 20 spot pick is by far the most popular variety of live keno.

Lottery versions of keno are now used in many National Lotteries or state licensed Lotteries around the world. The games have different formulas depending on the wanted price structure and whether the game is slow (daily or weekly), or if it is a fast game with just minutes between the draws. The drawn numbers are typically published on TV for the slow games and on monitors at the point of sale for the fast games. A video keno machine sometimes has a greater customer edge than a traditional keno game. However, because live keno payouts are configurable at will by the host casino, some live keno paytables house hold percentages match or are even lower those for video keno machines, which almost always have fixed paytables that don't change.

Detailed mathematical analysis

The version of Keno played in Maryland serves as a case study in the precise calculation of win probabilities and expected return—the latter referring to the result to be realized in the long run from each unit invested.

In Maryland, anyone 18 or older may play keno at any of thousands of establishments that are wired with a television screen and a pink machine resembling a cash register. The player uses a pencil to complete a small slip; the attendant feeds the slip to the machine, which generates a computer-printed ticket that is protected from tampering via cryptographic hash function. Games—which are played every four minutes or so—can be viewed over the accompanying television monitor. The computer selects twenty numbers (balls) between one and eighty. The payout is calculated based upon how many numbers (balls) were chosen and how many were matched. Intriguingly, for the nine-spot and ten-spot games, there is a payout if the player fails to match any numbers—it obviously being an unusual event for none of nine or ten selected numbers (balls) to match any of the twenty "dealt," so to speak, from the pool of eighty.

The probability that k of the n numbers (balls) chosen by the player, i.e.,

occur in the twenty numbers (balls) chosen by the computer can straightforwardly be derived:

1. The number of possible outcomes equals the number of combinations of eighty balls taken twenty at a time.
2. The number of ways in which k of the n balls selected by the player occur in the twenty balls selected (putatively at random) by the central Keno computer is equal to the number of ways in which k balls can be chosen from a set of n balls.
3. The number of ways in which the remainder of the balls do not occur in the twenty balls selected is given by the number of ways in which 20-k balls can be chosen from a set of 80-n balls.

Combining the foregoing, one finds that:

The payouts for each result can be read from the Maryland keno Web site. For the purposes of our discussion, if the player participates in the n-spot game and ends up matching k of the twenty numbers selected, we will refer to that payout as:

The expected payout for the n-spot game can be determined by summing, over all values of i from one to n (from zero to n if the game pays out in the case of zero numbers matched), the product of the payout for that result and the probability of occurrence of that result:

which could alternatively be represented as the inner product ("dot product") of the vector of probabilities and the vector of payouts.

One finds that the best game for the player is the three-spot game, which realizes an expected return of approximately 62 cents for every dollar invested, or approximately a 38% loss. The seven-spot game ranks close behind, returning just over 60 cents per dollar. Perhaps not surprisingly, despite the astonishingly high payoff for strong performance, the ten-spot game is by far the poorest from the player's perspective.

References