By Roger Gros   Tue, Aug 30, 2011

Everybody loves a winner, and Don Johnson seems to be a favorite of all casino gamblers. Although he built a very successful horse-race handicapping business and managed Philadelphia Park racetrack for a time, Johnson’s fame has risen from his proficiency in playing blackjack at Atlantic City casinos.

Over the past year, Johnson has won $4 million from Caesars Atlantic City, more than $5 million from the Borgata. But his biggest “score” to date—and the one that attracted most of the media attention—was a $5.8 million win at Atlantic City’s Tropicana in April. While Johnson admits to some losing sessions, his success, he says, is due to one key concession from the casinos where he plays: a discount on his losses.

Johnson’s consistent wins made some suspect that he may have been cheating or manipulating the cards, but others knew better. He was merely taking advantage of a situation that the casinos themselves agreed to. Johnson understands numbers and proposed set game rules, betting spreads and limits, and discounts on losses, which he says was crucial.

Discounting History

Table game discounts are hardly a new development in the gaming industry. They’ve been going on for at least 30 years. Jim Kilby, a casino consultant, former executive and author of Casino Operations Management, the “Bible” of any gaming operation, is critical of how casinos offer these discounts and claims to have been there at the beginning of the trend.

“I’m sorry to say I may have been partially responsible for this when I worked at the Trop (Las Vegas) in the early ’80s,” he says.

According to Kilby, the competition for high rollers was reaching a peak at that time.

“We had a group of high-rolling gamblers who would come in and play for 50 or 60 hours each trip,” he explains. “They’d lose around $1 million and take months to pay it off. So our casino and others made a deal with them. If they paid off their markers before they left, they’d give them a 5 percent or 10 percent discount.”

While it seemed like a rational offer at the time, Kilby said discounting began to spread like wildfire.

“It began to spread as executives moved around,” he says. “If a baccarat pit manager wanted to move down the street, that casino would want him to bring players with him, so they would agree to deepen the discounts. It became a vicious circle. It’s insidious.”

The problem, says Kilby, is that the discounting isn’t as simple as it appears.

“It looks like the discount only costs you 10 percent,” he says, “but it’s usually more costly. We discovered that for the average discount player, we just broke even. And that was without the expenses of actually operating the marketing department.”

Kilby shudders when he hears an executive talk about how his casino “beat” a particular player, explaining that there is no such thing.

“I hate that term ‘beat’ because you do not keep what losing players lose; you only keep the difference between what losing players lose and what winning players win,” he explains. “So they ask me, ‘If a player loses $500,000 and we refund $100,000, haven’t we just won $400,000?’ No, because you’re going to have another player or another group of players that comes in and wins, and you won’t get that $100,000 you discounted to the first player back from them.”

Making the Choice

Casinos have to evaluate their risk when competing for the big players. Max Rubin, a former casino executive and author of Comp City: A Guide to Free Casino Vacations, believes discounting has a place in the industry, but executives have to evaluate it very carefully.

“Today’s casino operators are very savvy,” he says. “They understand the business, particularly the big companies like MGM, Caesars and the Sands. They know what they’re doing and who they can offer those discounts to and who they can’t. There is a professional here and there who will slip through the cracks, but by and large it makes the casino money. And those companies get enough business so they can overcome the deep discounts and the wins that some players make. But you don’t see a Gaughan or any mid-tier operators in Vegas getting into that game because they understand that they don’t understand it. That’s really a crucial point to grasp.”

Kilby believes the small margins make it a loser for every casino but the largest corporations.

“The good thing about premium play is that there is a high profit margin,” he says. “The bad thing about premium play is the extreme volatility. When we invented the discount, we kept the bad—the volatility—but we’ve done away with the good—the profits.”

Rubin says the big companies can still make profits even with a narrow margin.

“Unquestionably it is a small-margin business, always has been,” he says. “But it’s a small margin on a huge amount of money, so they can still make a lot of money.”

But the smaller casinos had better beware, he says.

“If you’re a single, stand-alone property and you don’t have an appetite for volatility, it might not be the way to go,” he says. “The Tropicana (Atlantic City), probably given the nature of where they stood with the markets and ownership, probably should not embrace these players as much as a Wynn Resorts would or one of the other big companies.”

The bad economy probably influences the decision these days, says Rubin.

“Casinos get so desperate to get a big win given the erosion of profits, they are gambling,” he explains. “And that’s the trap that some of these smaller and stand-alone casinos get caught in. This often offsets all of the other business you take in. For example, it’s highly probable that Don Johnson was betting more on one hand than all the other players in the casino were betting at the same time. It’s impossible to offset. And they just ran unlucky. Had they had a war chest like an MGM would have, they could have withstood those kinds of hits. But I don’t think its good business for a small casino to take the chance they’ll take a hit like that.”

All casinos have owners, whether they are individuals, boards of directors or Indian tribes. Rubin says the decision to pursue this action should take place at that level.

“From an operator’s standpoint, there are other implications to whether you should take the bet simply because you have the edge,” he says. “Some of those implications are what does it do to your quarterly earnings, what does it do to the longevity of your management team or CEO. In Indian Country, you have to answer to a tribe that may not want to embrace this volatility. An MGM, on the other hand, isn’t going to worry about a player that beats them for $5 million or more. They know they’ll get it back.”

And there are other reasons that would preclude taking the action that have nothing to do with volatility.

“It takes all the energy out of your company,” says Rubin. “If you start focusing on this player or this small group of players, everything else becomes secondary. You lose focus on the larger pool of players who are really providing the foundation for your organization. Most casinos are much better served not trying to get this business, not trying to play the game. They’d be much better served trying to get the $5,000, $10,000 or $25,000 credit-line players in action rather than pursue this often unrealistic group, where the margins are much slimmer. Those smaller players won’t affect your bottom line as much, and won’t threaten your career longevity either.”

Aaron Gomes, the vice president of casino operations at Resorts Atlantic City, turned down Johnson when he proposed a similar deal to the one accepted by the Tropicana.

“It wasn’t a smart offer, and common sense told us that it wouldn’t work for us,” he says.

Tony Rodio, the recently appointed president of the Tropicana in Atlantic City, says his casino’s goal is simply to increase business.

“Our strategy is to offer higher limits,” he told Global Gaming Business. “And the more you allow them to bet, the more they can win. When you allow a player to bet $100,000 a spot on blackjack, they can win quickly. For the first eight or nine months of the program, the Tropicana played lucky. Just my luck, when I arrive it swings back the other way.”

Setting Limits

A report in Blackjack Insider said that Johnson’s deal was hard to beat. In addition to his 20 percent discount, he set the rules of the game—a hand-shuffled six-deck show, standing on soft 17, splitting up to four times were just some of the rules—and the betting limits. He reportedly had the option to bet $15,000 on three spots, $25,000 on two or $100,000 on one spot.

Kilby says that was just playing into his hands.

“The casino was just encouraging more volatility,” he says. “This player knew that he’d much rather bet $100,000 on one hand than smaller amounts on two or three hands.”

It’s the deal that makes discounting so bad, says Kilby, not the rules of the game.

“If a player can make a discounting deal with a casino and really understand how it works, he can lower the house edge on any game,” he says. “There’s one dice player in Las Vegas who shops deals that turn the game in his favor. The last one I looked at, he had a positive expectation of about $20,000 an hour.”

Johnson’s deal required him to buy in for $1 million and he’d get the 20 percent discount after he lost $500,000. But Johnson said he’d never lose the million.

“If you got to minus-five hands, you would stop and take your 20 percent discount,” he told Blackjack Insider. “You’d only owe them $400,000.”

It’s that discount that caused Resorts to refuse his play on his terms.

“When you think about discounts, a 20 percent discount is really a 40 percent discount,” says Gomes. “We’ll assume that there is no edge, since the numbers are so small, so the player will win half the time and lose half the time. You’d be crazy to give them a 20 percent discount because you don’t get a discount when you lose! So there’s their 40 percent discount. And when you add show-up money, match play, airfare, comps, they player has the edge. It’s nuts!”

Kilby says craps is even worse.

“Forget about discounts on dice,” he says. “The fluctuations are too great.”

Rodio found that out the hard way when a second player beat the Tropicana for $5 million at the craps table.

“We allowed a player to bet $10,000 on the line at craps,” he says. “It doesn’t sound like a lot, but when you throw in five-times odds; he’s buying all the numbers and prop bets; he’s got $180,000 on the table for every roll. If he holds the dice for 15 minutes he can win hundreds of thousands of dollars. That said, over time, it’s going to swing back.”

 Rubin agrees about the math

“The math will catch up,” he says. “It always catches up. But if the math is in the player’s favor, then you have to expect that it will catch up big time.”

If you’re going to offer a discounting program, you have to set reasonable parameters. Gomes says Resorts has done just that.

“We do have a discount policy, but it’s a quarterly program with at least three trips during that period,” he explains.

The long time period and a requirement for time played will avoid the problems encountered by creating short “trips,” says Gomes.

“If you have a customer who comes in one day and loses $200,000 with a 20 percent discount, and then comes in the next day and wins $200,000, he’s even gaming-wise, but he’s up 40 grand! How does that makes sense?” he asks.

Kilby says the numbers will tell the story.

“Casinos have requirements on how long a customer has to play, but then have a provision for a quick loss, which is silly,” he says. “Mr. Johnson in Atlantic City would be done after losing five hands, so how does that work? You have to develop an objective system.

“It cannot be based about how much a player loses. It has to be based on how many hands he plays and the volatility of his betting. And then of course you have your administrative costs.”

Rubin says that it takes more than just a computer program to determine if a casino should accept action from a particular player.

“If you know your players, you’ll know that some will just play as long as possible until they’ve lost their money,” he explains. “That’s just who they are. You have to know your players, and that’s why you rely on your director of player development when you decide whether or not to take this action. Blackjack isn’t simply about the math; it’s about the people and their behavior. If you have a brand new player coming in requesting these things, the alarms should go off. But if you have a player who has a record of playing in different places with a long track record of being a profitable guest, the math won’t help. You do it. That’s a good decision.”

By Rich Geller   Tue, Aug 30, 2011

It has been over two years since the government of Ukraine shut down all legalized gambling in the country. What was supposed to have been a temporary ban awaiting new regulations became an indefinite hold on virtually all forms of gaming.

In 2010, various bills designed to reintroduce the once-flourishing industry—but this time with consistent behavior on the part of the authorities—never made it through parliament. Even now, with one of the country’s most powerful anti-gaming political leaders under arrest for unrelated past matters, there is no clear path forward. And with less than a year to go before Ukraine co-hosts with Poland the 2012 European soccer championships, there is no reason to assume that the legislative logjam will be addressed in the autumn parliamentary session. But it could be.

Ukraine before the ban was something of a Wild West territory when it came to gaming. Although regulations were in place that included licensing fees and taxes, the reality was that a much more informal situation held sway outside of the major cities. Literally thousands of gaming venues were in operation around the country of 40-odd million, in every neighborhood. Of an estimated quarter-million slot machines, only half were thought to be licensed. The government was missing out on over $1 billion worth of revenue annually, and the player was pretty much dependent on the virtue of the operator and local authorities.

The end of the era came suddenly in May 2009. In the city of Dnipropetrovsk, a fire broke out at a slot arcade operated by Metro Jackpot Company and resulted in the deaths of nine people and injuries to 11 others. The tragedy was quickly seized upon by anti-gaming factions within parliament, who pushed for and won an emergency ban on all casinos and gaming machine businesses in the country. The ban made no distinction between legitimate operators abiding by the rules—such as the local subsidiary of publicly listed Olympic Entertainment Group of Estonia—and those who chose to work outside the law. The move was supported by 340 of the 442 ministers of parliament.

Leading the charge at the time was then-Prime Minister Yulia Tymoshenko. The attractive and charismatic gas-speculator-turned-politician had no sympathy for those protesting the loss of some 200,000 jobs in the gaming sector.

“There are those who say that this is a business and people have lost their income and jobs. But drug trafficking is also a business that provides income and jobs,” said Tymoshenko, quoted on her own website. “For me, drugs and gambling are the same. We need to put the issue of gambling to a close. And I believe this will be to the benefit of the people of Ukraine.”

For Tymoshenko and her supporters, the solution was to follow the Russian example: banish gambling to remote regions where its harmful effects would be minimized.

“The gambling industry should be located outside of cities,” Tymoshenko said, following a May 2009 meeting of the government commission investigating the arcade fire. “This practice exists in other countries, and we need to put a stop to such poisoning of the morality of our youth. I know that this measure was recently approved in Kazakhstan and Russia, and for a long time now most states in the U.S. do not allow gambling facilities in cities.”

It was a seemingly odd choice for someone who together with Viktor Yushenko had led the anti-Moscow “Orange Revolution” in 2004. The Russian closure of gaming venues outside of the infamous four empty gambling zones was scheduled to take place in two months. But since 2004, the paths of Tymoshenko and Yushchenko had diverged, to the point where President Yushchenko at first vetoed the bill that arrived on his desk. But he quickly bowed to growing public sentiment, although not without registering his protest.

“I’m dissatisfied with this decision,” said Yushchenko. “I don’t find in it any answer to resolving this problem in the country.”

The law included instructions for the cabinet to draw up new legislation to regulate the gaming industry and to designate the special zones where gambling would be permitted. The task was supposed to be completed in three months, but nothing happened. The casinos and slot halls remained closed—officially—at year’s end.

A New Regime

In February 2010, Viktor Yanukovych was elected president, defeating Tymoshenko by some three percentage points in the second round of voting. Yanukovych lost the 2004 election to Yushchenko after allegations of fraud had forced a repeat vote.

Since taking power, Yushchenko’s Party of Regions and other supporters have introduced several bills intended to restart the gaming industry. Generally, to no avail.

One of the first efforts was a proposal by Mykhailo Brodsky, chairman of the state committee for regulatory policy and entrepreneurship, to allow casinos at hotels in the resort area of Crimea and at five-star hotels in major cities around the country. The motivation for allowing casinos to again operate was to raise funds for the general budget and for projects involved with the 2012 European soccer championships, which Ukraine is co-hosting along with Poland. Additional variations on this theme have since surfaced, but none have become law.

Of course, the problem with having no regulated gaming is that unregulated gaming thrives in its absence. Internet cafés and sports bars—whose publicly accessible computer screens can offer any game virtually—filled the gap left by the departure of the physical slot machines and table games. The operators were able to take advantage of a loophole in the law that did not recognize this format of gaming.

In January 2011 came the first attempt to rein in the internet cafés. VostokReport, a young consulting group specializing in gaming in the Baltics, Ukraine and Russia, reported the introduction of an amendment to the original law banning gambling. Bill 8024 added gambling online or by computer simulation to the list of prosecutable offenses. In April the parliament voted to adopt the bill—introduced by Tymoshenko’s party—in first reading by a vote of 289 to 161.

In May, the parameters of what is gambling were expanded even further. Tymoshenko’s party managed to get parliament to accept a more detailed definition of gambling. The second reading of Bill 8024, adopted by a vote of 251 to 199, defined gambling activity as any activity aimed at providing access to gambling, whether that be in a casino, or via a computer terminal or slot machine simulator. A gambling game now is defined as any game in which participation requires payment by the player, including by electronic means, and which enables the participant to win a prize based on randomness. The bill was signed into law by Yanukovych in early June.

In mid-June, the Party of Regions introduced draft legislation to create a state monopoly on lotteries. Bill 8652 would go so far as to prohibit the very use of the word “lottery” by all gaming operators other than the national monopoly. The reason for limiting the use of the word is that in many countries in the region, calling a game a lottery is a semantic fix to get around the letter of the law.

The intent of 8652 is to channel the money currently being spent on privately operated lotteries into the national coffers, ostensibly for use on “good cause” projects. VostokReport says that the treasury’s share of lottery income is forecast to exceed UAH2.65 billion—about $328 million—for the period 2011-2015.

A single lottery operator would be sought and awarded a license valid for 12 years. The bill requires the operator to maintain an official lottery office in designated areas with populations of 500,000 or more and have representatives in areas with population of 5,000. Share capital requirements for the operator are to be the same as in effect for banks, with the operator holding equity of UAH100 million. The licensee would be restricted to involvement in only those activities necessary to operate the lottery.

The move to a national lottery monopoly is the exact opposite of what is happening in most European countries. However, even the E.U. continues to recognize that as long as the intent is to protect the populace from compulsive gambling, there can be justification for a monopoly.

Poker Is Not Gambling

Aside from lotteries, of which there are currently three licensed operators, the only other legal form of gaming at the moment is the poker tournament. Poker in tournament form is officially recognized as a sport by Ukraine, as it was in neighboring Russia prior to that country’s gaming shutdown in 2009. Ukraine capital Kiev has become the destination of choice for Russian poker players seeking locations other than their own local underground clubs.

Online operator PokerStars is currently in the midst of a second season of its Russian Poker Series, which for obvious reasons is steering clear of its namesake. Four of the six events are scheduled to be held in Kiev, where the series kicked off in April with 265 players paying or qualifying for seats at $3,000 each. September will see two events back-to-back, together creating a guaranteed $1 million in prize payouts. The series will culminate with a televised $3,000 buy-in in tournament in Kiev in December.

In contrast, poker cash games are illegal. But as with some “lotteries,” operators have been employing a semantic workaround.

Pauls Lusins, the editor who covers online gaming and live poker events at VostokReport, explains that a player obtains chips by leaving a “deposit” at the cage. This deposit is then claimable by the person who returns the chips to the cage.

The practice seemed to be working fine throughout 2011. Then, in early August, police raided a poker club in Kiev for using this method. Also, the dealers were said to be raking the games, just like in poker rooms anywhere else. The question at that point was whether this was a one-off raid or whether it signaled a new focus on poker by the government.

Barring an emergency call to parliament to discuss the Tymoshenko arrest, the next legislative session is scheduled to begin September 6 and run through January 13, 2012. Armed with new legislation that better defines what is and isn’t gambling, it may be easier now for legislators looking to establish a regulated gaming industry. But it will still be a matter of local authorities willing to enforce whatever laws are put into place, in order to create a sustainable environment for legitimate operators.

Russia Update

The gaming ban in Russia has pretty much played out as expected. Since the mandated closing of accessible casinos in July 2009, the four designated gambling zones have been pretty much ignored, and underground casinos in cities have flourished—along with corruption among officials and police.

As an added attraction, rival government agencies are now using charges of illegal gambling involvement to tar their opponents.

Although police have reportedly closed down hundreds of illegal operations, new ones continually arise to take their place. Lyubov Loginova, who chairs the board of operator and supplier Alsart, explained the futility of the game to GamblingCompliance in June. The trick is to continually find loopholes in the law, exploit them for as long as feasible and then get out.

“In Russia, you will get your return on investment in one or two months’ time,” says Loginova. “So even if it is for six months, you will cover costs and you will make a profit.”

A good example is the proliferation of internet cafés whose only reason for existing is to offer online gambling. It was only in late July that President Dmitry Medvedev signed into law a bill that introduced criminal and civil penalties for operating this kind of business. Now, fines as high as RUB1 million and prison terms of six years can be imposed.

Still, the ban has not been bad for all business. VostokReport notes that one beneficiary of the underground gambling industry is cash terminal operator Qiwi, which has 100,000 terminals turning cash into an SMS with Visa card details. The method allows users to purchase goods and services online, fairly anonymously. The card is valid for three months and can take a maximum balance of RUB15,000—about $500. Qiwi takes a commission of 2.5 percent with a minimum of RUB25.

Of the top 20 destinations for Qiwi card payments, PokerStars is fourth—after PayPal, iTunes and Google—and Full Tilt Poker sixth. Also figuring in the top 20 are bwin.party and Titan Poker.

And in the gambling zones, the peaceful sound of crickets...

By Glenn Smith   Tue, Aug 30, 2011

Kinmen is back in the crosshairs, but not by the People’s Republic of China artillery gunners this time as it was back in the 1950s, when it was known by its dialect pronunciation Quemoy. Instead, Kinmen, a group of tiny Taiwan-administered islands located, preposterously, at the mouth of the most important river of China’s populous Fujian Province, is now being targeting by global gambling interests.

Their lobbyists, operating from Taiwan’s commercial capital, Taipei, a 50-minute flight away, say that if a casino resort is allowed on Kinmen it could prove a bigger draw for Chinese gamblers than Macau or Singapore.

International law offices flanking Taipei’s Dunhua Road boast of expertise these days in the legal needs of casino operators. So far, one of the most visible proponents of legalizing gambling is Professor Paul Hsu, chairman and CEO of Phycos International, Ltd., an expert in cross-border transactions as well as a holder of concurrent adjunct professorships at Taiwan’s most prestigious schools, National Chengchi University and National Taiwan University.

Also of note is Dr. George Lin, managing partner of Lin & Partners, which recently completed a draft of a gaming law commissioned by Taiwan’s Ministry of Transportation of Communications (MOTC). (Neither agreed to requests for interviews.)

Hsu and Lin shared a podium at the International Conference on the Gaming Act of Taiwan held in Taipei on June 3. And they appeared together again on July 6 at a special luncheon of the European Chamber of Commerce Taipei, titled “From Military Front Line to Tourist Heaven” and subtitled “Transforming Kinmen from a Military Stronghold into a Gaming Hotspot.” According to talks at this event, the Taiwan Gaming Act is expected to pass by 2012 and casino operations could start as early as 2016.

Yet a victory lap is premature. Neither of these men—nor anyone else in Taipei or Taiwan—has a say in the matter. The decision of whether or not to allow a casino resort on Kinmen must be put to a referendum; and, when or if that happens, only Kinmen residents will cast votes.

Field Report

To take a firsthand look, this writer spent 10 days on Kinmen this past July. The most indelible experience was standing on its western beaches and marveling at how close China is. At night, Xiamen’s skyline bathed dark, starlit Kinmen in a gaudy, neon glow. Kinmen County includes 12 islands, but nearly all residents live on the two largest—Big and Little Kinmen.

Martial law was lifted in 1992 (versus 1987 in Taiwan), and since then the number of soldiers has dwindled from 100,000 to the low thousands. Some forts are now museums, as are the massive defense tunnels.

Times change. In one tunnel, a classical music concert is held each year. Supposedly 80,000 people live in Kinmen County, but many work in Taiwan and return only for elections. Little Kinmen has one 7-Eleven, the only 24-hour business on the island. Beach access is limited, as landmines are still being removed. On Big Kinmen, its main port, Shueitou, is tiny but busy with ferries from Xiamen.

On one day, boatload after boatload of Chinese college basketball players were arriving for a tournament. Big Kinmen, of course, beats Little Kinmen in its 7-Eleven count, but forget about Big Macs or other Western delicacies. Ditto, fancy hotels. I stayed in a restored Ching Dynasty merchant’s home for US$50 a night. Kinmen is laid back, its people hospitable.

One afternoon, I cold-called the County Government and asked to talk to someone about Kinmen’s plans for a casino. Graciously, a call was made on my behalf, and the next morning I was sitting at the office of Tsang-Chiang Chen, Ph.D., councilor of Kinmen County Council.

Chen is the man spearheading the push for a referendum on casinos in Kinmen. He is a Kinmen native, a professor at National Quemoy University, and politically an odd bird.

In fact, Chen is the first Democratic Progressive Party (DPP) councilor in Kinmen. The other 18 councilors are all Kuomintang (KMT). Kinmen’s steadfast allegiance to the KMT stems from its military past, and the belief that the DPP would like nothing better than to return the offshore islands to China.

“I initiated the petition because I believe referendums are an important tool in the democratic process,” says Chen.

But democracy works in strange ways. Chen turned in his petition on August 27, 2009, and two years later, it is still gathering dust at the Kinmen County Election Commission.

To qualify, his petition needed 354 signatures, based on the Referendum Act requirement of 0.5 percent of eligible voters in the most recent election, and 460 were collected in a mere three days.

In contrast, the election commission has convened seven times to review the petition. During the first two meetings, there was quibbling over how the referendum question would be worded on the ballot. In five subsequent meetings, the vote was delayed each time due to insufficient attendance.

“Politicians are ostriches,” Chen says. “They don’t want to touch this. They will lose votes.”

Yet Chen is optimistic that the referendum will be scheduled, put to a vote and passed. “If you look at who is against gambling, it is the people at the top,” he says. “But a referendum would be decided by the people at the bottom—laborers, taxi drivers, the everyday people. What they see is jobs.”

Economy vs. Jobs

Typically, debates over the legalization of gambling weigh two opposing viewpoints—one that anticipates an economic upside versus a second that fears a moral downside. “People say they oppose gambling because it will bring sex and violence, but I’m not so sure,” said Chen.

The final version of the Taiwan Gaming Act, when passed, is expected to include regulations designed to prevent that. Chen envisions the casino in Kinmen’s future to be akin to Resorts World Sentosa in Singapore. “I’ve been to Macau and Las Vegas, and they are great locations,” he said. “They’re not just for gambling. They are leisure resorts.”

But mega-resorts also need international airports, which is something that Kinmen, due to its size, will never have.

“Will Europeans or Americans come to gamble at Kinmen?” Chen asks rhetorically. “Will the Japanese? No, that is impossible. The guests at a Kinmen casino resort would come from China.”

And that is why Chen’s role in this process is so unusual. His political party, the DPP, is against the legalization of casinos on Taiwan’s outer islands and, in general, against anything promoting stronger ties between Taiwan and China.

The DPP was founded in 1986, and before that was an illegal political movement. Early members were mostly native Taiwanese, descendants of the Fukinese emigrants who settled in Taiwan during the late Ming and subsequent Ching Dynasties. Seven million of them lived on Taiwan when Generalissimo Chiang Kai-shek along with 1.5 million mainlanders, mostly poor soldiers but including some of Chiang’s fabulously wealthy supporters, arrived in the late 1940s. Chiang’s Nationalists maintained one-party authoritarian rule until the lifting of martial law in 1987.

Today, Taiwan has 23.2 million people, and the KMT has had to learn to share power with the DPP.

The DPP is isolationist, and its first elected president, Chen Shui-bian, during an eight-year term from 2000 to 2008, did everything feasible to distance Taiwan from China. Now, the KMT has returned to power with the election of President Ma Ying-jeou in 2008, and is vigorously attempting to expand relations with China. Offshore casinos are a small part of that.

Nearby, just two kilometers away at low tide, China, with its 1.3 billion people, would no doubt love to pull Kinmen into its orbit, if only for the potent symbolism.

Kinmen has been a thorn in China’s side for centuries, first due to pirates—in particular, Ming loyalist Koxinga, who wreaked havoc along the China coast through the early Ching, and most recently, due to dug-in Nationalist troops with the U.S. Seventh Fleet patrolling the Taiwan Strait as backstop.

As they say... it’s complicated.

Turning the Tide

2009 marked a turning point for international gaming interests struggling to get a foothold on Taiwan since as early as 1988.

Taking office on May 20, 2008, President Ma Ying-jeou made good on his campaign promise to bring casinos to the outer islands. He directed the Council for Development and Planning to conduct a feasibility plan.

He pushed for the Executive Yuan to amend the Offshore Islands Development Act to allow the legalization of casinos, where approved by referendum, and that amendment became law in January 2009. Next, the Executive Yuan tasked the MOTC, which includes the Taiwan Tourism Bureau, to draft a Gaming Act that will regulate it all. That chore was commissioned to Lin & Partners in May 2010.

Momentum is building in Taipei. For the KMT, offshore gambling is clearly a policy objective. If free to openly pursue this goal, the party would make offshore casinos a reality in a few short years.

But Taiwan’s politicians and bureaucrats also want to protect themselves from electoral blowback. Luckily for them, national politicians can rely on the referendum process—which places the onus of supporting gambling on the tiny island’s governments—to shield them from responsibility.

This makes predicting the debut of the casinos a tad iffy. Case in point: Pro-gambling interests failed miserably when the first binding referendum, as stipulated under the newly amended Offshore Islands Development Act, was held on September 26, 2009 in Penghu.

Penghu, along with Matsu, are the other “outer islands.” Unlike Kinmen and Matsu—both Cold War fortresses a stone’s throw from China—Penghu is an archipelago of small islands much closer to Taiwan. In the late 1990s, all suffered faltering economies. For Kinmen and Matsu, the cause was the withdrawal of troops. Penghu’s problems, in contrast, stemmed from the collapse of its fishing and agriculture, and the loss of Taiwanese tourists who had discovered more glamorous international destinations.

The Offshore Islands Development Act, passed March 21, 2000, was an attempt to address these challenges by turning the offshore islands, now dubbed the Three Mini Links, into stepping stones for formerly banned travel and trade between Taiwan and China.

When debating its passage, legislators wrangled over whether or not to include casino development in the law, but ultimately it was rejected as too controversial. Even so, Penghu became a cause celebre. In the early 2000s, Taiwan’s leading newspapers ran opinion polls. On Penghu, pro-gambling business groups held impromptu referendums, prematurely as the Referendum Act had yet to be passed, and flogged favorable results to legislatures.

International gambling magnates toured Penghu, and bought real estate. Land prices skyrocketed. A Taiwan developer with interests on Penghu was kidnapped and murdered. Without a Referendum Law, a referendum could not be held.

Hilariously, expressing the frustrations of gambling advocates thwarted in their efforts to legalize their industry, a Penghu councilor threatened to petition for a referendum on Penghu seceding from Taiwan. But, in Taipei, national politicians dawdled. In 2004, a presidential election was under way, in which DPP President Chen Shui-bian defended his office against KMT hopeful Lien Chan. Discussion of gambling was avoided.

The Penghu debate died a slow death, but was revived four years later, in 2008, when KMT President Ma Ying-jeou took office. Eighteen months into Ma’s first term, Taiwan’s first legally binding referendum on offshore gambling was held at last.

For gambling advocates, the result was a slap in the face. The September 26, 2009 referendum in Penghu rejected casino resorts, with 56.4 percent of voters against their legalization and 43.6 percent of voters for it. Only 42.2 percent of Penghu’s 73,651 voters turned out.

Three years would have to pass, until 2012, before another referendum can be held on Penghu. That shifted attention to Kinmen, where Councilor Chen had petitioned for a referendum earlier that year.

Chen, speaking of the debacle on Penghu, says, “Gambling advocates were overly optimistic, and didn’t expect strong opposition from the DPP. But that is what happened.” He estimates that Penghu’s voting base is split roughly 40/60, DPP versus KMT.

In Kinmen, a referendum on casinos will face little opposition from the DPP. The party is virtually non-existent on the island.

Kinmen voters, if casting ballots according to KMT wishes, would give casino resorts a green light. But this sure win also gives Kinmen leverage in extracting concessions to sweeten the deal, and only time will tell what they see as a fair.

As one Kinmen taxi driver cum amateur analyst put it, “There won’t be a referendum until everyone gets their bribe money.”

By David Ross   Tue, Aug 30, 2011

The signs are all there. The casino floor is evolving, as operators seek to inspire excitement and keep patrons interested and intrigued with lighting that creates moods and interactive signage that informs and entertains.

And a programmable server can control it all.

Some companies are on the glowing edge of the new technology. I-5 Design and Manufacture specialized in signs and awnings 10 years ago when the company began to focus on casino signage and interior architectural features.

Dave Waters, I-5’s senior designer, sees LED lighting leading the way in bringing excitement and movement to the floor. “You always want things fresh and new,” he says. “LED lighting lets you keep that look longer and draw attention to parts of the casino you want to highlight.”

I-5 has created interactive light shows when a jackpot is hit and interactive displays where players touch a screen, creating a symphony of lights and sounds.

“This is not just for gaming,” says Waters. “Casinos need to create venues that are exciting at bars and nightclubs.”

For the Choctaw Casino Stringtown in Oklahoma, a truck stop casino, I-5 fabricated a giant 1935 Packard hubcap in the center of the floor. Within the spokes is an ever-changing light display.

“It has an amazing ability to draw people onto the floor,” says Waters. “It’s like being under a spaceship.” Arched, bridge-like trusses mimic old highway bridges. Fully animated, they glow internally, creating a whirling motion that can be coordinated with the center hubcap light.

Waters adds, “We’ve joined nightclub environments with casinos where we do wholly controlled LED video displays. We are doing a nightclub at the Route 66 Casino near Albuquerque with LED lighting fully controlled from the DJ booth.”

Architectural features include a suspended soffit structure (think oversized crown molding) with lighting shining up on its ledge, creating a constantly changing cove of light. Over the stage a four-tiered structure uses LED lights to create a rock concert look. “We have a 50-by-25-foot oval, like the Eye of Sauron from the Lord of the Rings movies, suspended by tubes radiating from the center, that can create almost unlimited action and effects.

“We use silhouettes to light up the area behind the signage, creating a glow,” says Waters. “In the Little Creek Casino and Resort in Shelton, Washington, we used red for cashier, green for players club and blue for nightclub—you can follow the blue light to the Starlight Lounge.”

Lights hidden in a beam are tied into the tribal-inspired look. “Indirect lighting is a powerful tool and is easier on the eye,” says Waters.

I-5 combines diffused lighting creatively, using textured acrylic panels, like etched glass, or a product called iMetal, where specialized brushing  creates light patterns that look like holography, combined with curtains and metal chains of polished chrome that manipulate light.

The next step? Video walls and curtains, or screens made from virtually anything that can display programmable messages and visuals. This technology is expensive, “but if you use it like architecture you can get a lot of bang for your buck. We are finding creative ways to use it every day,” he says.

Traditional Standards

Young Electric Sign Company (YESCO) opened its first Las Vegas office in 1932 and integrated the first LED into a sign for Caesars Palace in 1984. It is one of two manufacturers of LED signs in North America.

“YESCO designs, engineers and fabricates the cabinets and structures that hold the LED products or bolts them to existing architecture. Everything starts with design,” says Office Director Nick Priest, who notes that YESCO has 30 designers on staff.

Michelle Bass, interior signage specialist for YESCO, says LED is a hot topic right now. “I see the trend to signage of translucent materials and less sheet metal and aluminum,” he says. “Translucent materials are illuminated with LEDs. Metal is painted or laminated. It’s dark. You have brighter signs using dynamic or smart LEDs.” Standard LEDs are controlled by the strip. A “smart” LED is controllable to every diode, giving a sign the capability of RGB (red, green, blue) with a billion levels of colors that change hourly, daily or yearly, depending on the operator.

“Let’s say you are the Red Rock Casino, and you have a red interior tone,” says Bass. “You replace the carpet with yellow and change out the chandeliers and wallpaper. With controllable dynamic signage, you just change them by network to yellow tones. You can change the entire mood of your casino and signs within minutes.”

This hasn’t been seen in many casinos—yet. “The investment is significant and  requires a commitment of resources—such as a lighting control system—and applying resources to manage that system,” says Bass.

YESCO has installed these displays at Tulalip Resort and Casino in Washington state and Mystic Lake Casino Hotel in Minnesota. “Remodels and renovations are beginning to embrace this concept. Customers are looking at it,” says Bass. “Agua Caliente Casino Resort Spa opted not to network it, but the signs all have this technology and can be changed on the fly.”

Static graphics are old-school. “The old video games had the logo on the Plexiglas,” says Bass. “Since games are downloadable and more flexible and ever-changing, the old requirement no longer applies. There are less static printed images and more digital signage with a system that can promote other offerings, such as concerts.”

“The next step is adding LEDs not just for marketing purposes, but as pieces of art, similar to screen savers,” says Bass. They can be used for theming, specific to a high-limit area, for example. “You change content to change the mood, replacing logos with colors and lighting and movement. Signage is not necessarily for advertising anymore.”

Bass sees a continuing evolution of flexible signage: “Operators can make changes to signs without buying new signs.”

Cool as a Mule

Matthew Olden of Bally Technologies heads the creative team that created Bally’s CoolSign digital media technology, which manages all of a casino’s displays.

CoolSign can advertise a game’s progressive values on signage over the game, on marquees or in the parking lot. “Customers in the food court can know that the Blazing 7s progressive jackpot is getting very high,” says Olden. “We are a gaming company with a signage product, instead of a signage company. Since we are integrated to our back-end systems, we can display unique marketing events. Using progressives as an example: every slot machine pays out a win or jackpot. That information is managed by the Bally system. It knows every machine, and only CoolSign can access information from a machine. We can set the tone of the casino 24/7 and integrate with lighting and sound systems to play all the bells and whistles, or a few.”

The operator can take the clock into account in setting how much fuss to make over a $500 payout when fewer customers are on the floor, compared to when the floor is full. “We can set that up so everyone gets a sense of win,” says Olden.             

CoolSign interfaces all of the resort’s signage for shopping venues, food courts, showrooms, even the golf course. “We can drive ticket sales for a comedy show,” says Olden. “We can play that we are running out of tickets, ‘so act fast!’ Or if there is a perishable buffet inventory, push a special on the crab. The manager can show a new price on all of the displays.”

By Nicole Wolf   Tue, Aug 30, 2011

In 2011, there has been a sea change in the level of sophistication on the part of casino marketing departments. A year ago, many casinos weren’t even on Facebook, but now, everyone knows social media is here to stay.

“Since it’s no longer an ad hoc part of their media spend, casino marketers are dedicating more resources—largely labor—so they’re now starting to look at ROI, too,” says Nancy Smith, CEO of Masterminds Advertising. “Moreover, budgets aren’t growing. This is money that is moving over to social media from other marketing line items—print, radio, TV.”

Smith believes that these days, having a social media presence is basic customer service for a casino. Just as years ago websites became de rigeur due to customer demand for a 24/7 online resource for basic information on amenities—hotel reservations, hours of operation and menus for restaurants—so now has social media come to be expected.

For that reason, Smith posits, although there are many ways to measure ROI on social media, “It’s like asking ‘What is good customer service worth?’ If your front desk agent answers a customer’s question correctly and in a friendly manner, how do you measure the ROI on having the front desk staffed with that capable employee? How much does the alternative cost?”

Word-of-mouth commentary among consumers—be it an endorsement or a damning comment—has always been more influential to fellow consumers than one-way communication coming from a company. Companies or brands need to pay attention to social media because these conversations are now happening among thousands of people on Facebook or Twitter instead of between two people over coffee.

So, conversation is currency. A few years ago, if you had a bad meal at a restaurant, you’d tell your colleagues or friends, and they probably wouldn’t go to that restaurant anymore. Now, customers are more likely to post their experience on their Facebook page, and within the same amount of time, they’ve told hundreds or thousands of people not to eat at Joe’s anymore. Social media has turned individuals into broadcasters.

Conversations Are Valuable

While the goal of any marketing plan is to attract customers to your casino, social media is a little more diverse.

“The goal is to tap into the viral nature of social media,” says Ryan Leeds, VP of strategy at Masterminds. “You may have 5,000 fans on your Facebook page. The goal isn’t to tap into those 5,000 fans, but to get them each talking to their 140 friends.”

Traditional currency has always been measurable: you could open your wallet right now and quickly determine how many U.S. dollars or Chinese yuan are in there. The team at Masterminds, however, argues that taking a similar approach with social media could be short-sighted. They say conversations among fellow fans or followers lead to increased engagement, which translates to loyalty, which is increased brand. A tried but true definition of brand? Loyalty beyond reason. And don’t you want customers doing the “unreasonable,” driving 10 miles past your competitor’s casino—with the same banks of slots and tables— to come to yours because you treat them right?

“In a casino, an ambiance is developed,” says Marianne Martino, COO and principal, Gaga Marketing. “It’s like a comfortable pair of slippers. As a customer, when you find it, you want to go there again and again.”

Ready to Engage?

Increased engagement online translates to increased engagement offline. Smith and Leeds offer several examples of using social media to engage:

• A restaurant: A casino restaurant has its chef tweet the daily special and discuss on Facebook, using supporting pictures, the fresh seasonal ingredients that he is using that week. Then, on the Facebook page, the restaurant displays a link to the Open Table reservation system.

• A car giveaway: A basic use of social media would be simply telling fans to come to the property next Friday night for a Ford Mustang giveaway. A more clever strategy could be to initiate dialog among your followers and their friends by asking people if they won the car, where’s the first place they’d go? Or to share the best road trip they’ve ever had. Or give them the opportunity online to design a custom vanity plate for their new Mustang.

• A scavenger hunt: Another interesting tool, according to Patrice Gianni, CEO of Marketing Results, is CheckN2Win, a mobile application that allows a casino property to offer patrons a branded mobile application via Apple’s App Store. CheckN2Win provides detailed information about the property as well as an innovative social gaming experience using the “social check-in” mechanic found in other applications such as Foursquare, Gowalla and Facebook Places.

CheckN2Win users can view information about all of the places at a property, such as gaming areas, clubs, event venues and restaurants, and then “check in” to receive specially branded badges and targeted offers. Users can track their status on the leader board as they compete against each other for the title of “mayor,” which is the user with the most check-ins over a given time period. They can share this experience with their friends online by posting their check-ins and comments on the places they’ve visited.

“When you check in at one place, you may receive a free drink or restaurant discount associated with a barcode or offer code. We then will track how many are redeemed per day per outlet,” says Gianni, who cautions that the numbers will be small because CheckN2Win requires an iPhone and is still a relatively new concept.

Says Smith, “When executing social media strategies, it is important not to talk at your customer, but to take steps that open a conversation or encourage engagement. Once your customer engages with you, your brand is exposed to many more potential customers.”

Results of Engagement

Relationships formed online result in people planning to meet up and play together in the casino. Many casino marketers are surprised to find that the traditional casino demographic, women 40-55 years old, is in fact engaging in social media. Facebook provides demographics of a company’s page; those demographics tend to mirror what the casino’s database is showing.

Smith says, “We all know golfers who come home and talk all day about their round of golf, especially with other golfers. They relive every hole. Well, gamblers are the same way. When they go out for a night of play and they sit at a table for hours and are up and down, they love to talk about it with anyone who will listen.”

Social media provides a forum for continuing the conversation. Leeds says, “We offer strategy to help casinos harness those conversations and steer them in the direction to talk about upcoming events/promotions at the casino.”

Overcoming Perceptions

Just as we’ve groomed our casino customers across existing communication tools to expect a timely response—a phone answered within three rings or an e-mail within 24 hours—so we must shape their expectations in a social media environment. Answer a question or complaint lodged via Facebook or Twitter quickly and publicly: chances are, others have those same questions. So, social media is a very efficient and effective way to harness two-way communication to tell your story, rather than allowing the rumor mill take over. Bottom line: if you aren’t talking to your customers via social media, your competitor will be.

Smith recounts a casino client whose customers perceived that the rate of winning was low at a particular property. By monitoring social media, Masterminds could see that one person would post something along the lines of “no one ever wins here” and 10 people would chime in about the casino being tight with its holds, etc. Realizing that the lack of winning was actually just a perception, as hold rates were comparable to others in the market, Masterminds directed the client to broadcast customer wins via social media.

They posted photos of the winners and congratulated them on the website and on social media, and perpetuated winning stories. That online conversation of “no one ever wins” went away. Now, if one disgruntled person posts a negative comment, no one jumps on the bandwagon and the conversation dies. As a result, there’s a more positive perception of the brand among its customer base.

“Given the opportunity, customers love to tell you how to make your operation better,” says Gianni.

Managing the Social Media

The greatest expense surrounding social media is labor. Whether it’s managed in-house or outsourced to an agency, typically when a casino first launches its social media presence, the task is incremental to a current resource’s tasks. However, businesses are learning that the more successful they are at social media, the more followers, the more conversations, the more time it takes to manage. Typically, management of social media starts with a fraction of an FTE (“full-time equivalent” in human resources terms) and a few thousand dollars, and then grows into multiple FTEs.

As Smith says, “You’re inviting customers in by virtue of having a Facebook page, so customers expect you to be there to host the online party. You can’t not be there.”

Measuring Social Media

There are myriad ways to measure social media, including:

    • number of fans/followers

    • page views

    • impressions

    • quality of that community

    • sentiment

    • level of engagement

Gianni measures engagement through Facebook Insight Metrics that track the number of impressions and discussion points made during a period of time. For example, during a promotion, they monitor comments before and after the event to see if the numbers of commentaries are increasing as well as the nature of the content. It requires manual processes, but she says the feedback is worth it.

“In the future, we expect to see software solutions that will improve the evaluation of engagement as well as analytical tools specific to the gaming industry,” Gianni explains. “Right now, the tools available can track who participates in a specific program, if they endorse, share and distribute to their online friends and how that translates into click-through rates and conversions… as long as they are making a purchase. Today we use social media to create value, interact and improve the guest’s experience.”

The Power of PR

While we all look forward to the day when social media monitoring is as systematized as traditional media has become, none can deny that social media is good for branding. If you don’t have a strong brand, you have to buy customers though expensive reinvestment efforts. Accepting labor as a constant expense across a property’s marketing team, PR requires little additional cash outlay and is therefore a low-cost—and often-overlooked—element of driving results.

“If you’re leaving PR out of your marketing effort, or relegating it to an afterthought, then you’re relying on your message getting out to a public with shrinking attention spans who are bombarded with advertising messages,” says Dave Kirvin, partner, Kirvin Doak Communications. “Effective PR differentiates, motivates and provides credibility in a very cost-effective manner.”

Kirvin continues, “It’s difficult to provide depth and context through a billboard or a 30-second television ad. A strategic PR effort builds credibility and consistency, two crucial components of brand-building.”

Perhaps it’s for that reason that if you ask Las Vegans what’s new at the 15-year-old Stratosphere, you’ll hear a unanimous, “Bungee jumping!” On Interstate 15 that cuts through the city, the property launched a somewhat ambiguous billboard about its newest experience. There was no ambiguity in the media, however, where it was hard to miss the enthusiastic reviews from reporters from around the city and across the country coming to Vegas to take the 855-foot plunge.

Most PR practitioners, those in-house as well as in agencies, are adding social media to their list of services. In fact, marketing dollars for traditional public relations efforts have been shifting to social media. However, there is an important distinction: PR is one-way communication; social media is two-way.

Gianni says, “What these two channels do have in common is raising credibility. Readers, followers, fans are more likely to believe information more when it comes from the press or when they read it online from other customers’ reviews than when a company tries to ‘sell’ them.”

Kirvin says, “Our clients are looking to raise awareness and through that awareness drive action. The action varies by client. It can be to drive business or educate the public or even raise money for a non-profit. But every campaign starts with an objective, and part of that objective is always the return on investment.”

Measuring the Marketing

Social media may be the new kid on the block, but at the end of the day, it has to be experimented with and measured. If social media could learn one lesson from the measurement challenges presented in traditional casino marketing, it would be this: control your experiment.

Close your eyes and think back to 7th grade science class. Yeah, the room smelled bad and the teacher wore a different ugly tie each day, but what else? Right: the basics of constructing an experiment. We learned that when designing an experiment, we had to first develop a hypothesis—the concept we were trying to prove and our anticipated results. Next, we learned that we could only measure one variable at a time while everything else must remain constant.

It seemed so simple back then, but somehow, it’s become muddled in today’s casino marketing environment. The pros agree: it’s muddled. At most casinos, there are too many promotions or variables in play at a given time, rendering measurement of any given one scientifically impossible.

“On a given day in a gaming environment, there may be a senior day, a dining offer, a slot tournament, etc., so it’s difficult to measure the impact of a single promotion on the business,” says Michael Meczka, president of Meczka Marketing/Research/Consulting, Inc. “Just look at the direct mail you receive. There’s a dollar offer, a direct free play offer, a multiplier day offer, a senior offer, a redemption coupon offer, a spa offer, discounts in shops, etc.—all in one mailer.”

Andrew Klebanow, principal with Gaming Market Advisors, observes the same phenomenon: “Clients typically ask me how to measure a promotion. I have to explain that in order to effectively measure a promotion, there has to be just one in play.”

He explains that the truth is in the P&L, and that he extracts all marketing expenses from the P&L and produces a reinvestment analysis that takes a comprehensive and honest look at marketing expenses and ROI. Klebanow acknowledges that marketing teams are under a tremendous amount of pressure from corporate and tribal ownership to constantly promote. There’s a fear that if they stop promoting, customers won’t come in, which just isn’t true.

Gianni observes, “Today’s tracking systems are so much better than they were a decade ago that there should be no excuse to continue to run legacy promotions that do not generate a profit, yet it happens. For one new client we audited, there were events layered on top of other events and promotions on the same weekend. Turned out, there were customer segments where thousands of players had comps exceeding 100 percent.”

Lessons Learned: Reapplied

When a new method of communication is introduced, marketers scratch their heads, attend conferences and debate its integration into their existing marketing mix. Our generation lived it with the introduction of the web; our grandparents’ generation lived it with the introduction of television.

Then there was cable television. Martino remembers a client in a rural area coming to her firm asking to buy ads on cable rather than network television. She had to explain that, at the time, the only way to target an ad to her client’s market was via local network television, and that buying ads on cable TV would involve spending obscene amounts of money to reach a national audience, 99 percent of whom were nowhere near her client’s property.

Martino explains, “I’ve had the same experience more recently with satellite radio. It was hip and new and my client listened personally. I had to explain that we couldn’t extrapolate our personal listening habits to those of our target demographic.”

Now, there’s social media. As with the other new media that preceded it, social media is here to stay. Individuals have become broadcasters, and one good or bad customer experience is spread virally in seconds. Our customers have become our best marketers, and we must engage them and harness that conversation. And that’s the cost of conversation.

By GGB Staff   Tue, Aug 30, 2011

3 Steps to Measuring the ROI of your Social Media Strategy

1. Determine the objectives of your social media strategy. Why are you investing in this channel? Improved brand perception? Top-of-mind awareness of your programs and benefits? Improved customer service? Direct response? All of the above?

2. Define the word “return.” What specific behavior/perception are you trying to effect? Brand value scores? Improved customer service scores? Positive word-of-mouth? Improved perception of luck? Increased number of trips? Greater share of wallet?

3. Do benchmark research at the beginning of each year to determine baseline metrics among social media users and non-users. Repeat the research at the end of the year to determine changes in behavior or perception in user and non-user groups.

Nancy Smith, CEO, Masterminds, www.masterminds1.com

3 Things Marketers Should Know About Social Media

1. Social media has overtaken porn as the No. 1 activity on the web. It isn’t a fad. Get in the game and develop a strategy to win your customers’ trust. Devote at least 10 percent of your media budget to it. Traditional media such as TV, radio and billboards invade our space. They are like uninvited guests that show up in our living room, in our car, along the highway. In social media, the customer seeks you out. With this kind of customer engagement, you need to assign necessary resources to create an ongoing dialogue.

2. Be authentic. Have personality. And listen. Check out Vinny at New York-New York or Tony Hsieh at Zappos. Find a personality that represents your brand and connects on an emotional level with your guests. Tell stories to engage your audience. Don’t turn your social media channel into advertising.

3. Define ROI. It can’t always be monetary. It depends on your goals. Social media promotes your brand, your reputation. It establishes a real-time dialogue with customers and prospects. It should reinforce your credibility with employees, shareholders, regulators and tribal leaders. Trackable ROI depends on the strategy, the channel and the available metrics. And metrics are evolving. And ROI will be a moving target. If, for example, you learn that your customers are bored to tears by a particular promotion, you may have just saved hundreds of thousands of dollars by changing the event. They are telling you loud and clear and they are telling all their friends and friends of their friends.

Patrice Gianni, CEO, Marketing Results, www.marketingresults.net

1. Know your customer/target: Once you know your target, you know where to aim.

2. Sometimes the old tried and true works: It’s not just abut trying to be hip.

3. Take a chance: Try something different for different results.

Marianne Martino, COO and Principal, Gaga Marketing, www.gaganation.com

1. If it’s an existing resource that is temporarily utilized to market a promotion, don’t count it as an expense: Have a year-long contract on a billboard that you’ll be re-appropriating for the month of November to promote a holiday shopping event? What the heck—don’t count that expense! (Let one of your marketing colleagues take the hit on that one—what’s a little shady accounting among friends?)

2. If you have some unused promotional items at the conclusion of a promotional event, book ‘em as an asset: Remember those 1,000 leftover “Don’t be a turkey” t-shirts from your Thanksgiving 2010 promotion? Book ‘em, Danno. They’re an asset now! (You were planning on having your marketing intern peel the “0” off each shirt and reapply a “1” for the 2011 promotion, right?)

3. Immeasurable goals: Why not set “Creating Excitement on the Floor” as a campaign goal and state that it increased by 12 percent? After all, it’s always possible that your boss will let it slide. OK, not! Emotions are not measurable; actions are. “Increasing carded play by 12 percent among platinum level players” during the promotion is a good, measurable goal.

Disclaimer: Mr. Klebanow produces reinvestment analyses for his clients by pulling the truth from P&Ls. He offered the aforementioned tongue-in-cheek advice for levity only—levity he has derived from too many years of observing marketing chicanery.

Andrew Klebanow, Principal, Gaming Market Advisors, www.gamingmarketadvisors.com

By Roger Gros   Wed, Aug 31, 2011

Ho hum. The July gross gaming revenues in Macau were up again at another record level. The numbers surpassed expectations, even though July is the height of holiday season in China. For only the second time, revenues of MOP24.2 billion surpassed US$3 billion (May 2011 also hit the $3 billion mark).

But it was the shuffling in the order of market share that was the real story in July. While perennial leader SJM with its overwhelming number of casinos continued to lead the pack, its share of revenues has been dropping steadily for the past two months, from when it held a 32 percent share in May to July where it had decreased to 28 percent.

With the opening of Galaxy Macau, its first Cotai Strip resort, Galaxy Entertainment rose to second place at 19 percent.  Melco Crown jumped to third place at 16 percent, followed by Wynn Macau (15 percent), Sands China (14 percent) and MGM Macau (8 percent). Galaxy’s market share has quadrupled over the past two years and jumped from last place to second. Sands China fell from its traditional second-place finish all the way to fourth.

July revenues in Macau were up 48.4 percent over the same month in 2010. Union Gaming Group speculated that a high-speed train accident in China had caused some vacationers to change their plans and travel instead to Macau.

The strong showing in July caused analysts to revisit their predictions for total 2011 revenue. RBS analyst Philip Tulk raised his outlook by 6 percent, which would result in revenues of US$34.1 billion. Union Gaming predicted MOP263 billion (US$32.8 billion), which would multiply the Las Vegas Strip estimates of $6 billion by 5.5 times.

Gary Pinge, senior vice president of gaming and consumer research for Macquarie Securities, says the rapid market share rise for Galaxy is a good thing.

“Galaxy Entertainment has taken time to understand its customer base and market segment well over the last five years,” he says. “This is what has allowed it to see such a fast ramp-up of its product, particularly on the VIP side.”

More impressive, says Pinge, has been the ability of Galaxy to maintain a high level of business at its original casino resort, StarWorld, in Macau’s Peninsula region.

“StarWorld’s performance has remained solid post the Cotai opening,” Pinge explains. “This can be attributed to the fact that Galaxy manages its properties as a group, rather than a silo. Hence, similar to what Harrah’s used to do, Galaxy managed the yield of its customer by moving it to different properties rather than forcing one property to compete against another. This strategy is not a coincidence and was most likely introduced by Galaxy’s CFO, Bob Drake, who previously was at Harrah’s in the U.S.”

The July revenue increase in Macau comes despite a rise in interest rates in China for the fifth time in the last nine months, including some local moves to cool the superheated gaming growth.

In a note to investors, JP Morgan analyst Kenneth Fong wrote that the July revenue report “proves industry momentum is very strong and dismisses concern that a tighter China credit market may have slowed VIP revenue growth.”

In fact, the VIP market has grown by 50 percent to 55 percent during the year. Total casino revenues in Macau were up 46.2 percent for the first seven months.

At the same time, non-gaming amenities continue to grow, even though they make up less than 7 percent of the total revenue for Macau casinos. Along with Galaxy Macau’s 2,000 rooms, an additional 6,000 will be added when the Sands Cotai Central—parcels 5 and 6 on the Cotai Strip—will allow the city’s integrated resorts to extend the average stay of 1.5 days.

And when you add the retail, dining and entertainment that continues to expand in Macau, the state government goal of increasing non-gaming tourism in Macau is well on its way to fruition.

By GGB Staff   Wed, Aug 31, 2011

Leading slot manufacturer International Game Technology announced the official release of “Monopoly: You’re in the Money,” a 30-line online slot game that is the first version of the Monopoly brand to appear online in a gaming environment.

While rival WMS Gaming still holds the license to create casino slot machines carrying the brand of the legendary Monopoly board game, IGT was able to secure exclusive rights to the brand in online and mobile gaming applications.

In the online game, “Mr. Monopoly” hosts two bonus events, including a mystery event and a main bonus that allows the player to win money for moving around the iconic Monopoly board. Landing on a property activates a mini-slot machine with a possibility of winning up to 12,000 times the triggering bet.

“IGT is extremely proud to hold the exclusive online and mobile Monopoly license,” said Alex Kelly, vice president of interactive at IGT. “High-quality branded titles are very important to operators and their players. With such engaging and rewarding bonus experiences, we expect Monopoly: You’re in the Money to quickly become one of the most popular titles within our portfolio.”

IGT’s global Interactive Division was created through the merger of the company’s WagerWorks and Million-2-1 groups.

By GGB Staff   Wed, Aug 31, 2011

When Chris Christie became governor of New Jersey two years ago, he promised to streamline regulation over all businesses in the state, and that included the casino industry. A bill passed by the legislature earlier this year dramatically changed the roles of the two agencies responsible for oversight of the casinos, giving more power to the Division of Gaming Enforcement and taking power away from the Casino Control Commission, and reducing the overall costs of regulation in the state. CCC Chairwoman Linda Kassekert spoke with Global Gaming Business Editor Frank Legato about those changes, how it has affected her agency and how it has impacted the casino industry overall. For a podcast of this interview, visit www.ggbnews/podcasts.

GGB: Let’s start out with state Senate Bill 12, the regulatory reform legislation. How did the new law change the role of the commission?

Kassekert: What it did was move the day-to-day operations the commission had jurisdiction over before to the Division of Gaming Enforcement, so we could concentrate more fully on our core mission, which was casino licensing, key employee licensing and some other functions. So, we sort of morphed from regulating the day-to-day aspects to retaining a quasi-judicial role.

Did you spend a lot of your time on minutia before this?

We did. We had casino inspectors who were on the floor 24/7, we handled all the counts and the issuance of casino revenue taxes. So, this is a very different aspect, but it allows us to concentrate on casino licensing especially, which we see as our core mission.

As far as the regulatory system in general, how is it going to operate more efficiently, or better, going forward?

The division will have responsibility for it all—they have responsibility for collecting the taxes, certifying the revenue. They will maintain a presence on the floor—the statutory requirement to have a presence on the casino floor 24/7 is gone, but they will have a presence there. As the so-called “prosecutors” in the regulatory scheme, they’ll have responsibility for not only prosecuting, but also monitoring those functions in which they might end up bringing charges against the casinos.

To what extent will you work with the DGE, and the new acting director, going forward?

I have a great relationship with Acting Director (David) Rebuck. I’ve known him for a number of years. We see a very cooperative relationship; we’ll work together. A number of our employees, as part of the changes in S12, are now at the division, because they assumed some of our functions. So I think it will be a very good, close, cooperative working relationship.

We’d like to touch on some of the matters before the commission right now. First, the boutique casino licenses—how many applications have you received?

We have received three applications. We promulgated the regulations that preceded them, because the legislature gave us that responsibility.

Landry’s has purchased Trump Marina and is transforming it into the Golden Nugget Atlantic City. Can you give us an update?

We unanimously approved their application for ICA (initial casino authorization—a temporary license). We were very excited by their presentation. We think it’s going to really bring a great energy to the Marina, and especially the synergy they’re creating with the Landry’s restaurant chain.

The stalled Revel project in Atlantic City is under way again. What is the prognosis for that development?

We’re looking forward to a summer 2012 opening. So, that’s good news. And, I think now that the economy is stabilizing, I’m hopeful that some of those other projects will come back and take a second look. Because the Pinnacle site, especially, is just a great land mass. It’s just wonderful; it’s right there on the Boardwalk. I’m hopeful there will be some reconsideration, if not by Pinnacle, by someone, to come back and fill up the site.

How involved are you with the CRDA’s plans for the tourism district and general improvements downtown?

I serve as a member of the CRDA, and we’ve got some very exciting things happening. A lot of the entities that were being run separately, like the convention and visitors authority, will be coming under CRDA. We’ve already moved to bring the Special Improvement District under the agency. It’s really a concentrated effort on that tourism district—keeping it clean, keeping it safe. It’s a real concentration of efforts, which is going to be great.

What is the most important part of that plan—what’s the first priority?

A lot of it is perception. We’ve had discussions over the years about the safety of Atlantic City, and the crime rate, and how the crime rate by comparison is not bad—but it’s a perception. That is our first goal—we’ve got to change that perception. We’ve got to have people feel comfortable on the Boardwalk, and have it be clean. The Special Improvement District, now a division of CRDA, is doing a great job in making sure the Boardwalk, which is really our front door, looks as beautiful as it can be.

You are very bullish on Atlantic City. Can you give us the reasons for your optimism?

We’ve just got so many exciting things going on. We went through a couple of very tough years, but so did everyone else. I think we’re well positioned to move forward. The Landry’s licensing was very exciting news, and as Revel continues their work and as the tourism district works to beautify the city, I think we have everything going for us. All these other gaming locations, I’m sure they have a lot to offer. But no one can offer the concentration—the restaurants, the shopping, the spas, the golf—that Atlantic City offers. And on top of all that, we’ve got a beautiful ocean and Boardwalk.

By GGB Staff   Wed, Aug 31, 2011

Pleasantville, New Jersey-based AC Slots (formerly AC Coin &Slot) announced the appointment of Sean Evans as the company’s new vice president of sales.

Evans was most recently chief operating officer for slot manufacturer Aruze Gaming America. Prior to that, he was senior VP of sales for slot-maker Aristocrat Technologies, where he was instrumental in that manufacturer’s surge in the years following its Nevada licensing in 2000.

“We are extremely excited to add Sean’s talent, expertise and industry savvy to our leadership team,” said Jason Seelig, executive vice president of sales and marketing for ACS. “He is well-known in the gaming industry and has guided some of the major slot manufacturers through successful new game launches. His experience is precisely what we are looking for to continue our growth and increased market share.”

Evans will be responsible for the strategic development of industry relationships for AC Slots, and managing, directing and assisting the existing sales team to provide pioneering slot products to the gaming industry.

By GGB Staff   Wed, Aug 31, 2011

Aristocrat Technologies Spain, S.L. has appointed José Muyo as commercial officer. Muyo will be based at the Barcelona office and primarily spend his time visiting operators, distributors and other important contacts.

With his 23 years in senior sales and commercial roles, Muyo brings a wealth of sector knowledge and experience to the job. He has been employed with operators and distributors, including Codere, Jogan, Egasa and Grupo Miky.

Christian Colus, Aristocrat’s head of sales for Southern Europe, said, “José is well-known and well regarded in the Spanish Type B games market. His industry knowledge and network of contacts are an ideal fit to help further strengthen Aristocrat’s position and market share.

“Having close and continual contact with front-line operations, particularly in key target regions such as Catalonia, Valencia, Aragon, Madrid, Basque Country and Galicia, will also help us to gain more valuable insight into players’ evolving needs.”

By GGB Staff   Wed, Aug 31, 2011

Isle of Capri Casinos, Inc. has announced the election of Scott E. Schubert to its board of directors, filling the vacancy created when a board member resigned in May.

Schubert has an extensive background in corporate finance. In 2009 he became a member of the board of directors of Sonus Networks, Inc., where he currently serves as chairman of the audit committee and as a member of the corporate development and investment committee. He previously served as chief financial officer of TransUnion LLC, as well as chief financial officer and executive vice president of corporate development of NTL, Inc. (now known as Virgin Media, Inc.). From 1999 to 2003, Schubert held the position of chief financial officer of Williams Communications Group, Inc.

Schubert also served as head of BP Amoco’s Global Financial Services, leading the initial integration of BP and Amoco’s worldwide financial operations following the merger of the two companies.

By GGB Staff   Wed, Aug 31, 2011

Slot manufacturer American Gaming Systems announced that it has appointed Curt C. Mayer as its chief financial officer.

Mayer comes to AGS from Las Vegas-based SkyWire Media, Inc., where he served as executive vice president and CFO for the private start-up company that develops integrated, mobile-centric applications for the hospitality industry.

Prior to joining SkyWire, Mayer, beginning in 2007, served as the corporate vice president of finance for Station Casinos, Inc., where he played key roles in Station’s $5.7 billion going-private transaction in 2007, $410 million in debt financing for Aliante Station in 2007 and a $250 million land loan in 2008.

From 2002 until 2007, Mayer served as CFO for Black Gaming, LLC, a public gaming company located in Mesquite, Nevada, where he was integral in raising approximately $180 million and taking the company public in 2004. Prior to Black Gaming, Mayer spent 10 years with the accounting firm Arthur Andersen serving public companies in various industries from gaming to technology.

By GGB Staff   Wed, Aug 31, 2011

Larry Gregory has been named director of the Mississippi Casino Operators Association. Gregory recently retired as the executive director of the Mississippi Gaming Commission.

Gregory served on the state’s gaming commission for nearly 10 years, overseeing day-to-day operations and enforcing casino and bingo parlor rules. He was instrumental in Gulf Coast casinos’ recovery and reconstruction efforts following Hurricane Katrina in 2005. Gregory also helped draft regulations that moved coastal casinos up to 800 feet inland.

“Gregory’s experience and knowledge of our industry as well as his established working relationships throughout the industry will make this an easy transition,” said MCOA Chairwoman Tess Ingram. Gregory will start his new job in September.

By GGB Staff   Wed, Aug 31, 2011

The fifth annual G2E Asia trade show, held in June at the Venetian Macao, registered a 25 percent attendance increase, according to statistics released by the show’s organizers, Reed Exhibitions and the American Gaming Association.

“G2E Asia keeps pace with the latest gaming trends and what the industry demands, and provides the products, information and networking opportunities,” said a joint statement from the organizers.

The exhibit floor showcased 119 exhibitors from 22 countries and regions, of which 34 percent were first-time exhibitors. The event attracted 5,748 industry professionals from across the regions, surpassing attendance at last year’s event by 25 percent. According to the organizers, exhibitors were very satisfied with the influx of quality and increase in trade visitors.

The exhibition floor opened over a three-day period with a special program offered to invited VIPs from Asia, along with international and local media, to get a firsthand look at the gaming exhibits. The event was inaugurated with an official ceremony on June 8 featuring a Chinese traditional dragon dance.

Most of the visitors came from Macau and Asia. Visiting countries include Japan, Taiwan, South Korea, Malaysia, Vietnam, Thailand, Laos, Indonesia, India, South Africa, United Kingdom and United States. In particular, the number of attendees from Australia, Philippines, Singapore, Cambodia, China and Macau increased significantly when compared to last year. The strong attendance growth from around Asia confirms that G2E Asia is truly an event for the Asian gaming industry.

One of the highlights of G2E Asia 2011 was the return of the Gaming Investment Forum. Sponsored by UBS, this two-day, invitation-only event featured a number of renowned corporate leaders and financial analysts offering their expert perspectives on the financial future of leading gaming companies.

Another highlight on the show floor was the Game Protection Seminars delivered by industry expert Sal Piacente, a world-renowned gaming veteran who advises casinos on detection and prevention of table game cheating. Visitors were able to learn from his live demonstration on the latest card cheating tricks for baccarat and poker.

By GGB Staff   Wed, Aug 31, 2011

The G2E Asia Gaming Management Certificate program, held on June 9, received a positive response from the industry. Produced in partnership with gaming professors at the University of Macau and the University of Nevada Las Vegas Singapore, the program was limited to 100 participants and attendees received a certificate of completion at the end of the workshop. It included special interactive educational workshops designed to help new casino managers in Asia further their knowledge of current gaming trends in Macau.

By GGB Staff   Wed, Aug 31, 2011

G2E Asia 2011’s Conference Program experienced a 22 percent increase in attendance over 2010, according to the organizers. The three-day conference program covered comprehensive industry information focusing on Macau, marketing, the gaming floor, risk management, finance and non-gaming amenities. The dedicated senior management and middle management tracks introduced this year were well-received.

Among the most popular sessions this year was “VIP Vision: How Junkets Work Across Asia,” which examined how the VIP junket system works in each country and the keys to player satisfaction. More than 55 industry experts shared their knowledge on the hottest issues facing the Asian gaming industry.

By GGB Staff   Wed, Aug 31, 2011

Leading slot manufacturer International Game Technology announced the official launch of “Dirty Dancing,” a MegaJackpots wide-area progressive video slot based on the 1987 Lionsgate film about a dancing duo in the Catskills during the 1960s.

The slot features three main bonus rounds, using multiple video and audio clips from the film, which starred Patrick Swayze and Jennifer Grey. Grey provided voice-overs for the slot’s audio, hosting bonus rounds and repeating some of her lines from the movie.

The game introduces a randomly initiated feature called Spin Magic, which selects one of the minor symbols and turns it wild for a given spin. MegaFX surround-sound chairs, which create an immersive and entertaining game experience, help bring scenes and songs to life.

Dirty Dancing remains one of the most popular films in Lionsgate’s 13,000-title library, and is one of the most enduring modern classics in feature film and home entertainment history.

“No one will want to put this baby in a corner,” said Eric Tom, IGT chief operating officer, referring to Grey’s character “Baby” from the film. “Featuring the unforgettable characters, clips and soundtrack that made the film a pop culture icon, Dirty Dancing Video Slots will have players singing along and dancing in their seats.”

“We are thrilled to be partnering with IGT to give fans this unique and exciting Dirty Dancing experience,” said Anne Parducci, Lionsgate’s executive vice president of family and home entertainment marketing. “The film continues to resonate with each new generation, expanding upon what is already an extremely loyal and active following, and we are constantly developing ways for the Dirty Dancing fans to relive this remarkable film in new and exciting ways.”

By GGB Staff   Wed, Aug 31, 2011

Popular artist Michael Godard has brought his whimsical touch to Atlantic City with the debut of the “Michael Godard’s Rockin’ Olives” video slot game at Borgata Hotel Casino & Spa. The game, presented by Aristocrat Technologies, has become a favorite among slot players across North America.

Godard made a recent appearance at Borgata’s Gypsy Bar to promote the debut of the video slot, which is based on the artist’s world-famous olive paintings. Michael Godard’s Rockin’ Olives tells the story of the ultimate rock concert, complete with guitar and drum-playing olives and sexy strawberry fans. Godard hand-painted each frame of each reel.

The slot is housed in Aristocrat’s award-winning VERVEhd cabinet. Sleek, modern and a work of art in itself, the cabinet features twin 21.5-inch HD monitors, panoramic digital audio, “Nteractiv” LCD buttons and ergonomic design.

By GGB Staff   Wed, Aug 31, 2011

JCM Global has unveiled its new PayCheck 4 thermal printer, dubbed “the better, faster, stronger printer for the casino gaming industry.” According to the company, PayCheck 4 is the fastest printer in the industry.

Designed for traditional casino slot gaming, VLT devices and Class II devices, PayCheck 4 prints a complete ticket in just 0.6 seconds, compared to up to two seconds by other printers. Because of the speed, there is no need for it to rely on ticket “bursting” like other printers do.

PayCheck 4 prints at 250mm (9.8 inches) per second in text mode with 500 dots per line, or 203 dots per inch. That means the printer completely prints a ticket faster than a player can reach for it.

“Indisputable facts clearly show that PayCheck 4 is simply the fastest printer on the market,” said Mark Henderson, VP global sales of JCM Global. “In a horse race with all other casino gaming printers, it’s not even close—PayCheck 4 leaves everyone else at the starting gate.”

PayCheck 4 is available now for most global jurisdictions. For information, operators should call their JCM account representative or visit JCMGlobal.com.

By GGB Staff   Wed, Aug 31, 2011

Software supplier and consultant NEWave has announced that “dozens” of new tribal casinos are signing contracts for the company’s myCompliance software, which helps tribes comply with Title 31 requirements.

Title 31 is a key component of NEWave’s myCompliance suite. The solution logs financial transactions from all potential sources as they happen, and ensures Title 31 reports and forms (SAR-C, CTR-C) are generated and properly e-filed. It completes the process by digitally storing files for reliable, quick and secure retrieval.

“We instantly realized that NEWave’s Title 31 software was what we had been missing in our daily operations,” said Ruth Ritchie, cage and vault director for California’s Tachi Palace Hotel & Casino, which added the software in May. “The installation was well organized and smooth, the software is very easy to use, and we immediately achieved a more streamlined approach to our business, saving a volume of labor hours. Additionally, we gained added confidence that all transactions are being recorded in real time.”

By GGB Staff   Wed, Aug 31, 2011

The sports book “arms buildup” that has occurred during the last two years has finally erupted into a war.

Cantor Gaming has been grabbing sports book operations left and right, including M Resort, Hard Rock, Tropicana, Cosmopolitan and others. William Hill of the United Kingdom, meanwhile, has purchased three Nevada sports book operators: American Wagering, Cal Neva and Brandywine Bookmaking, controlling dozens of sports book operators across the state.

Both operators have cutting-edge technology. Cantor offers its “in-running” devices in its operations, which can also be used to play casino-style games. William Hill, through American Wagering, offers mobile sports betting within Nevada via smart phones.

The competition took another step last month when Cantor Gaming filed suit against Brandywine Gaming CEO Joe Asher, who introduced Cantor to the Nevada industry. Asher left Cantor in 2007 to form Brandywine Gaming. The Cantor suit alleges that Asher immediately set up sports betting operations in casinos operated at that time by the Navegante Group. The company claims that Asher had been negotiating with Navegante to install Cantor in those operations. Asher denies the charges, and the Cantor suit doesn’t clarify why it took four years to file the objection.

At the time of its purchase by William Hill—which has yet to be completed—Brandywine Bookmaking was operating the 16 Lucky’s Race and Sports Book locations in southern Nevada. The suit wants to freeze the $15.7 million purchase and direct an undetermined amount of money to Cantor.

The Cantor suit also alleges that Asher has two outstanding loans to the company that have yet to be repaid.

By GGB Staff   Wed, Aug 31, 2011

Innovation Food & Beverage, an affiliate of the Innovation Group of Companies, announced that it will be representing domestic operations for the Non-Traditional Division of Papa John’s International as the pizza chain seeks to grow its footprint in the casino and entertainment resort market.

“As casinos look to diversify their food and beverage options and cater to changing consumer demands, Papa John’s can provide a turn-key solution,” said Michael Soll, executive vice president of the Innovation Group. “The Papa John’s franchise model allows casinos to control both the bottom line and customer experience while providing high-quality food product to its customers. Papa John’s is a proven leader in its market segment, and will bring an added dimension and demand driver to select casinos and entertainment resorts.”

Joe Smith, vice president of non-traditional development for Papa John’s, added, “Papa John’s has been looking for strong growth markets, and casinos present a very interesting opportunity for the company, particularly due to our franchise model. To have the ability to utilize the expertise, network and reach of the Innovation Group of Companies we believe will be invaluable to help us achieve our goals. The timing of the Innovation agreement with Papa John’s is strategic, as it helps position Papa John’s to compete in the growing quick-service and grab-and-go segments of casino food and beverage programs.

“Consumer demands are changing, and there is a strong emphasis on the price-to-value relationship,” said David Rittvo, director of Innovation Food & Beverage. “For consumers, we believe Papa John’s quality offerings provide a strong balance between these two ideals. From the operator’s perspective, a Papa John’s franchise can drive new revenue sources to the food and beverage department of a casino and/or resort, while helping increase an efficient bottom line.”

By GGB Staff   Wed, Aug 31, 2011

General Media Communications, Inc., publisher of Penthouse magazine, announced that it has signed an agreement with Bulgaria-based slot manufacturer Casino Technology to produce “Penthouse” and “The Penthouse Club” slot machines.

The new series of slots will be available beginning in early 2012 in casinos throughout North America, Europe, Central America, South America and Asia, according to the announcement. The slot swill feature well-known Penthouse images such as the “Penthouse Pets” and the “Penthouse Key Girl,” as well as other icons associated with the popular men’s magazine.

“Our goal with this agreement is to create a product with special appeal, which is unlike other products we have created in the past,” said Rossi McKee, vice president of Casino Technology. “Penthouse and The Penthouse Club slot machines will feature high resolution and quality video and graphics, as well as innovative designs, concepts and distinguishing characteristics that will set these machines apart from all others.”

Jeff Stoller, director of global club licensing for the Penthouse brand, added, “This agreement is a milestone for our brand since it represents the first worldwide license we have given in the gaming category. Casino Technology and its executive team have shown a willingness to go above and beyond the norm, and through their business relationships around the globe, we feel confident that the Penthouse and The Penthouse Club brands will continue to expand to new locations and consumers.”

By GGB Staff   Wed, Aug 31, 2011

It’s no longer tribe versus tribe when it comes to online gaming in Washington, D.C. Although the California tribes continue to have differences regarding a possible legalization of online poker within that state, in the nation’s capital, things are changing.

With commercial casinos ramping up lobbying efforts—recently announcing the formation of a PAC, FairPlayUSA, to promote legal online poker—tribes are starting to realize they must get aboard or be left behind. And after a recent alliance between Senate Majority Leader Harry Reid of Nevada and Senator Jon Kyl (R-Arizona), previously a fierce opponent of online gaming, tribes understand that the stars could be lining up.

“We’re 40 percent of all gaming in this country, and we’re going to be left out of the internet gambling bill,” Jess Green, an attorney and a member of the Oklahoma’s Chickasaw Nation, told GamblingCompliance.

But with the tribes’ insistence that any legalization of online gaming should fall within the Indian Gaming Regulatory Act of 1988 and that no federal tax could be implemented, it’s difficult to see where compromise could be reached.

While no bill has yet been drafted outlining the role of tribes in online gaming, National Indian Gaming Association President Ernie Stevens says there should not be any more federal agencies set up to oversee it.

“We don’t expect to have to go to a new agency that doesn’t understand Indian sovereignty,” Stevens said.

Sheila Morago, executive director of the Oklahoma Indian Gaming Association, says tribes have proven they can oversee and regulate any kind of gaming.

“We are perfectly capable of operating and regulating internet gaming,” she told the Senate Indian Affairs Committee recently, “and I think when you’re looking at these bills, it’s important that you have to remember that. It shouldn’t be a monopoly for the commercial gaming industry that we don’t have access to.”

Limiting online gaming to tribes currently conducting land-based gaming is also a non-starter, according to some tribes. The Cheyenne River Sioux Tribe of South Dakota is located on a remote reservation where land-based casinos would not succeed. So the tribe wants to be able to take advantage of this opportunity.

“The ability to join with other tribal nations in internet gaming might save us millions of dollars in terms of the start-up costs for any tribal gaming,” tribal attorney Steve Emery told GamblingCompliance. “That’s incredibly important to us because, among other things, we have the dubious distinction of having the poorest county in the United States.”

While the tribes are preparing for a possible legalization, it’s not a guaranteed thing. Rep. Tom Cole (R-Oklahoma) is the only Native American currently serving in Congress. He says he’d oppose any online poker bill in the House because it could “destroy an industry that employs tens of thousands of people.”

By GGB Staff   Wed, Aug 31, 2011

A new coalition called FairPlayUSA has recently formed with a mission to persuade lawmakers to regulate online poker and crack down on illegal internet gambling. FairPlayUSA, whose advisory board includes former Homeland Security chief and ex-Pennsylvania Governor Tom Ridge, as well as professional poker player Greg Raymer and child-safety advocate Parry Aftab, is a self-proclaimed “grassroots” lobbying group designed to push Congress to fully legalize online poker and to clarify the nation’s online gambling laws.

The Washington, D.C.-based group has launched a new website, www.FairPlayUSA.com, which outlines its plan “to educate the public and policymakers on the need to reform internet gambling laws in three key areas: strong law enforcement and strict regulation, consumer and child protection, and the rights of adults to play online poker.”

The website lists the group’s 10 Principles, which include strengthening the Unlawful Internet Gambling Enforcement Act (UIGEA) of 2006 as well as a “crackdown on unlicensed foreign operators who do not comply with U.S. law.” The website also includes a petition that encourages U.S. poker players to sign, which FairPlayUSA intends to eventually submit to Congress.

According to the group’s Executive Director Marisa McNee, “The website and online petition will be the focal point for recruiting and organizing supporters who will actively engage and make their voices heard by members of Congress. Outreach will be directed toward law enforcement officials, those who support internet consumer safety, and online poker’s strongest asset—the millions of Americans who enjoy online poker.”

McNee has stated that the group does not support any specific bill, but they do support a federal regulatory body to oversee poker at the national level.

“I wholeheartedly endorse having policymakers clearly define what is illegal internet gambling and giving law enforcement the tools necessary to enforce such a ban. I also strongly support the strict regulation of online poker. Americans who choose to play poker against each other on the internet should be assured that the games are fair and limited to adults,” said Ridge.

FairPlayUSA has received its initial funding from land-based casino owners Caesars Entertainment and MGM Resorts.

Experts say the group is the land-based gaming industry’s answer to the Poker Players Alliance, which was formed by offshore online casinos about six years ago. The PPA’s initial funding largely came from the indicted companies, principally PokerStars and Full Tilt Poker. Since the indictment, the clout of the PPA has been diminished and its reputation tarnished. FairPlayUSA carries none of the baggage that now weighs down PPA.

Nonetheless, PPA welcomed the arrival of FairPlayUSA.

“On behalf of our 1.2 million members nationwide, the PPA is pleased to see another group dedicated to restoring and protecting Americans’ freedom to play internet poker,” the organization said in a press release. “The PPA has been at the leading edge of the fight for U.S. regulation for nearly six years, and we welcome the addition of another voice—and one that represents a new constituency—to the chorus of supporters for a sensible federal policy towards online poker.”

By GGB Staff   Wed, Aug 31, 2011

The parliament of Greece has passed online gaming legislation that in general complies with European Union law.

The legislation creates a sector control committee to be established at an unspecified date. Once established, a six-month transition period will begin, during which time operators may offer their products and advertise them on all forms of media.

E.U.-based operators will be allowed to use servers based outside of Greece during the six-month transition period. It is not yet clear what the requirement will be for an operator after a license has been granted.

During the transition period, E.U.-licensed operators who enter the Greek licensing process will pay 30 percent tax on gross gaming revenue. Players will be responsible for a 10 percent tax on winnings.

According to GamblingCompliance, some concerns remain due to the wording of the law regarding tax liability for past revenue.

The country manager of one operator responsible for Greece told GamblingCompliance, “Theoretically, the tax liability could start from the first of January 2010. However, that liability is undecided because we don’t have a ministerial decree for the time being.”

Betfair, which had lodged a complaint with the European Commission for excluding betting exchanges from the law, told eGaming Review, “The Greek government’s decision to recognize the licenses held by E.U. betting operators during the transitional phase is a positive step. Betfair will continue to engage with the Greek government during this time, working on elements of the law which we believe could be brought more into line with E.U. principles.”

As reported by eGaming Review, the move brought a cautiously optimistic response from Remote Gaming Association CEO Clive Hawkswood.

“Ensuring an equitable and competitive marketplace involving private operators and the part state-owned OPAP is also an important factor,” said Hawkswood. “We hope to continue to have a constructive dialogue with the Greek authorities on those matters with the aim of ensuring a viable and E.U.-compliant framework is put in operation to the benefit of government, consumers and remote operators.”

By GGB Staff   Wed, Aug 31, 2011

It was a contentious battle in July and August, one which pitted Republicans and Democrats, with the Tea Party thrown in. But in the end, a deal was struck so President Barack Obama could raise the debt ceiling and avoid default on U.S. bonds. But the deal wasn’t enough for rating agency Standard & Poors, which downgraded U.S. debt from AAA to AA+.

The deal creates a “super Congress”—a 12-member bipartisan commission—that will oversee more than $1 trillion in federal budget cuts. Congress will be asked for an up or down vote on those recommendations, without the ability to offer amendments, between Thanksgiving and Christmas later this year.       

Online gaming advocates see an opening in this commission. They see an opportunity to create new revenues by taxing the new activity of online gaming. Congressman Jared Polis (D-Colorado) supports online gaming taxation, as well as placing levies on legalized medical marijuana and other activities.

Polis’ numbers may be off, however. He says the Congress can raise $42 billion over the next 10 years in taxes on internet gaming. But according to GamblingCompliance, that calculation assumes all 50 states opting into the activity. The Joint Committee on Taxation says the true figure is more like $10 billion over that period.

“It’s not a take-it-or-leave-it proposition,” Polis spokesman Chris Fitzgerald told GamblingCompliance. “Congressman Polis is just trying to get people to think outside the box when it comes to raising revenue without raising taxes.”

Polis is a co-sponsor to three online gaming bills already introduced into the house by Reps. Joe Barton, John Campbell and Jim McDermott.

Some doubt, however, that the revenue garnered from online gaming would make a dent in the national debt.

“The national debt is more than $14 trillion,” said David Schwartz, director of the Center for Gaming Research at the University of Nevada at Las Vegas. “Revenue from gambling would probably keep the country running for about five minutes.”

By GGB Staff   Wed, Aug 31, 2011

A letter sent last month by Senators Harry Reid (D-Nevada) and Jon Kyl (R-Arizona) to U.S. Attorney General Eric Holder asked the Justice Department to confirm its belief that intrastate online gaming is, indeed, illegal under the 1934 Wire Act, as the senators seemed to think.

Ray Lesniak, the New Jersey state senator who introduced a bill earlier this year that would have legalized online gaming within the state, says Reid and Kyl are all wet. In his own letter to Holder, Lesniak says the Justice Department should butt out.

“The state of New Jersey should not be impeded in any manner from exercising our rights under our state constitution and under federal law,” wrote Lesniak.

Lesniak used federal legislation—the 2006 Unlawful Internet Gambling Enforcement Act (UIGEA)—to justify his claim. He quoted from the act:

“The term ‘unlawful internet gambling’ does not include placing, receiving, or otherwise transmitting a bet or wager where,” he said, “the bet or wager is initiated and received or otherwise made exclusively within a single state.”

Lesniak pointed out that both Reid and Kyl voted for UIGEA. He also says the senators’ contention that all online gaming is illegal is mistaken.

“Were you to accept Sens. Reid and Kyl’s letter on its merits, you would have to prosecute the Nevada Gaming Board, which this year approved sports betting via mobile internet within the confines of the state of Nevada. Nevada has also approved other forms of internet and remote wagering on casino games, poker and sports within Nevada by firms like Las Vegas Sands and Station Casinos.”

“And for that matter,” Lesniak continued, “New Jersey and 37 other states would also have to be prosecuted for permitting online wagering on horse races, which has existed for years.”

By GGB Staff   Wed, Aug 31, 2011

The pressure on parent company Pocket Kings to negotiate a sale of Full Tilt Poker was ramped up last month after the company laid off its international staff, leaving only its Dublin-based headquarters in business. And the layoffs came just two days after Pocket Kings paid a £250,000 licensing fee to Alderney, where its license is currently suspended. With a hearing before the Alderney regulatory authorities concerning the suspension set for September 15, the need to conclude negotiations has become greater. Alderney authorities have made it clear to Pocket Kings that they would prefer to deal with new owners rather than hold a hearing on the alleged misdeeds of the current owners.

And remaining outstanding is the ability and process that will be used to repay the deposits of former Full Tilt players in Europe and the U.S. Alderney regulators issued a statement last month on the payment of the licensing fee and the impact it would have on player reimbursement.

“The recent payment of overdue license fees by FTP is also in players’ best interests since it allows commercial negotiations to take place that might result in a successful refinancing deal,” the release said.

It has been reported that a group of European investors were interested in buying the company, but the extremely complicated deal has bogged down over issues of operations and liabilities, not to mention the site’s already-dodgy reputation with players.

By GGB Staff   Wed, Aug 31, 2011

WMS Gaming is expanding its license relationship this year with Hasbro, the game company from which it licenses the longstanding hit franchise Monopoly. Among the newest Hasbro licenses the slot-maker has acquired is a Hasbro game once made into a slot by the former Mikohn, the “Battleship” board game.

In reproducing the legendary game, in which players face each other in a strategic competition to sink each other’s unseen battleships, WMS had the advantage of 10 years of technological advance since Mikohn executed the license. It also had game styles like “Immersive Gaming” (as in “Wizard of Oz”) and the new competitive setup of the Community Play “Team Compete to Win” series.

This new setup involves four or six machines in front of one large LCD monitor framed by two portrait-style monitors. The bonus is split into two “teams”—the left half of the bank constitutes “Team Blue,” the right half “Team Red.” When one of three competitive bonuses is triggered, the player teams try to sink each other’s battleships, with high-definition video, BOSE surround-sound audio and vibrating chairs all adding to the immersive experience.

There are four base games in the series—“Periscope Pays,” “Commanding Officer,” “The Brigade” and “Grand Armada.” Each base game has its own individual bonus events.

The three common competitive bonus events occur at random. In “Bomber’s Run Bonus,” each portrait screen displays the team’s “bombing run” while the central video displays the results—for added tie-in to the board game, the bombs look like the pegs from the game and land in pegboard spots on the ships to go toward sinking each ship. The team with more hits in the first round receives a second bombing run. Each hit results in bonus credits for both players on the team.

In the “Free Spins Victory Bonus,” a reel set appears on the main screen, and cannon symbols award shots at the opposing team’s fleet in an effort to sink ships. The team sinking more ships receives a 2X multiplier at the end. In the “Find and Conquer Bonus,” each team places its fleet of ships in various positions on a replica of the Battleship game board, and then shares three picking rounds to fire at the opposing team’s ships. The team sinking the most ships gets an extra pick at a 5X multiplier.

Manufacturer: WMS Gaming
Platform: CPUNXT2
Format: Five-reel; 20-line, 30-line or 40-line video slot; 45-credit or 60-credit minimum bet configurations
Denomination: .01, .05
Max Bet: 150—1,500
Top Award: Progressive—$200,000 reset; Stand-Alone—15,000, 20,000, 25,000, 30,000, 50,000, 100,000
Hit Frequency: 23.11%—53.38%
Theoretical Hold: 10%—14%

For more information, visit www.wms.com/battleship, and for a video of the game features, go to http://www.youtube.com/watch?v=Fv26N9fNTP0.

By GGB Staff   Wed, Aug 31, 2011

This new 25-line video slot employs Aristocrat’s new “Mega Pay” game feature, which multiplies the sets of reels during free-spin bonus events. Themed on the ancient Incas civilization from the Andes Mountains in South America, the primary game uses high-definition graphics and animation on the new Viridian WS wide-screen format to convey the theme.

The primary game is a fairly standard medium-volatility program, but an ante wager qualifies the player for a highly volatile bonus feature utilizing the Mega Pay game mechanic.

When three or more scattered “Idol” symbols appear on the screen,12 free games are awarded with all symbols on the fifth reel transformed into the wild Inca symbol. During the free spins, ruby symbols are collected to trigger the Mega Pay feature.

When 10 rubies are collected, a second reel set appears, and the free spins continue on two sets of reels, with all the symbols on reels 4 and 5 transformed to Incas. When 20 rubies are collected, three reel sets appear with Incas covering the three right-hand reels.  With 30 or more rubies collected, the remaining free spins are played out on four reel sets with all but the first reel covered with the wild Inca symbols.

Manufacturer: Aristocrat Technologies
Platform: GEN7/Viridian WS
Format: Five-reel, 25-line video slot
Denomination: All denominations available
Max Bet: 200, 400
Top Award: 1,000 credits times line bet
Hit Frequency: Approximately 50%
Theoretical Hold: 5.16%—14.37%

By GGB Staff   Wed, Aug 31, 2011

This video slot utilizes two of Bally’s most popular new game mechanics, the U-Spin “gesture control” technology and the new “Directional Wilds,” which expand wild symbols in a random direction to make additional symbols wild.

Golden Pharaoh is the follow-up to the popular Money Vault, which was the first game title available on Bally’s Alpha 2 Pro Series V22/22 upright cabinet. The cabinet features the “Hammerhead” oversized top box.

Golden Pharaoh is a 40-line video slot featuring a top wide-area progressive resetting at $1 million. On random spins, a Directional Wild symbol will appear on the third reel. When it lands, the symbol changes into a spinner, and points to an edge or corner in one of eight directions. All symbols in its path are turned into wild symbols. According to the manufacturer, this occurs every six spins, on average.

The main bonus is the U-Spin Wheel, which appears on the top box display and turns into a horizontal 3D image. The player touches the screen to spin the wheel, which responds to the amount of pressure applied to spin at the appropriate speed. Prizes on the wheel include credit awards, free spins with stacked wilds, and the top progressive jackpot (max-bet only).

The U-Spin wheel is synchronized with the top-box display, which includes a “Super Pointer” at the top, flashing in sync with the 3D virtual wheel and illuminated side bezels. A “Super Candle” is also synchronized with game play, adding to the effect.

Manufacturer: Bally Technologies
Platform: Alpha 2
Format: Five-reel, 40-line video slot
Denomination: .01
Max Bet: 200
Top Award: Progressive; $1 million reset
Hit Frequency: 41.65%
Theoretical Hold: 11.97%—13.92%

By GGB Staff   Wed, Aug 31, 2011

The newest game for IGT’s giant “Center Stage” theatrical community-style game setup, The Dark Knight uses the giant video screens—103-inch or 70-inch monitor, or a new 50-inch screen on a two-machine version—to re-create one of the action sequences of the 2008 Batman film of the same name starring Christian Bale and Heath Ledger.

The primary game is a 50-line video slot, with bonuses available with a bet to cover the lines. The player is prompted to assume the role of one of the two main characters, Batman (as portrayed by Bale) or the Joker (Ledger). Some of the icons and animation in the slot game change according to which character the player picks.

There are two pick-style bonuses triggered by reel combinations. “Agents of Chaos” and “Sonar” incorporate familiar scenes from the film with multiple winning outcomes. Another base-game bonus event, “Sleight of Hand,” has the player swipe his hand on the screen to turn over the Joker’s card.

There are also random events during play, but the central feature is the “Battle for Gotham,” a high-speed car chase played out on the big screen for all eligible players on the bank. Batman and the Joker race around Gotham City in their souped-up vehicles, and the players who picked the winner at the start of play win the higher bonuses. Players get the bird’s-eye view of the super-vehicle race, thanks to the surround-sound speakers and vibrating chair, which take them right into the chase-and-crash scene from the film.

Manufacturer: International Game Technology
Platform: AVP; Center Stage
Format: Five-reel, 50-line video slot
Denomination: .01
Max Bet: 500
Top Award: Progressive; $100,000 reset (varies by jurisdiction)
Hit Frequency: Approximately 50%
Theoretical Hold: 6.5%—15.72%

By Aron Ezra   Wed, Aug 31, 2011

It’s hard to go anywhere without seeing someone flicking their fingers across a smart phone, and that is increasingly true across casino floors around the world. Casino patrons take photos of big wins, invite friends to play, preview shows, and check out what else is happening nearby.

This is good news for the gaming industry. Smart phones and mobile apps provide operators with new opportunities to interact with players before, during and after their actual visit to the casino.

The Pew Internet Project estimates that one in four U.S. adults now uses mobile apps, and of those, nearly two in three people use their apps every day.

And this is a trend that’s only just getting started—mobile is revolutionizing the way that people access information.

Consider the following:

• Gartner Inc., a technology research firm, predicts that by 2013, more people will access the internet through mobile devices than through personal computers.

• Smart phone sales are now outselling PCs—there are more than 350,000 Apple mobile devices activated every day and 550,000 Android devices activated daily.

• Data from the Nielsen Company projects that half of Americans will own and use smart phones by 2012.

• To date, more than 15 billion apps have been downloaded by Apple users alone.

After we created their apps, many of our individual casino clients have been able to attract more than 100,000 mobile app users in just their first year following launch.

Given those numbers, it’s no wonder that operators are so excited about the future of mobile. Apps allow a casino to be ever-present on a patron’s mobile device. But in designing your app, watch out for some of the common pitfalls. Here are five important steps to ensure your app is as effective as possible:

1. Listen carefully to what your users are requesting. Feedback is critical. The best app designers are open to what their customers suggest—and they act on those suggestions. A good app allows patrons to rate games, rooms, staff, meetings and more as they walk around the casino. Users should have the ability to comment on everything happening at the property, which gives casinos a 24/7 focus group. If someone at one of the tables has a bad experience with the dealer, through the app, management can find out immediately and take action before the player goes home.

2. Don’t just duplicate your website. Take advantage of a smart phone or tablet’s capabilities; remember that people want a different experience in the mobile world.

A lot of first-time app efforts are essentially glossy brochures with photos and a booking area. That’s a good start, but not fundamentally different than the experience someone has on a website. The beauty of apps is that a person can have a wealth of location-based information and features at their fingertips.

Mobile devices have interactive features that most personal computers don’t have, like GPS, an accelerometer, cameras, QR Code readers and more. Users want an app that helps them as they walk around and takes advantage of their device’s capabilities. Be sure to create experiences that are customized to a customer on the go, not a customer in front of a computer.

3. Apps aren’t just for guests—they’re for your employees too. Remember that it’s important to think about creating solutions to help your employees to be more efficient. Apps for your employees are powerful internal communication tools, and can show team members everything from back-of-the-house maps and orientation materials to player’s club profiles or scheduling and benefits information. This is an exciting new area that can generate new revenue and make your teams more effective.

4. Integrate mobile into your larger marketing, gaming and and outreach strategy. It’s not enough to just launch an app. Properties should be cross-promoting their app over several marketing channels, using on-site signage, social media, advertising, public relations, direct mail and customer service to get the most downloads and interest. It’s amazing how often companies launch an app but don’t properly promote it. Another common mistake: forgetting to tell the front-line staff that there’s a new app. This results in a lot of patrons asking staff mobile questions that they can’t answer.

5. Don’t let content get stale. Continue to innovate. To keep people coming back to an app, it’s critical to make sure you don’t let the content or the features stagnate. An app that was great six months ago doesn’t necessarily take advantage of today’s new features and hot social-media technologies, such as Foursquare and GPS possibilities. Outdated offers or difficult-to-find info is one of the quickest ways to generate negative feedback, so be sure to keep content fresh. Give your customers something valuable that they will enjoy using, and you’ll earn more revenue and more respect. Remember, mobile is still a young technology, and the rules are still being written. Don’t be afraid to take risks and try new things. You never know where it can lead.

By Frank Fahrenkopf   Wed, Aug 31, 2011

Terry Lanni’s death this July led to an outpouring of respect from across the spectrum of the gaming industry. The dozens of statements issued and eulogies written tell of a life well-lived. His accomplishments as a business leader, corporate philanthropist, husband and father have been well chronicled over the past weeks and months, but it is important to reflect on what we can learn from the way Terry conducted his business and his vision for the entire industry.

In the five decades I have been involved in the gaming industry, I have had the privilege of working with most of its true giants. Terry Lanni was one of those giants. Perhaps more than anyone I’ve known, Terry could be at the same time tough and collegial, a leader and a listener, respected and respectful.

Terry had many successes over his illustrious career, but it was his work over the last two decades that solidified his legacy as a historic figure in our industry. It is during this period that his vision for the future of his company (MGM Mirage, now MGM Resorts International) and the future of the gaming industry bore its greatest fruit.

Terry was instrumental in 1995, along with gaming executives such as Bill Boyd from Boyd Gaming, Chuck Mathewson from IGT, Phil Satre of Harrah’s Entertainment, Steve Wynn of Mirage Resorts and others, in the creation of the American Gaming Association. He was an early and enthusiastic advocate for bringing the industry together to deal with common opportunities and challenges. Terry knew that the expansion and growth of the industry would create political, legislative and regulatory challenges that would require the efforts of a united industry. That proved to be true in spades (to use a card analogy) when, just over a year after the AGA was created, the National Gambling Impact Study Commission (NGISC) was formed.

In my opinion, the growth of our industry over the last 15 years would not have happened as quickly or, perhaps, not at all, had Terry Lanni not been a member of that commission.

John Wilhelm, president of the labor union UNITE HERE, captured the importance of Terry’s style and personality during the deliberations of the NGISC in a quote I read recently in the Las Vegas Business Press. Wilhelm said of Terry’s role on the NGISC, on which they both served in the 1990s, that “Terry was the perfect representative for the industry because he was the antithesis of the then-prevailing stereotype of a gaming executive. His intelligence, sophistication, his ability to listen and his unfailing courtesy disarmed the more anti-gaming members of the commission.”

John went on to credit Terry’s participation in that commission for being “in no small measure responsible for the fact that the commission, contrary to expectations, agreed to a unanimous report that did not undermine our industry nor provide the basis, as some intended, for federal taxation.” I completely concur with John.

For those who may have forgotten, it is worth remembering that the NGISC was a very real threat to our industry. We had just experienced a tremendous period of expansion—expansion that, frankly, outpaced the nation’s understanding of the social and economic impacts of gaming. In that environment, the moralists who vehemently opposed and still oppose gaming were having substantial success perpetuating a host of negative myths. Nearly two decades later, those myths have, for the most part, been laid to rest, so it can be easy to forget the credibility they were given in the early and mid-1990s. Thanks to the work as commission members of Terry, John Wilhelm and Bill Bible, then chairman of the Nevada Gaming Control Board, the results of the study proved to be the beginning of the marginalization of the anti-gaming movement and a major contributor to the continued growth of gaming across the nation.

It was thanks to the commitment and selflessness of leaders such as Terry that the AGA and the industry were prepared to deal with the threat the NGISC represented. It took vision to see beyond the short term—a good lesson for an industry that must always be vigilant.

Terry’s vision extended far beyond the idea of a united industry. As someone who has worked in the political arena for most of my life, I had the greatest respect for Terry’s understanding of the political process and its impact on his business and our industry. He certainly was not alone among his peers in that respect, but he was among the first to see beyond the board room and, as there is little hope the role of politics will get smaller in our lives, all corporate executives would be wise to follow his lead.

We could also learn from Terry’s strong sense of corporate altruism and philanthropy. He was widely recognized as a leader committed to diversity in business. He established the industry’s first formal diversity and inclusion program, and MGM Resorts International’s diversity programs continue to win awards from a range of national groups. Terry led MGM to be a major partner in a local school’s empowerment program and also started the MGM Academic Excellence Scholarship Endowment, the MGM Hites Foundation Scholarship Awards and MGM Resorts Foundation, an employee-giving charity.

I began by tying Terry’s legacy to the last two decades. It is no coincidence that period coincides with the coming of age of the gaming industry. By coming of age, I mean becoming an accepted part of the nation’s economic fabric. That has come about for many reasons, but among them are through the efforts and personal charisma of leaders such as Terry. His vision is not complete. Some of the old stereotypes still persist, but they will soon be gone if we continue down the path that Terry helped blaze.

By Frank Legato   Wed, Aug 31, 2011

Product: oneCheck cash management solution
Manufacturer: Crane Payment Solutions

The CashCode oneCheck asset management system is an advanced analytics tool that provides a secure environment to streamline a casino’s drop, soft-count and peripheral management process.

CashCode made recent additions to this multi-use, multi-function product. Some benefits noticed directly by operators have been the reduction of labor by eliminating the need for cashbox asset tracking, a significant improvement in variance reconciliation, and quicker and more accurate preparation of the end-of-shift closing report.

The oneCheck system is now compatible with a variety of printers. It will work with any TITO printer to provide three different reports, each designed to help improve the efficiencies on the floor.

Software is now available to make bill validators recognize their cashbox size. With this advancement, casinos are able to receive notification that the cashbox is nearly full, to allow the drop team enough time to swap the box before it is completely full, alleviating machine downtime.

The online database has a new performance dashboard displaying key performance indicators as well as other detailed information in a concise and user-friendly manner. Detailed graphs and charts have also been added for a friendlier and updated look.

One useful report that has been added to the performance dashboard is the Firmware Versions Report. This report indicates the software and boot versions of each bill validator in the database by batching the results in a pie graph. With one quick glace, the operator can keep track of the upgrade progress of each unit to ensure no unit has been overlooked.

For more information, contact Crane Payment Solutions at 905-303-8874 or 702-739-8263, or visit www.craneps.com.

By Frank Legato   Wed, Aug 31, 2011

Product: Virtual Tennis
Manufacturer: Inspired Gaming Group

Inspired Gaming Group, the world’s leading supplier of virtual sports products to in-shop, online and mobile betting platforms, has launched the industry’s first “Virtual Tennis” product. The new addition will join a wide portfolio of sports already available from Inspired, including horse racing, football, motor racing and cycling.

Inspired uses motion-capture techniques from the TV and film industry to achieve graphically advanced virtual sports content. The 12-month development process for Virtual Tennis involved a large team of engineers who filmed two of Britain’s leading tennis players in a specially designed venue. The venue housed 60 cameras to capture every individual movement made by the players, and the motion-capture data was then used to create the true-to-life animated players seen in the final product.

The company developed Virtual Tennis to include an in-run betting option. A previously unseen addition to virtual sports, this follows the trend of live betting and allows customers to place set and match bets during play. The odds will vary throughout the match, reflecting the previous results of the game.

Events vary from indoor to outside courts, clay, grass and hard-court surfaces, and weather conditions including sunny, overcast and floodlit. As with all of Inspired’s Virtual Sports products, the courts can be customized with operator branding, and the product is available in over 16 languages.

The decision to develop Virtual Tennis is a result of the increasing worldwide demand for virtual sports betting and the popularity of tennis as a live sports betting event. Three of the top 10 online sportsbooks have already signed up for Virtual Tennis.

For more information, contact Ian.Fiddeman@ingg.com or Lucy.Buckley@ingg.com, or call +44 (0)20-7438-5800.

By Frank Legato   Wed, Aug 31, 2011

I got a press release from Cintas Corporation, and unlike most dispatches from Cintas Corporation, which generally are about whatever it is that Cintas Corporation does, it was about the “America’s Best Restroom” competition, an event that, remarkably, is in its 10th year.

Had it not been for Cintas, we would have had no information on good restrooms for the past decade. We’d be lost.

By the way, I was kidding before when I indicated I didn’t know what Cintas is. It’s a Las Vegas lounge act, right? Brothers and sisters Frank, Joe “Bucko” and Mary “Mama” Cintas. No wait, that’s the Scintas. Cintas makes uniforms and stuff.

Anyway, the release listed the Top Ten Finalists for the 2011 America’s Best Restroom contest—did I mention they’ve been doing this for 10 years?—and they included Main Street Station in Downtown Las Vegas. Boyd Gaming officials have subsequently pointed the honor out to media, as well they should have.

While Main Street Station has made it to the finals, we won’t know which establishment wins the “America’s Best Restroom 2011” award until after September 19. The public can vote for any of the finalists through that date, and presumably, the top vote-getter will win the Golden Plunger, or whatever it is that they get.

Do you think a public vote is practical? To render objective opinions, wouldn’t one have to visit all 10 finalist restrooms? It would be a better idea to carefully choose a panel of noted restroom experts with Ph.D.s, and have them evaluate the finalists. I’m sure there are restroom experts, right? I mean, without their first names embroidered onto a jumpsuit. But I digress.

After digesting the news of the contest, I began to wonder about the possible features of America’s Best Restroom. Would it have a full staff of attendants, towels at the ready? Would there be a bidet? There surely would be a big, polished-oak shoe-shine station, maybe even with a gold spittoon. The “seats” would be cushioned, lots of room in the stalls, perhaps a newspaper for your reading pleasure.

Actually, the press release included a couple of lofty descriptions of finalist restroom locations:

“The restroom boasts hand-painted, Italian-style frescoes.”

“The restroom trailer... features granite counterspace, black marbleized walls, wood doors, and complimentary hors d’oeuvres.” (OK, I made up the last item.)

I was in Las Vegas, so I decided to see for myself what a Top Ten Finalist for America’s Best Restroom looked like. I went down to Main Street Station (a casino I happen to love) to inspect the restrooms. Well, at least the men’s room. To include the ladies’ room in my research would have required an assistant, which wasn’t in my budget.

I knew from the news reports that the main feature catapulting the Main Street Men’s Room into America’s Top Ten was the fact that its urinals are embedded in an actual chunk of the real Berlin Wall. I went into the men’s room right off the hotel lobby—no Berlin Wall. I crossed through the casino to the other men’s room, and there it was—a plaque commemorating the fall of the Berlin Wall, and pictures of people jumping the wall over the years, all on top of a big piece of the graffiti-covered wall itself. And the urinals.

I looked around to the rest of the men’s room, expecting some grand restroom design, but no. The whole room was maybe 13 feet long, with three wooden stalls and four urinals on the Berlin Wall. No attendants with towels. No shoe shine, no gold fixtures, certainly no bidet.

OK, maybe the opportunity to urinate on a famous symbol of Communist totalitarianism does score some style points. And yes, the wooden stalls were charming, even quaint. The room was clean. Good water pressure. But where was the “wow” factor? Where’s the spiffy restroom attendant handing me a towel, and pointing me to a collection of talcums and other desirable grooming products?

Maybe my restroom standards are just too high. I’m not going to agree to be a restroom judge, if I’m ever asked. (Well, it would depend on the pay.) So we’ll just rely on the public, that great pool of restroom users in America, to continue their vigilance in visiting the 10 restroom finalists before rendering their votes—thousands of independent researchers scouring the nation to find the finest restroom in the U.S.A.

Don’t forget the bran muffins.

The public is invited to vote for their top pick at www.bestrestroom.com through Monday, September 19, 2011. The site takes visitors on a photographic tour of each facility and then encourages them to choose their favorite. The winner will be announced this fall.

By GGB Staff   Tue, Aug 30, 2011

Storm International CEO Darren Keane has been jailed in Moscow since June 22.

Keane is accused of allowing two Storm International casino properties in Moscow to continue to operate beyond the July 2009 mandatory closing of all casinos not located in one of four designated gambling zones. The arrest followed an April raid on the Shangri-La casino in Moscow, where roulette tables are said to have been found in operation.

News of the arrest only surfaced in the English-language media at the start of August, when the St. Petersburg Times reported that Keane’s life was in danger from an untreated medical condition, thrombosis.

Keane, a British national, has since been moved to the Matrosskaya Tishina pretrial detention facility, where he was said to be receiving proper treatment, the Moscow News reported.

Arrest warrants for other, unnamed foreign executives of Storm International are said to have been issued. The company’s website has been taken down voluntarily by the company.

The news of Keane’s arrest followed the introduction of tougher measures for illegal gambling offenses, signed into law by President Dmitry Medvedev in late July.

GamblingCompliance reports that the amendments make it a criminal offense to organize illegal gambling. Prison sentences can now hit six years in some cases.

Also covered in the bill is online gaming, a move seen as a way to stop the gambling at internet café-type locations.

The crackdown on illegal casinos this year began after the Moscow Investigative Committee formally split from the Prosecutor-General’s Office. The committee has since sought to bring charges of corruption against the Prosecutor-General’s Office.

By GGB Staff   Tue, Aug 30, 2011

The government of Greece appears ready to scrap plans to privatize the national lottery operator and to proceed with online gaming legislation already declared non-compliant by the European Commission.

Casino Advisor reports that the government may attach the online gaming proposals to a must-pass financial bill. The move could force the E.C. to launch infringement proceedings that would end up in the European Court of Justice.

Just as concerning is the previously proposed sale of the government’s 34 percent controlling stake in lottery operator OPAP.

Greek Finance Minister Evangelos Venizelos recently said the sale of the OPAP stake, scheduled for the fourth quarter of 2011, may not go through as planned, or at least not the sale of the entire 34 percent.

The move could jeopardize the efforts of the Finance Ministry as it tries to raise cash for the financially troubled country.

Venizelos said, “We have a clear target to present €1.7 billion from privatizations by the end of September and €5 billion by the end of the year.”

The OPAP stake has a market value estimated at €1.17 billion. The sale to a strategic investor is projected to raise €1.2 billion, while the sale of online gaming licenses would bring another €500 million.

By GGB Staff   Tue, Aug 30, 2011

The Blackpool casino destroyed by fire in July 2009 is aiming to reopen before the end of 2011.

“We will definitely be open before Christmas and are hoping to be ready to take Christmas bookings for our casino and restaurant,” said Pierre Coulon, owner of the Paris Casino.

The fire that began in the Grand Hotel next door to the casino was only the start of the problem. Much of the damage to the interior was due to water used to extinguish the blaze.

The new Paris Casino will be situated at a different address, at the former Number One Club on Bloomfield Road. Coulon is investing £1 million in the property, which is twice as large as the old casino.

The casino will again feature a French theme and have a restaurant and bar.

By GGB Staff   Tue, Aug 30, 2011

Two casinos in Spain have begun offering open-air gaming to smokers.

DingNews reports that the casinos of Valencia and Monte Picayo have each prepared terraces with two gaming tables and a dozen machines, plus a bar. The terraces are the only places where guests may smoke while playing. Both properties belong to the Cirsa group.

The new offering opened on August 1 and will be available through the early autumn, weather permitting. The Valencia region casino terraces are expected to welcome 4,000 visitors a month.

The new arrangement was made possible by a change to the Valencia casino regulations. Casinos in all of Spain saw a drop in revenue of 6.7 percent in 2010, according to Yogonet.

Casino Cirsa Valencia has a patio of 140 square meters fitted with two American roulette tables and twelve state-of-the-art slot machines from manufacturers Atronic, Novomatic, Unidesa and Williams. The Paradise Terrace bar has seating for 24 and offers a view of the city.

The terrace of Casino Cirsa Monte Picayo has one roulette table and one reversible blackjack-casino poker table. The twelve slot machines consist of six different models, primarily from Unidesa and Williams.

By Frank Fantini   Tue, Aug 30, 2011

As I sit at the keyboard about to write this column, much of the world is transfixed as the rest of the world is fast selling everything it can to pile into whatever appears to provide safety, from gold to, ironically, U.S. government bonds.

President Barack Obama is about to address the nation, and in anticipation, stock prices are falling, as though whatever he says will be cause to sell.

In this environment, it is difficult to write a column of some lead time because whatever is written will be outdated by the time it sees print, maybe even just minutes or hours after it’s written and the “-30-” in the old newspaper style has been typed in at the end.

And amid all the talk about double dips and U.S. bond ratings, and a euro crisis that can knock the underpinnings out from under the world economy, it is difficult to gain some perspective, no less the equanimity to say, this, too, shall pass.

But in the world outside the frantic financial markets and the breathless voices of CNBC, things look pretty much the way they did before the sell-off, and better than a number of months ago.

Consider the trends in the lodging and casino spaces that we call home:

• The three biggest pure-play regional casino companies have all announced earnings, each better than expected, each demonstrating the ability to bring even modest revenue improvements to the bottom line, and each saying that business is picking up among their most affluent players. And that those trends continued into July.

That caused prices to pop on Penn National, Pinnacle and Ameristar as earnings estimates and target prices rose.

Then, the market sold off on issues having very little to do with the fundamentals of regional casinos, save, of course, a possible double dip.

So, as of this writing, Ameristar is selling at half of its growth rate, a forward 8.8 price-to-earnings ratio, and 6.45 enterprise value to EBITDA.

PENN is at three-quarters its growth rate and 7.4 times enterprise value to EBITDA.

Pinnacle, long an EBITDA story (not earnings story), is at 8.05 times EV to EBITDA.

And each of these is an earnings growth company—Ameristar through paying down debt, PENN as it opens Ohio casinos and PNK when it opens a casino in Baton Rouge, plus as it continues to improve EBITDA margins as new management finds efficiencies.

• Las Vegas-Macau. It’s pretty hard to be pessimistic about any of the operators in Macau, nor the two biggest Las Vegas Macau plays, Wynn and Las Vegas Sands.

One can always question whether their stocks are overvalued, but their long-term business fundamentals are clear, barring the unforeseen.

During the last market meltdown, those stocks were slammed by the collapse of the financial markets, with LVS and MGM Resorts nearly done in.

That shouldn’t be an issue this time. Meanwhile, Macau is booming, and for LVS, add in Singapore, which is about to generate $1.6 billion in EBITDA alone.

• Suppliers had taken a tumble even before the sell-off as their fundamentals generally haven’t improved and the return of that darn North American replacement cycle keeps getting kicked down the road.

Still, they got clobbered in the sell-off. Here are the forward PEs of the biggest suppliers, all reasonable to cheap: Aristocrat 12.8, Bally 12.9, IGT 13.3 and WMS, a recent darling, now mimicking a fallen angel, 8.1.

• Lodging. Company after company is reporting growing earnings that are stronger than expected, sometimes significantly so.

The improvements are driven by occupancy, but more by increased room rates that, in turn, drive up RevPAR. And this is happening as the least amount of supply ever is coming to market, assuring pricing power, unless the economy deeply double-dips.

In some cases, these figures are specific to the gaming industry, such as the recent increased room rates along the Strip.

Or they hint at direct gaming effect, such as the recovery of group and convention business that has become such a large part of the Las Vegas Strip business model.

But in any case, the lodging recovery spells good news for the gaming industry. As Patrick Scholes of FBR Research recently reported, there tends to be a correlation between rising room rates and increased gaming revenue.

So, while the big economic trends are scary, and may have dramatic and unimagined consequences by the time this column sees print, there is also reason to believe that gaming industry fundamentals are strong enough to give bargain-hunters buying opportunities when the dust clears.

By GGB Staff   Tue, Aug 30, 2011

U.S. Senators John McCain and Jon Kyl, both of Arizona, both Republicans, have introduced a bill that would prevent the Bureau of Indian Affairs from taking “off-reservation” land into trust. McCain and Kyl are concerned about a recent BIA decision that allowed the Tohono O’odham Nation to acquire land in Glendale, Arizona, far from its Tucson-area reservation, to build a casino, over the objections of the city, county, state and surrounding tribes.

The bill is called the “Off–Reservation Land Acquisitions Guidance Act” and is similar to two proposed amendments to a Department of the Interior appropriation act introduced separately in the House.

Rep. Jim Moran (D-Virginia) was one of the first to comment: “These amendments are an assault on Indian Country, attacking the land-into-trust mechanism established to ensure that tribes who suffered for centuries at the hand of the U.S. government receive some measure of compensation for their loss. They should be defeated, and if they come up for a vote this fall I will work to try and stop them.”

The bills are so toxic to Indians that the National Indian Gaming Association has sent out alerts to its members to marshal support for a counter-attack.

One amendment, by Rep. James Lankford (R-Oklahoma), would prevent the BIA from increasing the net amount of federal land under its jurisdiction, and would, according to NIGA, immediately stop all land-to-trust applications.

A second amendment, by Rep. Charlie Dent (R-Pennsylvania), would prevent tribes from using money gained from land claims to acquire land to be used for a casino, which is something that only two tribes, one in New York and the other in Oklahoma, have done.

The McCain bill would prevent the BIA from putting land into trust if it is not within “reasonable commuting distance” from the tribe’s reservation, i.e., it would restore a Bush administration rule that the Obama administration just eliminated.

McCain’s bill would greatly increase the ability of state and local governments to oppose such an off-reservation application, which critics derisively call “reservation shopping.”

The bills appear to be a reaction against bills being proposed that would “fix” the 2009 Carcieri vs. Salazar U.S. Supreme Court decision that said that tribes recognized after 1934 cannot put land into trust.

McCain said the Carcieri issue is very controversial to Senate Republicans, and demonstrates that it may be hard to separate the issue of gambling from the Carcieri issue. This, despite the fact that of pending land-into-trust applications, only 1.5 percent involve gaming.

By GGB Staff   Tue, Aug 30, 2011

North Carolina Governor Beverly Perdue is negotiating with legislative leaders and the Eastern Band of Cherokee regarding allowing live table games like blackjack and poker at tribal-owned Harrah’s Cherokee Casino. Currently, blackjack-like games are available on computers. Representative Roger West of Cherokee said tribal officials estimate live gaming could create up to 600 new jobs.

Chris Mackey, spokeswoman for Perdue, said, when the casino first opened, “There were new hotels, new restaurants and businesses that meant jobs all around Cherokee, and I think the idea is that something like that could happen again. That’s good for North Carolina and it’s certainly good for western North Carolina.” Mackey did not know if offering live gaming at the Harrah’s casino would lead to a revenue-sharing agreement with the state.

The property only could offer bingo games when it originally opened in 1997. Today it has developed into a large and popular casino resort with 120,000 square feet of gaming space, a 15,000-square-foot conference center, retail, restaurants and hotels. More expansion is planned in 2012.

A recent study commissioned by the tribe indicated Harrah’s casino generates more than $380 million annually for the local economy.

By GGB Staff   Tue, Aug 30, 2011

A regulation that would prohibit smoking in public places on the Navajo Nation's reservation—except in tribal casinos—was vetoed by Navajo Nation President Ben Shelly, who said the measure “does not adequately address any given employees who are subjected to a smoking workplace environment.” The Tribal Council passed the bill on July 20 in Flagstaff, Arizona. The bill would allow the council to reconsider the casino exemption after gaming financing debts were paid.

The regulation said smoking would have been allowed only in designated areas of casinos, such as at slot machines, in outdoor areas and on golf courses. In addition, $150,000 would be set aside annually from gaming revenues to provide anti-smoking education.

Shelly said he was committed to protecting tribal members “from cancer or diseases caused by exposure to secondhand smoke or tobacco use.” He noted, “Although the legislation identifies ‘public places,’ it does not specifically highlight those places such as schools, playgrounds, parks or places where it is of the highest priorities to prohibit and encourage a healthier environment.” He urged the nation’s Division of Health, Division of Public Safety, Judicial Branch and the Navajo Nation Gaming Enterprise to “work together to draft a bill that considers a healthy lifestyle for the Navajo people.”

By GGB Staff   Tue, Aug 30, 2011

The casino industry of Chile appears to have suffered no lasting damage from the February 2010 earthquake.

GamblingCompliance reports that gross gaming revenue for the 15 federally regulated casinos reached $247.5 million in the first half of 2011, up 146 percent on the same period the year earlier.

Leading the rise was the Monticello Grand Casino, which had revenues of $69.9 million. The Casino Marina del Sol was second with $31 million and the Casino Rinconada third with $27.4 million.

WMS proved to be the leader among slot producers when it came to floor space. The company’s machines accounted for 18.5 percent of the 8,267 gaming machines in operation during H1 2011.

Bally Technologies just beat out previous market leader Atronic, with 18.1 percent compared to 18 percent. IGT had 17.2 percent of the total.

Slot win averaged $143.60 per day, with those of the Monticello Grand holding $199 per machine.

The 2005 law allows for a total of 18 casinos. Additionally, there are seven casinos operated by municipalities.

By GGB Staff   Tue, Aug 30, 2011

One of the smartest investments ever made by Australian gaming magnate James Packer (above) was to join Lawrence Ho in forming Melco Crown Entertainment to develop casinos in Macau. The partnership has been enormously successful, owning and operating the Altira, City of Dreams and now Studio City. Packer owns 33 percent of Melco Crown.

But Merrill Lynch analyst Nathan Gee believes Packer would consider selling his stake to finance a takeover of the Echo Entertainment Group, the recent casino spinoff from Tabcorp. Echo owns Australian casinos in Brisbane, the Gold Coast and Townsville, along with its flagship property, Star City, the only casino in Sydney. Crown already holds a minority interest in Echo, but Gee says Packer wants more.

“We can’t discount a Crown takeover of Echo, but we think a deal is unlikely until 2012,” Gee told The Australian.

And because of the strength of the Melco Crown shares compared to Crown Casinos shares, Gee believes Packer would consider selling out in Macau.

“We can’t rule out Crown looking to divest Melco Crown, particularly if the Australian market continues to discount the value of Macau relative to the Melco Crown share price,” he said.

Crown has said it has no current plans to increase its holdings in Echo.

If Packer did consider selling his share, there is one company that would likely be first in line: Caesars Entertainment. Shut out of the initial license concessions, Caesars has been anxious to get into the Macau market, but unable because no new licenses will be issued until at least 2020, and no other concessionaire is likely to sell.

By GGB Staff   Tue, Aug 30, 2011

The “Dead Sea casino” affair may have finally been put to rest with the clearing of charges against Jordan Prime Minister Marouf al-Bakhit.

Bakhit, who was appointed prime minister by King Abdullah in February, had occupied the position of prime minister in 2007 when he signed a development agreement with a London-based Palestinian investor.

The deal, which included two casino licenses, was canceled after one week. It was later renegotiated during Prime Minister Nader Dahabi’s time in office, annulling the agreement and sparing the treasury $1.4 billion in contractual penalties, according to Ammon News.

Bakhit has previously testified before parliament that he was unaware of the details of the agreement when he signed it, reports Al-Jazeera.

Last month, parliament voted to clear Bakhit and 13 other members of his 2005-2007 cabinet. Only former Tourism Minister Osama Dabbas has been indicted.

Jordan’s anti-corruption committee opened the investigation but eventually referred its findings to parliament, the only body authorized to investigate cabinet ministers. The matter has spurred calls for change.

“The anti-corruption authority needs to be independent from the government,” Azzam al-Huneidi, a member of parliament with the Islamic Action Front and the head of the party’s anti-corruption committee, told Al-Jazeera.

By GGB Staff   Tue, Aug 30, 2011

The New Zealand Racing Board, which generates about $250 million a year in pokie machine revenue, wants to pump some of that money back into the racing industry. The move has sparked the ire of charitable groups, which get much of their funding from pokie machine revenue.

As it stands, more than a third of the revenue from pokie machines in clubs and bars throughout New Zealand goes into community trusts, which the charities apply for. The racing industry must also make an application if it wants access to the funds. But a recent proposal by the NZRB would divert some of that money directly into the racing industry, effectively shrinking the pool of money from which charities draw.

Though opposed by charities, officials from the NZRB maintain they are simply being more transparent.

The NZRB operates a small percentage of the 18,000 machines nationwide, though if the license change takes place, the number of operating venues could increase.

By GGB Staff   Tue, Aug 30, 2011

Vietnam continues to collect multibillion-dollar resort project proposals.

According to news site VietnamNet Bridge, the current count includes the Hoang Gia city project in Phu Tho-Yen Bai provinces ($4.3 billion), Ho Tram Strip ($4.2 billion), Nam Hoi An in Quang Nam ($4 billion) and Saigon Atlantic ($4.1 billion).

The existing Silver Shores Hoang Dat at Da Nang adds $160 million. Meanwhile, the Mui Dinh project in Ninh Thuan awaits government approval of its casino component.

The latest newsmaker is the proposed Phu Quoc Island development, now slated for a casino resort among its features. Thanh Nien News reports that foreign investors have been given the go-ahead to develop the project in the southern part of the country.

At least 10 investors are said to have shown interest in the $4 billion project. The bidding process for the 30-year casino license is scheduled to begin later this year.

Thanh Nien reports an unnamed source has indicated a Singaporean investor is currently most likely to win the competition. If successful, the project would be similar to the integrated resort model present in Singapore, according to the source.

A 135-hectare site in the island’s northeast has been designated for a casino resort complex. As currently planned, a 30,000-square-meter casino will have 2,000 slot machines and 200 to 400 game tables. The complex will include up to six five-star hotels, offering a total of 3,000 rooms.

The government intends to separate Phu Quoc Island from Kien Giang Province, to which it currently belongs, and grant it special administrative and economic region status within the next decade. The goal is to turn the island into the region’s top trade and tourism center, with 10 million visitor arrivals by 2020.

Standing in the way of the ambitious plans for the island is insufficient infrastructure, according to overseas Vietnamese investor Nguyen Ngoc My. He said that at present Phu Quoc does not have the facilities and services to support a casino complex. However, he believes that the Singapore model could work.

Meanwhile, in the north of Vietnam, local authorities of Phu Tho Province and Yen Bai Province have been meeting to discuss the $4.3 billion Hoang Gia resort city.

Proposed by Tsinghua Construction & Engineering Company Limited of Macau, the project would be joined later by investors from the U.S. and Australia, according to VietnamNet Bridge.

The plan calls for construction of the city on 1,664 hectares on Van Hoi lagoon, of which 585 hectares are in Phu Tho Province and 1,079 hectares in Yen Bai Province. The project includes a five-star hotel, villas, luxury apartments, golf course, entertainment center, tennis center, water sports center and helicopter area.

The casino would still need to receive official approval.

By GGB Staff   Tue, Aug 30, 2011

It’s no longer sites 5 and 6 on the Cotai Strip. It’s now “Sands Cotai Central” where three new hotels will spring up along with more casino space for Sands China. In addition to the already-announced Sheraton hotel, the company will add two more new brands to Macau.

Las Vegas Sands announced last month that Sands China had entered into franchise agreements with Hilton Hotels to create a five-star Conrad Hotel. A third hotel, from the InterContinental Hotels Group PLC, will be a four-star Holiday Inn. The hotels will both open by the first quarter of 2013. The Conrad and the Holiday Inn will have 636 rooms and 1,224 rooms respectively. The Holiday Inn will the brand’s largest hotel in the world.

The Conrad and Holiday Inn brands will replace the St. Regis and Shangri-La brands, which terminated an agreement with Sands China last March. According to Las Vegas Sands COO Michael Leven, Sands China will operate the hotels and the company will only pay a licensing fee to the parent companies.

By GGB Staff   Tue, Aug 30, 2011

The General Assembly of International Sightseeing Industry Development Diet Member Association—known informally as the “IR and Casino Diet Member Association”—approved a measure that would permit any casino in Japan to charge an entry levy for Japanese citizens who wanted to gamble. The edict is modeled after the Singapore statute that requires citizens and permanent residents to pay S$100 (US$70) or S$2,000 annually to visit the casinos in that island nation.

While the committee is not a formal group associated with the Diet, the legislators, public officials and businessmen are likely to frame the debate when it is officially considered.

According to Tokyo-based consultancy Gaming Capital Management, the purpose of the session was to explain the outlines of an enabling law to allow casino gambling in Japan. The House Legislation Bureau of the Japanese Diet is drawing up a bill that will be introduced at a later date.

The chairman of the committee, Issei Koga, of the Democratic Party of Japan, said neighboring countries, such as South Korea and Taiwan, are considering the legalization of gaming via integrated resorts, and Japan cannot be left behind.

By GGB Staff   Tue, Aug 30, 2011

Less than nine months into his administration, New York Governor Andrew Cuomo (l.) is taking on the controversial issue of gaming expansion—specifically, commercial casinos—in the Empire State.

Last month, Cuomo told reporters it’s time to “come to grips” with the matter, which would require a constitutional amendment starting with approval from two successive legislatures, followed by a public referendum.

“You have gaming in this state and you have gaming in neighboring states,” Cuomo said at a press conference in Albany. “So it’s really not an issue any more of, ‘If we don’t officially sanction it as a government, it’s not going to happen.’ It is happening.

“So now you have to go to the second step. If there’s going to be gaming, how should it be done? And that’s an important question for the state.”

New York has five Indian-run casinos and eight racinos offering limited electronic gambling. The ninth racino, a $2 billion development at Aqueduct racetrack in Queens, is set to open later this year, and its developer, Genting New York, has always said it would like to build Resorts World as a full-fledged casino.

Cuomo’s comments should also be welcomed by the state’s other racinos, which have been lobbying the state legislature to let them expand their gaming options. According to the New York Times, the state could earn $684 million this year from racinos alone, and allowing full-blown casinos would substantially raise that figure. Tim Rooney Jr., president of Empire City Casino in Yonkers, said the cash-strapped state loses up to $2 billion a year in revenue “exported” from New York to places like Atlantic City and Las Vegas.

“If you had full casino gambling in New York,” Rooney told CBS-2, “we’d not only be able to keep that $2 billion in the state, but attract out-of-state dollars as well.”

By GGB Staff   Tue, Aug 30, 2011

Casino giants Caesars Entertainment and MGM Resorts International last month reported that visitors to the Las Vegas Strip have been spending more per trip, and casino revenues are inching up accordingly.

The June gaming revenues, announced in August for Nevada, showed the Strip number up 32 percent over the same month in 2010, the largest percentage increase since June 2007.

Caesars’ revenue in Las Vegas in the second quarter increased 10.3 percent over 2010, and spending per trip grew 9.2 percent. According to the Wall Street Journal, executives reported that nearly all of the nine Vegas casinos owned by Caesars were on the upswing.

MGM Resorts International also reported “consistent” gains, said CEO Jim Murren, who noted that it is the second consecutive positive quarter for the company.

The Las Vegas Convention and Visitors Authority has reported that hotel room rates are up 9.6 percent over 2010 for the first five months of this year, and occupancy rates up an average 4.2 percentage points. In addition, gaming revenues on the Strip last year rose 4 percent over 2009, to about $5.8 billion. But that was still down from the $6.8 billion Strip casinos earned in 2007.

By GGB Staff   Tue, Aug 30, 2011

Just weeks before it was to be sold at a special auction, the company that has run it for the past 20 years has bought Atlantic City’s legendary Steel Pier.

Trump Entertainment Group, Inc., owner of the 1,000-foot “Showplace of the Nation,” has sold the pier to Steel Pier Associates, LLC. The company, which consists of the three Catanoso brothers—Charles, Anthony and William—as well as longtime partner Ed Olwell, has been leasing the pier and operating an amusement park there since 1993. Offering rides and attractions, food, carnival booths and a helicopter tour, the Catanoso family has kept the spirit of the structure alive from spring to fall for the past two decades.

“This purchase means more to us than just owning the structure on which we operate an amusement park,” said Anthony Catanoso, president of Steel Pier Associates. “For us, it’s an honor to own something that has touched and entertained so many people over the years.”

Looking to consolidate its holdings, Trump Entertainment planned to offer the pier at auction on August 25, but the Catanosos—which had a lease agreement until 2016— scooped up the property for $4.25 million before the bidding could begin. They now retain the rights to the Steel Pier name, as well as the 113-year-old landmark pier and its buildings.

“As a lease holder, we were unable to make long-term plans. As the owner of Steel Pier, we now have some amazing opportunities that we will be evaluating for the future,” the company stated in a press release.

Some of those plans could be a full-scale expansion, as Steel Pier Associates, LLC has named a new partner, entertainment architect Paul Steelman. Atlantic City native Steelman is internationally known for his designs, including several casino resorts in Macau. Steel Pier remains the only full-scale, family-friendly amusement pier in Atlantic City.

By Roger Gros   Tue, Aug 30, 2011

The grief I felt when I heard of the passing of Terry Lanni was, I’m sure, a small fraction of the loss felt by his family. I’ve gotten to know Terry’s son, Sean, over the past couple of years, and I know that he loved his father dearly.

But it was grief nonetheless shared, I’m sure, by all. Everyone in the industry who knew him—and many who did not—felt affection and respect for Terry. He was a great representative of the industry and he will be sadly missed.

I first met Terry when I was hired as a dealer at Caesars Boardwalk Regency in Atlantic City in 1979. While I can’t claim to have really known him then—he was, after all, one of the leaders and I was a mere dealer—I was acknowledged and made to feel like he was truly engaged during the few opportunities I got to speak directly to him.

One of my more ardent co-workers—who not surprisingly is no longer in the industry—once tracked him down to the tennis courts, where Terry stopped his game and calmly discussed whatever issue was burning brightly at that time.

Later, as a journalist covering the industry, I did get to know him and always had the impression that my interviews were very important to him whenever we talked.

Terry always joked about how he “accidently” joined the industry when Caesars World recruited him as its CFO. He joined the company at a time its leaders, Clifford and Stuart Perlman, were denied a license in New Jersey, and eventually got forced out of the company, making people like Terry and Henry Gluck and Peter Boynton the faces of the company.

It was a fortuitous “accident” for the gaming industry, for sure. While I had long respected Terry, it wasn’t until he was appointed to the National Gambling Impact Study Commission in 1997 that his political skills became apparent to me. The commission was formed by several anti-gaming congressmen essentially to emasculate the casino industry. Terry was given a seat on the nine-member panel as a concession to the Nevada delegation, but he was largely outnumbered by those who would rubber-stamp what the anti-gambling fanatics hoped to accomplish. But along with UNITE HERE’s John Wilhelm—an equally classy and intelligent man in the rough-and-tumble world of union organizing—Terry was part of a one-two punch that kept the opposition off balance the entire life of the commission. By concentrating on the facts and presenting them with dignity and class, Terry and John—and former Nevada regulator Bill Bible—were able to help craft a credible and balanced report that is today still one of the best studies of the industry available.

Terry had an eye for talent as well. The staff he built in Atlantic City in those early days is legendary. Executives that came from the Caesars incubator at that time include Bill Weidner, Mark Juliano, Rob Goldstein, the late Steve Hyde, Gary Selesner and Audrey Oswell, just to name a few (with apologies to those I missed). And when you consider the extraordinary team he built at MGM Resorts, which is now running the company, there’s no doubt that Terry has forged a legacy in this industry that will last a long, long time.

It was during his time at MGM that Terry showed his compassion for those who might have a more difficult time reaching for the American dream that most of us have. By instituting MGM’s diversity initiative, Terry not only proved he was tuned in to the sometimes-forgotten members of our society but also that he was an astute businessman.

MGM annually spends millions on this initiative. I remember asking him how he could justify that expense. He told me that by making sure that women and minorities get jobs with his company and companies owned by those segments can do business with MGM, he was opening up new markets and appealing to new segments of the population, while, at the same time, doing what was right. That vision has proven to be one of the strengths of the company, achieving recognition and accolades from a wide spectrum of organizations.

Terry Lanni’s vision of a gaming industry that provides entertainment to its customers, jobs and careers for its employees and benefits for the communities where it is located is on its way to fruition. No, Lanni wasn’t the only one who had this vision, but he was one of the first. And he will always be remembered for making this a better industry and helping to make us all better people.