One of the recent high-tech methods employed by casinos, and chip manufacturers, to deal with counterfeit chips is RFID technology. An RFID chip looks just like a regular one, except it contains an RFID tag embedded inside it that is encoded with its monetary value and other data. It also has a radio device that broadcast secret serial numbers. Special equipment is installed into the casino's computer systems that identifies the legitimate chips and detects the fake ones.
Each RFID chip only costs about $2.50 to make, which is about double the price of regular chips. This amount also doesn't include the equipment that needs to be purchased, such as the RFID readers, and computers and networking hardware. The Wynn is spent about $2 million just on RFID chips a few years ago and the Hard Rock Hotel and Casino in Las Vegas have stated their plans to implement RFID chips. Shuffle Master, the Las Vegas gaming-equipment company, acquired two patents related to RFID technology for $12.5 million and has partnered with RFID equipment maker Gaming Partners International to develop new RFID gaming products.
RFID technology comes in low frequency and high frequency. Low frequency (125 KHz) RFID chips are best for tracking, counting, authentication, inventory and security purposes. High frequency (13.56 MHz) RFID combines the benefits of low frequency combined with sophisticated player tracking capabilities that can be integrated with the casino's other systems.
Although security is the frequently-cited benefit of RFID technology, the benefits of RFID go far beyond security.
This obvious benefit is related to keeping counterfeiters from cashing in fake chips. Because of the RFID tags, if a chip is stolen, its ID can be flagged as stolen in the casino's databases, and the chip could be easily deactivated, preventing it from being redeemable for cash. Usually, only the high-denomination chips ($1,000 to $25,000) have RFID tags inside them.
A lesser-recognized security benefit is the ability to secure the accuracy and fairness of the game being played by installing RFID readers inside the gaming tables. This allows dealers to compare their own count of the chips on the table to the total that the computer shows. Here are a few aspects of game security.
Actually, they do much more than that. RFID chips are a form of security, but they are also an amazingly precise way of measuring activity in the casino.
Since credit risk is a large part of any casino's operations, the casino can manage their credit risk by monitoring the chips that they issue on credit to players. If a chip issued to a player on credit gets cashed in by a different person, this means that the player who received the chips on credit may have taken the chips out for non-gambling purposes, such as making a loan to another person.
RFID technology may also help casinos by creating targeted marketing campaigns that are personalized to individual gamblers. The technology allows casinos to "rate players", which means offering them comps (free room or meals) based on how much and how often they wager.
But the technology may also allow casinos to rate how well a gambler plays. The casinos generally reserve the best comps for their most "valuable" players - that is, the worst-skilled players. Currently casino technology is very good at monitoring the scale of a player's activity, but is not very efficient at rating the skill of a player's activity. A casino can only do this manually - by directly monitoring a player's activity. The only exception to this is the slot machine, which is essentially a computer that constantly analyzes information. The superior technology inside slot machines has led to slots generating the majority of casino profits. Casino management hopes to duplicate the analytics that slots employ and apply it to table games. So, RFID may also allow casinos to rate the skills and decisions of players on a mass scale. Imagine walking up to a craps table and being labeled as a "Craps donkey" because you often choose the worst-appealing wagers.
RFID allows casinos to improve the accuracy of the chip counting and cage inventory procedures.
Many casinos are holding off on buying RFID chips because they cost too much at this point. The technology is also not completely up to speed because it takes the RFID reader a few seconds to read all the chips at the table, which slows down the game a bit.
RFID technology is triggering some concerns from privacy activists, who are worried that the technology is too intrusive with regard to monitoring people's activities. These concerns about Big Brother have been relatively mild though since casino betting is a completely voluntary activity. Also, most people aren't worried about their privacy at casinos since casino surveillance is already very heavy.
HPG ADMIN on March 1, 2013