United Coin’s technology boost keeps slots spinning

By Richard N. Velotta

Friday, July 3, 2009 | 3 a.m.

Nevada’s largest slot machine route operator has upgraded its telecommunications network for its 600 customers and 6,500 machines.

United Coin Machine Co.’s communications makeover has turned a spaghetti bowl of 600 voice lines to a more efficient broadband connection. The improved communication enables the company, best known for its Gamblers Bonus loyalty club, to send graphics and sound fields to its machines in local bars, taverns, convenience stores and supermarkets.

In Nevada, 46 percent of the company’s locations are in bars and taverns and 44 percent are in convenience stores. Small- to mid-size casinos and supermarkets comprise the remaining 10 percent.

Although United Coin doesn’t have an exclusive agreement with the 7-Eleven convenience store chain, it has equipment in 155 stores in Nevada. The company offers a global deal to franchised locations in Southern and Northern Nevada that the franchise operators association recommends to independent store operators.

The company, a tightly held subsidiary of Billing, Mont.-based Century Gaming Inc., that state’s largest slot operator, did not disclose the cost of the makeover.

Steven Arntzen, chief operating officer of United Coin, said the company is evolving more as a technology operation than a service and maintenance provider, although it still does both. The company’s 600 Nevada employees include about 300 who serve as attendants at the company’s leased sites and about 300 who run the routes, performing maintenance and filling machines. The company’s preventive maintenance lets technicians check every machine at least twice a year.

The company that eventually became United Coin opened its doors in 1957 and was a division of Bally Technologies, formerly Alliance Gaming. Bally spun off United Coin, and it was acquired in 2004 for $127 million by Century Gaming. Century was formed in 1986 when slot machine play was legalized in Montana.

Today, Century operates 4,500 games in about 350 businesses in Montana.

Because of the company’s connection with Bally, it had a heavy mix of Bally slot machines on the route. Today, it prides itself in having a blend of Bally, IGT, Williams, Aristocrat, Konami and Atronics games and CEI poker machines.

Arntzen said the company operates IGT bar-top poker machines in many locations and has IGT games in casinos and supermarkets. But the company is reluctant to jump in with some of IGT’s newer technology, which he thinks is more effective in large, tourist-oriented destinations than it is for most of United Coin’s locations.

“Part of our job is to keep up with what is popular and what the people want to play,” Arntzen said. “We plan to stick with what our customers want to play until they tell us otherwise.”

That, he said, involves keeping communication open between the company and the location proprietors.

“The challenge is that they’re all different,” Arntzen said. “In some places, we have some machines with some old themes, but we keep them because they are the games the customers want to play. The last thing we want to do is go in and take out something that has kept a steady customer coming back.”

The reason the games are different is that each tavern, convenience store and supermarket serves a different demographic. What may work in one neighborhood could flop somewhere else.

Although some themes are old, the company upgraded machines with game management systems that incorporated automated cash dispensers. That resulted in a more secure system and eliminated cash drawers for the site proprietors. Machines also are equipped to deliver reports to managers and even print out W2G forms, the federal income tax forms that are required for players who win more than $1,200 in a single event.

United Coin started Gamblers Bonus in 1996 and has about 70,000 members. Every dollar played on a Gamblers Bonus machine calculates a point and up to one bonus point. Once players accumulate 5,001 bonus points, they can begin redeeming them for cash with $1 for every 1,000 points. Players can redeem from $25 to $150 a day for cash based on level of play.

The program appeals to many players because it doesn’t require a card, it is available in a variety of locations and points can be converted to cash.

United Coin dwells in a competitive mix that includes about a dozen local players. Its biggest local rivals are ETT, a subsidiary of Herbst Gaming, which has a slot route that includes the Terrible Herbst convenience stores, and Golden Route Operations, a division of Golden Gaming, which operates the PT’s Pub franchise.

About two-thirds of United Coin’s Nevada machines are in Southern Nevada with the rest in Reno and Elko.

After a year of shrinking revenue, Arntzen said the slot route revenue from bars has rebounded to 2007 levels. In 2008 revenue was off about 15 percent, he said, but it was hard to determine whether the rough economy or a change in smoking laws factored more in the downturn.

To boost revenue, United Coin is in the midst of a relaunched “Cash Call” promotion that uses cell phone messaging technology to market Gamblers Bonus.

“Mobile phone text messaging marketing allows us to communicate with our members anywhere they happen to be,” Arntzen said. “We’re continuing to develop new and interesting promotions like Cash Call that utilize this growing technology.”

The marketing effort is designed to boost Gamblers Bonus, a slot club that allows members to use a PIN-protected login number. The promotion continues through July 31.

It’s the second time out for the Cash Call promotion. In 2005 United Coin picked up hundreds of new members and gave out $240,000 in cash and play. The promotion generated more than 4,000 calls a day at its peak.

“Given the larger base of Gamblers Bonus slot club members today and the evolution and greater acceptance of text messaging in 2009, we expect the 2009 promotion to be even stronger with a projected cash value distribution of more than $300,000,” Arntzen said.

Here’s how it works: Players who sign up for Gamblers Bonus call a toll-free number from a cell phone. Any member who calls by midnight will get a text message the next day. The message will say how much a player has won — from $1 to $1,000 in points. Players then must log on to a Gamblers Bonus machine to claim the prize, which can either be redeemed for play or cash.

Arntzen said the worst a player could do if he called every day during the promotion is win $31.

United Coin also has a casino management division that operates properties on a temporary basis while casino owners await licensing. The company routinely appears before gaming regulators to explain its participation in ventures that await formal license approvals.