Grand Vision machine gains final approval
By Cole Boehler
Tim Carson is an optimist. Last spring he predicted the new video gaming machine from a new manufacturing partnership, Grand Vision Gaming (GVG), would hit casino floors by July 1.
The Aug. 19 approval from the Gambling Control Division and subsequent release missed that date by about six weeks, but the achievement is nevertheless impressive: in less than a year Carson, Steve Arntzen, Heidi Schmalz, Merle Frank, Grant Lincoln and a team of engineers, artists, technicians and support staff turned mere mental concepts into highly complex operational equipment.
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| Grand Vision Gaming ‘screen shot.’ |
The Montana Tavern Times sat down with Arntzen, Schmalz and GVG sales manager Bruce Wilson in Helena Aug. 26 to learn more about the highly anticipated machine's release.
All agreed the final approval was a great relief, yet the proof of the validity of their concepts must yet wait until the actual in-the-field play data can be analyzed. That ought to be clear in about 30 to 60 days, Schmalz and Arntzen said.
Any time a piece of gambling equipment incorporates entirely new principles, some delays can be excused as engineers in the state lab work back and forth with their counterparts within the manufacturing entity submitting the device to assure everything is copasetic, and that all regulatory parameters are met.
In the case of the GVG platform, they are the first to use a USB automated storage device (ASD), or "thumb drive" as it is more commonly known. Other Montana manufacturers are also in the process of incorporating this technology.
Prior to new rules issued late last year, Montana machines needed to record machine data on impact-printed duplicating paper "audit rolls" which are loathed by both the regulator and operator communities.
The rolls are cumbersome and bulky and in most cases had to be kept for three years, filling entire, and expensive, warehouses with boxes of inert paper. To find specific transaction data needed in the audit verification process meant scrounging through the building to find the right pallet, then sorting through the boxes to find the right audit roll, then unrolling and visually scanning perhaps hundreds of feet of paper. They old system worked, but barely and with considerable labor expense.
Now, auditors, and operators, can obtain the encrypted secure data by unplugging the small ASD, less than the size of your finger, then plugging it into a computer where the data is downloaded to a spread sheet for instant on-screen analysis or for reporting and accounting purposes. Heck, the data can be viewed on the screen of the gaming device itself with no downloading required simply by accessing the administrative functions.
The new technology meant lengthy discussions with regulators regarding exactly what data needed to be recorded and in what format it would be presented. The process was painstaking but thorough, Arntzen said, and broke the new technological ground the industry will likely now tread for years.
"We have been inventing a new wheel," Arntzen said.
But back to the machine.
Schmalz said starting with an entirely blank engineering landscape actually abetted the quick development of the games and machine, since there were no work-arounds required to overcome past, and perhaps outdated, engineering. Often, building a house from the ground up is easier and faster than a complete remodel and can even be cost-effective.
Arntzen said he and Schmalz maintained more of a background posture, and even the hands-on Carson pulled back from the development process at times in order to let their development crew do what they do best: create and execute. Arntzen said the real day-to-day driving force back in the engineering shop was operations manager Merle Frank.
Schmalz said 550 machines have already been built and 600 have been ordered. With a price tag of roughly $15,500 each (which includes a special ergonomic chair and a first upgrade due before the end of the year), the math indicates the stakes in this game are high, but only the partners know how the income balances against the expense side of the ledger.
"The development costs and bill of materials on this game are huge," Arntzen said.
The $15,000-plus price tag is the highest of any VGM for sale in Montana, but the partners don't blanch at it. After all, a machine is only expensive if it doesn't generate substantial returns for the owners, they pointed out.
The machine currently runs just seven combined games of poker and keno, which raised a few industry eyebrows initially, but the partners have maintained that seven highly played quality games are better than 40 games where 35 of them are dogs.
Nevertheless, the first upgrade, included in the initial purchase price, is expected to include two new keno games and at least two new pokers. And interestingly, Schmaltz and Arntzen said their poker games are receiving a significantly higher proportion of machine play relative to keno than is the industry standard, where play is about 80 percent keno, 20 percent poker.
When asked if the new GVG platform will compete with the top performers in competitors' line-ups, GVG 's Wilson said emphatically, "It better!" Actually, the GVG machines have been running on an Indian reservation for awhile and "have been showing promising results," Arntzen said.
But with over 100 years of experience amongst the partners in design, manufacturing and distribution, and dozens more amongst the engineering–even the marketing–crew, the bet is pretty heavily hedged. Certainly the company's lenders must believe so.
Arntzen said the partners have excellent relationships with banks in their home base of Billings, then he laughed and said the lenders were getting nervous during the delays.
Of the first 600 orders, 340 are going to independent location and route operators, with the balance being set on the Century Gaming and Amusement Services routes. Arntzen, Schmalz and Lincoln are principals in Century Gaming and Carson is president of Amusement Services.
Since the day of the approval, trucks have been in motion between the GVG facility in Billings and licensed locations in the field. The day of the interview, Arntzen said another 20 machines were being set, mostly in the Billings area with installations fanning out in coming weeks.
The assembly operation should crank up again in September, Arntzen said, to fill the remainder of the orders and future orders the company feels are sure to come once the new machine's earning power has been verified and demonstrated in the field.
Arntzen and Schmalz both acknowledged the release comes during the first ever downturn in the gambling business in Montana. Revenues were down 2.18 percent in the last fiscal year (July 1, 2008-June 30, 2009) and were down 4.34 percent in the last quarter. And this is in conjunction with a smoking ban that will be fully implemented Oct. 1 and which effects are unknown and has many worried.
Nevertheless, the partners feel the introduction of a brand new gaming platform may be just the shot in the arm an industry in the doldrums needs.
Additionally, operators can certainly continue to count on new innovations from Fleetwood, Summit and Spielo, the state's market share leaders, all of which have new products in the approval process, a sure sign there is yet much vitality in this sector.
"The market will drive it," Arntzen said. "Our queasy stomachs will be gone in a month. We'll hold our breaths but we're confident. The trials were very positive."