WMS Industries

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WMS Industries, Inc.
Type Subsidiary of Scientific Games Corporation (SGC)
Industry Gaming Technology
Founded 1974
Headquarters Corporate office
New York City
WMS Gaming
Chicago, Illinois
, United States
Products Slot machines, Online gambling, Mobile gambling, Gaming software/hardware development
Parent Scientific Games Corporation (Nasdaq: SGC)
Subsidiaries Phantom EFX
Casino Video Games
Jackpot Party Casino
Online Gaming Site
Website www.wms.com

WMS Industries, Inc. is an American electronic gaming and amusement company with development facilities in Chicago, Illinois. In 2013, it became a wholly owned subsidiary of Scientific Games. The company's main operating subsidiaries are WMS Gaming and Williams Interactive. WMS traces its roots as far back as 1943, to the Williams Manufacturing Company, founded by Harry E. Williams. However, the company that is known today as WMS Industries was formally founded in 1974 as Williams Electronics, Inc.

Williams initially was a manufacturer of pinball machines. In 1964 Williams was acquired by jukebox manufacturer Seeburg Corp. and reorganized as Williams Electronics Manufacturing Division. In 1973, the company branched out into the coin-operated arcade video game market with its Pong clone Paddle Ball. In 1974, Williams Electronics, Inc. was incorporated in Delaware as a wholly owned subsidiary of Seeburg and replaced the previous entity. In 1987, Williams changed its parent name to WMS Industries, Inc. when it made its public offering. WMS is a shortening of Williams, which it also selected for its NYSE ticker symbol. In 1988, it acquired competitor Bally/Midway, which it spun off in 1998, together with its video game business. It closed its pinball division in 1999.

WMS entered the reel-spinning slot machine market in 1994, and in 1996, it introduced its first hit casino slot machine, Reel ‘em In, a "multi-line, multi-coin secondary bonus" video slot machine. It followed this with a number of similar games like Jackpot Party, Boom and Filthy Rich. In 2001, a glitch was uncovered in the company's software that allowed players to earn credits on some machines without paying for them.[1] The industry leader IGT also sued WMS for patent infringement related to its reel-spinning games, winning a judgment that required WMS to limit the flexibility of its line of reel-spinning games. By 2001, however, the company introduced its Monopoly-themed series of "participation" slots. Since then, WMS Gaming has continued to obtain licenses to sell gaming machines using several additional famous brands, including Top Gun, The Wizard of Oz, Star Trek and The Lord of the Rings. WMS Gaming introduced a new video operating platform, CPU-NXT, in 2003. It employed a faster, more open architecture that took advantage of the economies of scale enjoyed by Intel and other PC component vendors.[2][3]

The company continues to sell gaming machines and to market its participation games. In 2013 Scientific Games acquired WMS Industries and its subsidiaries.[4][5]

Early history[edit]

1967 Williams Pinball Game with a Beatles theme, "Beat Time"

In 1943, Harry Williams founded Williams Manufacturing Company at 161 West Huron Street in Chicago, Illinois. The first five products were a fortune-telling machine called Superscope, another electro-mechanical game called Periscope, a novelty called Zingo, and two pinball conversions, Flat-Top and Laura. These pinball machines were made by purchasing older pinball machines made by other companies and changing artwork and other elements on the playfield. The lack of raw materials during World War II made the manufacture of new machines difficult and expensive.[6]

A Stanford engineering graduate, Williams devised the “tilt” mechanism for pinball machines. The first known original amusement device made by Williams was an early-era pinball machine called Suspense in 1946. During the late 1940s and early 1950s, Williams continued to make pinball machines and the occasional bat-and-ball game. In 1950, Williams produced Lucky Inning, their first pinball machine to have its bottom flippers facing inward in the modern manner.[6] In late 1958, Williams Manufacturing became known as Williams Electronic Manufacturing Company. In 1960, Harry Williams designed his last pinball machine as a full-time designer, the horse racing-themed Nags. The last game he designed for Williams was also one of the last electromechanical games, Rancho (1977).[7]

In 1962, 3 Coin became the first Williams machine to sell over 1,000 units (1,100, specifically). One year later, Skill Pool sold 2,250 units. In 1964 Williams was purchased by the Seeburg Corporation.[8] Its 1966 pinball machine A-Go-Go, with its avant-garde 60s theme, sold a record 5,100 units.[8] Early Williams pinball machines often included innovative features and pinball firsts, such as mechanical reel scoring and the "add-a-ball" feature for locations that didn't allow game replays. By 1967, pinball was in the middle of its so-called "golden age", and the number of pinball units that sold began to increase dramatically. Popular Williams pinballs included Shangri-La (1967), Apollo (1967), Beat Time (1967), Smart Set (1969), Gold Rush (1971), and Space Mission (1976).

Arcade videogaming and solid-state pinball[edit]

Williams was one of the major forces in arcade amusement history. Taking note of Atari's success with Pong in 1973, Williams decided to enter the fledgling coin-operated arcade videogame industry. Its first arcade videogame was Paddle-Ball.[9] In 1974, Williams Electronics, Inc. was formed to acquire the company. Williams developed its own breakthrough hit with the release of 1980's Defender, whose space alien theme and scrolling feature made it an instant classic. Williams' other notable arcade hits were 1982's Joust and Robotron: 2084. In 1980, Seeburg (which had since been renamed XCOR International) sold Williams to Louis Nicastro, who, with his son Neil, would take the company public and run it for over two decades.

At the same time, Williams entered the solid-state electronic pinball market and would come to dominate the pinball industry. Williams' first solid-state machines produced in 1976 were prototype runs based on electromechanical games; Aztec (1976)[10] and Grand Prix.[11] Williams continued to release new electromechanical pinball machines through October 1977, when they released their last, Wild Card.[12] From November 1977, Williams released solid-state pinball games exclusively, beginning with their first solid state production model Hot Tip (1977),[13] which sold 4,903 units (the electromechanical version previously released in June sold 1,300 units).[14] From the late 1970s through the 1980s, Williams released numerous innovative pinball games, such as Gorgar (1979, the first pinball featuring a synthetic voice), Firepower (1980), Black Knight (1980), Space Shuttle (1984), Comet (1985), Pin*Bot (1986), F-14 Tomcat (1987) and Cyclone (1988).

Addams Family pinball game

By 1983, the arcade amusement industry experienced a major decline. Williams managed to weather the poor economic conditions better than most. In 1985, Williams once again changed its name, this time to Williams Electronics Games, Inc. It became a publicly traded company in 1987, and the parent company's name became WMS Industries, Inc. trading on the New York Stock Exchange under the ticker symbol WMS. In 1988, WMS acquired Bally Midway Manufacturing Company, which was the result of a 1981 merger between Bally's pinball division and Bally's video game company Midway Manufacturing. For over a decade, the company was known in the industry as Williams-Bally-Midway. Williams also continued to sell pinball machines (under the Williams and Bally brand names), while Midway concentrated on video games (thus ending the Williams brand in video games in 1991). WMS created a new division in 1991, Williams Gaming (now WMS Gaming), to enter the gaming and state video lottery markets, developing its first video lottery terminals for the Oregon market in 1992.

In 1992, the company produced the licensed Addams Family pinball game based on the 1991 Addams Family movie. Addams Family sold 20,270 units, a record that still stands today. In 1993, the company produced Twilight Zone which sold an impressive 15,235 units, but the pinball and arcade game industries continued to decline. After 1993, though still the market leader, Williams never came close to matching the sales numbers of Twilight Zone and Addams Family. In 1999, Williams made one last attempt to revitalize pinball sales with its Pinball 2000 machines that integrated pinball with computer graphics on embedded raster-scan displays. The innovation didn't pay off, as the manufacturing expenses exceeded the prices that the market would bear, and that same year, WMS left the pinball industry to focus on slot machine development.[15] Over the years, however, the company produced an extensive list of video games.

During the "Golden Age" of pinball, Williams was one of the three major manufacturers (Bally and Gottlieb being the other two). For much of the later history of pinball, Williams dominated the industry even as pinball declined in popularity. In 2005, Pinball News.com reported that WMS had exclusively licensed the intellectual properties and the rights to re-manufacture former Bally/Williams games in the field of mechanical pinball (including traditional pinball and Pinball 2000-style machines) to Australian Wayne Gillard of The Pinball Factory. In 2008, Crave Entertainment released a video game developed by FarSight Studios called Pinball Hall of Fame: The Williams Collection. It features virtual representations of ten classic Williams pinball machines from the 70s, 80s and 90s. The game also features Table Art for each pinball game, including original promotional flyers.[16] FarSight and Crave Entertainment later published The Pinball Arcade, a simulated collection of pinball machines.[17] including licensed machines by Williams. Additional machines have been and will be published as downloadable content each and every month. Crave filed for bankruptcy in 2012 which only affected the Xbox 360 release since all versions for other platforms are self-published by FarSight Sudios.[18]

Focus on gaming machine industry[edit]

As the pinball industry declined, WMS invested in the hotel industry, successfully taking public and then spinning off its hotel subsidiary, WHG Resorts, in 1996 (which was later taken private and acquired by Wyndham International). Its video game subsidiary, Midway Games, enjoyed rising fortunes in the early 1990s with a number of successful arcade games, including Mortal Kombat and NBA Jam.

First slot machines[edit]

WMS entered the reel-spinning slot machine market in 1994, and its products have helped to move the industry trend away from generic mechanical slot machines and toward games that incorporate familiar intellectual properties. For more than a century beginning in the late 1800s, mechanical slot machine reels employed limited themes: card suits, horseshoes, bells and stars, varieties of fruit, black bars and the Liberty Bell.[2] WMS's video gaming roots would prove to be its strength when, in 1996, it introduced its first hit casino slot machine, Reel ‘em In, a "multi-line, multi-coin secondary bonus" video slot machine. WMS followed this with a number of similar successful games like Jackpot Party, Boom and Filthy Rich. Meanwhile, by 1996, WMS had transferred all of the copyrights and trademarks in its video game library to Midway, including Defender, Stargate, Robotron: 2084, Joust and Smash TV, as it took Midway public and finally spun it off in 1998.[19] With the closing of its pinball division in 1999, WMS focused entirely on the gaming machine industry. During the 1990s, that industry grew as additional states permitted casino gambling and video lottery games and as Native American tribes built gaming casinos.

By 2001, WMS introduced its very successful Monopoly-themed series of "participation" slots, which the company licenses or leases to casinos, instead of selling the games to the casinos. The company's participation games have included machines based on such well-known entertainment-related brands as Men in Black, Match Game, Hollywood Squares, Clint Eastwood, Powerball, Green Acres, The Dukes of Hazzard, Top Gun, The Wizard of Oz, Star Trek, The Lord of the Rings and Clue. Some of these games are networked within casinos and even between multiple casinos so that players have a chance to win large jackpots based on the number of machines in the network. These branded games proved popular with players and profitable for WMS, as the net licensing revenues and lease fees generated by each game have exceeded the profit margins of its games for sale. Other recent games include Brazilian Beauty and Hot Hot Super Jackpot.[20] WMS Industries acquired a second subsidiary, Netherlands-based gaming company Orion Financement Company B.V., in July 2006.[3][21]

From fiscal year 2006 to 2011 the company's revenues grew from $451 million to $783 million, respectively, and its net income reached $113 million in 2010.[22][23][24] The company's revenues decreased to $690 million in 2012.[4]

Current products, technology, business[edit]

WMS merged with Scientific Games in October 2013, becoming a wholly owned subsidiary of Scientific Games. Scientific Games paid $1.5 billion for WMS, and WMS shareholders received $26.00 per share. At the time of the merger, the company's stock ceased trading on the New York Stock Exchange.[4][5]

WMS continues to produce video gaming machines and, to a smaller extent, reel-spinning slots, for sale and for lease to casinos in the U.S., selected foreign markets and state lotteries. Some of WMS's product designs reflect the changing demographics of its industry. Younger players raised on video games often seek more challenging experiences, both physical and mental, than do women age 55 to 65 – the traditional audience for slot machines. Accordingly, some of the company's machines incorporate surround sound, flat-panel display screens and animated, full-color images.[25]

WMS also manufactures the G+ series of video reel slots, the Community Gaming family of interconnected slots, as well as mechanical reels, poker games, and video lottery terminals.[24] WMS began to offer online gaming in 2010 to persons over 18 years old in the UK[26] and in 2011 in the US at www.jackpotparty.com.[24] In 2012, WMS partnered with Large Animal Games to incorporate several of WMS's slot machine games into a cruise ship-themed Facebook game application titled "Lucky Cruise". By playing games and enlisting Facebook friends' help, players can accumulate "lucky charms" (instead of money). The game play is similar to playing a slot machine but includes a "light strategy component".[27][28] In 2012, the company introduced gaming on mobile devices and focused its efforts on expanding its online game offerings. For casinos, it introduced My Poker video poker games.[4]

WMS technologies include:

  • Transmissive Reels gaming platform, which employs video animation that is displayed around, over and seemingly interactively with mechanical reels. The technology is based on the CPU-NXT2 operating platform.[29]
  • Operating Platforms: CPU-NXT2 incorporates an Intel Pentium IV class processor, up to 2 gigabytes of random access memory, an ATI 3-D graphics chip-set, and a 40 gigabyte hard disk drive.[24] The CPU-NXT3 operating platform was introduced in 2012 for participation games and new cabinets.[4]

Approximately 70% of WMS's revenues are derived from U.S. customers.[23] Its design facilities are in Chicago, Illinois. It has other facilities and offices across the United States and international development and distribution facilities located in Argentina, Australia, Austria, Canada, China, India, Mexico, the Netherlands, South Africa, Spain and the United Kingdom[24] and an online gaming center in Belgium.[4]

iGaming Business

In July 2012, WMS Industries announced the formation of Williams Interactive to serve the global online gaming industry.[31]

References[edit]

  1. ^ Yamanouchi, Kelly. "Slot glitch offers cheater payoff", Chicago Tribune, May 1, 2001, accessed September 8, 2013
  2. ^ a b Eisenberg, Bart (January 2004). "The New "One-Arm Bandits" Today's slot machines are built like PCs, programmed like video games". Software Design. Gijutsu-Hyohron Co., Ltd. Retrieved 2009-05-28. 
  3. ^ a b "WMS Industries Inc. 10K filing". United States Security and Exchange Commission. September 11, 2006. Retrieved 2009-05-27. 
  4. ^ a b c d e f g "WMS Annual Report for Fiscal 2013", (ending June 30, 2013) filed with the Securities and Exchange Commission on August 29, 2013
  5. ^ a b "News release: Scientific Games Completes Acquisition of WMS", Scientific Games Corporation, October 18, 2013
  6. ^ a b "Williams-Bally-Midway the 'Roman Empire' of Gaming", Gamester81 Enterprises, January 6, 2012
  7. ^ "Williams Rancho". Internet Pinball Machine Database. Retrieved 15 March 2011. 
  8. ^ a b WMS Industries, Inc. - Company History
  9. ^ VintageComputer.net - Williams 1973 Paddle Ball
  10. ^ "Williams Aztec". Internet Pinball Machine Database. Retrieved 15 March 2011. 
  11. ^ "Williams Grand Prix". Internet Pinball Machine Database. Retrieved 15 March 2011. 
  12. ^ "Williams Wild Card". Internet Pinball Machine Database. Retrieved 15 March 2011. 
  13. ^ "Hot Tip (SS)". Internet Pinball Machine Database. Retrieved 15 March 2011. 
  14. ^ "Williams Hot Tip (EM)". Internet Pinball Machine Database. Retrieved 15 March 2011. 
  15. ^ Form 10-K Annual Report for the Fiscal Year Ended June 30, 2001, WMS Industries Inc., accessed May 9, 2012
  16. ^ Caoili, Eric. "Gamasutra's Best of 2008: Top 5 Overlooked Games", Gamasutra.com, December 10, 2008, accessed February 25, 2013
  17. ^ Ryan, Mike. "The Pinball Arcade: An Interview with Community Manager Rob Mann", Warp Zoned, 5 November 2012, accessed February 25, 2013
  18. ^ "Crave Entertainment", GameZone, accessed February 26, 2013
  19. ^ Midway Games Form S-3 dated November 27, 2001. After 2000, Midway Games experienced poor financial results. See Midway Games' 2008 Form 10-K, filed with the SEC on April 6, 2009. Midway declared bankruptcy in 2009 and ceased operations in 2010. "Finish Him! Bankruptcy Court Dismissed Suit Over Mortal Kombat Intellectual Property Rights", Morris James, LLP, September 2, 2011
  20. ^ "Play WMS Slot Games Now on your PC with Phantom EFX New Releases", TheGamingGuide.com, June 13, 2012
  21. ^ "WMS to Display Expanded International Product Line With Player Driven Innovation Features at IGE 2009". WMS press release. January 21, 2009. Retrieved 2009-05-27. 
  22. ^ WMS Annual Report for Fiscal 2008 filed with the Securities and Exchange Commission on August 28, 2008
  23. ^ a b WMS Annual Report for Fiscal 2010 (ending June 30, 2010) filed with the Securities and Exchange Commission on August 26, 2010
  24. ^ a b c d e Annual Report for Fiscal 2011, WMS Annual Reports, WMS Investor Relations pages, September 29, 2011
  25. ^ Rivlin, Gary (December 10, 2007). "Slot Machines for the Young and Active". New York Times. Retrieved 2009-05-28. 
  26. ^ WMS Quarterly Report for the period ended December 31, 2010, filed with the Securities and Exchange Commission on February 9, 2011
  27. ^ "Lucky Cruise Launched on Facebook as First Social Game Collaboration Between Large Animal Games And WMS Gaming", WMS Gaming, Reuters, February 14, 2012
  28. ^ Green, Marian. "A matter of persistence…", Casino Journal.com, June 1, 2012
  29. ^ "WMS Launches Premium, For-Sale, Multi-Game Gaming Machine on Popular Transmissive Reels Platform". WMS press release. October 7, 2008. Retrieved 2009-05-28. 
  30. ^ "WMS Wins Four Awards for Player-Focused Products in Casino Journal's Top 20 Most Innovative Gaming Technology Products Awards for 2008". WMS press release. April 16, 2009. Retrieved 2009-05-28. 
  31. ^ "US-WMS Interactive to integrate WMS’ online offering". G3 Newswire. Retrieved 17 April 2013. 

External links[edit]