Baccarat: The Casino’s Nemesis

If you’re a high-roller, you absolutely must have heard of baccarat – high speed, high pay outs and popular with the gambling elite who can afford to bet millions on a hand. You can find games of baccarat everywhere, from the largest, most grandiose casino in Macau, to humble online casinos like Betfair Casino. But is baccarat the best thing to happen to casinos? Or the worst?

Let’s have an in-depth look at the game and see whether or not it’s really worthwhile for casinos to host these games.

A quick primer

If you aren’t familiar with baccarat, it might be difficult to understand some of the information on offer here, so we’ve included this quick primer. Baccarat starts with several decks all shuffled together into a ‘shoe’. Two hands are dealt from this, banker and player, and the gamblers can place money on either to win or that they’ll draw. The order of play is as follows:

• Both hands are dealt face up
• If neither hand has 8 or 9 as their total, the dealer will follow the drawing rules to allocate more cards
• If the player has an initial total of 0-5 they draw a card, if they have 6-7 they stand
• The dealer’s draw depends both on what they had and what the player has – there are multiple variables but the rules are designed to give the banker a slight edge
• Depending on the result, the winners are paid out.

In baccarat, ten value cards are worth 0 towards the score as the first digit is dropped when calculating the hand’s worth. For example, a seven and a six equals 13, which is worth 3.

Because of the rules, the odds of a banker win are actually slightly higher than that of a player win.

Baccarat in the Casino

So how long has Baccarat been a casino staple? Sources vary with some claiming it was invented in the 15th century and others the 19th century, but for the majority of its life baccarat has had a minimal fanbase in the casino. The game itself was often jazzed up and given the ‘James Bond’ treatment in order to capitalise on the fact that the famous spy himself was a fan. While it never really faded away, it was always relegated to high roller tables that banked on an appreciation of the aesthetic and wasn’t a major draw. 30 years ago, it made up around 17.81% of the casino’s revenues compared to blackjack providing 47.94%.

But nowadays bacccarat is worth 39.7% of total casino revenue in Vegas! But Vegas isn’t where baccarat has the strongest hold. Over in Macau, the biggest casino market in the world, baccarat accounts for a colossal 88% of their revenue and the gamblers of Macau are likely to be major contributors to the worldwide expansion of the game. There’s just something about the game that really seems to catch the interest of Asian gamblers, but what is it?

The Appeal of the Game

For the conventional gambler, the biggest draw of baccarat will be the low house edge. With odds close to 50:50, neither bet is a bad choice, but with the additional weighting for the banker’s hand, you’re quite likely to see yourself winning reasonably regularly. In fact, the only game with better odds in the house is blackjack which requires considerably more skill in order to win. But, much like blackjack, the pay-out for baccarat isn’t incredible which is why high-rollers are normally drawn to it. As they can bet larger sums, the return is equally sizeable.

But this isn’t the only reason, according to Bill Zender, a former Nevada Gaming Control Agent. The reason this game is so popular is also a cultural one. He claimed that because the game relies so heavily on luck, the Asian gamers felt that the pre-arranged shoe and lack of choice from the player meant any wins or losses were just down to luck and standard casino elements, for instance the practice of burning the cards after a dealing mistake, felt like ruining luck and would drive away patrons. This unique appeal of the game, the lack of advantage play or strategy, runs counter to what draws most western gamblers, in but sounds like a good time for the casino. But if it’s so good for the casino, and offers such an impressive revenue stream, how could it possibly be bad for the casino?

The Peril of Baccarat

For casinos, the fact the game has both a low house edge and a tendency to attract high-rollers means it can be colossally dangerous. If it drew one or the other it wouldn’t be a problem but if a gambler is regularly betting $10,000 per hand and wins consistently, the casino could soon be down a $100,000 or more. This is further compounded by the fact that a baccarat game that wants to attract high-rollers will need a high table limit in order to draw the serious gamblers which only increases the risk that the casino will need to pay out more than they can afford.

The irony is that this is the same problem a lot of gamblers face when playing at the casino, because the house can bet for so much longer eventually the gambler is sure to lose. However, if the gambler’s bankroll is equally impressive, it can put the casino in a precarious position where their fortunes are left in the hands of fate. This is also one of the reasons that the banker bet has a commission on winning bets, without a commission there would be no house edge at all on these bets.

Does Baccarat have a Future?

With it’s incredible popularity and outstanding earning potential, it’d be a real surprise if casinos decided to drop baccarat. While it does open them up to a certain level of risk, the expected gain if the high-rollers are unlucky makes it too tempting to pass up. You can expect more baccarat tables opening in Vegas, Monaco and other major casino cities as the years go by.

Do you think we’re right? Let us know in the comments below!