Regulatory Updates

Gaming Regulators and Rising Technology

Jamie Hummingbird
Jamie Hummingbird

Jamie Hummingbird, Director
Cherokee Nation Gaming Commission

Gaming regulators and operators across the country, both tribal and non-tribal, will soon be facing the challenges brought on by the latest developments in technology: server-based games, downloadable-games, and wireless gaming. Each one brings with it its own pros and cons, both of which must be appropriately addressed to ensure the proper functioning and accountability of games that utilize the technological advances.

In the not too distant future, gaming operators will be able to assess the profitability of the gaming floor and adjust the game mix by deactivating one game and downloading a new game to the same unit. A patron will be able to pick “his/her game” from a library of games residing on a server, and play them at a denomination level of their choosing. If a patron wants to escape the crowds and noise of the casino, they will soon be able to play their favorite game by means of a wireless device while sitting in the restaurant or by the pool.

It's true that these “new” technologies have been out there for a few years. There have been a few beta-test gaming facilities that offer games using these technologies, but only in a limited number of venues and in relatively small numbers. Through these efforts, the technology is poised to become the new standard in gaming. In fact, many of the major game manufacturers are expected to move forward offering games utilizing one or more of these technologies within the first half of 2008.

As with any new development in the gaming environment, gaming regulators are faced with the challenge of figuring out how to best protect the integrity of the games. A change in the technology used in gaming activities will have a ripple effect on other areas, such as player reward systems, complimentaries, and accounting. As such, existing regulations and control standards will require modification and new regulations and controls will be needed. Gaming operation management will be compelled to modify policies and procedures to deal with the change in regulation.

Gaming operators will be facing yet another challenge. In order to use these technologies, some gaming facilities will be require to make significant improvements to, or in some cases, re-build their communications infrastructure. Without having an effective network in place, operators, as well as regulators, will not be able to take full advantage of the technology.

Gaming regulators, operators, and vendors alike will also need to invest in developing significant security measures for these new technologies. Physical security controls have been long employed by the regulator and operator. Electronic security controls have also been used, but will require regular modification based on the changes to systems and/or advances in technology - and in the ways to gain unauthorized access to the systems (e.g. hackers). It will become increasingly important for regulators to conduct internal security reviews, external system penetration testing, and assessments & audits of policies and procedures. System security and integrity are paramount.

Regulators will also be impacted by the need to have someone trained in gaming systems and networks to provide them with an independent (i.e. non-vendor, non-managerial) review and certification. Some regulators will elect to have personnel on staff to address their needs on a daily basis. Some will seek assistance from outside contractors to provide this service. Others will opt for a combination of the two. The end goal, however, is the same: to provide for a secure gaming environment.

Gaming regulators have dealt with most areas affected by the new technology: licensing requirements have been instituted for those that have access to the servers, whether physically or by electronic means; processes have been put in place that ensure that all changes or upgrades made to gaming systems are tested, approved, and overseen by regulatory staff. Now, however, regulators will have to drill deeper into these processes than ever before. For example, procedures will need to be drafted to cover the multitude of methods for making changes to a gaming machine - whether by traditional means (e.g. EPROMS), servers with pre-loaded game libraries and associated pay tables, new games/game upgrades downloaded via the internet from a vendor's network center. Regulators will need to know and/or identify who must be present for the change, schedule and approve when changes can take place and their frequency, how changes must be performed, and how changes are verified (on the machine and at the server level).

In addition, new testing and verification methods and tools will also be required. Similarly, regulators will call for the development of new methods of conducting forensic tests. Once in place, regulators will make use of these new tools on a regular basis through regular audits and security assesments.

Technological advances are intended to make our jobs and our lives easier. Invariably, when we seek to make things work better or to make things easier, we must deal with the resulting side-effects. The acceptance and deployment of these new technologies may not happen over night. However, as was the case with the ticket-in/ticket-out technology, once the benefits are recognized, those that were apprehensive at first will soon be joining the ranks of the converted. The time is now to begin preparations for meeting the challenges that the future holds.

Jamie Hummingbird is Director of the Cherokee Nation Gaming Commission. He can be reached by calling (918) 207-3848 or email jamie-hummingbird@cherokee.org