Schuetz: How Much Skill Does It Take To Shape A Study Of ‘Skill Games’?

There's an uphill battle for a lobbyist to earn public trust, especially in a 'sin industry' such as gambling
pennsylvania skill games

Gallup Inc. is known for its global research products. The company has been publishing public perception rankings of a large number of U.S. professions with respect to honesty and ethics for several decades.

The professions that the public scores as “high” and “very high” in honesty and ethics are firefighters (which 90% of the U.S. public places in one of these two top categories), nurses (79%), engineers (66%), medical doctors (62%), and dentists (61%).

On the other end of the spectrum are insurance salespersons (13%), car salespersons (10%), members of Congress (9%), telemarketers (6%), and, at the very bottom, lobbyists (5%). And amazingly enough, lobbyists have been trending down for over a decade. The good news is they will soon have no more room to fall. 

Based on the numbers, it seems the only way that lobbyists would not be at the very bottom of the rankings was if “root canal” were declared a profession.

It is also interesting to note what the finance industry and others identify as sin industries: alcohol, tobacco, gambling, weapons, sex/adult entertainment, and, more recently added, fossil fuels.

The one-time lobbying group for the tobacco industry — the Tobacco Institute — and the “big tobacco” research arm — the Council of Tobacco Research — were, according to The Washington Post, “the twin ‘mechanisms of past lying and conspiracy’ the industry had used to fool the public.”

An early demand by state governments that went after big tobacco, which resulted in what is known as the Master Settlement Agreement, was that these two entities disappear and never come back. And the reason was they were dishonest. 

Based on the lessons of the past, it seems that a modern lobbying entity — especially for a sin industry — should work to ensure that its research efforts are of very high quality and do not become known as unclear, inexact, or misleading.

I have previously written, in another publication, that I had issues with a recent American Gaming Association research effort on diversity. I encourage you all to access the hyperlink above to understand my thoughts. In short, I felt the research effort was junk science, and following its publication, a number of people with some serious credentials in quantitative methods, mathematics, and statistics agreed with me that the research was severely lacking.

Media and methodology shortcomings

What bothered me about the AGA’s diversity study was that it did little to actually enlighten readers about diversity in the gaming industry, and I saw that as an insult to everyone except those who are male and pale. My attitude is that if one wants to address diversity in the gaming industry, one needs to get real, undertake some serious work, and not spin out some junk science effort.

I was also bothered by how the gaming press parroted the AGA’s press release about its diversity research product. I believe few of those covering the story bothered to look under the hood of the study, either because of their haste to get to print or because they were not sufficiently fluent in research methods to know what was under the hood. I am reminded of the expression “garbage in and garbage out.” I think the gaming press needs to do better.

(To those writers in the space who parroted the AGA diversity study, if you did read the study and looked at the methodology and believe I am wrong, please get in touch — I am not hard to find, and I am always anxious to learn something.)

Having said all that, I think the AGA has now provided some additional curious research.

On the AGA website, there is a study named “The Dangers of ‘Skill’ Games: Consumer Attitudes.” Under the title of “Methodology,” the following two paragraphs appear:

Kantar, on behalf of the AGA, conducted an online survey from August 11-18, 2023, among a nationally representative sample of 2,002 American voters aged 21 and over. The margin of error is +/- 2 percent and greater among subgroups.

“Skill machines” were defined as machines located in gas stations, truck stops, bars, taverns, restaurants, convenience stores, strip malls or other non-casino locations that resemble and often function like casino slot machines, in that a player inserts money for the chance to win more money. They often include player interaction beyond pressing a button and sometimes include memorization games, using hand-eye coordination, or demonstrating knowledge of the game mechanics.

The first indented paragraph above really does not say much. I did send along a note to the AGA using their website’s “contact us” function in an effort to gather more clarity and detail about the study. I waited a few weeks and did not hear back. I then sent a note mirroring the same request through the fax number listed on their website, and again, I did not hear back.

The interesting paragraph is the second one, which starts with “Skill machines” and states what the AGA study used as the definition of a “skill” game.

This definition makes no sense to me, and I wonder if the AGA believes placing the word “skill” in quotes gives it the license to create a term that defies what most knowledgeable people in the industry understand as a skill game. 

The first sentence of the definition is the meaningful part, for the use of the terms “often” and “sometimes” in the second sentence are not, by definition, necessary conditions for the definition. The necessary conditions for this definition are that the machines are in “non-casino locations,” they “resemble and often function like casino slot machines,” and a player “inserts money for the chance to win more money.” 

As an aside, I found it fascinating that the AGA referred to the “chance” to win more money in its definition of a skill game.

What is a skill game?

In the eyes of the AGA, a skill machine, by definition, relies on chance, not skill, even though skill is allegedly the critical element separating the two classes of machines.

Moreover, based on the AGA’s definition of skill games, the machines in the Harry Reid International Airport are skill games. This will be quite a surprise to the operator, manufacturers, and regulatory agency. And I won’t even start with the challenges to this definition brought on by distributive gaming.

In essence, the AGA defines a “skill” game as a slot machine that is not in a casino.

I had a priest friend who used the acronym “BFO” often. It stood for “brilliant flash of the obvious.” If you are going to measure something, it is a BFO that the definition of what you are trying to measure must be accurate. Apparently, what the AGA was trying to measure, based on the definition the organization listed, was consumer attitudes toward slot machines that are not in casinos. This will confuse a great many people who believe, as I do, that there can be more to a skill game than it simply being a slot machine that is not in a casino.

The AGA may benefit from doing a bit of homework. The definition of a skill game varies state by state, and determining the legality involves terms such as the dominant factor test (a.k.a. predominance test), the material element test, the any chance test, and other notions. Even within a state, there can be different interpretations by municipality.

It is certainly not as simple as suggesting a skill game is a slot that is not located in a casino. If this were the case, it would be interesting to spy a worker hauling a slot machine out of a casino and watch the magic transformation of it into a skill game as it passes through the door.

I suggest that the AGA may want to recognize the reality that a “skill” game may be unregulated in a state but not be illegal. In its drafting, the organization should always be careful not to conflate those two concepts. A slot machine can also be unregulated and illegal or regulated and legal. It depends on the jurisdiction. And the AGA does not seem to appreciate or does not want to acknowledge how nuanced this all can be. It is far easier to skip over the part about a skill game having the potential to be something different from a slot machine and just paint all gaming machines with the same broad brush.

Guiding the outcome

Since I wrote that previous article suggesting that the research efforts by the AGA can be, at best, weak, the organization has done nothing to change my opinion. With respect to “skill” games, the AGA has created something of a paper tiger by defining something in a way that concludes the very premise they are trying to argue. But then again, maybe that is the point.

It is also important to understand that this is not a problem of the vendor or enterprise doing the actual testing or research effort. I had a long career in corporate marketing, finance, and casino management — up to being a CEO in the gaming industry. I often knew the result I wanted in a research effort and knew what vendor to enlist, how the budget could shape the quality of the effort, and how to guide the outcome by the guidance I gave the vendor.

One of the things that has always fascinated me is that the AGA has a board of directors of over 50 people. As boards go in the modern world, this is beyond huge, and many organizational thinkers suggest that a board that is large, let alone huge, is generally ineffective and is not good policy. My opinion has always been that having such a large board nullifies its effectiveness.

I know a number of the people who are on the AGA’s board of directors, and I am firmly convinced that many of these people do not want their names associated with poorly designed research efforts that possess the potential to mislead the public. It may be time for a small group of the people on the board with research and quantitative skills to form a committee to provide an appraisal for the overall board of the research efforts being undertaken by the AGA.

My suggestion for a special board of directors committee to evaluate the quality of the organization’s research efforts is kind of like prescribing chicken soup for a cold — it probably can’t hurt. The committee may even suggest that my comments are the deranged meanderings of an old casino guy, and wouldn’t that be fun?

But if there is merit to my thoughts, it just may lead to better research efforts by the AGA, and that may help raise the public’s opinion of the lobbying profession above that of a root canal.


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