The first slot machines can be traced back to the 19th century! The first gambling machines were manufactured in New York by the company Sittman and Pitt. In 1891 the company made a mechanical machine for playing a simplified version of poker. In fact, these machines from another era were the video poker of today.
As for the first modern “slot machine”, it first appeared in 1894. This mechanical slot machine known as the Liberty Bell was invented by Charles Fey.
Cigar and drink prizes
In 1891, there were no restrictions on gambling. In New York, as well as in other major US cities, poker machines manufactured by Sittman and Pitt were available in bars, and sometimes even in tobacco shops and men’s hairdressing salons.
In just a few years, Sittman and Pitt sold thousands of poker machines. However, while poker machines were played with real coins, they didn’t pay out in real money. Winning combinations were rewarded with cigars, and sometimes drinks, especially in bars.
Due to the success of Sittman and Pitt’s poker machines, other companies also ventured into this new gaming industry. Poker had already become a popular game by this time, and poker machines were played on a massive scale.
Coin insertion and reels
To try your luck on these poker machines, you had to insert a nickel into a slot, and then pull a small lever. This caused 5 reels, each featuring 10 playing cards, to spin.
Traditional poker is played with 52 cards. On poker machine reels, two cards were removed: the ten of spades and the jack of hearts. This reduced by half the chances of getting the best hand: a straight flush. However, this didn’t stop players from getting caught up in the excitement of the game.
Slot machines with automated payouts
The first slot machine in history to pay out in real money dates back to 1894.
Charles Fey, a German who emigrated to the USA, was behind this invention. His invention, “The Liberty Bell”, was revolutionary in its day. Fey’s simple mechanical slot machines featured 3 reels and one payline. On the reels, there were no cards, but card and horseshoe symbols, and images of the Liberty Bell.
The amazing thing about these Liberty Bell slot machines is that the payouts were automatic. There was no need to ask the machine operators to check the wins and then reward the winners. This was the beginning of mechanical slot machines with automatic payouts.
Charles Fey
Trained as an instrument maker, Charles Fey was also keen on mechanics. Before arriving in the U.S., Fey already had a taste for adventure. He worked in England and France in various machine factories. In 1885, he crossed the Atlantic to join his uncle in New Jersey. After travelling to various US states, Fey settled permanently in San Francisco. In 1890 he opened a machine repair shop.
In his spare time, and after four years of research, Fey succeeded in building a slot machine in 1894 that was to be his greatest success, the Liberty Bell. Charles’s genius was about to make him rich. Instead of selling his machines, he made them available to San Francisco barkeepers, and received half the revenues from the machines.
Almost all the bar owners in San Francisco had agreed to partner with Charles Fey.
Competition and Prohibition
Within just a few years, between 1900 and 1905, several companies entered the promising slot machine industry. Most of the new slot machines of this era bore an uncanny resemblance to Charles Fey’s Liberty Bell machine. Naturally, this hurt the business of the founding father’s first automated payout slot machine.
In 1909, slot machines were prohibited in San Francisco, and by 1910, many US states had also banned gambling. Indeed, gambling addiction had caused major problems for society. Even if trying your luck only cost a single nickel, many gamblers had gone broke on the “one-armed bandits”.
Fruit Machines
To bypass laws prohibiting gambling in the USA, slot machine manufacturers had a great idea in the 1910s. Instead of slot machines that paid out in coins, they were going to make chewing gum machines. Although the idea may seem far-fetched, these machines were nevertheless remarkably successful. Winners were paid with balls of chewing gum.
The symbols on the reels of these fruit machines were fruit flavor icons!
Prohibition and Mafia
During the period of prohibition on alcohol in the United States from 1920 to 1933, slot machines made a lot of money for the Mafia. As well as illegally selling alcohol, the most notorious Mafia families had a stranglehold on slot machines. Placed in speakeasies, the Mafia’s one-armed bandits made huge sums of money in profits.
It wasn’t until December 5, 1933, when Prohibition ended, that slot machines became legal again. However, it wasn’t until the first Las Vegas casinos opened in 1946 that mechanical slot machines became a mass industry.
From 1946 to now
The years after the end of the Second World War were golden ones for slot machine manufacturers. The governments of developed countries were extremely interested in the tax revenues derived from gambling. Between 1946 and 1980, many countries decided to allow slot machines in casinos. In addition, wealthy investors had made it possible to build large casino gaming resorts all over the world.
Although the Internet has been a big part of the casino business since the 2000s, there are still major projects for land-based casino resorts in the pipeline. This year alone, North America’s largest casino opened its doors in Ontario, Canada, in June 2023. This resort, the Great Canadian Casino Resort Toronto, is reported to have cost $1 billion !
Tax revenues
In many countries on all five continents, gambling represents a huge financial windfall for the state coffers. Surprisingly, it’s not the players’ winnings that are taxed, but rather the profits made by gaming operators.
Lottery games are big business in many countries, and so are sports betting kiosks. Casinos are also part of the high-volume gambling sector. However, since the 2000s, many gamblers have become increasingly interested in Internet gaming options. Nowadays, a large percentage of the business of land-based casinos has passed into the hands of the operators of online casinos.
Casinos on the Internet
The first virtual casinos go back to the 1990s. Over the years, Internet gaming offers have steadily improved. Now in 2023, you can even play live blackjack and roulette online with real dealers. Thanks to live streaming Web servers, users now have access to this state-of-the-art technology.
Slot machines account for over two-thirds of casino revenues. Among the most popular slot machines, there are classic 3-reel slots that resemble the Liberty Bell slot machines of 1894. Which just goes to show that Charles Fey made history.