The very first “coin-in-the-slot” wheel mechanism was built in the late 19th century, and nobody could have predicted what a huge industry would evolve over the next hundred years. Today, slot manufacturers have facilities on every populated continent, churning out new games almost daily. Following is an overview of the most prolific of these machine makers, along with some insight into the reasons for their success.
The Rise of the Great Slot Makers
In the early 1960s, a handful of manufacturers dominated worldwide production of slots, all of them based in the United States. The largest, Jennings & Co., was a division of Hershey Manufacturing in Illinois, and at its height the company claimed a 40% share of the U.S. market. Its biggest rival was Mills Bell-O-Matic Corp. based in Chicago with a 35% share. The two were acquired by American Machine and Science Company and merged to form TJM Corporation, while smaller rivals such as Maryland’s Ace Manufacturing and Las Vegas Coin Machine Company struggled to survive.
The death knell for all of these early giants of mechanical slots was sounded by the development of new technology by Bally Manufacturing, a Chicago pinball maker that was founded in 1932. Bally launched “Money Honey” in 1964. It was the first slot to combine mechanical play with electric circuitry and took the industry by storm. Soon Bally was churning out more electro-mechanical models and squeezing the older slots right off casino floors. The company went public in the late 1960s, acquired Germany’s Guenter Wulff-Apparatebau and Illinois’s Midway Manufacturing. By 1969, Bally controlled a 90% share of the worldwide slot market—a virtual monopoly.
By the 1980s, TMJ Corporation dissolved. Bally diversified into amusement parks (Six Flags), casino ownership (MGM Grand) and video games (Space Invaders/Pac-Man), changing its name to Bally Entertainment. Meanwhile, International Game Technology (IGT), established in Nevada in the 1950s, had developed “random number generator” technology in 1975, which allowed computers and video screens to replace spinning reels. Once again, the slot industry experienced a sea change, as IGT went public in 1981 and quickly grew to dominate market share with innovations like video poker, progressive slots and slot player tracking. Through growth and acquisitions, IGT became the NYSE’s top-performing stock by 1994.
The Competition Heats Up
Two of IGT’s major purchases came in 1998—first Barcrest Gaming, the U.K.’s leading producer of “fruit machines,” and then Sodak Gaming, a key gaming distributor for the Native American market. By then, Bally Gaming had been spun off from Bally Entertainment and its intellectual property rights were obtained by Chicago-based WMS Industries, who launched a new line of “multi-line, multi-coin secondary bonus” video slot machines in 1996, starting with the now classic fishing game “Reel ‘Em In.”
As the new millennium opened, IGT found its worldwide domination challenged not only by WMS in the United States but also by a host of “regional” manufacturers located abroad. They included video game maker Konami Corporation and pachislot producer NewGin Co. Ltd. in Japan, U.K.-based Bell-Fruit Games Ltd. and JPM International, and Germany’s Gauselmann Group, which has become a major supplier and casino owner in Easter Europe.
One of the rising stars among slot makers in Asia now is Universal Entertainment Corporation (formerly Aruze Corp.), a Japanese company that owns 21% of the Wynn Las Vegas Casino. In 2000, they acquired SNK Corporation, followed by controlling interest in Sigma Game Inc. in 2010. In addition to its licenses to both manufacture and distribute casino machines in Nevada, Mississippi and New Jersey, the Tokyo-based company also has interests in Manila Bay Resorts and operates a subsidiary in Macau. Its “community” slot games like Paradise Fishing and Rich Life are proving UEC’s ability to innovate, too.
Even as IGT was celebrating the manufacture of its two-millionth slot machine in 2010, hot on the leader’s tail was Aristocrat Leisure Limited of Sydney, Australia. Aristocrat is probably best known for interlinked progressives and its iconic “Queen of the Nile” Egyptian-themed slot. However, the purchase of ALI Gaming Solutions in 1999 allowed the Australian company to expand quietly into 37 casinos in South Africa. It is now the market leader in supplies and services to all casinos in Sub-Saharan Africa and the Indian Ocean Islands, as well as the major force in Australia and New Zealand.
And don’t forget brands like Scientific Gaming. Current owners of Barcrest, SG also own WMS Gaming are were one of the fastest growing developers in 2016.