The history of slot machines from Liberty Bell to Mega Moolah

There is no doubt that Mega Moolah is a great video slot game. It didn't get to be what it is today by accident, though. There is a lot of history behind an industry that traces its roots back more than 100 years. The whole concept of slot gaming evolved from a novelty idea that eventually gave us the technology we now enjoy.

If you are interested in learning more about the history of slot machines, this post is one you will truly enjoy. We will take a look at how the slot machine came to be, how it managed to prosper even during years when gambling was outlawed, and how mechanical slot machines gave birth to the video versions we now play.

Late 1800s: The first slot machine

The term 'slot machine' comes from our modern understanding of mechanical slot machines. In order to play a mechanical machine, you must insert a coin into the "slot" provided. But back in the late 1800s, a slot machine had nothing to do with gambling at all. Instead, it was an automatic vending machine that gave you what you wanted only after you inserted a nickel.

The first slot machine was actually called a gambling machine. It was released in 1891 by a New York company known as Sittman and Pitt. The game was essentially a mechanised poker game intended only for novelty purposes. Players would insert their nickel and pull a lever. Drums inside the machine would spin along with playing cards attached to them. When they stopped, the player would look inside to see if he/she had formed a decent poker hand.

It didn't take long for the machines to make their way into bars and pubs throughout the city. Because they had no direct payout mechanism, the bartender would have to verify a win before paying the prize. More often than not, the prize was a free beer or a cigar. Early machines didn't offer cash prizes.

A new game mechanism

While the Sittman and Pitt machine was entertaining bar patrons, an inventor by the name of Charles Fey was working on a simpler mechanism that would accomplish two things: make registering wins a lot easier and allow for automatic payouts. The first iteration of his mechanism was built into a coin-operated gambling machine released in 1894.

Fey continued to develop his automatic mechanism. The following year he came up with the 4-11-44 machine and began distributing it to local pubs. It proved so popular that he quit his own pub job so that he could open a factory to build machines.

By 1898 Fey was ready to start building the Card Bell machine, a gambling machine based on poker hands. He began building the legendary Liberty Bell machine in 1899. The Liberty Bell dispensed with the poker foundation and instead combined playing card symbols with horseshoes and bells. Rather than trying to form a poker hand, players looked to land like symbols.

The Early 1900s: slot machines go big

Fey's Card Bell and Liberty Bell machines were instant hits in his hometown of San Francisco. By the turn of the century they were making their way clear across the country. They proved so popular that other companies, like the Mills Novelty Company of Chicago, began making their own machines.

It wasn't long before every company manufacturing automatic vending machines started building gambling machines. This is about the time people started referring to them as slot machines. It was also around this time that the same people who had a moral objection to alcohol started showing their concern over legalised gambling.

As the first decade of the 1900 began drawing to a close, competition among slot machine producers continued to escalate. The Industry Novelty Company made its name in 1909 by introducing a new slot machine using fruit symbols instead of playing cards and horseshoes. But all was not well. San Francisco banned slot machines that same year. Thousands of "mechanical pickpockets" were either smashed or dumped into the ocean.

Slot machine gambling was outlawed in the United States just a few years later. To get around this, Industry Novelty Company decided to use its fruit symbols to its advantage. Rather than building slot machines, they started building chewing gum dispensers. Other companies followed suit.

These new machines were still gambling machines, but their automatic mechanisms dispensed chewing gum instead of cash prizes. The real prizes were passed over the counter when no one was looking.

One other important development occurred during this time: the invention of the jackpot. The Mills Novelty Company came up with the concept in 1916. Any lucky player who hit the right combination of symbols would win all of the coins currently in the machine.

The era of organized crime

Legal restrictions on slot machine gambling led to organised crime getting involved. Along with bootleg liquor, mobsters took over building and distributing slot machines from the mid-1920s all the way through the nine years of the Great Depression. The end result was a federal government that placed even more restrictions on gambling.

Things eventually got to a point at which slot machines were only allowed in private social clubs. They were illegal everywhere else. The one exception to the rule was Nevada. The Silver State legalized all forms of gambling in 1931, opening the door to an industry largely credited with building Las Vegas.

Despite legal restrictions, slot machine gaming continued to thrive in secret. If a person couldn't go to Vegas to play, he or she would simply find a back-alley club where slot machines were available. But just like prohibition could not squelch America's thirst for alcohol, laws against slot machines didn't stop players from playing. By the early 1950s, law enforcement was all but ignoring illegal slot machines.

The Post-War Era: Rise of the machines

The next big development in slot machine gaming occurred in Las Vegas during the post-war era. Despite World War II being the economic engine that pulled America out of the Great Depression, the war effort racked up huge amounts of debt for the federal government. They began looking at slot machines as a tool for revenue generation.

The 1950s saw the introduction of the electromechanical slot machine. This technology combined the best slot machine mechanics with new electronics that made for multiple payout options in a single game. You could make the case that this was the next big step in slot machine gambling. With multiple payout options came more opportunities to win.

Las Vegas embraced these new electromechanical slot machines with open arms. Well-known mobsters like Bugsy Siegel began opening casinos in Vegas as a way to both make money and launder what they were making illegally in other parts of the country. Vegas casinos began to market slot machines as suitable for the ladies while the gentlemen spent their time and money playing poker.

The idea of slot machines being for the ladies had an unintended effect: it caused people who couldn't afford to play high-stakes card games to realise they could still gamble anyway. They could play a lot of slot games with $100 in coins. That same amount of money wouldn't get them very far at the blackjack table. Slot machines became the game to play.

The One-Armed Bandit

It was during the 1950s that the American slot machine earned the nickname 'one armed bandit'. Where did the name come from? It came from the highly unlikely odds of a win. Suffice to say that Vegas casino owners didn't worry a whole lot about being fair back then. For one thing, Vegas was controlled by the mob. But there were also very few regulations governing slot machine design.

The one-armed bandit was seen as a machine more than willing to take your money without giving you anything in return. Most of the machines of the day were single payline machines, with either three or five reels. The winning formula was simple: get three like symbols and you win.

The 60s and 70s: From electromechanical to video slots

At some point during the mid-1950s, game developers decided they wanted to introduce more payout opportunities by increasing the number of paylines and reels. They went to work. By 1963, Bally had come up with a fully electromechanical slot machine with a bottomless hopper and a payout system capable of dispensing 500 coins without any human intervention. That game was called 'Money Honey'.

Continued technological advancements allowed game developers to add more paylines and more ways to win. Then something amazing happened: game developers figured out that it was possible to get rid of all of the mechanics and transform a slot machine into a completely electronic device.

From the late 1960s through until the early 1970s, designers were tinkering with video technology. The very first true video slot machine was introduced in 1976 by Fortune Coin Company. The Las Vegas vendor introduced the game in Kearny Mesa, California with great fanfare. It featured a 19-inch colour monitor and a series of electronic logic boards that produced the video image and handled all game functions simultaneously.

Fortune Coin had to make some modifications to their original game to prevent cheating. With the fixes in place, they began full production. The first of those production games made their way to Las Vegas. Fortunately, city and state regulators saw this coming years in advance. They already had regulations in place to prevent cheating on both sides. Regulators quickly approved the new video slot machine and the rest is history.

Fortune Coin Company was eventually acquired by IGT in 1978. They continued developing the original video technology even as their competitors did the same. Intense competition continued all the way into the 1990s, giving us the kinds of video slots that we are most familiar with today.

The Modern Era: Online and mobile slots

Video technology is perhaps the most important thing to have influenced video slot gaming since the first machines were built in the 1800s. Video technology allows for an endless array of possibilities that transcend the limits of mechanical and electromechanical machines.

As a result, we now have video slot games that can pay out thousands of different ways. We have slots that offer bonus features ranging from free spins to multilevel bonus games that involve role-playing. To keep things fair, computerised random number generators determine how symbols land on each spin.

Number generation systems have to be truly random in order to win approval from regulators. Systems have to be routinely audited as well. Yet despite tight controls, the biggest benefit of a video-based system is that the same number generator can be used on virtually any video slot machine. Once a company's technology is audited and approved, it doesn't have to keep producing a new number generator every time it introduces a new title. That part of the technology is done.

Welcome to the internet

So what's the big thing in video slots today? Gambling online. It is not a stretch to say that the internet has done for gambling what video technology did for slot machines. Thanks to the internet, we can now play all of our favourite slot games online. We can even play without having to be tethered to a desktop PC. We just bring up our favourite games on a smartphone.

It was more than 100 years ago that an enterprising company in Brooklyn, New York decided to introduce a novelty gaming machine that people could play while having a beer. A lot has changed since then, and it's all good. What began as a fun way to pass some time at the pub has become a multi-billion-dollar industry supported by players from all over the world.

From the moral crusaders of the early 20th century to prohibition and organised crime, the venerable slot machine has proved to be a survivor. That's why you and I can play the Mega Moolah slot in 2018.

The Future: Bitcoin and the dawn of Provably Fair Gaming

Provably fair gaming systems allow the operator to publish a method for verifying each transaction in the game through open source algorithms, hashing, and random number generation. The player can independently and immediately verify the authenticity of e.g. a card shuffle. The benefit of a provably fair system is that third-party verification and auditing is unnecessary.

Combine Provably Fair Gaming with bitcoin and you add privacy, immediacy, and irreversibility. Bitcoin doesn't respect national borders and there's no third-party middlemen to process payments. It's the ideal digital casino chip for the modern world.

Progress cannot be stopped, but it can be slowed down by law-makers and anti-gambling activists - as they have done since Liberty Bell. It doesn't take much for governments to outlaw gambling or establish licencing regimes to take a large cut of the action - and that's what we've seen happen over the past few years.

Byline: This article was published by Mega Moolah expert Henry. Media and other enquiries.

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