By Frank Legato   Tue, Nov 04, 2008

Steve Sutherland calls it the “podium,” and he wants his company, Konami Gaming, to stand on it. Standing with the gold would be nice, but the goal is at least the silver or bronze.

The podium refers to the top three spots among the ranks of the world’s slot machine manufacturers. Earlier this decade, few observers would have given Konami a chance to join that elite club. Sutherland, the company’s executive vice president and COO, says the odds of reaching the podium are better than at any time since the company entered the gaming industry.

Konami Gaming is suddenly the slot-maker to watch. After several years of comparatively flat results, the company’s revenues have nearly doubled in the past two years. Rising sales of the company’s K2V video slots have been augmented by what has become one of the hottest products in the industry, the Advantage 5 series of stepper products.

Rising game sales have been accompanied by a steady evolution of the Konami Casino Management System, or KCMS. Operators have lauded the solid engineering behind the system, which will launch a new module at G2E that can give casinos the capability to accurately gauge customer worth away from the casino itself.

At a time when some slot manufacturers are announcing layoffs and dealing with slumping stock prices, Konami is hitting its stride. The reason, if you ask the slot-maker’s customers, is engineering—and more specifically, the K2V video and Advantage reel-spinning platforms.

“Back in 2002/03, we installed nickel 10-line Konami games,” recalls Robert Allen, corporate VP of slots for Grand Casinos in Minnesota. “They had rock-solid hardware, but they hadn’t cracked what the players were looking for from a content standpoint.” By 2006, he says, “we told Konami we had concluded there was no future for us with their product.”

Luckily for Konami, the end of 2006 was the precise moment of the launch of K2V, a new platform with all new games. After some cajoling, Allen installed a bank of eight K2V games.

“I’m telling you, in 26 years of my career, I had never seen a manufacturer go from worst to first—I never saw a turnaround like this,” Allen says. “We saw some of our best players, who were died-in-the-wool Aristocrat players and usually pretty loyal, cross over to Konami. That’s what captivated my attention. And the numbers were phenomenal.”

Allen adds that he found his players more willing to “price up” on Konami games. “We placed them in pennies and we saw players pricing up to 2 cents, nickels and dimes more than any other manufacturer’s games,” he says.

“We’re just thrilled with the performance. Of the four largest manufacturers we use, Konami has the highest efficiency on our floor.”

Sutherland attributes much of the success of the new platforms and game series to a careful, analytical approach to game design. “Historically, many manufacturers have looked at game design as an art,” he says. “We look at it as more of a science. We were originally in that art mode; we weren’t looking at the scientific component of design. There are some proven principles out there. Today, we are applying these principles to game design, and more importantly, once they are on the casino floor, we make sure we fully analyze the results.”

Sutherland says that from Konami’s entry into the U.S. market in 2000 until a few years ago, the company’s designers were “throwing games up on the wall to see what stuck with patrons.” He says the scientific approach has absolutely reversed the company’s success rate in new titles. “For the first four or five years, approximately 25 to 30 percent of our games had legs,” he says. “Over the past three years, we’ve seen a switch, where 70 percent of our titles are seeing results over the house average. We’re going to continue to refine our design process in a very objective way.”

Entertainment Experts

The improvement of Konami’s video platform and technology provides only part of the story of why the company’s games are clicking with players. The real reason behind the appeal of Konami’s games is that entertainment was the business of the slot-maker’s parent company since its founding.

The company now known as Konami Corporation was founded in Osaka, Japan, as a jukebox supplier in 1969 by Kagemasa Kozuki, who remains chairman and CEO. Within a few years, the company, incorporated as Konami Industry Co. Ltd., was building amusement machines for arcades, and was one of the pioneers of the arcade video game business.

The company eventually moved into several areas of entertainment, from card games to toys and hobbies. But it is Konami’s home computer amusement game business—another pioneering effort that began in 1982—that would establish the company as an entertainment provider of legendary stature. In Europe, millions know the company by its Pro Evolution Soccer game for PlayStation and other computer game systems. In the U.S., the Metal Gear Solid series is a staple of home gamers.

It is this expertise that Sutherland says will catapult the gaming division to the “podium” of slot-makers.

The company’s strategy is to take a careful, deliberate approach to utilizing the company’s vast engineering assets—a process begun with the creation of the K2V platform, as well as the three-reel and five-reel Advantage stepper platforms.

“As a manufacturer, it’s engineering first, followed by all the related distribution services,” Sutherland says. “Engineering is first and foremost in our mind, and the utilization of those worldwide resources is key to our long-term success.

“There is a lot of focus right now on Konami’s gaming and systems business in North America, but I really think we have to start taking a look at our company as Konami Corporation’s worldwide gaming and systems business. We have manufacturing, engineering and distribution resources at Konami Australia; we likewise have that in the U.S. KGI Japan is another engineering resource. It will be through the effective utilization of these resources that we achieve the podium, how we become one of the top three players in the industry. I am very confident we will achieve our goal.”

So is Satoshi Sakamoto. The president and CEO of Konami Gaming Inc., Sakamoto heads the Gaming & Systems Division at Konami’s corporate offices in Japan.

Sakamoto says the gaming division—with an amusement and a sports/fitness division, it is one of the company’s three main business segments—is growing in importance within the corporation, particularly in the U.S. Like Sutherland, he credits improvements in engineering and R&D.

“When we entered the gaming business in 1996, we didn’t have much gaming-related technology,” Sakamoto says. “We had to catch up with our competitors. But last year, we started talking to our amusement division, and we started to mix that technology and entertainment essence into our gaming machines. To accomplish this, we would like to tap into the know-how on entertainment at our Japan headquarters.”

“Within Konami Corporation, the Konami Gaming unit is of very strategic importance to the parent company,” adds Sutherland. “They’re definitely looking to make a major play in the marketplace.”

Coming-Out Party

That major play will begin at this year’s Global Gaming Expo, which is something of a coming-out party for Konami. Sutherland says this year’s G2E will demonstrate how the company has evolved in game design. “When we introduced our K2V platform, we replaced our older platform with a larger footprint and viewing area for our patrons in the field, and then applied the engineering techniques I mentioned though new engineering management,” he says. “We finally hit upon a formula for success, where the platform and the engineering behind it have allowed us to take control of our destiny.”

Yuji Taniguchi, senior director of games R&D for Konami Gaming, adds that he began “global synchronization” of game design, research and development shortly after he joined the company early in 2006. “When I started at KGI, I observed territory ego,” says Taniguchi. “It was, ‘We are right; you are wrong.’ I encouraged global synchronization, maximizing the output from the three R&D centers.”

Taniguchi says the goal of R&D was to balance game output, and to ensure quality content rather than simply increasing the quantity of games. “We’ve reached the position where we can balance unique game development, because our financial status has improved a lot,” he says. “Since that has been accomplished we have started unique product development. The number of new games launched in fiscal 2007/08 was 55—fewer than the previous year, but we balanced product development with our new standards.”

Sutherland says the evolution of the game content itself has been just as pronounced. “When we launched as a company, we had to develop a baseline of industry product offerings,” he says. “Our competition had video product, we had video product. Our competition had stepper product, we had stepper product. Over the past few years, between our new K2V and Advantage platforms, our KonXion and Scattereels concepts, we’ve begun to establish a Konami brand, a Konami uniqueness.”

At G2E, the company will showcase new titles in all of its established game styles, as well as rolling out completely new game and system concepts.

Leading the way will be new games for the company’s ultra-hot “Advantage 5” series of reel-spinning slots. If any format has established a “Konami brand,” it is this one, which features five full-sized reels, a large LCD video screen that appears to be floating in air within the top box, alternating lights on and behind the reels, and a cabinet style that uses mirrors for a cantilevered effect.

“When the first five-reel stepper products were coming into the market,” recalls Sutherland, “there was a disagreement between myself and Satoshi Sakamoto—my position was to take advantage of the market trend. It would have been a ‘me-too’ product, very similar to the IGT and Bally five-reel steppers. Mr. Sakamoto insisted it be extremely different than the rest of the industry, and the five-reel product was shelved until the development of Advantage 5. Strategically, he made the right decision.”

(Interestingly, rival slot manufacturers are beginning to take a “me-too” approach to many of the groundbreaking Advantage 5 features, such as using standard-sized reels in five-reel formats.)

Konami is launching six new titles in the Advantage 5 group at the G2E show. “It will be an exciting show,” says Taniguchi. “Our new steppers feature full-color back lighting behind the reels. In addition to that, we are taking advantage of the top-box LCD with exciting graphics.”

Among the new Advantage 5 titles is “Secrets of Egypt,” which uses the top-box video screen for a second-screen “pick-a-tile” bonus event. Other new titles include “African Diamond: Jewel of the Wild,” “Gold Frenzy,” “Thailand Fantasy,” “Challenge of Perseus” and “Lucky Fountain,” a reel-spinning version of what has been one of the company’s more popular K2V video slots.

These games will join several other new Advantage 5 games at Konami’s booth that will be in casinos by then, including “Thunder Warrior,” a unique take on a reel-spinner that uses a bonus round in which the middle three reels become wild. Konami also is releasing “Rawhide: Marshall’s Bounty,” a reel-spinning version of the popular “Rawhide” video slot, which features a free-spin bonus round in which all pays are doubled.

The company’s three-reel stepper series, Advantage Plus, also will be well-represented at the show. According to Taniguchi, many of the new Advantage Plus titles will utilize the top-box LCD for bonus events and attract/celebration animation. “Last year, we first exhibited our new cabinet and top-box LCD for the Advantage product; this year, our content will take advantage of that LCD,” he says. “Players will be able to participate in the game. On one title, the player touches his palm to the screen to activate a bonus.”

The “KonXion” series, which features hexagonal reel symbols in a cluster-pay screen setup, got a facelift this year with a new look and feel, and with an increased number of reel spots for higher hit frequency. The first two games in the new KonXion will be “Eleven Pearls” and “Full Moon Diamond.”

Also at the show, new K2V slots will be showcased in an improved format, says Taniguchi. “K2V has seen lots of improvement in its graphic power,” he says. “The platform is much more powerful than previously. We can present better graphics and more complex games.”

The improved platform also will permit the standard Quick Strike mystery progressive link to be installed with both stepper and video slots linked to a single jackpot. According to Sutherland, all stepper and video slots will soon be on the same improved K2V platform.

“There are significant benefits for the company to utilize the same electronics in both stepper and video,” he says. “In the multiple jurisdictions in which we operate, it is easier to get one electronics platform approved, versus multiple platforms. Also, there are inventory benefits which result in cost savings to the company. If the electronics are designed correctly, there is no reason they cannot be utilized over all platforms—video, stepper and also some unique products we’ll be launching in the future.”

Attendees at the G2E show also can expect new games using the innovative play features the manufacturer has developed in the past few years, including “Xtra Reward,” which features an extra ante wager that enables several bonus features. The version of “Arctic Diamonds” in this series, for instance, randomly changes the entire fifth reel to wild symbols when the extra bet is made. On “Egyptian Eyes,” the extra wager activates a feature that randomly changes four different symbols in the pay window to wild symbols.

Other new launches in the K2V series will include 50-line and 100-line setups.

Finally, Konami will display a completely new game style for U.S. markets this year, in a unit called “Beat the Field.” Originally released in Australia under the name “Sport of Kings,” it is a community-play game with a horse-racing theme, which places all players in the bank in a bonus horse race.

System Advances

The systems division also is a big part of the Konami success story. KCMS is now the primary casino management system at over 100 casinos and growing, and that number promises to grow more as the company reveals unique new capabilities at this year’s G2E show.

Konami’s system customers offer the same explanation for the success of KCMS as for the success of Konami slots—engineering first.

“When we were searching for a casino management system, I told my department directors there are two approaches—marketing-driven and engineering-driven,” says Jay Burgess, chief information officer for Oklahoma’s eight Creek Nation casinos. “Marketing-driven systems are created by marketing (officials) and then place the technology underneath it to support it. Engineering approaches create the technology and roll marketing on top of that. One of the things that set Konami apart was that it is an engineered casino management system.”

The Creek Nation team selected KCMS as the standard for all of the tribe’s casinos. “It operates first as a networked system, and connects to all other systems seamlessly,” comments Burgess. “There is strong technology underneath—Oracle, the Cadillac of database systems today.”

Sutherland refers to it as having the right infrastructure on which to build.

“We brought in Senior Director/R&D Tom Soukup, who has a background in the high-tech industry, which provided us the opportunity at Konami to build the system upon the right architecture,” he says. “Mistakes have been made by some of our competitors in their hardware and software infrastructure design decisions. For KCMS, we wanted to make sure the system was based upon an Ethernet network and a very large-scale database.

“The banking industry is the only other type of industry I am aware of beyond the internet that has the volume of transactions the casino industry has. We decided we needed to have a very large-scale database, so we went with Oracle. In effect, we adopted a Fortune 100 company architecture.”

At the G2E show, Konami will launch two truly groundbreaking software products that utilize the power of the Oracle database. The first, called “Patron 360,” solves a problem system engineers in the casino industry have been grappling with for years—how to track and reward non-gaming customers of casino resorts.

This functionality has, of course, become increasingly important as resorts have moved toward non-gaming amenities as a revenue source. “We know that in a number of casino properties, casino revenue contribution may be 50 percent or less of total revenues,” comments Sutherland. “The rest of the revenues are driven through the property management of the hotels, the shows, the golf courses, the retail, and so forth.”

Patron 360 uses the Oracle database to collect and store information across a property. Patrons swipe their player’s club card at POS terminals in the retail outlets, for those thousands spent on bottle service in ultra-lounges, in high-end restaurants, in the hotel, and everywhere else on a property.

“Oracle takes it a step further by creating very strong relationships between different systems,” notes Burgess at Creek Nation. “The information can be quickly retrieved. I can not only look up demographic information, but I can take a multi-dimensional look at that player.”

Soukup notes that Konami’s acquisition of Mindset and its business-intelligence system last November was the key in being able to develop a system that could capitalize on the information being collected in Oracle.

“In the time since Konami purchased Mindset, instead of making it a stand-alone application for a data warehouse, we integrated it into the KCMS architecture,” Soukup says. “Patron 360 mines against the Oracle database that is the repository for the traditional slot and table gaming spend data, as well as POS, hotel and retail applications, or the non-gaming spend data.”

According to Soukup, the Patron 360 Patron Worth module mines this gaming and non-gaming customer spend, and computes a “worth code” for that spending. “Now, when you bring up a patron in KCMS or through the S2S interface to the hotel system, you have a score that says this person is in, say, the 95th percentile for non-gaming spend. Do I want to give him a comp?”

At G2E, the newest module of Patron 360 will be demonstrated. It is called Patron 360 Campaign/Offer Management. “Now, in addition to looking at customer worth, making groups out of them, sending them offers and seeing how many patrons return, I can analyze my return on my marketing investment through Patron 360 Campaign/Offer Management,” says Soukup.

While Soukup acknowledges that large operators like Harrah’s are working on CRM systems that mine data in a similar fashion, he notes that Patron 360 is affordable to any size casino. “If a smaller, 1,000-game casino tried to build its own repository for this information, it would be a very significant investment for them,” he says.

In addition to the advances with Patron 360, Konami will launch another groundbreaking product at G2E—a mystery progressive jackpot that can be won anywhere in a property. Called “LotABucks,” the operator can set up a multimillion-dollar progressive incremented through gaming revenues. The next version of LotABucks will not only enable gaming revenue to contribute to the progressive, but any S2S-interfaced non-gaming revenue source. This would mean a customer could swipe his card at a high-end restaurant and win the progressive.

It is true that to gain these groundbreaking capabilities, an operator must install the KCMS system. Sutherland says that while he doesn’t expect large casinos to rip out their current Bally or IGT systems to implement Patron 360 or LotABucks, these advanced marketing products will give them one more reason to consider KCMS when it’s time to replace their casino management systems. “It’s compelling enough that when a casino has made a decision that its system is obsolete or no longer fulfilling its needs, and they do a point-by-point analysis of KCMS, that KCMS not only stacks up, but surpasses the competition,” Sutherland says. “Those companies that have done a detailed, non-biased casino management system comparison have selected KCMS over our competition.”

Approaching the Podium

Sutherland says Konami is nearing the end of a road that will catapult the company toward that “podium” as one of the industry’s top three slot-makers. He says it has been a deliberate, step-by-step process.

“If you review the Konami corporate financials, you’ll see the consumer software division, Konami Digital Entertainment, along with the Yu-Gi-Oh! card business and other toy and hobby divisions, is a billion-dollar-plus entity,” Sutherland says. “That did not happen overnight. There were small investments, and today, it’s a billion-plus revenue-driver.”

He says the small investments are now ready to return big-time. “We want to be on the podium,” he says. “We want to be No. 1, No. 2 or No. 3. We are following a strategic plan to achieve that.”

Sakamoto adds that the future of Konami game and system development will be a future that sees continued merging of gaming technology to the amusement and electronics prowess that has made the parent company successful.

How about slot machines based on Konami’s PlayStation games?

“Transfer of that entertainment essence may come later,” says Sakamoto. “ Metal Gear Solid is very popular in the U.S., and one day, we in gaming may come in with that kind of title. We don’t know when, but it’s possible.”

These days at Konami, just about anything’s possible.

By Andrew MacDonald   Wed, Nov 05, 2008

One of the latest buzzwords that has come into general usage in the world of legal gambling is that of “integrated resorts” (or “IRs” as they are sometimes known).

The notion of integrated resorts came into prominence with the bid process for the two Singapore casino licenses. The Singaporean government as early as 2004 made it quite clear that what they did not want was “just” casinos or resort facilities dominated by their casino operations, so they mandated that only a very small proportion of the actual physical facilities would be for casino utilization. The rest would be support facilities and consumer-oriented amenities that would dominate the developments.

The Singapore authorities therefore set up a licensing structure that mandated that less than 10 percent of the gross floor area would be for casino use—the rest would be for hotels, theaters, convention centers, theme parks, museums, retail and food and beverage offerings.

The concept of integrated resorts is in reality nothing new in the world of gaming. Singaporeans were requesting international world-class developments combining elements already found in other major casino developments such as the Crown Entertainment Complex in Melbourne, Australia; the Venetian and Palazzo in Las Vegas; the Atlantis on Paradise Island in the Bahamas; Genting Highlands outside of Kuala Lumpur in Malaysia; or the Grand West Casino in Cape Town, South Africa, just to name a few.

At present, many operators claim to have the first integrated resort in their region, but arguably the mid-20th century Nevada developer Jay Sarno can lay claim to the distinction of being the first to establish this type of facility. Caesars Palace—which Sarno opened in 1966—ushered in a new era for Las Vegas casino facilities. Caesars acted as a critical catalyst for the more diversified styles of casino resorts that were to follow.

Sarno built the Circus Circus Casino, which opened two years later as a heavily themed family resort, continued the transformation of the Las Vegas Strip and served as an additional model for future developments. Along with Caesars Palace, it brought about a significant shift in the composition and profile of Las Vegas visitors that has continued over the past four decades. While Caesars and Circus were still principally “casinos,” they were no longer just centered on gambling but also offered much more in the way of non-gaming amenities to their guests.

Today’s concept of integrated resorts has come a long way since those first resort developments. The Mirage in Las Vegas—which Steve Wynn opened in 1989—had capital costs of around $630 million. Many Wall Street analysts and other industry observers felt that this was far too ambitious a project to succeed and would never provide a reasonable return on investment. Of course, Wynn proved his critics wrong, as the Mirage demonstrated the attractiveness and revenue-generating capabilities of non-gaming amenities to diverse audiences who are interested in more than “just gambling.”

Integrated resort developments at the present time might cost $4 billion or more, and include facilities and amenities that create virtual “cities of entertainment.” These new-style resorts also change the landscape around them by spurring complementary developments and even enhancing the interest among some to have residences in close proximity to them. Thus, they can become substantial hubs of economic activity and catalysts for further development.

Defining ‘Integrated Resorts’

The scale and mix of amenities and assets and their ability to act as catalysts that can transform a region’s economy are what make such developments distinct from traditional casinos and casino-hotel complexes. How should one define an integrated resort, and what outcomes can typically be expected when such a facility is developed?

An integrated resort is really a euphemism for a very large-scale entertainment development based around a casino. The casino component, while physically small, must still act as the primary economic engine which drives overall returns and facilitates investment in other facilities and amenities. Thus, the casino element must be of such magnitude and importance that it can generate over half of the development’s annual cash flow.

With capital costs associated with integrated resorts at, say, $4 billion, such a facility would need to generate at least $500 million in EBITDA (Earnings Before Interest, Taxation, Depreciation and Amortization) to be viable. Even with the casino occupying less than 10 percent of the gross floor area, it has the capability to generate a disproportionate contribution to EBITDA so that substantial investments can be made in non-gaming facilities that might not be otherwise sustainable.

With the casino as the nucleus, the structure of the rest of the integrated resort may be developed. This could include a sizeable hotel development (15 of the 20 largest hotels in the world are affiliated with “mega-casino” projects located within a two-mile radius along the Las Vegas Strip) of at least 1,500 rooms and would also likely include significant space for conferences and conventions.

As with any development planned for so many visitors, an array of food-and-beverage outlets and facilities are needed as complementary amenities. The range and breadth of restaurant and lounge offerings create an even greater magnet effect that can enhance the overall appeal of a venue and allow for even more facilities to be added.

Other non-gaming assets that might be considered include cinemas, showrooms, nightclubs, golf courses, spas, wild animal exhibition areas, art galleries, amusement parks and retail shopping malls. A new trend, yet fully tested, is the integration of mixed-use tourist accommodation units into integrated resort complexes, on the belief that a certain proportion of the population will want to live or have second residences in close proximity to such attractions. Thus, many new integrated resorts are incorporating apartments, condominiums, time-share units and other residential hybrids into the mixed-use master planning of such developments.

To create a modern integrated resort, however, it must be developed proportionate to the demand that can be generated in the market where it is located. It is important to note that most gambling markets are local; they rely on the demand created from within a catchment of about 100 kilometers drive time. There are, of course, some exceptions to this guideline, such as Las Vegas and Macau, but for the great majority of gambling markets in the world, the primary clientele are local or regional residents.

Planning An Integrated Resort

In planning an integrated resort, there is little point in just putting a pin into a map and drawing concentric circles to determine the number of individuals who live within three, four or five hours flying or driving time of a location. Dropping such a pin almost anywhere in Asia can result in hundreds of millions or even billions of people being located within the area.

Market and feasibility studies are essential in creating the appropriate sizing of any IR development under consideration. Such studies should focus on those segments of the population who have the means and interest to participate in the kinds of resort activities being contemplated. As the primary economic engine, it is important that adequate attention is given to the casino segment and the returns likely to be generated from this portion of the operation.

Gravity models that take into account the local population may be essential to determine baseline revenue generation potential and income contributions from the casino. This modeling should take into account the size of the population over the age of majority, ethnicity, wealth, tolerance to gaming, and likely visitation and spend levels.

Gravity models also take into account the impact of increasing distance from a location on the number of trips made per capita and also the size of the trip budget. It has been found that as distance increases, the number of annual per-capita visits decreases, so that when distance above a threshold level is doubled—visitation rates drop by roughly three-quarters, when the distance is quadrupled—visitation rates drop by fifteen-sixteenths, etc. At the same time the gaming budgets of individuals who travel long distances to an IR increase dramatically—as such trips are considered more as special-purpose gaming trips, so individual visitors budget accordingly.

Defining these models carefully will provide an indication of how many visits a particular location might generate and what level of income the economic engine provided by the casino is capable of producing. If this simple baseline modeling does not result in predictions of a gaming market above $300 million per annum, then it is unlikely that a true stand-alone integrated resort could be developed. On the other hand, once that baseline model has satisfied these threshold criteria, then it should be possible to add further business and income streams generated from premium customers and high rollers.

Once the baseline size of the casino engine has been established, it is then possible to design the remainder of the integrated resort. That too depends on the appropriate market and feasibility studies being conducted. However, these become far less important to the overall project, as sensitivities will be driven largely by the success or failure of the casino component.

That said, one area where this statement may not be true is the development of convention and conference facilities. Such concepts should not be considered in isolation of what already exists in the market and how the location of the IR is perceived by potential convention and conference customers.

Meeting Expectations

Conventions of substantial scale require accessibility and ease of movement afforded by such locations as Las Vegas or Orlando. Flight access and location of the airport relative to the convention facilities and hotels are high in importance in determining relative attractiveness, as is the overall appeal of the destination. Convention and conference organizers are usually driven by the potential for a venue to maximize attendance for their events. Consistent with this objective is a desire for environments that can accommodate conference needs in terms of size and mix of amenities, as well as offering a vibrant nightlife for after-hours networking to take place.

Furthermore, the stock of hotels at or near the location becomes of critical importance. No single hotel can accommodate all the delegates of many major conferences and conventions held today and thus, while an integrated resort itself may be sizeable, it will be important to consider the number and style of hotels within the vicinity of the IR that can cater to business travelers.

Overall, this step-by-step and holistic approach should produce an integrated resort model which fits within its location, community and region. While it is important to think of the local catchment area as a critical component of this exercise, contributions to revenues and operating income can also come from more distant visitors, and visitors who are interested in other IR attributes besides the casino.

Based on the experience of Las Vegas, when dealing with a true integrated resort, it is possible that only about half of the total revenue generated will come from casino operations. The remainder will be driven largely by people staying in the hotels, attending conferences, conventions and events, or theme park activities. Depending on the general attractiveness of the venue and its supporting infrastructure, much of the non-gaming spend at the IR will be derived from people outside of the local catchment area and will support the direct new investment being made into the project.

To illustrate this point, one can note that the major IR mega-casino resort properties on the Las Vegas Strip now derive around 60 percent of their revenues from non-gaming amenities. The Atlantis on Paradise Island in the Bahamas generates over 70 percent of its revenues from non-gaming facilities. At Sun City in South Africa, 70 percent of total revenues also come from non-gaming sources. In other markets, non-gaming contributions as a percentage of total revenues tend to be less significant.

However, the ratio is sometimes skewed by casino revenues that are driven by relatively few international high-end customers who are attracted to the integrated resort as a consequence of the grandeur and scale, or because of aggressive marketing strategies in combination with high-quality facilities.

Initially, the Singaporean authorities—as part of their bid process for the two IRs in Singapore—stipulated that no more than 50 percent of gross revenues could be derived from gaming. This requirement was later dropped in light of the recognition that significant casino revenues could be generated from international tourists. (From Singapore’s perspective, such revenues would be beneficial to the city-state as sources of foreign exchange and “export services,” as well as import substitution that would create “net economic impact” for Singapore.)

Thus, a successful casino operation as the nucleus of an integrated resort is essential to the process of developing a proposed multibillion-dollar development. Indeed, it is difficult to think of many resort projects—with billions of dollars invested and at risk—where such an important economic contributor is not included. The failure in the early 1990s of two multi-hundred-million-dollar non-casino integrated resort projects in Hawaii—the current Grand Wailea in Maui and the Waikoloa on the Big Island of Hawaii—point out the challenges of success without such an engine.

In summary, a reasonable working definition of an integrated resort is: a multibillion-dollar, multi-dimensional resort that includes a casino that takes up, say, no more than 10 percent of the resort’s public floor space, but where the casino generates at least $300 million in gaming revenues.

Economic Benefits of Integrated Resorts

With any development involving capital in the billions of U.S. dollars, there are going to be a number of wide-ranging economic benefits and multiplier effects accruing to the region.

The first round comes from the construction contracts and the related employment opportunities. The development of a multibillion-dollar resort takes a minimum of two years and is likely to extend to three or more years when planning is included. The extent of local economic impact will be related to the amount of local labor and resources utilized in planning and construction, as well as the extent to which the local region can cater to the demands of those employees and resource owners earning higher incomes from the project.

Depending on the construction environment, much of the construction budget will be spent locally, although there will be some leakage, depending on the materials being used and the capabilities of local construction firms. In general, however, it would not be unusual to see around 40 percent of the construction budget being spent locally with 70 percent of that generating local incomes and employment.

If an appropriate income multiplier was around 1.4, the total economic effect of an IR project meeting the above parameters would be about 40 percent of the construction budget. In other words, local incomes in aggregate could be expected to increase by about 40 percent of the magnitude of the entire project over the course of the construction phase. Taking average labor costs into account, it would then be possible to estimate the annual number of jobs created and the impact on full-time equivalent labor during construction—both of which can be very meaningful to a local community.

Of course, it is the actual opening of the integrated resort that generates the greatest flow of economic benefits. Integrated resorts tend to be labor-intensive, requiring large numbers of staff to service the various facilities and activities on offer to customers and guests. This number can exceed 10,000 direct full-time equivalent employees, depending on prevailing wage rates and other factors.

The casino in particular can be a major contributor to employment with anywhere from five to seven employees per table game. In Asia particularly—where table games are the most popular form of casino entertainment—an IR casino might have 500 or more table games with 3,500 or more staff just in that department.

The diversity of job opportunities within an integrated resort can be surprising to outside observers. However, an IR should be viewed as a small township with a multitude of roles required to maintain its operation. It is not unusual for there to be 100-200 different positions within the entire complex, ranging from accountants and attorneys to, in some cases, zoologists and marine biologists. Direct employment of this magnitude induces a multiplier effect in the local community with additional jobs created to service the employees of the IR.

Depending on the extent of economic development in the region, the increase in jobs and incomes deriving from employment at the integrated resort can be very large indeed. An employment multiplier of 1.5, for example, would result in an additional 500 jobs for every 1,000 full-time jobs created within an integrated resort. This sort of impact on a local community can be of great significance and should not be underestimated.

Employment, Tourism and More

There are few industries that can provide quality employment at this level of scale in one location. The Crown Entertainment Complex in Melbourne, Australia is an example of an integrated resort casino opened in 1997 that can boast of being the largest single-site employer in the Southern Hemisphere.

Another significant impact of IR developments is the amount of consumable items required on a daily, monthly and annual basis to satisfy staff and guests. Operating expenses, maintenance, marketing and cost of goods sold will be substantial cost elements of which a significant proportion will be purchased locally or regionally, depending on the conditions prevailing in the regional economy. Supply chain benefits and clustering effects can be substantial in creating new business and employment opportunities within a region.

Perhaps the most significant economic impact from the development of an integrated resort is visitor impact. An IR located in a capital city such as Singapore or Melbourne, or even those close to population centers such as Foxwoods or Mohegan Sun, can generate significant visitor numbers sometimes exceeding 10 million per annum (implying an average of upwards of 30,000 visitors per day).

Depending on location and the actual type and range of facilities offered, this may well result in millions of additional tourists visiting the region, resulting in incremental spend in the local communities as these visitors take tours, eat in local restaurants, stay at local accommodations (outside the IR) and spend time and money outside the integrated resort. At Genting Highlands in Malaysia, for example, it is estimated that approximately 3 million people visit the country annually specifically to visit the resort. This represents around 15 percent of total international visitors to Malaysia.

Singapore, when it decided to establish two integrated resorts in the city-state, did so on the basis of the potential visitor impacts and the positive effects they would have on Singapore’s economy as well as its image. Singapore’s goal was to triple its tourist numbers over a period of 12 years and to more than triple the resulting economic impact by attracting higher spending and thus higher-value visitors to that country. When they open in 2010 or 2011, the two IRs will be critical in achieving that objective and will likely contribute more than 50 percent to Singapore’s long-term goal by 2015.

Another benefit of such developments is the regenerative power successful large-scale integrated resorts can have on their particular locales. Such effects might include transportation infrastructure upgrades to the venue to cater to the visitors expected to be drawn to the area, as well as improvements in general facilities and amenities for guests as well as locals. A gravity effect of sorts also occurs with complementary leisure and entertainment facilities that might be developed nearby, as well as new hotel and apartment developments at different price points.

Urbanization in general leads to many mixed-use developments in and around cities, but this can be accentuated around integrated resorts due to the extent and range of leisure options that can be afforded under one roof. A multibillion-dollar IR can stimulate billions of dollars of additional developments within the local region as businesses and accommodation options cluster around the site.

An excellent example of this can be found around the Crown Entertainment Complex on the Southbank of the Yarra River in Melbourne. In 1993, prior to development of the A$1.7 billion Crown Complex, the neighborhood was largely a derelict and abandoned industrial area. Within a decade after the opening of Crown, the Southbank had become one of the most attractive commercial, residential and entertainment areas in all of Melbourne, with capital investments in excess of A$10 billion within two kilometers of the Crown site.

Some casino operators such as MGM Mirage have created master-planned precincts such as the CityCenter development on the Las Vegas Strip. In a similar manner, Las Vegas Sands and its majority owner Sheldon Adelson—and some other companies—are developing the Cotai Strip in Macau as a massive series of integrated resorts, with aggregate capital investments in the range of US$12 billion in the form of branded hotels, entertainment offerings and, of course, casinos.

Other situations have developed over time to bring about integrated resorts in less planned ways. The massive organic growth of Genting Highlands outside Kuala Lumpur in Malaysia, which now boasts over 10,000 hotel rooms (the largest concentration under single ownership in the world), has resulted in an entertainment complex with indoor and outdoor theme parks, convention and conference facilities, and over 200 retail, food and beverage outlets. While less structured in its evolution than other IRs, it is nonetheless important to appreciate from Genting Highlands what can be developed off the back of casino-led expansions.

The positive annual impact from integrated resort developments can indeed be substantial. Estimating the economic potential of these IRs will depend on the unique situations established within each locale and legal situation. However, it is often the case that such developments can become the most significant that any locale will have seen from a single activity, and can have impacts in excess of the holding of the Olympic Games or sponsoring a World’s Fair or some other spectacular event of worldwide significance.

It becomes easier for affected parties and stakeholders to understand the changes that the development of an integrated resort can bring to a government and community once the quantitative and qualitative impacts are released and understood. These multibillion-dollar developments can generate thousands of jobs, regenerate regions, and stimulate much broader economic activity, as well as bring about substantial returns from gaming taxes, fees and initial license costs.

One need only look at the fiscal and economic impacts that have accrued in Macau in several short years to understand these fundamentals, or to analyze what Singapore is achieving and will likely experience in the next few years with the Genting International development at Sentosa Island and the Las Vegas Sands development at Marina Bay.

Why Integrated Resorts Make Sense

Because of their relative economic and social benefits and costs, the attractiveness to countries and jurisdictions of the strategy of authorizing substantial integrated resorts, in comparison to legalizing other forms of gambling, such as gambling-centric casinos that do not require other amenities, or convenience gambling outlets such as arcades filled with slot machines, will likely become a popular option in the future.

Such efforts will have to be accompanied by specific limitations on the number of licenses issued, as well as other protections against regional competition, which will create an environment conducive to the substantial capital investment levels desired. This will obviously not work well for every jurisdiction that would like to go forward with this kind of strategy, but it can work if the underlying economic, political and social circumstances permit it.

The major conclusion for national governments, or for states and provinces empowered to authorize casino-style gambling, is to reach the understanding that their policy alternatives are not a question of integrated resorts versus no gambling whatsoever. Rather, they have a choice between permitting alternative structures, styles and types of gambling industries that have markedly different economic and social impacts. By virtually any measure, the concept of integrated resorts best harnesses the benefits associated with their alternatives, while (potentially) reasonably constraining the unintended negative impacts.

Carefully developed legislation and implementation, which seems to be the case for Singapore, will prove far more benevolent in the long run than the haphazard and opportunistic approaches that have been undertaken by many countries, states and provinces over the past few decades.

Such alternatives, such as permitting the proliferation of electronic gaming devices in arcades or bars and taverns (so-called “convenience gambling”), limits the economic and catalytic power that might be associated with integrated resorts. Furthermore, the ability to control for excessive or problematic gambling through exclusionary strategies is far more difficult for convenience gambling than it can be for highly regulated and cooperative integrated resorts.

It will be interesting to see which countries will be next to accept and act upon these scientific observations, by harnessing the economic potential that integrated resorts promise with thoughtful and effective legislation and implementation. Among the candidates to watch in the immediate future will be Mexico, Japan, Taiwan, Thailand and Vietnam, and even perhaps (but with lower probabilities) Dubai, Abu Dhabi, India, or somewhere in China other than Macau.

The high potential of success of IRs in Singapore will no doubt be an important example to other governments and may indeed set the stage for the next major direction in the spread of legal commercial gambling.

Andrew MacDonald is founder of urbino.net and is also executive vice president of gaming for Genting Berhad, based in Kuala Lumpur, Malaysia. He can be reached at andrew.macdonald@genting.com.

Bill Eadington is a professor of economics and director of the Institute for the Study of Gambling and Commercial Gaming at the University of Nevada, Reno. He is an internationally recognized authority on the legalization and regulation of commercial gambling, and has written extensively on issues relating to the economic and social impacts of commercial gaming. Eadington can be reached at eading@unr.nevada.edu.

By Rich Geller  

Sitting atop Europe on the Scandinavian Peninsula, Norway and Sweden are two of the continent’s most fiercely independent and powerful traditionalists. They consistently rank high among the top 10 nations in the world when it comes to standard of living, and are comfortable with their own systems.

The Swedish people voted not to adopt the euro currency in 2003 and Norwegian voters have said “no” twice to joining the European Union. Likewise, each nation’s government has stood fast in its decision to retain a centrally controlled monopoly approach to most forms of gaming, for as long as possible. How long that particular status quo can be maintained depends on how well the gaming needs of their respective populations are served by the existing monopolies, and on when—and if—E.U. pressures can ultimately force a change.

In Sweden, in 2007, all forms of legally allowed gaming combined produced total gross gaming revenue of SEK38.7 billion, equal to about $5.8 billion at the time. Over 86 percent of that was accounted for by the two government-owned and operated monopolies ATG and Svenska Spel.

ATG, the tote company created by the government to handle the betting on Swedish thoroughbred and harness racing, generated 31 percent of all gaming revenue. Svenska Spel, the 100 percent government-owned entity that operates all four of Sweden’s casinos, an online poker site, most lottery games and sports betting, accounted for 55 percent of the total. Various public and private lotteries produced over 8 percent, bingo almost 4 percent and low-limit table games, which for years have been allowed in restaurant bars, provided less than 2 percent of revenue.

Svenska Spel was formed in 1997 by the merging of two state-owned companies that separately had operated lotteries and sports betting. When, after years of government discussion, the decision to allow casinos was made in 1999, Svenska Spel was given control over the sector.

The company turned to Holland Casino of the Netherlands, another state-owned monopoly that had developed a successful casino formula for its own similar market, for information and know-how. The concept of the casinos was to offer a contemporary mix of moderate gaming, enjoyable dining and light entertainment, all in a socially responsible way as opposed to a purely business approach that might seek to wring maximum profit from high rollers.

The first two casinos were opened in the cities of Malmo and Sundsvall in 2001, followed by one in Gothenburg in 2002 and finally Stockholm in March 2003. The properties offer a total of about 100 tables and 1,000 slots. Along with the standard roulette and blackjack can be found punto banco, sic bo, Caribbean Stud, Casino Hold’em and Big Wheel, depending on the casino.

All four casinos offer poker cash games and weekly tournaments, spreading hold’em, Omaha and seven-card stud at a variety of limits. Each casino also provides visitors a choice of two or three restaurants and bars serving meals and light snacks.

Financial results for the five years 2003-2007 show growth in gaming revenue of at least 8 percent each year. In 2003, with all four casinos operating for most of the year, revenue was SEK720 million, about $90 million. In the next four years revenue grew to SEK853 million, SEK922 million, SEK1 billion and SEK1.15 billion, about $172 million.

How the current economic situation will affect 2008 results is not yet clear. For the first nine months of 2008, revenue was said to be up again but not by as much as the previous year. (Interim results were due to be released toward the end of October.)

At the start of June 2005, Sweden was one of the first countries to introduce a smoking ban in public places, which affected restaurants and bars and of course, the casinos as well. The immediate result was the now-predictable drop in business. Year-on-year revenue at the casinos did increase for 2005 and 2006, although only at a rate of around 8 percent—less than half the 18 percent rise experienced in 2004. But when the 2007 numbers came in, revenue growth had returned to double digits, to almost 15 percent.

With no additional properties having opened and no major expansions of existing casinos, Svenska Spel management credits the recovery to the successful efforts to expand its casino customer base. This feat might have been easier in Sweden than in some other countries facing smoking ban-related losses, simply due to the newness of the Swedish industry.

Unlike long-established casino cultures such as Germany, where a certain clientele has been cultivated for decades, Cosmopol management would not have had the time to become dependent on a small but important core group of players. Also, the original mission of the Svenska Spel casinos, with its accent on light entertainment as opposed to hard-core gambling, could have resulted in the group taking less of a hit from losing a portion of its business and being better positioned to recover by using marketing to attract a wider variety of recreational players.

Two years ago Svenska Spel received permission from the government to create two more casinos. However, elections since then have produced a new government, one which decided it was time to review the entire gaming market in Sweden—both the live and the online market—and see what if any changes were needed. That decision resulted in the casino expansion plans being put on hold.

The government commission performing the study is scheduled to issue its report with recommendations for any new legislation on December 15. A year of discussions and explorations will follow, with no official news likely before 2010. Unofficially, there is an expectation that the commission’s report will not affect the live casino sector, thus maintaining the monopoly arrangement with Svenska Spel. If that is the case, then Sweden could see two new Cosmopol casinos relatively soon.

The governmental review of Sweden’s gaming market has been necessitated primarily by the pressures produced by the phenomenon of online gaming. Basically, operators of online sports betting, poker and casinos want legally recognized access to the market of enthusiastic Swedish players—and to markets in all other countries, for that matter. Sweden and particularly those other countries with government-owned or licensed gaming monopolies want to keep the operators out completely.

The European Court of Justice is faced with the unenviable task of weighing the wording of the E.U. treaties and regulations against the “what if” nightmare scenarios—real or imagined—of budget ministers, religious leaders, social workers, politicians, commercial operators and other interested parties in the E.U. member states. Given the number of countries, cultures and languages involved it is not an issue that is expected to be settled any time soon.

For Sweden, the reality is that foreign-based online operators managed to take an estimated 9 percent of the country’s total gaming market in 2007. For its part, Svenska Spel managed to capture 35 percent of the online market with its own products, which include bingo, lottery games, sports betting and poker.

Revenue from all the Svenska Spel games played online or via mobile devices grew by over 38 percent to reach SEK1.2 billion in 2007. Of these games, the best performer and biggest earner was poker, which saw an increase of 86 percent to SEK385 million. To put the online poker result into perspective, of the four Cosmopol casinos, only Stockholm managed to top that performance with SEK420 million.

One of the things that make Sweden such an important legal battleground for online poker operators is the zeal of the Swedish player. A 2007 survey conducted by industry organ eCOGRA turned up the fact that Swedish online players as a group reported the highest average monthly win from their sessions. How they won is irrelevant. What matters is that to win the most, they had to be involved in a lot of games and a lot of pots, which translates to more rake for the online operator.

A standard argument used by national operators for maintaining a monopoly system is the protection of the player from the dangers of addiction. Svenska Spel has developed a tool that online players can use to self-monitor their playing habits. “Spelkoll” debuted in mid 2007, and is based on more than 17 years research at the Chalmers University of Technology in Gothenburg. A combination of behavioral science, psychology, mathematics, artificial intelligence and technology, Spelkoll compares the player’s gaming behavior to a pre-set model. If the subject begins to exhibit risky patterns of play, a signal on the screen goes from green to yellow and the player is advised to examine his or her participation, even create a budget.

If the pattern continues, eventually the signal turns to red, at which point the player is advised to call a support line and offered the option to suspend himself from gaming. Svenska Spel also stops sending the player promotional materials. The system is attracting attention in other countries, and was adopted by the Austrian lottery operator for its own online poker site.

Another area controlled by the monopoly is slot machines in bars and restaurants. The system of linked VLTs known as “Vegas” is intended to avoid the situation found in many European countries, where a loosely regulated, low-limit street machine market will often dwarf the heavily monitored, licensed casino market. The 7,000 Vegas VLTs from Spielo/GTECH offer gaming at stakes from SEK1 to SEK5 and jackpots up to SEK500.

The machines can be found in over 2,200 restaurants, bars and bingo halls. In 2007, they produced gross gaming revenue of over SEK1.9 billion—more than the total revenue produced by the four casinos. This segment is still recovering from the smoking ban introduced in 2005, but is almost back to its 2004 level. An illegal street machine market still exists, but it is thought to be nowhere near the size of similar markets in some other countries.

Just across the border in Norway, there are some similarities and some major differences in the gaming market. Norsk Tipping is the name of the government-owned entity that operates all legal gaming in Norway. Unlike Svenska Spel, the Norwegian lottery and sports betting company has not expanded into the casino business or the online poker industry. However, it has embarked on the installation of a very advanced network of 7,200 interactive video terminals from supplier ACE Interactive. The iVTs will be available in similar venues to Svenska Spel’s Vegas VLTs.

The technological features offered on the new iVTs, combined with the required player card issued by Norsk Tipping, provide the player with a number of options designed to give greater safety and choice.

To be able to play on the linked iVTs, a player must first register and be issued a player card. The card can be used to transfer money from a player’s bank account to his player account and then can be credited directly to the iVT.

Player accounts come with an automatic loss limit of NOK400 per day—about $60—and NOK2,200 per month, which are maximums mandated by the new regulations. If the player feels these amounts are too high, he can reset his own limits to a lower amount. Stakes vary depending on the game, but run between NOK10 and NOK40. The maximum jackpot is NOK1,500. The terminals also fill the role of self-service kiosk for the purchase of other Norsk Tipping products.

Another new iVT feature will allow the player to designate an authorized sports club or cultural organization to receive 5 percent of any losses in a given session. The action is intended to emphasize the “good cause” aspect of gaming and give the player some say as to who benefits.

The first trial deployment of the cashless iVTs began with eight venues in and near Hamar, where Norsk Tipping is headquartered, in summer 2008. The network should be complete within the next two years.

Although not a member of the E.U., Norway must still abide by many of the same rules as those nations that are. Norway is considered part of the European Economic Area, and EEA members are obligated to implement E.U. legislation if it is important for the functioning of the internal market. However, the relatively low-profile Norway maintains the area of gaming may keep it from running afoul of the usual free-trade treaties. The E.U. recognizes that some forms of monopolistic behavior can be allowed when it comes to gaming.

By Barnard Thompson   Tue, Nov 04, 2008

The seemingly perpetual debate over the possible authorization of full-fledged casinos that are prohibited today in Mexico goes on—and it is hard to believe that bombastic politicians might one day break from the vicious circle of the past 15 years.

Yet, once again, there are expectations that something might finally be done by the Mexican Congress, based on occurrences during the run-up to its September 1-December 15 regular legislative session.

As well, the chairman of a congressional committee with oversight responsibilities told Global Gaming Business his understanding is that the gaming and casino reforms will probably be sent to the floor this session.

Reform legislation for Mexico’s outdated Federal Gaming and Raffles Law of 1947 is still mired in three committees of the Chamber of Deputies, the lower house in the bicameral legislature. Of the three, the Tourism Commission, or committee, has normally been the lead (yet hitherto uncreative) entity on this matter.

On August 12, during the congressional recess period, the Tourism Committee established a new Gaming and Raffles Subcommittee, chaired by Armando García Méndez, a proportional representation deputy with the Alternative (Alternativa) Party. The subcommittee was formed evidently to move gaming matters off the dime, and to police so-called “irregular” casinos that are operating outside the law or with questionable permits.

Concerning lost tax revenue, with the claim that 66 percent of gaming activities in Mexico are taking place outside the law, columnist Leopoldo Mendívil recently wrote, “The current gaming and raffles business is an everyday matter in Mexico. Related allusive propaganda can be found in every media (outlet), be it the written press, television, radio or the internet, and the gaming and raffles business has in fact become a normal entertainment activity in the life of all Mexicans.”

Mendívil also complained that the Secretariat of Government (Interior), which has jurisdiction over gaming activities in Mexico, has allowed (tacitly at least) the growth of gaming establishments—yet has failed in the promotion of regulatory reform which, in turn, would produce greater fiscal benefits for the nation. And, he said, “legislatively the Tourism Committee of the Chamber of Deputies has outstripped the Secretariat of Government, having established a new Gaming and Raffles subcommittee after recognizing that the important executive branch ministry is being obstinate by keeping the matter under the carpet.”

As well, concern (maybe based on political and/or selfish interests) is being expressed over “remote betting centers”—books for betting on offsite activities; and numbers parlors—for games on “electronic terminals” as the bingo-based machines are euphemistically called—that hold valid permits. Both of these venues are permitted by law, in establishments that could be called “casinos lite.”

Actions involving books and numbers parlors are based on federal permits issued by the Secretariat of Government—some new, some old. And ever since new permits were issued and others expanded in 2005, the number of gaming houses in Mexico has been growing.

The Major Players

Televisa, Mexico’s broadcasting and communications giant and the largest media company in the Spanish-speaking world, through its subsidiary Apuestas Internacionales, S. A. de C. V., holds 65 book permits and 65 numbers parlor permits, for operations in 29 of Mexico’s 32 federal entities (except for the states of Baja California Sur, Campeche and Colima). And Apuestas Internacionales, with an aggressive business plan, has been opening more and more of its Play City establishments.

The so-called Caliente Group, an international gaming conglomerate run by Tijuana-based Jorge Hank Rhon (who holds permits under a variety of corporate names), has also opened several new books and gaming centers, while expanding others. As well, a number of other facilities have been opened or enlarged by additional permit holders.

All of these could be harbingers of full-fledged casinos—or maybe beneficiaries of a quasi-casino presence if garrulous members of Congress play politics and, once again, drag their feet in a years-long do-nothing cycle.

The Mexico City daily La Jornada, on August 13, carried the following excerpt by reporter Moisés Sánchez Limón:

“Before the year is out the Chamber of Deputies will have voted on a new Gaming and Raffles Law, which will authorize casinos, although they will be limited by a regulation and restricted to determined areas of the country, especially tourist destinations, in order to create jobs and generate economic benefits for states and municipalities, according to members of the Tourism Committee.

“…the Gaming and Raffles Subcommittee will investigate the 763 permits that the Secretariat of Government issued during the tenures of Santiago Creel Miranda, Francisco Ramírez Acuña, and the current secretary, Juan Camilo Mouriño; it will also review the concentration of those authorizations in the hands of a few.”

One of those interviewed by Sánchez was Congressman Gilberto Ojeda Camacho (Institutional Revolutionary Party—PRI—Sinaloa), a member of the Tourism Committee. Asked if the PRI is in favor of casinos, Ojeda Camacho responded, “What the PRI wants is for all of these types of activities to be duly regulated. Certain areas of the country in need of tourist momentum would have to be tailored, and others not. A phenomenon is taking place: Casinos are being set up in places where they are not truly viable.

“What we want is for the autonomy of the states and municipalities to be respected, because casino operators are asking only for land use authorization, and they arrive with permits and they are set up, but they don’t pay taxes and they create jobs for people that they hire in other places.

“Thus, the work of the subcommittee will be oriented towards codifying information related to the way in which permits are issued for the operation of gaming houses, after holding meetings regarding the legislation in effect that will include appearances by officials from the Secretariats of the Treasury, Government and Tourism, among others, that are involved in the matter. Subsequently a proposal for the new Federal Gaming and Raffles Law will be drafted.”

Subcommittee chairman García Méndez was also quoted in the article. He was asked when this new law might be promulgated, and he answered that the hope is to have it ready by the end of this year.

Asked if the legislation would allow casinos, García Méndez responded, “It is not to allow or prohibit them; it is to regulate the activity. There it is, it has to be regulated; if not regulated it could become a social problem.”

Legal Language

Mexico’s Chamber of Deputies has established an ad hoc subcommittee to deal with what boils down to two areas: first, legal, regulatory and fiscal matters related to gaming activities nationwide; and second, legislation that could lead to full-blown casinos in Mexico.

The new Gaming and Raffles Subcommittee has been formed to advance inquiries and legislation regarding gaming matters; to police so-called “irregular” casino-like activities that are operating outside the law or with questionable permits; and to gain a future tax stream that is now but a trickle. And to address the casinos issue.

Ever since the 2004 passage of the Regulation of the Federal Gaming and Raffles Law and the issuance of new and/or updated permits in 2005—that vox populi at least tied to the presidential ambitions of then-Secretary of Government (Interior) and now-Senator Santiago Creel Miranda (National Action Party, or PAN), the matter of permits has been festering. Given that, the Adjunct General Directorate of Gaming and Raffles, of the Secretariat of Government, has increasingly come under fire—especially by opposition party politicians and some pundits who, among other things, charge bias or suggest favoritism in the issuance of permits and/or oversight of permit holders.

Much of this comes with the justification that only a claimed 34 percent of gaming activities in Mexico are legal, or conversely that 66 percent of the gaming is unregulated and untaxed. As well, observers say all of this could mean that many of the unlawful gaming activities are tied to organized crime and the laundering of drug money.

The initial meeting of the 14-member subcommittee (representing five political parties) took place on September 11, with a rather routine agenda for a first meeting. The two most interesting calendar items covered: “Advances, strategies and results obtained during the first stage of the work plan regarding the gathering of information;” and “Methodology proposal in order to undertake the next stage of the work plan that consists of work sessions and summons appearances with the actors involved with gaming and raffles.”

Ojeda Camacho said the work will be done in five phases: the compiling of information; working meetings and hearings; drafting of the proposed law; conclusions; and dissemination of the same.

According to a statement issued by the press office of the Chamber of Deputies, one of the first things approved by subcommittee members was to urge the Secretariat of Government not to authorize a single new or expanded permit for gaming and raffles until the subcommittee has comprehensive analyses of all authorizations, as well as the gaming industry in Mexico.

Subcommittee chair García Méndez was quoted as saying the draft of the gaming and raffles law proposal will be complete in four months. He said subcommittee members will soon meet with Undersecretary of Government Abraham González Uyeda and other ministry officials to discuss the difficulties.

Subcommittee member Gilberto Ojeda said the board is awaiting information from the Directorate of Gaming and Raffles to begin an investigation into gaming and betting parlors that presumably have counterfeit or bogus permits. The subcommittee is asking for a register list of all permits that have been issued by the Secretariat of Government, and will ask for a list of unlawful permits that have been found.

Shut Down Illegals

As a sidebar to the press statement, Octavio Martínez Vargas (Party of the Democratic Revolution, or PRD), who chairs the Tourism Committee in the Chamber of Deputies, discussed black market sales and transfers of permits to third parties with a reporter from the Mexico City daily El Universal. Martínez told the reporter that “gaming concessions are being sold regularly under the table, each costing up to US$2 million.”

The press communiqué also states that, during the meeting, an objective was set to authorize states and municipalities to close businesses that have slot machines, and to confiscate the machines insofar as they are unauthorized. In the interview, Martínez Vargas said, “Of each 10 small business establishments, seven have slot machines.”

Everyone acknowledges that a revised Mexican gaming law is necessary to replace the antiquated Federal Gaming and Raffles Law of 1947, and obviously this is to be a major part of the subcommittee’s work. Additionally, casinos, if they are to be authorized, must be part and parcel of a new law.

With the draft proposal slated for completion in four months, a vote on the legislation could come during next year’s February-to-April regular legislative period.

García Méndez says a new law is needed because gaming has become considerably more controversial over the past three to four years—a result of the increased number of betting establishments in Mexico and ineffectual regulations.

Moreover, when asked about casinos, García Méndez repeats what politically may be his safeguard catch-phrase, as he has used the implicit casino reference in variation before, saying that a new law is needed not to prohibit betting parlors but to regulate the activity.

And then there are several wild cards that will come into play with respect to casinos, over and above partisan political wrangling that is a sure thing—especially in Mexico’s 2009 midterm election year. The Catholic Church, entrepreneurial organizations and unions, citizens’ groups, addiction control activists, anti-crime advocates—the latter being important due to the fear of possible infiltration by organized crime—and others can be expected to step into the fray, and it is yet to be seen which way they might sway the spheres of influence.

Barnard Thompson, editor of MexiData.info, has spent 50 years in Mexico and Latin America, providing multinational clients with actionable intelligence; country and political risk reporting and analysis; and business, lobbying, and problem resolution services.

By Frank Legato   Tue, Nov 04, 2008

Some 2,000 gaming industry professionals from across Central and Eastern Europe gathered at the Expo Convention Center in Sofia, Bulgaria, last month for the region’s first combined trade show expo and focused educational conference.

The first Eastern European Gaming Summit was sponsored by the Bulgarian Trade Association of the Manufacturers and Operators in the Gaming Industry, Spectrum Gaming Group, Bulgarian slot manufacturer Casino Technology and an extensive lineup of media partners.

The EEGS conference featured more than 60 speakers from all segments of the region’s gaming industry, including major casino operators, regulators and vendors. The conference was combined with the Balkan Entertainment & Gaming Expo, a trade show featuring stands showcasing games and equipment from 72 vendors from 60 countries around the world.

Three days of conference sessions focused on issues ranging from needed changes in the regulation of casinos in Eastern Europe to marketing techniques to new products. Among the highlights of the program:

Michael Beottcher, CEO of Storm International—formerly the most prominent casino operator in Russia—painted a bleak picture of the prospects for operators under the new Russian gaming law instituted by former President Vladimir Putin, which will result in current casinos closing next year.

Beottcher, a casino executive known for his outspoken criticism of the new Russian law, complained that the four casino regions set up by Putin are in remote areas that lack even basic infrastructure and highways. He said there is no hope that Storm or any other major casino operator will be able to set up shop in Russia at any time soon.

Regulation in the region’s gaming industry was the subject of several sessions, including a presentation by Eduardo Antoja, honorary president of the European Gaming and Amusement Federation, or EUROMAT. Antoja commented that “society moves faster than regulations,” and the key challenge for regulators is to keep pace with technological advances in the industry.

Antoja cited the main challenges for operators in current European regulatory and gaming law setups are rigid regulations, excessive taxation and monopolies in certain countries that create an unfair competitive environment.

Separate sessions examined the intricacies of international gaming law and regulation. Fredric Gushin, managing partner of the Spectrum Group, gave an educational presentation on international regulatory trends. Gushin noted that regulation in many nations is less rigid than in the past, mainly due to the general acceptance of gaming as a legitimate business by Wall Street and by society at large. He said the public policy goals of gaming, which include reinvestment, tax revenues and job creation, often are adversely affected by government policy including high taxation and expectations that are unrealistic.

Bob Miller, chairman of the International Association of Gaming Advisers and former Nevada governor, spoke on the evolution of legalized gaming in the world and how various private entities in the gaming industry relate to government in different parts of the world.

Internal compliance issues were covered in a session by gaming attorney Jeffrey A. Silver, chairman of the Gaming and Administrative Law Department at Gordon & Silver Ltd.

A case study on expansion was presented by Anders Galfvensjo, expansion director for Olympic Entertainment Group. Galfvensjo outlined how Olympic’s expansion in the Baltic states has followed the design principles of Las Vegas casinos.

Problem gambling issues were addressed at several sessions, as were issues such as the ins and outs of marketing to players. One session on marketing was conducted by Marlene Reyes, senior associate of the Fine Point Group, who offered a formula for success in player promotions.

Reyes’ marketing formula includes simplicity (programs should be able to be explained to customers in 30 seconds), control, aspiration (give players something to shoot for), transferability (between properties or between a single casino and outside partners), and flexibility.

One session addressed minimizing the negative effects of smoking bans, which have taken hold in Western Europe but are viewed as inevitable in smoker-friendly Eastern Europe as well. Karen Blumenfeld, executive director of New Jersey GASP (Group Against Smoking Pollution), highlighted successful past efforts in which smoking bans have been turned into a positive through marketing efforts by casinos.

The conference sessions were augmented by round-table discussions covering specific Eastern European markets including Bulgaria, Croatia, Macedonia, Serbia, Romania, Greece, Austria, Malta and the British Channel Islands.

By Roger Gros   Mon, Dec 01, 2008

By Frank Legato   Sat, Nov 22, 2008

By Roger Gros   Sun, Nov 09, 2008

By GGB Staff   Wed, Nov 05, 2008

Last April, Cantor Gaming initiated a regulatory test of a hand-held mobile gaming device in conjunction with the Venetian in Las Vegas, becoming the first company to break through with such a device. Cantor CEO Lee Amaitis was instrumental in getting legislation passed in Nevada and later regulations drawn up surrounding this new form of wager. Now that the test has been concluded, Amaitis is anxiously awaiting the regulatory approval. He spoke with Global Gaming Business Publisher Roger Gros at his Las Vegas offices in October. A full version of the interview is available at www.ggbmagazine.com. Just click on the GGB Podcast button to listen or download the podcast to your IPod or MP3 player.

GGB: Cantor Gaming has been at the forefront of wireless gaming in the U.S. for quite some time. Can you outline the technology and the purpose that drove the formation of Cantor Gaming?

Amaitis: We’ve been in operation in Nevada for about five years.

The underpinning of the company was our financial-transaction technology. In the world of financial services, we act as an intermediary between banks and dealers around the world. We connect people around the world via secure electronic financial transactions of all kinds. The emphasis is on speed, so we developed a platform called “eSpeed” that connects the wholesale marketplace for financial products.

Because of the secure nature of this transaction we got into the bookmaking business in the U.K. with a company called the Cantor Index.

In order to make the Cantor Index more interesting, we decided that it was a good idea to invest in mobile technology. We spent years developing this for the wholesale financial industry and that was the underpinning of our products in Nevada.

You’ve got a test of a hand-held wireless system that has just concluded at the Venetian. Can you tell us how that has been accepted by the casino and the customer?

We went through the process of learning what can be done (in mobile gaming) and then working with the regulators, about how to offer mobile gaming within the confines of the resort, which is defined as the public areas of the resort—restaurants, lounges, swimming pools, etc.—except for the rooms and the parking garage.

Getting it approved by Nevada regulators was a very long process, but a gratifying one. And having a partner like Las Vegas Sands was very important because they saw the advantage of bringing something new to the table that can add incremental revenue, and not cannibalizing existing revenue.

What are some of the results you found at the Venetian?

Reports have been very good. The interesting part—which I could not have written better myself—is that most of the patrons said they would not use it on the casino floor, which is exactly what the casinos want to hear—players using it in areas where there are no games.

The criticisms were understandable and easily addressed. They wanted more games, more access to other games, bigger screens and the like—all of the things we have been working on, and once we come out of field trial, these are things that will make the system better.

What kind of demographics did you attract?

It was a very broad mix. I would have thought that you would have less slot play and more table-game play, but it was very even. There was no one age demographic that dominated. Everyone played and everyone seemed to enjoy it.

You have your own content, but can you provide content from others slot companies or table game providers?

We have content deals with several companies: Progressive Gaming for their table-game content, as well as Atronic and Aristocrat for their games.

We’re also very attractive to independent game developers because we have an open platform. We can decide what might be exciting and get it developed relatively quickly. That’s one of the advantages to having a server-based setup like we have. If you think a game has any traction whatsoever, you can just roll it out. If it doesn’t gain traction, you remove it with no harm, no foul.

How about sports bets on the mobile device? Seems like a natural.

That’s something we have been focusing on as well.

After we got licensed ourselves after going into field trial, we could really apply our philosophy of providing gaming in a comfortable setting. Whether they do it in a restaurant seat or a lounge chair or in the race and sports book, we can provide it. So we think this is a natural extension of our product.

In fact, we have a deal with M Resort to run their race and sports book, both physically in the casino and mobilely around the casino. It’s our software and systems that will power the M Resort race and sports operations.

We also have a function within the race and sports book programs called “in running” where the betting doesn’t end when the event begins. You can continue to bet on the event, whether it’s confirming your choice or hedging your bet. You can also bet on events within the events, like balls and strikes, runs or passes. It opens up many opportunities race and sports books never had before.

Where do you see your company in the next five years or so?

Cantor Gaming has been born out of the interest in technology and the transaction process. Wagering is just a financial transaction, so that gives us a very broad stroke in being able to grow. I see our company growing very significantly in the next two to three years. Coming out of the approvals and the testing process are major steps. Six months ago, it was a waiting game. Now, we’re rounding third and heading for home plate. Remember, we’re not competing; we’re providing services that make us partners with our clients and enhance their products and services.

By GGB Staff   Wed, Nov 05, 2008

Virginia McDowell was appointed president and COO of Isle of Capri Casinos a little more than a year ago. She joined the company after serving as chief technology officer for Trump Entertainment for two years. McDowell is a longtime casino executive, whose most notable experience was helping to build Argosy Gaming into a Midwest power. At Isle of Capri, McDowell, along with CEO Jim Perry, another Argosy veteran, has outlined the important operational aspects they have stressed and how the strategy to include the “Lady Luck” brand in some of the 16 Isle casinos will be carried out. She spoke with Global Gaming Business Publisher Roger Gros about the changes she has helped to institute. To hear the full version of this interview, go to www.ggbmagazine.com and click on the GGB Podcast button.

GGB: You’ve been in charge of Isle for over a year now. How would you characterize what has happened during that year and what you’ve done?

McDowell: This is a transition process. We are changing the company. It has been a collaborative effort on the part of the management team at the corporate level, along with contributions from our general managers.

When I joined the company last summer, it was perfect timing, literally two days before the credit markets shut down. We had just completed our refinancing, which is now a tremendous asset to the company at this point.

Jim Perry, who joined the company the same time that I did, chaired a strategic board committee. We looked at the company overall. We looked at who we were and where we were going. It was a kind of “what do you want to be when you grow up” moment.

That resulted in a strategic plan that said we have a great portfolio—concentrate on organic growth opportunities in the short term, stop chasing transformational projects and concentrate on our existing properties, both from an operational and capital-reinvestment perspective to make us more competitive in our markets. It’s been a busy year!

What are you doing to operate more efficiently in this economy?

There were some obvious things we could do in the short term. We focused on improving our margins by reducing our expenses both at the site level and at the corporate level. That required that we do a forensic analysis of legacy programs.

One of the things I tried to push was the concept of making decisions close to the customers. Isle had moved toward centralization over the last few years. A lot of the decisions had been made at the corporate office. But you can’t do the same kinds of things at Pompano and Waterloo than you can at Natchez and Marquette. The customer bases are very different.

At the corporate level, we have a team that, at Argosy, built one of the strongest balance sheets in gaming, so we’re in good hands.

Let’s talk about Florida. You’ve got a great location at Pompano Park but are at a severe disadvantage to the Seminole casinos in terms of taxes and table games. Do you expect any relief at any time soon?

Pompano is a difficult situation. We spent almost $200 million there building a beautiful facility, but it has become increasingly difficult to for us to compete in Florida. We have done a good job as far as margin improvement is concerned and in stabilizing operations. Our management team is focused on the type of things they have to do to create great experiences for our customers.

As for our competition with the Seminoles, the Indian Gaming Regulatory Act stipulates that before a tribe can offer a particular form of Class III gaming, it has to be legal in the state. Table games, other than poker, are not legal in the state of Florida. Now if we offered table games, we would be subject to huge fines or our license would be in jeopardy. The playing field is not level and it’s an untenable situation.

We tried to get legislative relief last year, but were not successful. We told the legislature what the impact would be and we’re starting to see that impact.

In the U.K., you’ve got one of the larger casinos in the Ricoh Arena in Coventry. With the difficult government oversight there, can you survive in that environment?

The economy in the U.K. is very similar to the U.S., but worse. You have the net effect of a tax increase, regulatory change and a smoking ban that has literally rocked the entire gaming industry there. As a result of this, it has become increasingly difficult to operate. Large companies like Gala and Stanley down to the smaller bingo operators and betting parlors, we’re all struggling. It’s not just us. We clearly over-invested, but we’re trying to make the best of a bad situation.

Are you considering exit strategies there?

We’re looking at all our options. We hired UBS to work with us on this and everything is on the table.

Explain the differences between the Isle and the Lady Luck brands.

By creating a local brand and repositioning these properties, we gain several advantages. First, we can maximize the profitability of the Lady Luck brand by pulling costs out of the property. We can centralize many of the management functions—marketing, information technology—and the decision-making process. Then we can focus on nailing the attributes that are crucial to a customer who truly views this kind of property as a local establishment. As our balance sheet becomes stronger, it allows us to be a logical acquirer of other smaller facilities across the U.S.

The Isle brand is aimed at a more regional market, with a fine dining experience, convention and meeting space, a name-entertainment venue, a spa, a business center; something that a meeting planner would consider.

By GGB Staff   Wed, Nov 05, 2008

Progressive Gaming International Corporation’s stock tumbled last month as the company replaced its CEO and warned investors that 2008 financials would not meet projections.

Shares fell 25 percent on the news and ended down $1.22, or 43.88 percent, to close at $1.56—the lowest figures ever posted by the company.

CEO Russel McMeekin has resigned. He came on in 2002 and presided over the transition of Progressive from a slot and table games provider to a pure technology company. Upon his exit, he was promptly replaced by longtime board member Terrance Oliver, the former chief operating officer of Fitzgeralds Gaming Corp.

Oliver, who is serving on an interim basis, announced that Progressive will look for ways to cut costs and improve its bottom line before the end of the third quarter.

Progressive has retained the services of investment bank Roth Capital Partners, LLC to examine alternative strategies for enhancing shareholder value.

By GGB Staff   Wed, Nov 05, 2008

Slot manufacturer Atronic International announced additions to its executive sales team in Europe. Matthew Collman will take over as head of sales for Eastern Europe. He will be headquartered in St Albans, U.K., and will be responsible for sales of Atronic slots and systems in Belgium, Belarus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland and Slovakia.

“We are all very pleased to introduce and welcome Matthew to the team,” said Stuart German, sales director for Atronic International. “With the upcoming G2E Las Vegas show it is a great opportunity for him to meet customers and key industry personalities. Matthew joins the sales team at an exciting time for Atronic with our new ‘Era in Gaming Solutions’ kicking off to a good start for the company.”

By GGB Staff   Wed, Nov 05, 2008

Slot manufacturer Aristocrat Technologies has underlined its intent to enter the Spanish low-stakes gaming market with the opening of a new subsidiary, Aristocrat Technologies Spain, S.L.

Based in Barcelona, the new entity is headed by two highly experienced aficionados of ‘Type B’ games, Jaime Riera Mendoza and Josep Carreras Pallares.

Mendoza served as general manager of one of Spain’s most successful amusement and gaming distributors from 1997 to 2007. He has played high-profile roles across a number of technological sectors, and holds several diplomas, degrees and higher degrees in mathematical, computing, business administration and management disciplines.

Pallares boasts an impressive academic record with both MBA and Ph.D qualifications as well as an ongoing professorial role. He has 28 years experience in the amusement and gaming industry, most recently serving alongside Mendoza as technical director.

“Aristocrat gaming products are successfully operating in over 200 jurisdictions, are respected by operators and are loved by players throughout the world,” said Nick Kihn, the new president of Aristocrat Technologies in Las Vegas who has for years served as executive general manager for the EMEA region. “In order to make a successful impression on what is for us a brand new market with fresh and exciting challenges, it was important to appoint two of the most renowned names in Spanish low-stake gaming. Jaime and Josep will be instrumental in introducing the Aristocrat brand to a vibrant, highly complex and competitive market.”

By GGB Staff   Wed, Nov 05, 2008

Station Casinos recently announced the selection of gaming industry veteran John Fort as director of gaming operations at its new California property, Aliante Station. Fort, who has worked in both Las Vegas and Atlantic City for almost 40 years, will supervise all casino operations when Aliante Station opens November 11. His responsibilities will include overseeing table games and the poker room, as well as the race and sports book.

Station Casinos plucked Fort from its in-house operations—the Aliante director of operations has worked for Station for four years in various capacities at Palace Station, Green Valley Ranch and Santa Fe Station. Before joining the team at Station Casinos, Fort worked at MGM Grand, Harrah’s and Flamingo in Las Vegas, as well as Caesars in Atlantic City.

By GGB Staff   Wed, Nov 05, 2008

American Casino & Entertainment Properties, the parent company of the Stratosphere Casino Hotel and Tower, Arizona Charlie’s Decatur and Arizona Charlie’s Boulder, all in Las Vegas, and the Aquarius Casino Resort in Laughlin, Nevada, last month added three executives to its management team.

Derek Spisak has been named vice president of revenue management and distribution.

Spisak has over 14 years experience in gaming, hospitality and marketing. He will oversee revenue management and distribution channels for all American Casino & Entertainment Properties.  

Prior to ACEP, Spisak served as senior market manager/New York City for Expedia.com., and also served as revenue manager and database manager for Resorts Casino Hotel Atlantic City.

Keith Pakish is now vice president of gaming operations, and oversees all facets of gaming operations for the company.  

Before joining ACEP, Pakish was vice president of gaming operations for the Viejas Casino & Outlet Center near San Diego. He also served as a casino manager at Harrah’s Las Vegas and Boulder Station in Las Vegas.

Finally, Kevin Ball is now vice president of strategic sourcing for ACEP, and will oversee and direct the development of the company’s procurement department’s strategies, practices and procedures.

Prior to ACEP, Ball was senior director/sourcing for the Wyndham Hotel Group. Ball led the sourcing department and leveraged category spending across the nine different Wyndham brands.

By GGB Staff   Wed, Nov 05, 2008

The Mashantucket Pequot Tribal Council voted last month to abolish the position of CEO—the job was the victim of hard times. That also puts Patricia Irvin, who has held the position overseeing business operations for a year, out of a job.

She has no criticism for the tribe. “I have the greatest respect and admiration for the tribe and its accomplishments and wish the tribe the very best in this difficult climate,” Irvin said.

A spokesman for the tribe said it was restructuring to meet current economic challenges. 

By GGB Staff   Wed, Nov 05, 2008

Aristocrat Technologies Europe has appointed Milana Baysangurova to the post of regional sales manager. She has six years experience in the gaming industry and will be responsible for jurisdictions that include the U.K., Germany, Italy, Monaco, Macedonia, Latvia, Lithuania, Estonia, Gibraltar and the Isle of Man.

Baysangurova, who is fluent in Russian, English, Italian and French, previously worked as sales executive for a gaming components developer with responsibility for Eastern Europe and Russia.

Daniel Lindsay, general manager sales and marketing for Aristocrat Technologies Europe, said, “We have made great advances in Europe through deploying a combination of great gaming solutions and committed, talented people. I am delighted to welcome Milana, the latest addition to our sales team.”

By GGB Staff   Wed, Nov 05, 2008

Red Hawk Casino in Placerville, California, announced last month that Heidi Hamers has been named vice president of marketing, and Joe Diver has been named vice president of food and beverage.

Hamers has more than 16 years of marketing experience in the gaming industry, and comes to Red Hawk Casino from Four Winds Casino Resort in New Buffalo, Michigan. As vice president of marketing, Hamers was instrumental in the development of the marketing campaign for the opening of the casino.

Diver arrives at Red Hawk from Red Rock Casino Resort and Spa in Las Vegas.  At Red Rock, Diver served as director of food and beverage and led a team of more than 900 people, serving the resort’s nine restaurants, two nightclubs, five bars and pool area. 

By GGB Staff   Wed, Nov 05, 2008

The Seminole Hard Rock Hotel & Casino in Hollywood, Florida, last month named two veteran gaming executives to fill executive positions.

Bill Mabrey has joined the casino as vice president of operations. He will oversee hotel operations through several departments including sales and catering, food and beverage, reservations, concierge, facilities and recreation services.

Mabrey has 25 years of senior management experience in the hospitality industry. He served most recently as vice president of hotel, entertainment and convention operations for Caesars Indiana.

Mark Ford has joined the Seminole Hard Rock as vice president of finance. In this capacity, he will oversee a team responsible for financial operations of the hotel and casino including accounting, budgeting, financial reporting, casino credit, casino cage, procurement and warehouse and receiving.

Prior to joining the Seminole Hard Rock, Ford worked for Foxwoods Resort Casino in Ledyard, Connecticut for 15 years with various responsibilities ranging from vice president of finance to executive director of finance and financial controller to director of operational accounting.  

By GGB Staff   Wed, Nov 05, 2008

In our review of IGT’s “Ultimate 4 of a Kind Bonus Poker” in the “New Game Review” section of our August issue, we incorrectly stated the process by which a bonus is added to four-of-a-kind hands as involving matching cards.

With a six-coin wager, Ultimate 4 of a Kind Bonus Poker awards bonuses to four-of-a-kind hands as follows:

When a player lands four of a kind, the screen displays a face-down, 52-card deck plus a Joker. The player gets one pick of a card with four 5s through Kings; two picks for four 2s, 3s or 4s; or three picks for four Aces. If the quad hand is dealt, the player gets a bonus pick. When picks are made, any card valued at 5 through King lands a $50 bonus; a 2, 3 or 4 pays a $75 bonus; an Ace pays a $100 bonus. If the Joker is picked in the bonus round, it pays $999. The bonus payments are accumulated and added to the normal jackpot for the four-of-a-kind hand.

In the September edition, an article entitled “The Radio Chip” reported that a vast majority of RFID inlays in chips manufactured by Gaming Partners International and sold to Wynn Las Vegas in 2005 were defective. Global Gaming Business has learned that no such issue ever existed with any of the RFID chips at Wynn Las Vegas. We could not independently verify the issue prior to publication, and should not have published an un-sourced report such as this. Global Gaming Business strives to provide the most accurate and up-to-date information for the gaming industry, and therefore apologizes for the error and regrets any harm the inaccuracy may have caused to Gaming Partners International.

By GGB Staff   Wed, Nov 05, 2008

Dozens of new table games crash and burn in Nevada casinos each year, but Las Vegas local Mark Brown has figured out how to market his company’s new versions of one of gaming’s top performers: poker.

Brown is CEO of Zen Gaming, a gaming company that has introduced No River Hold’em and Royal Hold’em, both based on the wildly successful Texas hold’em game. Zen Gaming’s poker games are now being played in poker rooms at Treasure Island and the Hard Rock Hotel.

Rather than slowly building name recognition and popularity in Native American casinos or properties in states with less restrictions than Nevada, Brown decided to take on the gaming mecca and first obtain approval in the Silver State. Zen Gaming’s strategy paid off; both No River Hold’em and Royal Hold’em were approved for play this year.

Last month, Zen Gaming took over free poker website NLOP.com, through which the company is offering its new poker games. Brown told the Las Vegas Business Press that the website promotes online play and encourages Las Vegas visitors to try the games in person.

“It’s all about awareness and education,” Brown told the newspaper. “Someone playing our games at the Treasure Island can continue to play them when they go home. Also, someone who has played the game on the site now knows where to find the games in Las Vegas.”

By GGB Staff   Wed, Nov 05, 2008

What is acknowledged as the best customer-loyalty program in the industry may be getting better as Harrah’s Entertainment announced a new method to rate non-gaming activity for its Total Rewards program. While it has long been recognized that visitors to casino resorts, especially in Las Vegas, do much more than just gamble, there has been no effective way to track their other activities beyond simply noting where they spend their time. But now, a new technology will allow Harrah’s Entertainment not only to track the activities its customers indulge in outside the casino, but actually reward them.

With 18 percent of company revenue coming from non-gaming sources, the new Total Rewards program will help more fully evaluate the customer, says David Norton, Harrah’s chief marketing officer.

“We will know the customer’s profitability to a much greater extent,” he says. “For example, you could have two $50 average-bet gamblers. One would spend $1,000 on the hotel, spa, shopping etc., while the other would spend $100. In the past, we would have treated them both the same. Inherently we will now know the true value of the customer and reward them appropriately. Exactly how we execute our marketing plans will be refined and evolve as we go along.”

Even non-gambling customers will be eligible to be rewarded for their activity, says Norton.

By GGB Staff   Wed, Nov 05, 2008

The basics of craps are pretty simple: roll a seven or 11 on the come out roll and you win; roll a two, three or 12 and you lose; and any other number becomes the point you must roll again before rolling another seven.

That second seven, or point-seven, is killer. And, because of the number of ways there are to make a seven (six out of 36 possibilities, more than any other number), it comes out far too often after a point is established.

To help take the sting out of that, Frank Mugnolo, CEO of Casino Gaming LLC, has added a new bet to the table. The bet is called 7 Point 7, and it offers players two ways to collect on a rolled seven.

The wager can only be played on a come out roll. If that roll is a seven, the player is paid 2-1. If a point is established and the subsequent roll is a seven, the player is paid 3-1. If the subsequent roll is not a seven, or if the come out roll is a two, three, 11 or 12, the player loses.

“This is the first bet that’s a new bet that is better than all the prop bets on the table,” Mugnolo said. “We don’t change the game; we just gave it a new option.”

The bet carries a 5.55 percent house edge, which is considerably smaller than the prop bets on the table. Additionally, some players have found that along with betting the top line, the 7 Point 7 bet is a good way to protect a pass line bet.

“People are smart,” Mugnolo said. “Once they realize it’s a good option, they will take it.”

The wager is currently on three tables at the Orleans, although Mugnolo is talking to other casino operators throughout the country.

By GGB Staff   Wed, Nov 05, 2008

Display solution provider Tatung Company of America announced that it has joined the “Enabl3D Partner Program” established by Magnetic Media Holdings, a supplier of 3D digital media products and services.

Under the partnership, Tatung will use Magnetic’s Enabl3D technology in production of 3D displays the company supplies to casino customers. Tatung will launch a line of products in the “Triview” series using the Magnetic 3D technology, which it will display at this month’s Global Gaming Expo.

The Enabl3D solution is a combination of technology that modifies a standard LCD monitor’s displays enabling viewers to experience 3D video content without the aid of any special eyewear.

“Magnetic’s Enabl3D technology is truly the next-generation digital signage solution, and it seems the casino industry has really hit the jackpot this time with a solution that promises to be a double threat by both enhancing the customer experience and raising awareness of featured promotions,” said John Sherry, national accounts and marketing manager for Tatung in the U.S. and Canada.

“We are thrilled that Tatung has joined the Enabl3D Partner Program and will be integrating our technology into their display products,” said Magnetic Chief Technology Officer Brad Bent. “Working with a strategic partner such as Tatung offers Magnetic tremendous opportunity in the casino and digital signage marketplace. Following the excitement this summer of our Enabl3D installation at the Borgata Hotel Casino & Spa in Atlantic City, we anticipate even greater success through our partnership with Tatung.”

By GGB Staff   Wed, Nov 05, 2008

International Game Technology and Las Vegas Gaming, Inc. have decided to settle their legal disputes and team up to develop software applications for IGT’s server-based casino systems.

IGT produces slot machines and delivers server-based software through systems like sb NexGen and sb Service Window. LVGI develops gaming software applications that will now be delivered from IGT’s systems in conjunction with their own software delivery system, PlayerVision. Through this partnership, LVGI has the opportunity to become a certified sb software developer.

In return for LVGI’s gaming software applications, IGT will invest $11.5 million in the company. Both partners agree that pairing up will be an asset for the ultimate beneficiary, the casino patron. LVGI President and CEO Jon Berkley said that the new applications will “dramatically enhance the player experience.”

“Combined, we will offer the gaming operator a path to move forward with software applications that can either be delivered with the robustness of the IGT sb network or by retrofitting existing machines through PlayerVision,” Berkley said. “This combination will drive more rapid adoption of these groundbreaking technologies.”

Rich Schneider, IGT’s senior vice president of network systems, agreed with Berkley and said the alliance will further the evolution of server-based gaming, thereby giving the casino patron a better gaming experience.

By GGB Staff   Wed, Nov 05, 2008

Technology firm PokerTek, Inc. has teamed up with Las Vegas-based gaming company Ameristar Casinos, Inc. to exclusively provide Ameristar’s properties with automated poker tables. The first Iowa installation of PokerPro automated poker tables occurred last month at Ameristar Casino Council Bluffs.

The two companies released a joint press release about the partnership’s benefits.

“Signing a corporate agreement with Ameristar is a significant event for PokerTek,” PokerTek CEO Chris Halligan said in the statement. “We value their industry leadership, and look forward to introducing our technology to their players. Council Bluffs is an ideal property for PokerPro, and we’re happy to be their poker solution of choice.”

Jerry Colgrove, table games operations manager for Ameristar Casinos, Inc., said the use of PokerTek’s technology will benefit Ameristar’s properties.

“We are pleased to partner with PokerTek for our automated poker needs,” Colgrove said. “PokerPro is a revolutionary technology, and we are excited to bring this innovative offering into our properties.”

By GGB Staff   Wed, Nov 05, 2008

The Securities and Exchange Commission recently agreed to a settlement that will resolve a three-year fraud investigation into past revenue reporting inaccuracies by Bally Technologies.

In the settlement, Bally agreed to a cease-and-desist order requiring the company to comply with federal regulations regarding internal controls and revenue reporting. Bally did not admit or deny any past wrongdoing in the settlement.

Richard Haddrill, Bally CEO, told the Las Vegas Sun the company is “pleased with this resolution of the SEC investigation, which allows us to put these matters behind us as we continue to execute our strategies for the long-term success of our business.”

On the same day the company’s settlement was approved, the SEC filed complaints against former Bally executives Steven M. Des Champs, former chief accounting officer; and Martha W. Vlcek, former vice president of finance.

The SEC filings accused Des Champs and Vlcek of making “misleading disclosures and omissions regarding revenue recognition” and making “materially false statements to the company’s outside auditors when they represented the transactions were proper.”

The company’s revenue reports were inflated from 2003 to 2004 as a result of the reporting inaccuracies. Des Champs and Vlcek face actions in U.S. District Court. Bally Technologies has not been charged with fraud or penalized for the reporting inaccuracies.

By GGB Staff   Wed, Nov 05, 2008

Bally Technologies Inc. and Mexican gaming operator Pringsa Corp. have inked a deal that will make Bally the exclusive provider of Pringsa’s casino management systems. Pringsa’s properties will also install many of Bally’s gaming machines on the casino floor.

Bally’s management system includes player tracking, cage accounting, promotions, bonusing and the iVIEW network. Bally’s iVIEW network offers downloadable content to players via built-in screens in gaming machines. The casino management system will be implemented throughout Pringsa’s 36 properties.

Bally also has the option to install up to 2,000 of its Alpha Elite video and mechanical-reel gaming machines within the next two years.

Bally CEO Richard Haddrill released a statement to the Associated Press that detailed Bally Technologies’ excitement about the new partnership with Pringsa.

“This agreement paves the way for Bally to further expand its games and systems presence in one of the industry’s leading growth markets,” Haddrill said.

In its commitment to bringing new systems and technology to Mexico, Bally will provide all materials in Spanish, including reports, training guides and screens.

“We are eagerly anticipating upgrading our technology with Bally’s advanced system features and Networked Floor of the Future tools, which will help us meet our goal to provide players with more advanced promotions, incentives and rewards for their loyalty,” said Pringsa CEO Jose Angel Lopez.

By GGB Staff   Wed, Nov 05, 2008

Gaming printer supplier FutureLogic, Inc. recently announced the shipment of its 1 millionth printer.

FutureLogic’s printers burst on the scene in 1999 with the PSA-66-ST, the first ticket-in/ticket-out printer for slot machines. The company’s products have grown more sophisticated in the years since the PSA-66-ST, and there are now 1 million FutureLogic gaming printers installed in more than 40 countries across six continents.

The company’s latest TITO innovation, the GEN2 Universal printer, is on the forefront of new gaming technology. The GEN2 Universal printer is compliant with both IGT and GSA standards, as well as current and future downloadable games.

The printer also supports FutureLogic’s own PromoNet couponing innovation, which enables casino operators to market more effectively to their customers via reward programs and targeted campaigns.

By GGB Staff   Wed, Nov 05, 2008

WMS Gaming Inc. has released a new “for sale” gaming machine that utilizes its proprietary Transmissive Reels gaming platform. It is the first mechanical reel machine to offer multi-game features, and will also allow operators to utilize networked, served-based gaming on mechanical reel machines.

Players will be able to choose from four unique games, each with its own unique pay table and bonusing.

Orrin J. Edidin, president of WMS, commented, “With the launch of this new product we are expanding our for-sale product offerings while continuing to demonstrate execution against our multi-year product plan whereby we use our foundational technologies for server-enabled gaming in advance of the launch of networked systems.”

The Transmissive Reels gaming platform combines the traditional mechanical reel slot machine with video capabilities, utilizing the WMS’ CPU-NXT2 operating system.

By GGB Staff   Wed, Nov 05, 2008

Slot technology provider Heber will preview its newest gaming controller at this month’s Global Gaming Expo, the company announced. Although details are being kept secret until the show, the new controller is said to contain groundbreaking features.

“Our expert engineers have designed what we believe to be the best product using the most incredible new emerging technology,” said a statement from the company. “Extremely easy to use, it’s an all-in-one gaming solution that offers unparalleled power and unequaled performance at an unbelievable price.”

By GGB Staff   Wed, Nov 05, 2008

A U.S. District Court judge in Nevada last month declared slot manufacturer International Game Technology’s patents covering the wheel-based bonus in Wheel of Fortune and other games invalid.

The presiding U.S. District Court judge in the patent infringement lawsuit between International Game Technology and Bally Technologies over Bally’s use of wheel-based bonus events stated in open court last month he intends to issue a written order declaring that the asserted wheel patents held by IGT are invalid. The order rejects IGT’s claims that Bally’s wheel-based games infringe on patents held by IGT.

The court also issued a written order invalidating certain claims of IGT’s player-tracking patents at issue in the case, and stating that Bally’s iVIEW display does not infringe certain claims. Other player-tracking claims may remain at issue, depending on the exact language of the written order.

The court reiterated that Bally’s antitrust claim against IGT could proceed to trial, and scheduled a hearing for October 22 to address the parties’ intentions regarding the remaining claims.

By David Ross   Wed, Nov 05, 2008

If you are in a casino, sooner or later you are going to leave the gaming floor, whether it’s to have a meal, sit by the pool, or watch a sporting event. Cantor Gaming’s new eDeck portable gaming devices allow players to take games anywhere on the property. Cantor refers to this as playing in “the e-Lounge,” sort of a virtual gaming environment.

The device was given its first public testing this summer in the Venetian’s high-limit salon. Wifi-enabled, the eDeck allows players to play what they want, when they want and where they want, even in the casino hotel room (where legal).

Cantor provides one-stop shopping for the casino, allowing properties to turn under-used casino space into a more productive, revenue-generating space. Players can access many kinds of games at one location.

“Backbetting” lets patrons bet on live games going on in other areas of the casino, and Cantor Financial Odds lets players wager on financial markets around the world. Cantor Financial Odds allows patrons to be on any financial market fluctuation from five-minute intervals to days and weeks. They can play the market without buying stocks or bonds.

The hand-held device connects patrons to any sporting event. With real-time wagering throughout the game, patrons can immediately bet a hunch. And, probably the most attractive option for players—they won’t need to wait in line to place their bets. This is also good for the casino because it means that no one will be left out because they didn’t get in line fast enough to place their bet.

The eDeck devices are customer-branded for individual properties, becoming, in a sense, a “traveling mobile billboard.” The property’s branding remains prominently displayed.

The eDeck offers traditional games such as slots, blackjack, baccarat, video poker, and either European or American roulette, but also unique games that can only be played on the mobile device, such as StatJack (i.e. “Statistical Blackjack,” a game that actually encourages card counting), Bonus Roulette and ExtraOdds Baccarat as well as slots.

For more information, call Cantor at 702-677-3800, or visit the company’s website at www.cantorgaming.com.

By David Ross   Wed, Nov 05, 2008

Cole Industries has introduced a “green” line of casino cabinets. The Evolver line of cabinets provides the maximum life cycle while still retaining the flexibility to be easily refreshed to support changes in the market.

The Evolver design allows slot technicians to do printer ticket loads and clear jams without opening the cabinet. This reduces downtime, increases security and extends internal components’ shelf life by limiting components that have to shut down and reboot when the door is opened. Cabinet ventilation keeps the inner cabinet cool enough to extend the operating life of key components.

External appearances can be dramatically changed in less than 30 minutes using the cabinet’s unique modular construction. External features are secured to the frame, but can easily be removed and exchanged on the casino floor. This design also allows field conversion kits to be designed when changes in the LCD market require cabinets to be upgraded to larger displays.

Using Cole’s Fast Track concept, games can be converted to support a variety of industry-standard gaming platforms.

The Evolver is “green” because the materials used in the manufacturing process are RoHS-compliant. If a cabinet is refurbished, the plastics and metal used in construction meet most jurisdictions’ requirements for recyclable materials. Game illumination is by LEDs, which produce little heat and require 80-90 percent less operating power than incandescent lamps. Cabinet ventilation is designed to use minimal power. Most of the line’s LCDs support a “power save” mode.

The Evolver line allows each customer to have a unique look. The customer participates in the cosmetic design of the exterior with a long list of materials to choose from. The customer can choose as many unique cabinet looks as desired. There is one cabinet style for each library of games or each distributor. Broad color schemes are available and may be interchanged with each order, giving the customer the flexibility to target specific markets and or casino themes.

For more information, call Cole Industries at 702-633-4270 or visit the company’s website at www.coleindustries.net.

By Frank Legato   Wed, Nov 05, 2008

Slovenia’s Elektroncek has released a groundbreaking multi-player automated blackjack game that has one thing no other multi-players on the market have: real cards.

The Interblock G4 Organic Card Blackjack game is a modular unit that places seven individual player terminals around an electro-mechanical device under a bubble that deals real cards. The game is live blackjack, in a secure environment with an automated deal and all hands recorded through linkage to online player tracking and accounting systems.

The G4 machine automatically shuffles and deals all cards, ensuring a totally random distribution of up to eight decks, arranging the cards and dealing them a the same time—the machine constantly shuffles. The casino can configure the number of decks, minimum and maximum wagering limits and all variable blackjack rules.

Each card is bar-coded for face value, for the serial number exclusive to each deck, and with a control number so no outside cards can be inserted into the game.

Each card dealt is read using optical sensors. Each hand includes an initial reading, when cards are inserted into the shuffler/dealer. A second reading occurs when the cards are dealt. The results of each deal and every hand are displayed on the video screen of each terminal, and on an overhead display visible to all players.

G4 Organic Blackjack can deliver up to 30 percent more hands per hour than live blackjack. “Based on our calculations, our machine will be at least as quick as a live dealer, but the factual number of hands depends on how long the player needs to decide,” explains Thomas Zvipelj, CEO of Elektroncek.

Manufacturer: Elektroncek d.o.o.

Platform: Interblock G4

Format: Seven-player automated blackjack

Denomination, Minimum/Maximum Bets: Operator-configurable

Top Award: Various

Theoretical Hold: 1%—4% average (based on number of decks and strategy)

By Frank Legato   Wed, Nov 05, 2008

Slovenia’s Gold Club, a leading supplier of automated roulette and other multi-player and single-player gaming machines for Europe and other worldwide markets, is launching a multi-player blackjack game.

The five-player unit provides a game of blackjack identical to the live version. Each player has a touch-screen monitor for wagering and for making decisions on each hand. The five player stations are embedded in a standard blackjack table in front of a video dealer, depicted on a 42-inch plasma screen.

The electronic blackjack game employs all the same game rules as the live game, but has the advantages of electronic dealing and shuffling—there are no dealer errors, there are no disputed hands, and all hands are recorded.  

The system also can be linked to online player tracking and accounting systems for accurate recording of wagering levels for the purpose of rewarding loyal players.

The blackjack game can be customized with whatever configuration the casino wishes to employ with respect to number of decks and variable blackjack rules with regard to splitting and other factors.

Gold Club’s blackjack game employs a sleek design and colors designed to attract attention on the casino floor.

Manufacturer: Gold Club d.o.o.

Platform:  PC/Windows

Format: Five-player electronic blackjack

Denomination, Minimum/Maximum Bets: Operator-configurable

Top Award: Various

Theoretical Hold: 1%—4% average (based on number of decks and strategy)

By Frank Legato   Wed, Nov 05, 2008

Slovenia’s Alfastreet, which is one of the leading manufacturers of automated, multi-player roulette games for the European market, is using the G2E show to launch Multi-Player Poker, a new 10-player electronic version of Texas hold’em poker.

Individual player terminals surround a video table-top that displays the common cards for the deal and the flop, and each player has a private video interface for wagering and making decisions on each hand.

The large central video display and high-end craftsmanship used to create the multi-player unit present a quite different appearance than automated poker games currently on the market.

“We have built our poker machine with a different approach from the competition, and I can say it is a pretty unique machine,” says Matjaz Petek, marketing and sales manager for Alfastreet. “We have a lot of experience in multi-player games, and we have used all our knowledge in the field to create our new poker machine. We see a lot of potential of this new machine on the market even if we are not among the first to offer a poker machine. We already have a lot of demand, especially from our key markets.”

Alfastreet multi-player products are designed with both players and operators in mind; they are known for their player-friendly interfaces. All terminals can be equipped with bill acceptors, coin acceptors, ticket printers, player tracking and cashless systems, and support SAS protocol. All Alfastreet equipment is GLI-certified.

Alfastreet has an alliance with Atronic Americas, under which Atronic assembles Alfastreet multi-player products for sale in North American markets.

Manufacturer: Alfastreet Gaming Instruments

Platform: Alfastreet Poker

Format: Ten-player automated Texas hold’em poker

Denomination, Max Bet: Operator-configurable

Top Award: Various

Theoretical Hold: Operator-configurable rake

By Frank Legato   Wed, Nov 05, 2008

I just read something that makes me want to go ahead and reveal my true heritage as a member of the Seminole Tribe.

It’s all because of something I just read in the South Florida Sun-Sentinel, which, of course, lands on my doorstep every morning along with major daily newspapers from every other part of the country.

(Really. I flip through dozens of newspapers every day, searching for pertinent gaming industry news. Some people just enter the word “casino” in an internet search engine. Imagine that. Lazy deadbeats!)

The item in the Sun-Sentinel was about how the huge casino the Seminoles want to build in Coconut Creek, Florida, is unlikely to have to pay any property, payroll and hotel taxes to the county, since it will be considered sovereign tribal land. However, what really got my attention was this line:

“Every man, woman and child in the 3,700-member tribe receives $126,000 in annual dividends from gambling profits, according to uncontested filings this year by tribe members in a child support lawsuit.”

Is this true? I’ve got a wife and three kids. Does that mean if I were a member of the Seminole Tribe of Florida, my family would receive $630,000 a year in casino income? Without even having to do anything, other than being a member of the Seminole Tribe?

That’s it. I’m a Seminole. Where do I sign up?

Oh, come on! Really, I just looked it up. There were ancient Seminoles in Calabria, Italy, where my family is from. What, you never heard of the Calabria Seminoles? That’s right, the Calabria Seminoles. Now give me my $126,000, and $126,000 for each of my family members.

OK, I guess I’m losing that argument, so let’s move on to other frivolity. This is our big annual G2E issue, which means I just finished writing my annual 20,000-word tome on the new slot machines being introduced at the trade show. (I was going to write an opus, but this year I decided to go with a tome.)

I wrote this after I got back from a trip to Europe, where I spent a week in Sofia, Bulgaria.

I was in Bulgaria to speak at a conference, and while I was there, I saw great games from local slot-makers Casino Technology and Euro Games Technology, and I ate something called “Mish Mash,” which was friggin’ great, and a couple of not-so-great dishes, like something called “Chicken On A Slab.” (I remember asking the server if there had been an autopsy performed on the chicken. She didn’t get it.)

I also found out that in Bulgaria, nodding your head means “no,” and shaking your head means “yes.” It’s true. I lost a couple of taxis because of it.

Anyway, back to our slot issue: The creativity of the slot-makers never ceases to amaze me. And, remarkably, as they tell me every year, each of them makes the best games in the industry. Yes, I know, it may not seem possible to the casual observer, but the gaming industry is the only place on earth where everyone is the best. People ask me who the best slot-maker is, and I tell them, “There is no best slot maker. They are all equally great. So long as they advertise in Global Gaming Business, they’re all winners.”

Yes, in the happy world of our annual “Global Games” feature, everyone is the best. It’s like in T-ball, where none of the parents keep score, or the Special Olympics, where everyone gets a medal.

I am, of course, being a wise-guy here (imagine that), but it is true that there is great stuff from all of the slot-makers. If you pressed me for my favorite games of the year, there are a few I’d have to mention. “Dirty Harry: Make My Day” by WMS would have to be at or near the top. Here’s a game that puts you in a bonus where you feel like you’re in Clint Eastwood’s unmarked squad car, chasing bad guys through the streets of San Francisco, shooting that big .44 Magnum out the window at the criminal’s car.

How cool is that?

I’d also have to put IGT’s new “MultiPlay” series, where you play four video reel slots at once and share the bonuses, near the top. And Konami’s “Secrets of Egypt,” and Bally’s “Two for the Money,” and Atronic’s new “Deal Or No Deal” game.

I could go on and on, but then you wouldn’t have any surprises when you turn to my tome. (Or is it an opus?)

Besides, I have to end this little ditty (that’s right; I do ditties as well as tomes and opuses) because I have an important date with the federal Bureau of Indian Affairs.

I have to convince them I’m a member of the Calabria Seminoles.

By Randy Fine   Tue, Jan 05, 2010

As I write this article, the stock market is in the midst of its eighth straight day of decline—and trillions of dollars of our wealth continue to be whittled away. It certainly is a frightening prospect. Who would have ever thought we would be making comparisons to the Great Depression?

There is no question that the bear market has impacted our industry, and in a meaningful way. Gaming stocks that were market leaders just a year ago have fallen 70 percent and more. Private equity deals that looked like no-brainers in February look like disasters today. Bankruptcies are starting. New properties are being stopped midstream. And expansions are being canceled.

So what happened? How did an industry that so many said was “recession-proof” end up in its biggest recession ever?

I think we can explain this predicament—and what to do about it—by viewing the development of gaming as a sequence of eras, each of which has been defined by certain views of capital deployment, bricks and mortar, and marketing. I would note that different markets are in different places along this continuum, so as you read, consider which might apply to you.

As gaming is legalized in a particular jurisdiction, it enters the first era, that of “constrained supply.” During this period, the race is on just to get a property open. It doesn’t much matter the quality of the bricks and mortar, the location or even the marketing. The simple product of a casino—slots and table games—is so compelling that customers will go through severe inconveniences, wait in lines, and sometimes even pay entry fees just to gain access to the product.

Twenty years ago, when gaming was legal only in Las Vegas and Atlantic City, properties were far less luxurious. They were gambling factories, grind joints that operated on a “key” marketing strategy: they unlocked the doors and made money. Since folks in Los Angeles or New York only had these options to legally gamble, they would drive hours, and stay in dark and musty rooms in order to gain access to the product.

Think to the opening of the riverboat markets in the 1990s. Initial riverboats were just that: refurbished, multi-level, former passenger and transportation vehicles that were redone for casino gaming. And at first, they did just fine. Customers in Midwestern cities were so happy to have the product available, they flocked to these facilities.

The second era, that of the “bricks-and-mortar arms race,” starts when operators realize that they have a substantial amount of competition in a market, and that the better facility can stand out in the marketplace. Often, these are not first-movers, but second- or later-movers who come to dominate the marketplace. The Mirage’s 1989 launch or the Borgata five years ago are great examples of this. Ameristar’s Midwestern properties raised the bar in Missouri and Iowa, blowing away the first-era properties that had inhabited the market.

And it is with our examination of this era that we can begin to tie things back to our current economic morass. These new properties were almost always financed by low-interest, easy credit from Wall Street. Moreover, operator performance tends to be evaluated by EBITDA, which is a measurement of current operating income but does not incorporate the amount spent on capital improvements. Many companies fell into a trap of using easy credit to build lavish properties to marginally improve EBITDA.

And so we entered an arms race, where new restaurant after new hotel tower after new convention center blossomed. So long as the economy was artificially performing—based on unsustainable increases in housing prices and more of that easy credit—the hotel rooms filled, the restaurants were packed and all looked right in the world.

But eventually these markets become oversaturated—too many properties, and too many nice properties at that. Results stagnate, capital dries up, projects get canceled. Sound familiar?

Thus begins the third era in gaming development: the “era of optimization.” In this period, we have what we have, and performance improvements are no longer capital-based, but built on fundamental efficiency improvements.

In this era, we improve performance in one of two ways: either we cut costs, or we increase revenue. But based on what I have seen over the past six years in this industry, most operators are very good at operating cost-efficiently. In good times and bad, GMs have been trained well to keep staff low and watch operating performance. So, for better or worse, at most properties, cost-cutting isn’t much of an option.

This means the era of optimization really ends up being an era of marketing, where the smart operator looks for the right combination of relationship marketing strategies to maximize the value of its database. In this world, operators compete with each other for market share, and at the end of the day, all too often, one operator’s success is another’s loss.

But the good news is that not all operators are going to effectively learn to market their properties, and so those that do will have substantial upside to claim.

The only meaningful strategy to win in this current environment is marketing. How we do that—the strategies and tactics that will work in this ever-changing world—will be the subject of my next column.

Randy Fine is managing director of the Fine Point Group and one of the world’s foremost experts in customer relationship marketing and gaming strategy and execution. Prior to founding Fine Point, he served as both vice president of Total Rewards and product marketing and vice president of slots and Total Rewards operations at Harrah’s Entertainment.

By Sudhir Kale   Tue, Nov 04, 2008

Have you noticed over the past five years or so that it has become increasingly fashionable among casino executives to talk about the “customer experience?” Several gaming companies have included the term in their mission statements. Yet, when you probe most executives on what they specifically mean by “experience,” chances are, you will get a vacuous response.

If gaming companies are serious about providing the customer with the right “experience,” they’d better be sure of what they are talking about.

All this talk about customer experience was triggered by the influential book The Experience Economy: Work is Theatre and Every Business a Stage, published in 1999, and co-authored by Joseph Pine and Jim Gilmore. The authors engaged in very savvy marketing of their book and are now regarded as among the premier thought leaders in business.

With the kind of hype this book has generated, one would expect these experience gurus to shed light on the phenomenon that they discuss. The most they do, however, is to differentiate experiences from commodities, goods and services: While commodities are fungible, goods tangible, and services intangible, experiences are memorable.

Well, I had my wallet stolen at a casino in Macau, and it certainly made for a memorable experience, but I don’t think the casino would pride itself in providing its patrons with this kind of memorable experience.

Lack of definition notwithstanding, marketers of every conceivable ilk have jumped on to the experience bandwagon. From the Forum Shops at Caesars Palace in Las Vegas to Weljekset Keskinen (the Village Shops) in the 500-inhabitant town of Tuuri in Finland, stores are now routinely practicing one-upmanship in inducing more store visits by making shopping fun and entertaining.

Mark Rivers of the Mills Corporation, a company known for designing shopping malls embedded with all kinds of experiences, attests, “The buzzword is experience. People don’t just want to be entertained. They want to participate. Creating experiences is a good way to connect with consumers.”

So what exactly is an experience, and how does it play out in the context of gaming? Answering this question requires delimiting of the term “experience.” We will need to separate commercial experiences from most other kinds of experiences (such as the experience of love, of abandonment, of self-realization, and the like). Next, we need a precise definition of what constitutes a commercial experience.

While examples in this category readily come to mind (a trip to Disneyland, a Broadway show, a helicopter ride over the Grand Canyon, and yes, a flutter at the casino), defining the commercial experience is a bit of a challenge. In 2004, my colleague Susanne Poulsson and I offered this definition: “an engaging act of co-creation between a provider and a consumer wherein the consumer perceives value in the encounter and in the subsequent memory of that encounter.”

Having teased out the concept, we next began to uncover the ingredients of a desired commercial experience. Our research suggests that for an experience to be positively memorable from a customer’s point of view, it needs to offer one or more of the following—personal relevance, novelty, surprise, learning and engagement. With this list in hand, casino management comes a step closer to conceptualizing the ideal gaming experience. But this is just the beginning.

It is the customer who will have the experience, and if the experience is judged as thrilling or engaging, he or she will experience delight, not just satisfaction with the visit. Also recall that when it comes to commercial experiences, the customer is not a passive bystander but a co-creator of experiences. Obviously, it makes little sense to decide on the experience the casino operator wishes to provide without carefully considering consumers of the experience.

Young, hip visitors may consider a visit to the Hard Rock Hotel and Casino in Las Vegas to be an engaging experience, whereas middle-aged patrons serious about gaming may consider many of the experiential attributes as distracting, if not forbidding.

You simply cannot talk about the customer experience unless you pointedly define the customer you want to target. Station Casinos and Harrah’s have followed this edict for quite some time and have experienced significant bottom-line success as a result.

Having identified the prime consumer of the gaming experience, ongoing research is required to monitor what precisely this consumer is seeking from the experience. The wants of the target segment need to be uncovered and categorized, and this information should be used as the starting point for designing compelling experiences.

Experiences need to be constantly tweaked because people’s wants evolve and change over time; competitive offerings can and do change rapidly as well. It is therefore vital that captains of the entertainment industry (gambling included) continue to monitor the pulse of their target market and alter their offerings accordingly.

And remember, every experience you offer your guests is a performance. Your employees are the actors and stars in this performance. You want to make sure that the actors understand and buy into the script. They are the ones who breathe life into the experience, and transform the consumer into becoming a co-creator. Their engagement is pivotal to delivering a memorable experience.

Sudhir H. Kale, Ph.D., is the founder and CEO of GamePlan Consultants, a full-service marketing consultancy that offers high-value training and consulting on the marketing and customer service aspects of casinos. He is also professor of marketing at Bond University in Australia. For more information, visit his website, www.gameplanconsultants.com, or e-mail him at skale@gameplanconsultants.com.

By Mark Balestra   Tue, Nov 04, 2008

Amid the U.S.-driven economic gloom and doom that seems to have a stranglehold on much of the global business community, I was pleasantly surprised with the enthusiasm and all-around positive vibe at the seventh annual European iGaming Congress & Expo.

For those not familiar with the event, EiG is the largest conference and trade show geared toward the interactive gambling industries, and the most recent EiG, held in September in Barcelona, re-emphasized that Europe is the center of the i-gaming universe.

Following are some observations taken from conference sessions as well as private discussions throughout the week.

Always on My Mind

Considering that operators in the i-gaming space have done a terrific job investing their resources in non-U.S. markets in the prohibition era, I’m amazed at the undying European interest in what’s transpiring in the States.

The Unlawful Internet Gambling Enforcement Act crept into discussion throughout the week—in conference sessions, on the expo floor and during networking events. Most of the curiosity revolved around the upcoming election and its implications on the industry; the topic first surfaced during the suppliers’ CEO panel, during which CryptoLogic CEO Brian Hadfield explained that for the United States to become a viable market, much more needs to happen than a change in leadership.

And of course, a longstanding EiG tradition is that something major happens in the United States prior to or during the conference. This year it was the seizure of 141 i-gaming domain names in Kentucky the night before the event was to commence—a development that diverted much attention away from European matters.

Consolidation Is Here… Again

Talk of consolidation dominated the financial discussions throughout the event. Analysts have been saying for the past five years that consolidation is finally upon the industry; they are right, but I’d add the word “again” to that notion, as it comes in phases.

Companies were buying up one another during the growth spurt prior to the bursting of the internet bubble in the early part of the decade. Then there was the gobbling up of fading companies post-burst. And now we’re seeing a post-UIGEA adjustment period that’s full of M&A activity.

Moderator Sue Schneider, consultant to Clarion Gaming and former CEO of River City Group, asked panelists during the operators debate whether they expected a wave of privatization, and the overall sentiment was that valuation issues and large companies’ limited ability to fund privatization make this unlikely. Malcolm Graham of PKR reminded the audience, however, that this could still be an option for small to medium companies.

One of the most interesting debates stemming from the operators session was whether the right model at this point is to focus on market share or profitability. The consensus among the panelists was that profitability is now the way to go. Market share, they agreed, was important for a young industry, but the shift to profitability has been made. They also agreed that bwin—the privately held Austrian bookmaker—has nailed the shift brilliantly, and panelist Mark Blandford of Valhalla Investments pointed out that bwin was afforded the luxury of taking this route by avoiding the short-term profitability demands experienced by public companies.

PartyGaming CEO Jim Ryan suggested that a balance between market share and profitability was essential, at least in the poker space, where liquidity is so important. “I think if you choose one versus the other,” he said, “it’s going to be a painful year.”

Diversification Wins

Diversification vs. specialization is apparently no longer a debate in the i-gaming space, as an overriding theme of the entire conference was that the more you diversify the better off you are. Martin Lerby, head of games B2B for Ongame Network, stressed during the suppliers debate that “the survivors are the full-service agencies.”

It is evident that the supply side has become crowded in this industry and as a consequence the lines between operator and supplier are blurring more by the day—a trend the industry moved away from early in the decade, when suppliers got out of operations to eliminate competition between provider and licensee and operators got out of supply to maximize liquidity. 888 CEO Gigi Levy suggested during the operators debate that there may be no pure suppliers with no links to operations, and he and Jim Ryan called for more transparency so that all suppliers can be upfront with licensees.

And finally, an interesting byproduct of the diversification trend is a heavy thirst for new products and services, which oddly enough translates to a favorable climate for startups during a period of consolidation. Blandford and his fellow panelists during and after the Launchpad session—in which representatives from five startups had 10 minutes each to pitch their concepts—confirmed that new and fresh products are indeed in high demand right now, as did members of the operators panel.

Web 2.0 a Focal Point

Content is still king, and “Web 2.0” was a common buzzword at EiG 2008.

While the emergence of gambling within the Web 2.0 environment is an exciting concept, the real emphasis has been put on Web 2.0 marketing initiatives, and this was touched upon throughout the conference.

Wired magazine’s David Kushner added an exclamation point on Web 2.0 during his day-three presentation, which focused on the convergence of gaming and gambling and the massive population of gamers ready to be “entertained” by gambling providers.

“It’s not enough to just play a game anymore,” Kushner told the audience. “There has to be sharing.”

Mark Balestra is the director of publishing for Clarion Gaming. A veteran of 11 years in the online gambling business, Balestra is the editor and co-creator of Interactive Gaming News (www.iGamingNews.com) as well as the editor and co-author of Internet Gambling Report, a legal guide to interactive gambling.

By GGB Staff   Tue, Nov 04, 2008

Several years ago, game developers at WMS Gaming began to get ready for the brave, new world of server-based gaming.

The approach to this mission was a bit different than that found at other slot manufacturers. Instead of concentrating on creating network infrastructure or download configuration systems, design engineers at WMS focused on one thing: What would networked gaming bring to the player?

WMS products released in the past two years have provided a preview of some of the game features that will be possible with server-based gaming. WMS engineers set up miniature server-based systems, each running a bank of slots in a casino, and created entertaining play experiences like “Monopoly Big Event,” in which all players go into a common linked bonus at the same time.

More recently, “Star Trek” provided an example of what can be done when a server-based network goes wide-area—players can pick up a game they stopped playing in Atlantic City when they’re in Las Vegas the following week, and not miss a beat.

In between, WMS has focused on using its unique and powerful technology to create play experiences that are like nothing seen on a slot floor in the past—from “Top Gun” to “The Wizard of Oz” and “Dirty Harry” in the virtual-reality-style “Sensory Immersion Gaming” series to “Cascading “Reels” and “Money Burst” in the “Innovation Series.”

Players have responded, making WMS arguably the hottest slot-maker of the day. Where other companies are laying employees off, WMS is adding employees. Where others are lamenting flat revenues, WMS is celebrating record sales.

“Doom and gloom in the industry? We don’t see it,” says Rob Bone, the company’s vice president of marketing. “We continue to have the highest multiple in our history. We’re starting to get recognized outside the gaming industry—we’re on Fortune magazine’s list of 100 Fastest-Growing Companies. We’re on Standard & Poors’ list of 300 companies with the potential to become blue-chip.”

WMS arrives at this year’s Global Gaming Expo on a bona fide hot streak. Its latest releases tell a story that belies the recessionary times in which the industry finds itself. For instance, Harrah’s Entertainment, which famously began removing participation games from some of its casinos recently, signed a multi-property deal with WMS to install Star Trek games. According to Bone, the operator plans to tie in its Total Rewards network with the wide-area network on which Star Trek operates.

There is no shortage of casinos installing the latest game in the Sensory Immersion series, either. “Dirty Harry: Make My Day” uses the Sensory Immersion system—vibrating chair, BOSE speakers in surround-sound setup—to the hilt in its bonus round. In case you don’t know, it’s a simulation of a police car chase through the streets of San Francisco. The player chooses his target as “Harry’s” car chases the criminal’s vehicle, and yes, you get to be behind the famous .44 Magnum as it causes the crook’s car to careen into “1,000 Credits” road signs.

At G2E, WMS will show up with new offerings in each of its successful current game groups, as well as some in completely new game styles. Many of the newest WMS games will be housed in a format that is the renewal of the cabinet-and-operating-system package that got WMS started on its path toward networked gaming—the “Bluebird” ergonomically designed cabinet and the “CPU-NXT” video platform, the setup that spread the WMS name into new markets around the world.

This year, WMS launches new versions of both the cabinet and the platform. According to Bone, Bluebird 2/CPU-NXT2 creates an operating system for slot games that is 10,000 times more powerful than a desktop personal computer.

Bluebird 2 provides what Bone calls the “digital cabinet of the future.” “It is the future of gaming today,” he says, noting that the dual-screen setup will allow customers to apply the technology of the networked floor in a seamless manner. The cabinet also features a wide-screen format with larger monitors.

CPU-NXT2, Bone says, was developed to give WMS game designers “a piece of white paper.” “It lets these guys innovate,” he says.

New Classics

One of those designers is Ben Gomez, a legend in slot development circles who is credited with creating “Reel ‘Em In,” “Jackpot Party” and any number of other famous WMS games. One of the new game series on which Gomez has worked applies the Bluebird 2/CPU-NXT2 technology to the classic style of video slot that first brought massive success to WMS a decade ago.

“We’re trying to get back to where we started, with interactive, fun bonus events,” Gomez says. “We’re replacing our classic video series with this new series of games featuring interactive fun and time on device.”

The new series is called “I-Play,” for “interactive play.” It is a modernized  version of the second-screen interactive types of games that WMS made famous. “We’ve reinvented the second-screen bonus experience with highly thematic games that will redefine the engagement of interactive video games,” says Bone.

Among the first titles in the new series will be “Airplane,” “MoneyHive” and, next summer, a new version of the venerable “Jackpot Party.”

The new I-Play series is a complement to the manufacturer’s “G+” series of games, which has gained popularity as a series of no-frills, basic video slots offering high volatility and simple free-spin bonus events. According to Bone, at G2E, WMS will showcase many of the 19 new titles for the G+ series to be launched within the coming year.

These new games will join new products in each of the categories WMS has established over the past few years. These products include new game styles within some of the categories.

For instance, the “Innovation Series,” the group of WMS video slots with special, innovative play features, gets a new member this year. The current series includes game styles such as “Cascading Reels,” in which winning combinations disappear and other symbols cascade down from the top of the screen to form new reel combinations; “Wrap Around Pays,” which employs a virtual three-dimensional reel setup (new line pays start on each reel); “Money Burst,” with the screen setup using two common rows of symbols that apply to all pays; and “Spinning Streak,” the hot new game group that re-spins non-paying reels to enhance wins.

At G2E, WMS will launch “Super Multipay,” a game style that displays four separate sets of reels to the player. They are all 20-line pay windows, with one large set of reels and three smaller sets. Bonus features and wild symbols appearing on the large game carry over to the other three reel sets for multiple payouts.

Bone says this game style was made possible by the wider pay window of Bluebird 2. “It’s the only format with a wide enough screen for this,” he says.

The company also will introduce a new technology for the “Bonus Bank” series, the game group in which an ante wager enables several special bonus features. It is called an “Advanced Random Intelligence Algorithm,” or ARIA. According to Bone, this enables trillions of possible game and bonus outcomes, with no two outcome the same. “Players love unpredictability, and this will enable the most unpredictable games in the history of slot machines.”

The ARIA technology will debut in a new series called “Premium Bonus Bank.” Highlighted at G2E will be a game called “Lucky Penny,” in which a bonus event can happen any at any time—an animated penguin will spontaneously row across the screen in a canoe to change symbols to wild symbols, or to change reel symbols to create a winning combination or trigger a bonus event.

“Goldfish 2,” another ARIA game, is a dual-screen game in which fish randomly jump into a fishbowl to launch a bonus event. Each of the fish has its own special bonus. This is another Bluebird 2 exclusive, utilizing the larger dual-screen setup for the bonus events.

The ARIA technology also is being used on a new version of the popular “Powerball” video slot.

Other video highlights this year include “Jackpot Party Keno,” a new twist on the standard video keno game that allows multiple ball draws on the same card. In this bonus feature, the player selects Jackpot Party balls to fill out a keno card, and there is no limit—the player selects balls until getting a “Pooper Ball.” This permits winning streaks not possible in standard video keno.

Rocking the Reels

The several new styles of video slot will be joined in this year’s WMS booth by an impressive array of mechanical-reel games, including three-reel and five-reel versions of new games, the first reel-spinning versions of popular video formats, and some totally new stepper styles.

Games like “Extra Extra Luck” will add new features to the classic three-reel format. In this case, it is a 15-coin reel-spinner with mystery bonuses resulting in free spins with multiplied jackpots—a classic video gimmick applied to the stepper genre.

There also is a new series of WMS steppers called the “Top Box Bonus Series.” This is WMS Gaming’s first series of reel-spinners with mechanical “light-box” top-box bonus events.

Another highlight in the reel-spinning genre is a new version of the company’s popular “Hot Hot Super Respin” game, in which clumped symbols lock reels in place and all other reels re-spin to create additional pays. This bonus feature can go on and on, resulting in huge credit jackpots.

Other five-reel mechanical slots (the “5RM” series) include reel-spinning versions of the G+ video series including two stand-along progressive levels; and a five-reel mechanical version of the popular “Goldfish” video slot.

Bone says the company has increased its production of reel-spinners by popular demand. “Forty percent of our shipments in the last quarter were mechanical reels,” he says. “Our five-reel mechanical players are people who love both video and mechanical slots, so our executions of these games appeal to both sides of the spectrum.”

“There is a whole slew of products for the mechanical player that are crafted for both the traditional mechanical player and this new-wave mechanical player who wants bonusing and merchandising,” adds Gomez. “We’re really branching out the mechanical area for every player.”

That includes, of course, the groundbreaking Transmissive Reels series—mechanical reels with a video overlay, a technique pioneered by WMS—which is being used in a number of totally new applications. “We’re leveraging all the technologies we’ve commercialized in the past,” says Bone, “to completely change the environment in reels with the Transmissive technology.”

One of the new products will be a Transmissive Reels version of “The Wizard of Oz,” last year’s monster hit in the “Sensory Immersion” series. There will be two separate themes, “Wicked Riches” and “Glenda the Good Witch,” with a whole new set of bonuses.

(In the “Glenda” game, there is a “Tornado Bonus” that awards one of four local-area progressive jackpots.)

Also new in Transmissive Reels is “Super Grand Hotel,” which applies the ARIA technology to a reel-spinner in what Bone calls a “kitchen sink” of bonus features. “This has every feature on it that we currently have available in any game, except for the BOSE chair (from Sensory Immersion),” says Bone, who notes that it includes a “Big Event” community bonus with a multiplier that is increased by reel combinations. “This is going to be a home run,” he says.

Community to Adaptive

The Super Grand Hotel game employs elements of many of the unique, specialized game formats that WMS has introduced in the past few years. The slot-maker will display new games in each of these special categories.

Up front in the Sensory Immersion series will be “Dirty Harry: Make My Day,” which was still spreading across the industry as we went to press.

In the “Community Gaming” series, in addition to the Super Grand Hotel Monopoly-themed game, WMS will launch “Big Event Poker,” a video poker version of the community-style game genre. Players on a linked bank of poker games will be able to make an extra wager of two coins to qualify for a communal bonus round. As in the Monopoly Big Event video reel game, each player adds to an individual multiplier amount through normal play.

When the bonus is triggered, every player is dealt four to the royal. The fifth card is dealt to each player from a separate deck—a one-in-47 shot at the 4,000-coin royal flush. If a player hits the royal, his jackpot is multiplied by whatever multiplier he has achieved through standard video poker play. Bone predicts this will drive coin-in like no other video poker game before it, since the bonus payments are funded through the ante wager and players will seek to drive the multiplier up as high as possible before the bonus.

Another new take on a proven favorite is a community-play version of the venerable “Reel ‘Em In” called “Reel ‘Em In Compete to Win.” The popular fishing-themed game is placed in a bank under a “virtual fish tank” formed by two 52-inch plasma video screens. A linked “Tournament Bonus” will put all players at the bank in a fishing tournament.

This is also the next step in what WMS has come to call “Adaptive Gaming,” the series launched this year with “Star Trek.” The Reel ‘Em In bonus fishing tournaments will be linked to the wide-area network used for Star Trek to create a national “Leader Board” for the fishing tournament. Players will be able to log in and see who the top Reel ‘Em In fishermen are around the country.

It is one more application of the network WMS calls WAGE-Net, for “Wide-Area Game Enhanced Network.” This technology is being broadened to include customer-relationship management features, says Bone. “WAGE-Net will offer customers a CRM tool that allows casinos to reward players enterprise-wide,” he says.

Bone says the push for WMS at this year’s G2E show will be to offer “freedom of choice, and true interoperability.”

“Players are younger now, and they have a higher entertainment bar,” comments Bone. “We’ve been evolving one step at a time, providing products that show you how a networked slot floor can work. We’re showing individual player applications that demonstrate how the 100-percent networked floor can work in the future.

“We were looked at as a provider of niche products five years ago. We’re a different company now. We’re the thought people in the industry and we have the technology to move forward as a major player.”

By GGB Staff   Tue, Nov 04, 2008

The name “Austrian Gaming Industries” could mislead some into thinking that the Austrian subsidiary of the Novomatic Group of Companies only serves the Austrian casino market.

The fact is, there are few markets in the world AGI does not serve. The Novomatic corporate logo is one of the most well-known in the world to players of slot machines and electronic table games, and AGI, the company’s manufacturing subsidiary, has spent the past decade expanding the company’s games throughout Eastern and Western Europe, Asia, South America and other parts of the world.

Austrian Gaming Industries GmbH was established as a wholly owned subsidiary of Novomatic AG through a consolidation of the research and development departments, the various production divisions, the international distribution arms and marketing department of the former Novomatic Industries GmbH.

The strength of the company’s products lies in the fact that Novomatic is an operator as well as a manufacturer. In fact, the company has most recently been striving to achieve a balance between its casino operations—the company operates some 85,000 gaming machines in more than 750 locations, including some of the most profitable Swiss, German and Czech casinos and 170 sports betting outlets in Austria—and its manufacturing operations, which grow every year.

The AGI subsidiary is the undisputed leader in multi-player electronic table games in Europe, and the company continues to spread its name in the area of single-player slots as well. Last year, the company sold 75,000 gaming devices in 62 countries.

According to Max Lindenberg, who heads marketing and business development for AGI, the fact of being both operator and supplier is what lies at the heart of the success of the company’s slots and multi-player electonic table games.

“Being both an operator and a manufacturer means that information from our operations can go into our research and development,” Lindenberg says. “Our operations are testing labs for our products. Only games that are successful in our operations make it into our product line.”

That product line is constantly growing, with some 80,000 units rolling off its production lines every year and new innovations constantly swelling the game library.

One thing that means for AGI executives like Lindenberg and Managing Director Jens Halle is a constant stream of trade shows. The company has displayed new games at all of the South American trade shows, as well as the European and Asian shows. This month, it will be the Global Gaming Expo in Las Vegas.

Most of the groundbreaking innovations, though, are launched in January at the International Gaming Exhibition in London, the main European trade show—and an event in which Novomatic dominates the floor every year.

At G2E, the company normally reveals few of the innovations it will reveal at the London show. However, this month’s display in Las Vegas serves as a showcase of what 2008 has brought to AGI’s customers.

For AGI, that means the famous Gaminator brand of multi-game unit, the Novo-Vision brand of stand-alone slots, and the Coolfire II video platform that provides a steady stream of additions to the company’s massive game library.

AGI launches a new innovation for its slot products every year. Two years ago, it was a foot pedal that substitutes for a “spin” button. One of the most successful innovations, according to Lindenberg, has been the one introduced at the 2008 London show on the Novo-Vision slant-top: the ability to hit a button to switch displays between the main LCD screen and the top-box monitor. Lindenberg says customer feedback has been universally positive on that feature; customers love the ability to switch the main game screen to the top monitor.

This year, the big innovation for Novomatic has been a hardware improvement: the “Super-V+” version of the Gaminator multi-game unit includes a recessed, third LCD video monitor between the two main screens. This serves as a portal for operator-to-player communications, special promotions and even streaming video.

At Global Gaming Expo, AGI will showcase the top games in the Coolfire II video platform in all of the new hardware formats. Top games recently have included “Book of Ra,” a 10-line video slot featuring 3D images of Egyptian temples, along with primary-game wild symbols, an expanding wild symbol and a free-spin bonus round.

Another strong game has been “Plenty of Twenty,” a straightforward 20-line slot with great animation on the reels. “Rich Witch,” another popular Coolfire II game, has an innovative feature in the free-spin round: if the player lands symbols representing three “ingredients” for the witch’s “potion,” it adds another 13 free games.

Two of the most successful games this year, according to Lindenberg, have been “Indian Spirit,” a Native American-themed game with wild symbols and a free-spin bonus; and “Shogun,” with expanding wild symbols along with free spins.

At G2E, in addition to showing the full range of video slots, Novomatic will showcase the Flexi-Link Jackpot System, a multiple mystery progressive link that randomly feeds one of four jackpots to a machine in a linked bank according to a trigger in the progressive level.

One unique aspect of this link is that the overhead display lets players know when the jackpot is coming—when the lower triggering threshold is reached, a message tells players the jackpot “must be won before” a certain level. It is a virtual guarantee of creating “jackpot fever” in a progressive.

In addition to the slot products, of course, G2E attendees can expect Novomatic’s booth to feature a full range of the company’s electronic multi-player games in the Novo Unity platform, including a new electronic multi-player Texas hold’em poker table that has been grabbing a lot of attention worldwide.

Novomatic is continuing efforts to extend its brand across the globe, with localized R&D in Austria, the U.K., Germany and Poland. Expansion in South America is continuing, and the company is constantly looking at new markets.

By next spring, the company will complete a new headquarters facility in Gumpoldskirchen, Austria—a new office tower and a new headquarters for R&D—and will add 150 new employees for a total of 900 at the AGI headquarters.

“Through vertical and horizontal integration, we have become one of the biggest operators worldwide,” says Lindenberg. “Our aim is to become the biggest gaming company in the world.”

By GGB Staff   Tue, Nov 04, 2008

International Game Technology is at the top of the slot machine market. Still.

Yes, IGT’s stock price is down, and in a couple of months, there may be layoffs at the world’s largest slot manufacturer. Does that mean the venerable supplier is in danger of losing its status as the leading slot-maker in the world?

Don’t bet on it.

IGT may have ceded some of the market share it once enjoyed to surging competitors, but it still commands more of the U.S. slot market than all rivals combined. And, if there is one thing IGT has proven over the years, it is that it has the research and development resources to meet virtually any competitive challenge.

The company proved this fact a decade ago, after then-upstart WMS Gaming seized the burgeoning multi-line video slot market in Nevada. Within a year and a half, IGT had completely revamped its video line, and regained the lead in that segment of the market.

The company will respond to the latest economic and competitive challenges in the same way—by regrouping and reinventing itself, once again, through R&D. No one does it better.

This year’s Global Gaming Expo is sure to drive this point home. Drops in participation slots? IGT has a mind-boggling array of for-sale products it will show. Competition in progressives? The company has groundbreaking new progressive concepts. The race toward server-based gaming? IGT’s booth will give the most comprehensive showing of the practicalities of the new technology to be found at the show. Competition in innovative new game styles? IGT has it covered, and then some.

In fact, this year’s G2E lineup is the most diverse and extensive showcase the slot-maker has shown in years, obviously intended not only to make a statement that the slot leader is still very much the slot leader, but to plant the seeds that will grow into a full-blown turnaround.

At the center of IGT’s booth will be a suite of slot games on the company’s AVP platform—it stands for “Advance Video Platform,” but it’s now being used for both video and reels—that are set up to demonstrate practical examples of how banks of server-based slot machines would be configured.

All of the games will include IGT’s award-winning Service Window, the portal through which casinos can communicate with and offer promotional programs to loyal players, and will be linked to a library of game content managed by an IGT software package called “sbX.”

The sbX system is what IGT calls “Experience Management,” in that it enables casinos to design and manage customized player experiences. For instance, the sbX Tier One allows operators to tailor games and promotions on a “bank-by-bank solution,” with mystery bonus events, targeted tournaments and other features specific to portions of a casino.

Outside of server-based applications, IGT will display a wealth of innovation in the slots themselves. “We will show new cabinets with the ability to do unique marketing and game theme utilization in the top box,” says Brenda Boudreux, IGT’s vice president of product management. “Attract modes will include feature callouts, showing the players special features of the games while the machine is in attract mode.”

These attract modes will include tutorials on what the special features do—the top monitor in the dual-screen cabinet will be used to teach players about some of the game features. For instance, a game will advertise popular IGT game features like “stacked wilds” or “tumbling reels,” but the top box will actually demonstrate what those terms mean and how they are applied in games.

“We’re using the real estate in the top box to emphasize all of a game’s new features, borrowing animation from the game itself,” Boudreux says. “Also, the operator can use that space for property marketing—upcoming concerts, promotions, and so forth.” She adds that during a game, the top box can now celebrate events like bonuses being triggered or jackpots won.

The improvements in hardware and extras like the tutorials and celebrations spice up a remarkable array of new games IGT will showcase at G2E, in all of its established game styles—plus a few styles that will make their debut at the show.

REELdepth Debut

One of the newest styles debuted at the Grand casinos in Minnesota a few months ago. An all-video market, Minnesota was the perfect market to launch the new game style that is being seen by many as the answer to placing reel-spinning slots into server-based, downloadable applications—“REELdepth.”

REELdepth is IGT’s proprietary game style using technology licensed from PureDepth, Inc., which it calls the “Multi Layer Display,” or MLD. The technology, appearing first on the latest game in IGT’s “Indiana Jones” series, overlaps two LCD video displays to create the illusion of depth. In simulating a reel-spinner, there is little clue that the player is not looking at a traditional stepper slot. However, these are video slots—as unique animation possible over the reels ultimately reveals.

Simulation of reel-spinning, of course, is only one possibility of the technology. The overlapping screens enable a true 3D effect that is remarkable—almost a stereoscopic effect.

All of these capabilities will be on display at IGT’s booth as it hosts the official coming-out party of REELdepth. IGT will show more than a dozen new REELdepth video slots at the show, in applications that take full advantage of the technology.

“We’ve just started to scratch the surface with the MLD technology,” says Boudreux. “We’re seeing great results in improving our base game library, and in those markets that don’t have traditional reels, like Minnesota, we’re already seeing some phenomenal results.”

Some of the REELdepth highlights:

“Magic Butterfly” takes advantage of the 3D capabilities of the MLD format. The player collects butterfly symbols during the primary game, and  the 3D animation has the butterfly flying between the front and back screens. They land on reel symbols and transform them into wild symbols for extra pays. It’s a compelling effect.

“7s Storm” features five different-colored “7” symbols on the reels, which can change color up to five times, often for a higher jackpot. Each reel can individually switch colors to transform a “mixed 7” jackpot into a higher same-colored 7 jackpot.

“Glitter & Gold” introduces a feature IGT calls “Symbol Swarm.” There are only six paying reel symbols, but they stack to fill up one or more reels—all the way up to filling the entire four-by-four pay window with one symbol. This one’s a three-level progressive, and the progressives are won according to how many symbols are stacked.

“At G2E, we’ll be showing the unique features and enhanced capabilities that MLD gives us,” says Boudreux. “Some games will be REELdepth games only; others will be available either in traditional reels or the REELdepth interpretation of it. The goal is to show how we are able to enhance the technology and use it to its maximum benefit.”

Among the games available in both the reel-spinning—the new “S AVP” series, for steppers on the AVP platform—and the new REELdepth video format are several that use a new “banking” concept, which will place multiple game themes under one common bonus round played out on a big screen over the bank.

One banked game to be featured at G2E is “Greenback Attack,” which will link various base reel-spinning slots in a bank to a community-style overhead video bonus event heralded by celebratory audio: “Green… back… Attack!  An animation sequence on the overhead screen then gives “greenbacks” to players on the bank as a bonus.

Base games on this bank will include 50-line and 20-line titles, including “3X Triple Seven 2X,” “Double 3X4X5X Bam,” “Fire It Up,” “Pirate’s Gold” and “Triple Red Hot Gold.” Each will have a game-specific free-spin bonus in addition to the common bonus on the overhead display.

Boudreux says IGT will display five to seven banked concepts at the G2E show.

Breaking New Ground

In addition to using new technologies and marketing concepts to spice up the games, IGT is using the G2E show to launch a few completely new game concepts, such as the “MultiPlay” series of video slots.

IGT bills this as having the potential to do the same for video slots as Triple Play did for video poker. MultiPlay presents four different sets of reels to the player on the same screen. The player can wager on one, two, three or all four of the games, and the reels spin on all four simultaneously. “The ability to wager on each will result in more coin-in for the operator,” says Boudreux, “while the wagering setup provides a lot of volatility for the player.”

Boudreaux estimates that players will wager big on these games, because not only can a player quadruple his chance at winning combinations on each spin; he can quadruple chances at a progressive jackpot. Some games in the series will have one progressive for which all sets of reels are vying; others will have four different progressive levels. Initially, the games themselves will be the most popular IGT video slots, including “Cleopatra,” “Wolf Run,” “Golden Eagle” and “Treasure Cove.”

Other new game styles being launched at G2E include two new game families called “Bettor Chance Way” and “MultiWayXtra.”

Bettor Chance Way games allow the player to make a side bet to activate additional ways to win. With the side bet, the screen transforms into 40 individual reels. Each reel has the entire complement of possible reel symbols on it, and operates independently of every other reel. This multiplies the possibility of getting each paying symbol by four.

MultiWayXtra is a follow-up to IGT’s series that allows the player to purchase reels instead of paylines with all wins paid as scatters. In the initial MultiWay series, there are 243 ways to win on each spin. MultiWayXtra adds reel spots in a hexagonal pattern, so clusters of symbols pay off. This results in 3,125 possible winning combinations on each spin.

Progressive Progress

In addition to the multitude of for-sale options available from IGT this year, G2E attendees can expect a wealth of innovation in the MegaJackpots wide-area progressive series.

New MegaJackpots offerings include several community-play games. One is a new version of the “Star Wars” multi-level progressive game. In the new game, the “Speeder Bike Race” that is the main bonus feature is actually competitive between players on the bank.

Players are each assigned a bike for the race on the overhead video monitor. It is a timed event, and the winner goes on to play a secondary bonus event for one of the four in-house progressive jackpots. (The wide-area progressive is won through a line combination.) The losers each get a consolation bonus prize, so this is a lot of fun even if you don’t win the race.

Other new MegaJackpots progressives being introduced at the show include “Elvis: Rockin’ The Charts,” another multi-level progressive that features a new catalogue of Elvis Presley hits that are played in the bonus round; a multi-level progressive version of “Fort Knox” with a variety of base game themes; and “Wheel Hottie,” a new twist on the traditional wheel bonus in which higher wagers result in better chances at spinning the bonus wheel, and players can actually win the big progressive by landing on a certain spot on the wheel.

There also is a new version of the classic “Megabucks,” in a multi-level progressive version.  Called “Megabucks Reel Gold,” the new game features a five-level progressive in addition to the top Megabucks wide-area jackpot.

There also is a new “Jeopardy!” four-level progressive slot featuring a 60-line base game (one credit activates two lines). In this one, the progressive amounts on each game in the bank are independent of each other, giving players the option to “shop” for the best progressive in the bank. In addition to the shot at the MegaJackpots wide-area prize, it is possible to win all three in-house progressives.

These join a host of other new multi-level progressives, including “Joker’s Wild,” the first multi-level progressive to use the REELdepth technology. It is a 30-line, 200-credit slot featuring a five-level mystery progressive.

Tried and True

The special new game styles and progressives are joined this year by an impressive array of games in all of IGT’s traditional styles. Highlights on the video side include “I Dream of Jeannie Magic Carpet Ride,” a 20-line game with a “Traveling Wilds” bonus feature and the “Bettor Chance Pay” option; and “3-Level Spellers,” a new game concept that features a “Spelling Bonus” within the free-spin feature.

The object of the Spelling Bonus is to land five letters on the reels in a free spin to spell out the word “BONUS.” This initiates a second “Multiplier Bonus” free-spin round, in which the player gets 15 additional free spins at multipliers up to 10X.

Another new game group on the video side is called “Hot Hundreds and Up.” This is a series of game in 100-line and 200-line configurations. IGT is launching more than a dozen new titles in this game group.

On the reel-spinning side, G2E will be the coming-out party for S AVP, the new reel-spinners on the AVP operating system. IGT will show dozens of new three-reel, four-reel and five-reel stepper titles, including many new game concepts.

“We’re really making a concerted effort to increase the entertainment in our stepper games,” says Boudreux. “We’ve relied for a long time on classic themes and play features, but we realize that players want much more than that—they want entertainment.”

Finally, IGT will show a number of new video poker games employing the sixth-coin “ante” wager in exchange for special bonus features. One of the launches will be “Quick Quads Poker,” which increases four-of-a-kind chances for the ante wager. For the sixth-coin wager, the game will add up the final two cards when the player is dealt trips—if they add up to the value of the trip card, you are awarded the four-of-a-kind. (For instance, three 3s, a 2 and an Ace will pay off as four 3s.)

There is more, of course—IGT will show a new group of electronic table games, Barcrest reel-spinners with mechanical top-box bonus rounds and other games which we have too little space to list.

According to Boudreux, the vast majority of the games being displayed by IGT at the show will either be approved or on WAM test (for “wide-area marketing,” IGT’s field-testing of new game performance against established titles) by February.

In all, IGT’s display this year is designed to re-establish the slot-maker’s ability to meet any and all competition.

And to stay on top.

By GGB Staff   Tue, Nov 04, 2008

Casino Technology’s brand of slot machines dominates the landscape in and near its home base of Sofia, Bulgaria. Casinos in Sofia are virtual showrooms of the manufacturer’s many varied styles of video slots and other products.

Lately, though, the manufacturer, founded in Sofia in 1999, has been branching out, its uniquely styled games, multiple-progressive links and clever specialty games spreading their presence throughout Eastern and Central Europe, and growing in popularity in places as far away as Latin America.

The company continues to produce products with appeal over a broad range of markets—Casino Technology currently has more than 50,000 games in the field in over 20 countries. The Eastern European Gaming Summit, held in Sofia at the end of September, reaffirmed the company’s strength in its home market area.

According to Steve Surch, group director of international sales and market development, the company has begun a step-by-step expansion into new markets around the world. “Our home market, of course, will continue to grow,” says Surch, who estimates that Casino Technology commands a 40 percent market share in Eastern Europe. “Romania is still a very active market; we work with many casinos in Eastern Europe—Ukraine, Serbia, Hungary, Czech Republic—we’ve firmly established ourselves over the past two years in this market, and we see these markets growing significantly in 2009.”

New product development, says Surch, will extend the market outward across Europe and into the Americas. “We hope to have a VLT product for 2009, which will open up the Czech Republic and Slovakia for us,” he says. “We’re also looking, with our new PC-based platform, to break into the Western European casino market. We see that casino market as the first- division, premier market for our expansion—and they’re always looking for a new mix of slots. We’ve already had some very successful trials in Hamburg, Germany, and we will soon be announcing some placements in German casinos.”

He adds that other markets on the front burner for Casino Technology’s expansion include France, where the company is currently going through the license approval process; Portugal, where the company hopes to get a slice of some of the largest slot floors in Europe; and Greece, where the company also is pursuing licensing. In Asia, the company had its first introduction at the G2E Asia show in Macau in June.

In Latin America, the company has already started an expansion. “We have a representative office in Peru, and we also work with a company in Panama,” says Surch. “We’ve had success entering these markets. 2008 was about positioning our brand through the four shows there. Having gotten some penetration and results from machine performance, we are actively looking to build on that success in 2009.”

North America? The G2E show, and Casino Technology’s large presence there, is being seen as a statement of the company’s intent to penetrate the market, first in Native American casinos, Surch says.

Product Strength

Casino Technology’s expansion has been fueled by constant improvement of its slot products in all markets. This year, the company has made improvements to all of its product groups, and will use the G2E show to display upwards of 40 games, including at least 20 brand-new titles.

On the hardware side, the company has improved its elegant “Gemini Sensa” cabinet. The cabinet features an ergonomic design, with the top monitor in the dual-LCD setup angled down for easier viewing by the player; and an innovative button panel that provides for comfortable and easy play.

“We’ve given Gemini Sensa a facelift,” says Derek Russan, Casino Technology’s R&D director. “We’ve been going deeper into industrial design, and that is delivering a much more coordinated design, focusing on player comfort, player usability and player direction.”

He adds that new features on the cabinet include a third video monitor for casino-to-player communication, promotional games from the casino, and even video streaming to allow players to watch sporting events or other video while playing.

The player button interface has been simplified, with only six buttons on the panel. “All the other functionality is now on a row of touch-buttons on a panel right below the screen,” says Russan. “It’s enabled us to separate the functionality with dedicated touch-screen buttons for bet levels, leaving the buttons on the panel as hold buttons for video poker or for stopping individual reels in slot games.” A patent is pending for the touch-screen controls, which are called “Crystal Touch Sensor Buttons.”

The Gemini Sensa cabinet is the format used for stand-alone video slots, for “Multi-Gemini,” the company’s multi-game unit; and for base games in the company’s multiple-progressive links, such as “Quatro Cash Mania” and “Columbus Treasure.”

New games to be introduced at G2E include video slots for all of the company’s game groups. Among the new titles are “Ocean Madness,” a high-volatility, 21-line video slot featuring a free-spin bonus round and multiplying wild symbols. Another prominent introduction is “Kilimanjaro Treasure,” one of the company’s new 50-line video slots, which includes a cascading-reel feature in which symbols in winning combinations disappear and new symbols cascade down the screen to replace them for possible extra wins.

Other free-spin games include “Deep Water Fishing,” a 21-line video slot that includes an interactive bonus screen that leads to several potential bonuses, in addition to the free-spin round; and “Queen of Nubia,” a high-volatility 21-line game that is a sequel to “Nubia Princess,” which has been one of Casino Technology’s most popular games.

Some new games include innovative new ways to present the basic free-spin bonus feature. In the game “Dancing Queen,” free-spin rounds are triggered by three different sets of symbols—one set of symbols triggers a traditional free-spin round; another triggers a free spin round with full-reel wild symbols; a third set of symbols triggers a free-spin round in which the triggering symbols reappear frequently to tack on additional free spins.

Multi-Gemini will be shown in two new versions, including both video slots that have proven successful and completely new games such as “Milk & Coffee,” which was developed specifically for the multi-game unit.

Finally, a focus of attention at G2E, as at most recent trade shows in which the slot-maker has participated, will surely be on the new versions of “PlayMe.” This is one of Casino Technology’s most talked-about attractions: a grand piano, built by the company’s engineers, that includes an embedded roulette wheel and several video player stations for wagering. It’s like a combination of a piano bar with a roulette wheel. Several of the units are already in the field.

Two new versions of PlayMe are being introduced at G2E. There is a new “Dueling Piano” version of the roulette game: Two pianos are positioned around the roulette wheel, with four player stations on each piano for an eight-station multi-game unit. And, this year, Casino Technology will launch the first video slot version of PlayMe—four of the company’s most popular video slot games are placed in the side of the piano this time.

“Our biggest achievement in the past year has been to be awarded ISO 9001, the internationally recognized quality accreditation,” says Russan. “The designation is recognized by several of the approval authorities we have to work with.” The designation streamlines the approval process in many of those jurisdictions, which will speed up the company’s march into new markets.

The company also has embarked on an effort to be “green,” with an initiative to ensure compliance with world environmental standards.

The standards most important to the company’s future, however, are those related to player appeal and profitability of the games themselves. In this respect, the company is maintaining a gold standard.

By GGB Staff   Tue, Nov 04, 2008

Casino owners in Indian Country know Cadillac Jack. As the leading supplier of Class II games in several U.S. markets, as well as the emerging Mexican gaming market, Cadillac Jack’s knack for creating profitable games is well-known.

For the past few years, the company that was founded in 1995 to serve the Indian gaming market has sought to bring that reputation for profitability to the Class III world. Last year, the company made strides in its first Class III installation in Oklahoma, and began making most of its video and reel-spinning slots available in either Class II or Class III versions. This year, with GLI certification under its belt, the company moved into the California market.

“Cadillac Jack is finding its way into Class III, and at the same time, big companies like IGT are finding their way into Class II,” comments Mauro Franic, director of product management for Cadillac Jack. “California, where we entered in Class III this year, has a limit on its compact. In that moment of hesitation, casinos opened their doors to Class II.

“Cadillac Jack will be in an outstanding position when those casinos convert the majority of their floors to Class III, because Cadillac Jack titles are already on the floor.”

Franic, who has been with Cadillac Jack two and a half years, says the past eight months have been the most exciting. A new management team, headed by recently appointed chairman and CEO Gene Chayevsky, has focused on strengthening the core product.

“The new management team focused with external consultants and our sales people on the style of games we needed and the markets to go after, and we developed products around that research,” Franic says. “In both the U.S. and Mexico, the profitability of our games is the highest it’s ever been. Our product portfolio did not shrink, but our product brands have become a lot more targeted.”

The company’s strategy this year has been to focus resources on the products that are achieving the highest profitability. “Our slogan for the year is, ‘Focusing on What Plays Best—And Getting It Right,’” says Franic. “Having our resources limited like most companies, our focus is on products that make the most dollars per square foot—what plays best, and gives casinos the most profitable product line.”

Hot Products

The hottest product for Cadillac Jack as it has moved into Class III markets has been “Cadillac Cash,” its wide-area progressive link. Cadillac Cash was developed for Class II markets—it is still the only wide-area link in Mexico, and remains one of the few multi-site progressives in Class II Indian Country in the U.S.

The Cadillac Cash link features various base games connected to the same progressive, and according to Franic, it will remain the company’s main progressive link as it moves into Class III.

However, the G2E show will concentrate on the company’s new stand-alone Class III slots, in both video and reel-spinning modes.

Cadillac Jack has developed an impressive library of stand-alone games available in both Class II and Class III, including five-reel video slots like “Double the Devil” and “Mythic Knights,” which feature bonus rounds that can max out at 60 free spins; and “Sugar Delight,” with a pick-a-tile second-screen bonus round that can award up to 100 times the total bet.

The company has also released strong traditional games, including the three-reel classic “Hot7s” in video and five-reel mechanical games with LCD video-screen bonus events, like “Cave-Age Cash” and “Crazy Vegas.”

For G2E, Franic says the company will launch a showcase of high-volatility video slots in 20-line or 25-line, 200-coin configurations with free-spin bonuses, and a full line of 50-line stand-alone video slots as well. These latter games are essentially half-penny games—one penny activates two paylines.

According to Franic, the company will launch between  12 and 15 new stand-alone titles at G2E, running the gamut of bonus styles.

All of the new games feature play styles the company launched last year, “SpeedPLAY” and “PlusPLAY.”

SpeedPLAY is an optional mode for the player that cuts out nearly all the animation of spinning reels to go directly to the result of each spin. The player simply touches the screen to cut to the chase for the result of the spin.

“SpeedPLAY has the ability to scale out to an almost instantaneous cycle between spins,” Franic explains. “If the player chooses not to watch animation and go directly from one play to the next, that is marvelous for the casino.”

PlusPLAY is designed to reward players with random bonus events in exchange for extended play. “It is designed to generate loyalty in players by awarding bonus events,” Franic says. Extended play triggers expanding wild symbols, free-spin bonus rounds and scatter-pay jackpots.

The company also will launch a new game for the Cadillac Cash link, called “Pump It Up.” The company pulled out all the stops for this game, which features free spins, a second-screen bonus event, scatter pays and wild symbols that expand to entire reels. “This game has everything which we know works,” says Franic.

Finally, the company’s G2E booth will include a large section devoted to Latin American games in all video and reel-slot styles, as well as new games for the company’s “Latin Bingo” series.

The progressive jackpot in this series has a unique feature: As the window for the progressive jackpot narrows, animation lets players know that the jackpot has entered the area in which it has hit in the past. According to Franic, the casino can set the system to notify players of an impending jackpot either based on historical information, or on a tier system. In the latter, the casino can set three tiers preceding the jackpot, and actually can change the payback percentage as the higher-tier jackpot nears.

It’s a formula for jackpot fever in the progressive, and it’s one more example of the ideas that are sure to bring Cadillac Jack into the fold as an important supplier to both Class II and commercial casino markets.

By GGB Staff   Tue, Nov 04, 2008

As rare as it is in these recessionary times, slot-maker Bally Technologies is expanding.

The oldest slot-maker in the industry has been opening new branches throughout Europe and Asia for the past year, spreading the gospel—and sales—of its hot Alpha operating platform to more and more new markets. Bally has been on a roll since the perfection of Alpha, logging record revenues of $900 million for fiscal 2008, even as some of its competitors struggled.

The Alpha platform has now been imported for reel-spinners as well as video, so that all Bally games going forward will be placed on the same operating system. Both reel and video slots now are available in all of the manufacturer’s unique cabinet styles, including the dual-cabinet V-20/20, the SC9 wide-reel stepper, the V32 vertical-monitor video, and the two signature wide cabinets, CineVision for video and CineReels for steppers. Bally’s game developers are now concentrating on creating content for the Alpha platform that meets all the needs of the company’s customers in casino operations.

In fact, the theme of this year’s G2E show for Bally, “Your Bally, Your Way,” reflects this renewed focus on tailoring products to the needs of the customer.

“We believe the way to distinguish yourself as a major slot manufacturer is to be customer-centric,” comments Gavin Isaacs, Bally’s chief operating officer, who adds that the perfection of the Alpha platform as the basis for all games going forward has given game designers the freedom to create. “It is a robust, stable and reliable operating system, which leads to a great flow of titles,” he says. “Having Alpha, we don’t have to go back and worry about upgrading our format for game development. We can allow these guys to get to their jobs and innovate. Instead of ‘Let’s launch this new platform,’ our designers can concentrate on meeting the needs of the market—a lot more content, fine-tuned to meet what the customers need and what they are asking for.”

The Alpha platform provides flexibility for both game designers and operators—games can be swapped out easily, even between reel and video. At this year’s G2E show, Bally’s customers will see plenty of both game styles.

According to Mike Mitchell, Bally’s vice president of game development, while the company’s reel-spinners have been its heart and soul for a long time, the Alpha platform has allowed a focus on video to bring that segment up to the traditional popularity of Bally reel-spinners.

“We’ve made a concerted effort over the past six months to retool our video elements,” Mitchell says. “The pipeline has opened up on video. We’re still managing our leading position on the reel-spinning slots at the same time, but we’ve had a determined focus on the video markets.”

Big Show

The focus on all product areas will be evident at the G2E show, where Bally’s booth—set up as the “road to profitability”—will showcase some 256 games, which includes 169 new game titles, according to Mitchell a 58 percent increase over last year’s display.

True to Mitchell’s word, 150 of the 256 game titles on display will be video slots, revealing new innovations that have been added as the company perfected its Alpha video lineup.

One of those improvements is the “Easy View Interface,” a standard look for all video slots that will provide consistent locations for game elements such as betting buttons, the credit display, the bill acceptor and pay schedules. “The by-product of this is that it allows us to let the developers concentrate on the game itself—making it fun, making it interesting,” says Mitchell.

Among the new looks in Bally video will be a series of banked packages—groups of games with similar math, and play mechanics, grouped together under a common bonus round that leads to a progressive jackpot. One of the first banked games is “Monkey Madness,” which features stacked wilds, free spins and a progressive jackpot.

Another of Bally’s new video series features a radical new way to play. The series is called “Dual Vision,” and the first game is “Two For The Money.” This is a two-player game, set up in a “his-and-hers” configuration with a two-seat bench in front of a wide screen. On the screen are two sets of video reels. Each player wagers independently, but both spin the reels at the same time.

The two players are actually partners in the bonus rounds. When one player triggers a free-spin bonus on his individual game, both players go into the bonus round at the same time.

Other highlights in Bally video include a new version of the hit game “Fireball,” the video slot that features blazing comets in the bonus round. This game is on Bally’s “V32” vertical cabinet, which scored a big hit two years ago with Bally’s video roulette game. The V32 version of Fireball places the blazing-comet bonus round across the long, vertical video screen for striking visuals. When the bonus is triggered, the entire long screen switches to a space-scape, and the player touches one of the blazing comets to reveal a credit award.

Bally is offering several new multiple-progressive games in the video format this year as well. “Cashburst” is a five-level progressive in a multi-game setup. Three different themes all offer the same five incrementing progressive jackpots. “We’re seeing a transition from stand-alone games to multiple games embedded in one chip,” Mitchell says. “This allows three different themes, which can be switched out by the operator without conversion kits.”

“Quick Hit Diamond” is the follow-up to the hot “Quick Hit Platinum” game currently in casinos. Various scattered symbols lead to one of five progressive jackpots, ranging from $15 to a top jackpot in the thousands. Quick Hit Diamond, like its predecessor, features a frequently hitting jackpot, that returns a progressive in the hundreds every few thousand spins, on average. This is another game that uses the V-32 cabinet, with video reels and the display of all four progressive jackpots all on the same screen.

Bally also is launching several new video progressive themes at the G2E show. “Power Progressives” is a new series of progressive slots featuring classic themes under a towering top box featuring a “bonus ladder,” the top rung representing the progressive prize. The first game, “Wild Rose,” will be a three-reel, 25-line stepper with a giant LED top-box featuring the bonus ladder.

Speaking of the “power” theme, Bally will offer a new series called “Power Platinum” that allows the casinos to alter the top prize to include merchandise. One of the first games is “Power Strike,” which allows for photographs of the top jackpot prize—a car, a motorcycle, a boat, etc.—to be incorporated into the pay schedule.

Rounding out the lineup of new progressives is Progressive Game Maker, which permits one progressive jackpot to apply to several games. In the video poker version, for instance, the same progressive royal flush jackpot will apply for Jacks or Better, Double Bonus Poker or any other poker game the player chooses.

New versions of Game Maker can also be purchased with an ancillary software product called “Game Maker Scheduler.” Operators can use this tool to pre-schedule game changes within the machine—a stand-alone version of capabilities normally associated with server-based gaming.

Reel Deal

As Mitchell notes, in addition to all the new video offerings, Bally is launching games at G2E that will re-establish its prominence in what has been its strong suit over the years—the classic reel-spinner. The slot-maker is releasing updated versions of several classic reel games like “Blazing 7s” and “Black & White” in the wide-reel Alpha platform with all the modern bells and whistles, in both three-reel and five-reel versions.

There is even a new giant reel-spinning format. Bally will display classic reel games in a jumbo cabinet with 15-inch reels (compared to the standard 9-inch). The big machine will stand eight feet tall, 40 inches wide.

There also are several completely new game groups in the reel-spinning genre coming from Bally this year. “PowerMax Reels” is a new and improved version of the “Frenzy” series, which was the Bally series of three-reel games with a fourth reel used for bonuses. In the PowerMax series, the games are three-reel base games with two extra reels. The three-reel base games employ multiple paylines, and the fourth reel includes bonus credits, free spins and other additions applied to winning combinations on the primary reels. The fifth reel includes all multipliers, which are applied to the already-boosted jackpots.

Another new reel-spinning series is the Bally take on hybrid reel/video games. “Transparent Reels” features a video overlay that allows animation to be added to classic Bally reel-spinners. Six different titles will be released in the new format this year, including some of the most familiar classic Bally slots.

Finally, Bally’s reel-spinning lineup will include the first stepper version of the Game Maker multi-game unit. Three different games—such as the various versions of Blazing 7s—reside on one game. When the player picks a game, the pay schedules, buttons and artwork on the face of the slot machine change. Everything changes but the reels themselves—the same basic symbols are used for the three different games.

In addition to the games, attendees can expect to find a good representation of server-based applications at Bally’s G2E booth, with demonstrations of various elements of the manufacturer’s “Networked Floor of the Future” program as well as the Download Configuration Manager, a joint-venture project with Aristocrat to download games to terminals from both manufacturers from a common server.

Isaacs says the strength of this year’s G2E lineup is a direct reflection of the development work Bally has been involved in for the past two years. “We are building on the success of the previous two fiscal years, and the retooling of our entire product line,” he says. “We’re excited about the coming year.”

By GGB Staff   Tue, Nov 04, 2008

Euro Games Technology has spent the past five years establishing itself in Eastern Europe. The company is now taking its award-winning show west to the Americas.

EGT, headquartered in Sofia, Bulgaria, opened a new factory the same week as it was nominated for several awards for its video slots at the Balkan Entertainment and Gaming Expo. The company’s game “Crazy Bugs” took the top award for best video slot in the Balkan region. The games “Rise of Ra” and “Book of Magic” also were nominated.

The company also won an award in industrial design for its new “Vega Vision” product line, which was launched at the Balkan expo. The upright and slant-top dual-screen cabinets—available in two series, Vega Vision and Vega Vision +—have been lauded for their ergonomic design and ease of maintenance.

It was not the first time the company’s games and technology have been recognized. According to Olia Al-Ahmed, who heads the company’s PR department, EGT’s products have been well-received in Hungary, Romania, Ukraine and elsewhere in Eastern Europe, as well Macau, where the company was a hit at G2E Asia; and at the International Gaming Expo in London, where Western European operators are being introduced to the company’s products.

Most recently, EGT impressed South American casino operators when it displayed its products at the SAGSE show in Buenos Aires, Argentina. “We also had a very successful show in Peru,” says Al-Ahmed. “People are very interested in our products across Latin America. North America is in our future as well.”

To this end, this year marks the first time EGT will be showing its products at the Global Gaming Expo. In addition to the two original versions of Vega Vision, the company will launch the Vega Vision + Slant Top at G2E. This is another award-winning cabinet design, with a wide-screen format—it combines a 22-inch main screen with a 26-inch top LCD monitor—and all the ergonomic benefits of the original versions. “All of our cabinet designs have been very innovative in creating a design that provides comfort for players,” says Al-Ahmed.

Two games are being launched specifically with the slant-top, “Pharaon’s Treasure” and “Lucky Buzz.” In all, the company will showcase 14 new games in all of its cabinet styles. Among the highlights:

“Gold of Roma” is a 20-line, 200-coin video slot with a wild symbol in the base game that can multiply jackpots by up to eight. It also features a lucrative scatter-pay win that pays up to 150 times the total bet, and another on-screen bonus that pays up to 148 times the total bet when “Gold of Roma” symbols appear on the first and fifth reels.

“Age of Troy” features stacked symbols in the primary game, a multiplying wild symbol that can substitute for the top jackpot symbol, and a free-spin bonus that can be re-triggered during the feature.

Other 20-line games being introduced at G2E include “Book of Magic,” “Casino Mania” and “Kashmir Gold.”

The company also will showcase several 10-line video slots including “Jungle Adventure” and “The Big Journey.” Both games feature primary-game wild symbols and free-spin bonus rounds. The Big Journey features a free-spin round with all pays doubled.

All of EGT’s games feature stacked wild symbols and an optional “Double Up” feature after every win, and all feature great artwork and incredibly sharp graphics.

EGT also will display new games for its “Classic Blend” jackpot system, an innovative system that supports up to 16 independent progressive jackpots with up to four denomination levels each, and up to three mystery jackpots at the same time. The Classic Blend system comes with its own unique ergonomically designed upright slot cabinets as well.

Finally, EGT will display a product group that has been one of its most popular at recent trade shows—electronic, multi-player table games, including a roulette game that places 22-inch monitors at play stations around an automated wheel; and the newest game in this category, an electronic blackjack game first introduced at the Balkan expo.

“Our mission is to generate a constant flow of revolutionary ideas, technologically advanced and carefully designed gaming products,” says the company’s mission statement. “Every step, from conception and design through to installation, service and support, is dedicated to EGT products to become a synonym for top quality worldwide.”

The G2E show is certainly the next step on that journey.

By GGB Staff   Tue, Nov 04, 2008

The Atronic Group is a different company than it was last year.      

After making remarkable strides in the slot-manufacturing sector within a brief 15-year period, Germany’s Gauselmann Group, which purchased Atronic in 1993 when it was a small Austrian producer of artsy video slots, went back to the amusement-with-prizes business on which it had made its original fortune. Atronic this year became part of GTECH Holdings Corporation, the Rhode Island-based lottery giant that also owns Canada’s Spielo VLT supplier.

The new corporate structure that comes with the acquisition, though, does not change the formula for success in the international slot market employed by the Atronic Group. The U.S. arm of the company, Atronic Americas, is in the process of moving from its longtime home in Scottsdale, Arizona, to a new headquarters location in Las Vegas.

Atronic will maintain its slot business as the casino slot division of GTECH, with Spielo retaining its video lottery role in Canada. However, the technology from the lottery side in the form of both the parent company and Spielo will be tapped regularly by the casino slot division, which will maintain its R&D centers in Arizona, in Graz, Austria (home to both slot development and Atronic Systems), and in Melbourne, Australia.

The company also will continue to employ some third-party game design—mainly from Arizona’s Games4You, the company formed by former CEO Michael Gauselmann and Jason Stage, who for years headed up R&D at Atronic Americas.

“Our new corporate identity will emphasize the strengths of Atronic, Spielo and GTECH,” says Michael Brennan, product marketing manager for Atronic. “We are keeping each brand in its traditional area. Spielo’s strength is in its video lottery base; Atronic will remain the commercial casino brand. However, the new structure will provide increased access to financial support, greater resource identity and a broad R&D portfolio.”

Time to Shine

With the corporate structure in place, the combined R&D resources at Atronic’s disposal will begin to take form in a flood of new game content, and new game formats.

One of these new formats to begin rolling out next year  comes from Atronic’s new sister company, Spielo. Called “prodiGi Vu,” it is a new wide-screen video slot format with a 22-inch screen, an enhanced, five-speaker sound system, and even an optional remote control with a spin button to make it easy for players to participate in tournaments.

The new format comes with a new computer platform called “sensys.”

“It is more powerful, and it can handle enhanced graphics and sound,” says Brennan. “It’s the next step technologically. Any content can be imported from all of our current platforms, or to any platform. Our development teams eventually will be able to work on any platform.”

“Spielo had a platform; we had a platform,” adds Colleen Nelson, Atronic market and product analyst. “In GLI jurisdictions, where the prodiGi cabinet is out, people want that cabinet, but our content. There will be parallel development on both formats for the next couple of years, and we’ll have teams creating interchangeable developments until we get the two platforms down the same path.”

Atronic will display games on 40 prodiGi Vu cabinets at G2E, containing Spielo game content. Among the top Spielo games to be launched at the show is “Jewelly,” a multi-game unit with various base games all carrying a common set of bonus events. The player will qualify for the random bonus events by making an extra ante wager. All of the bonuses involve the series’ title animated jewel character.

Meanwhile, Atronic has improved its own “e-motion” dual-screen video platform. At G2E, the slot-maker will officially launch “e2motion,” which Brennan calls a “bigger and badder” version of the ergonomic cabinet and video platform. The monitor has been bumped up from 17 inches to 19 inches, the sound system has been upgraded and the player tracking unit can now support a 7-inch LCD display. A cushioned wrist rest and other ergonomic improvements also have been made.

The Harmony slant-top also has been improved, with a second video screen replacing the former glass topper—a setup that will allow the slant to be used in networked gaming setups.

Finally, Atronic will release a new version of the Passion Deluxe Super Top cabinet, the giant, neon-trimmed reel-spinning format released last year as the three-reel, dollar version of “Deal Or No Deal.” This format places a tall top box on Konami’s “Advantage 5” reel-spinning format, which Games4You licensed from that manufacturer to create this format for Atronic.

Atronic is launching a five-reel version of the cabinet this year, in new versions of the classic Atronic video slots “Sphinx” and “Xanadu.”

“Particularly in the West, we found a lot of interest in a five-reel version of the format,” Brennan says. “The three-reel version is a very good niche product—it does well in end-cap units, with a self-merchandising top box. We’re going to parlay that with Xanadu and Sphinx in five-reel setups. We’re focusing on recurring revenue and strong, recognizable brands.”

The Deal

Speaking of recognizable brands, Atronic is exploiting the success of its series of slots based on the game show Deal Or No Deal with several new takes on the game to be launched at G2E.

All of them have the familiar “Briefcase Bonus,” in which the player is shown the amounts available behind closed briefcases, chooses one, and reveals the contents of several others before being made an offer by the “Bank” that is based on the prizes still available as the player’s possible bonus. The player picks “Deal” to take the offer or “No Deal” to reveal the contents of more briefcases—eventually taking one of the offers or eliminating all but one briefcase.

Players love this bonus because of the pure gambler’s adrenaline rush it produces. Thus, it remains in all the new versions, along with new features specific to each game.

“This is our most recognizable brand,” says Brennan. “We’re trying to leverage it and create some experiences with it. We’ve put new versions out there and gotten responses from players; and we’ve used what the players said to improve the product.”

“Deal Or No Deal: The Experience” incorporates a side-bet feature. For an extra wager, windows open in one reel spot on the first reel and another on the fifth. Regardless of other results on the reels, if those two windows line up, it becomes a second way to trigger the Briefcase Bonus.

The Experience also incorporates a progressive bonus feature. High and low progressive jackpots increment during normal play, and when the “Experience Bonus” is triggered, the player is given an offer of a guaranteed bonus right between the high and low jackpots. If he picks “No Deal,” he is awarded one or the other. It’s a 50/50 proposition; players have just as much chance at the high prize as the low one.

“We market-tested this product, then we tweaked it and enhanced it to make sure it succeeds,” says Brennan.

“Deal Or No Deal: The Banker’s Wheel” is another new version of the game-show slot that incorporates, for the first time, a mechanical bonus wheel, similar to the wheel on the TV show. In this case, the wheel determines a multiplier that applies to the total bet.

“Everybody loves a wheel, and it is something they have on the TV show,” says Brennan, who adds that there will be optional progressive versions in Atronic’s Rapid Link wide-area progressive series, with a frequent top jackpot resetting at $50,000.

On the back burner, according to Brennan, is yet another Deal Or No Deal game—it doesn’t have a name yet, but it does have an intriguing gimmick: It’s an all-bonus game. There are no reels at all. The main game uses a wheel instead of reels and paylines. There are two buttons—“Spin/Stop” for the wheel and “Deal/No Deal” for the bonus. You spin the wheel every play, trying to land on one of the spots that triggers the Briefcase Bonus. Every time you don’t trigger the bonus, the values inside the briefcases go up.

Brennan says a communal-style version of DOND also will be displayed at G2E. “We perceive this as being our biggest attraction at the show,” he says. “There will be five large LCD screens representing the briefcases (a-la IGT’s eBay). It’s a huge merchandising feature, and we’ve gotten very positive feedback on it from our corporate accounts.”

New Concepts

Joining the hot “Deal” series in Atronic’s G2E lineup will be several totally new game concepts. “Tree Of Riches,” to appear in casinos early next year, is Atronic’s first community-style game. It is a six-machine bank with a giant overhead LCD screen for a common bonus round.

Each player on the bank is represented in the bonus by an animated bird. (You’re either Happy, Sneaky, Crazy, Dreamy, Smarty or Lovey.) In the bonus round, the birds fly around a money tree depicted on the large overhead video screen, plucking dollar bills. Each dollar increments the corresponding player’s bonus, but a gold dollar gets the player into the next round. If at least one player’s bird keeps snatching gold dollars, there can be a total of six rounds of dollar-snatching—an eventuality Brennan says is sure to instill a good deal of camaraderie and excitement on the bank.

There will be no shortage of new game concepts in the standard Atronic “e-motion” dual-screen video platform. “Fisherman’s Cash” features an animated bass-fishing tournament, with the prize for the biggest fish being a progressive jackpot. You pick a fisherman and watch the tournament. This is helped out by an innovative dynamic-button feature—in the bonus, the wagering buttons switch to images of the fisherman characters.

This game also has five unique fishing-themed bonus features, for which you qualify with your wager—one coin per line qualifies the player for one of the random bonuses; five coins per line qualifies him for all five. Several of the bonuses can hit at the same time—including, theoretically, all five.

“This is the first game really targeted at one area that can have some mass appeal,” says Brennan. “The theme and characters are based on Minnesota, but fishing has mass appeal, so it will easily transfer to different markets.”

Other new games include “The Three Stooges,” still in the design phase at press time. This will be the first game theme to recall the legendary comedy team since Shuffle Master released a Stooges game nearly decade ago.

The Atronic Stooges video slot will be a three-level progressive. You guessed it—there will be a Moe Progressive, a Larry Progressive and a Curly Progressive. Lots of clips from classic Stooges shorts will accompany reel images like pies, football helmets, stethoscopes—each reel icon is related to a Stooge short; the game will run the appropriate film clip when one of them forms a winning combination.

“Our concept is to use as much of this license as possible in creating the game,” Brennan says. “We’re bringing a lot of the video into the game, which will be available in stand-alone or linked progressive versions.”

Also in the design phase at press time was “Stargate SG-1,” based on the popular science fiction TV series. A 52-inch plasma video display simulates the “Stargate” from the show, which is a portal through which the characters traverse time and space. Several bonus features will relate to various aspects of the TV show.

Finally, Atronic’s G2E showcase will include an updated version of its giant slot machine. The “Titan 2” cabinet is an updated version of Atronic’s giant slot that’s been in casinos since 1998. The bonus-only DOND game will be available in this giant format, as well as giant versions of “Sphinx” and other Atronic core games.

All the new games will be accompanied by displays of new networked gaming technology including “TournaMaster,” which allows operators to instantly switch slot machines on the floor between standard and tournament mode.

Atronic will no doubt be launching many more innovations in the coming years, as the advanced technology of the three companies that are now part of GTECH come together to form a new industry powerhouse.

By GGB Staff   Tue, Nov 04, 2008

Aristocrat Technologies is at a crossroads, and it’s up to Nick Khin to guide the slot-maker to the right path. Most observers feel he’s up to the task.

Khin, who recently took over as president of the U.S. subsidiary of Australian slot manufacturing giant Aristocrat Leisure Industries, inherited a problem that most have pinpointed as the main reason the slot-maker’s stock spiraled downward during the past year—flat sales in U.S. casinos.

Khin built up a stellar reputation while heading up Aristocrat’s operations in Europe, the Middle East and Africa, where his two-year tenure brought record revenues (up more than 50 percent) and profitability (up 140 percent), not to mention a significant increase in market share.

Aristocrat is hoping he can work the same magic in the U.S., where he replaced Tim Parrott in September as president of the Aristocrat Technologies subsidiary. Investors would appear to be in his corner—Aristocrat’s shares rose 19 cents on the Australian Stock Exchange after the announcement of Khin’s appointment.

He also will have a lot of help from product designers and engineers. This year’s lineup of new slot games for G2E is one of the manufacturer’s most extensive in years, and not only capitalizes on the great game styles introduced earlier this decade—Hyperlink multiple progressives, the Reel Power scatter-pay format, Bonus Bank ante-wager games, Standalone Progressives—but will launch several completely new product categories as well.

New Looks

For Aristocrat’s proven game styles, there will be a variety of new looks, thanks to innovative hardware and new video formats. For instance, the MavSlim and MavStepper slim cabinets were joined two years ago by the Crown slant-top, and last year by newest hardware, the server-ready Viridian cabinet, along with the new Gen7 video platform.

This year, Aristocrat capitalizes on all the new formats with a flood of new game content.

“Viridian and Gen7, which won the (Global Gaming Business) Gaming & Technology Award last year, has added a lot of new features that create a point of difference on casino floors, and really set us apart,” says Doug Fallon, Aristocrat’s director of marketing. “The performance of Gen7 has been up to 246 percent over MKVI (the former video format), even with the same games loaded in. With Viridian approved in most markets, our focus is now on content.”

Sean Evans, the company’s vice president of sales, adds that the formats themselves are being improved upon. This year’s G2E will host the launch of the Viridian RFX Stepper (RFX stands for “reel effects”), a reel-spinning version of the dual-screen video format that places back-lit spinning reels beneath a giant LCD video screen. What is really unique about this format is that, in addition to the 16-by-9-inch LCD video screen above the reels, used as a dynamic scorecard and for bonus animation, there is a touch-screen video interface below the mechanical reels.

The inaugural game in this format, called “Big Ride,” carries a bull-riding rodeo theme. Other games include “5 Koi” and “5 Dragons,” both five-reel games; and a classic three-reel slot called “Love Bites.” That one comes in “his” and “hers” versions.

The Reel Power format, in which players buy reels and all wins are paid as scatters, also will be super-charged this year, with a new version called “Super Reel Power.” This is a five-by-five setup—five rows of five symbols each, resulting in a total of 3,125 possible winning combinations on each spin.

Aristocrat also is introducing new games in its “Power Pay” series. These are video slots that offer extra bonus features with an ante wager. New for the G2E show is “Show Me The Game,” in which the ante wager improves the free-spin bonus. Without the ante, triggering symbols launch 10 free spins with jackpots tripled. The extra wager increases that feature to 15 free spins with jackpots multiplied by eight. This game, as well as “Wild Stallion, “Lucky 88” and others in both the MKVI and Gen7 formats, also features an increased return percentage with the ante wager.

“Power Pay tells people that for an extra bet, you get extra benefits,” says Evans. “We know players have embraced the ante bet going all the way back to Cashman in late 2000. We want to push a little extra back to the players in return for that ante bet, and operators like it because it pushes up the average bet.”

Other new takes on established formats will include a showcase of new multi-player electronic table games from Interblock, the Slovenian auto-roulette manufacturer half-owned by Aristocrat; and PokerTek, the North Carolina firm whose “PokerPro” electronic multi-player poker tables Aristocrat distributes outside the U.S.

The improvements on familiar formats will be joined by a few completely new ideas from Aristocrat. There will be games in higher denominations than the manufacturer has been known for, including the first Aristocrat mechanical bonus slot. “Hit the Heights” is an imposing new game that takes proven Aristocrat multi-line video slots and adds a mechanical, arcade-style top-box bonus device. There are three base games with this one, and each has a bonus feature that interacts with a wheel bonus in a giant top box.

Another new game style is “Players World By Demand.” This series, launched earlier this year with new versions being displayed at G2E, places four proven games under a single umbrella in a multi-game, multi-denomination format.

This first multi-game unit from Aristocrat features three player-selectable denominations—higher than you may think at quarters, 50 cents and dollars. The four games reside on one game chip, and the player can change games by touching one button. The entire game, including the top box, changes when you select a new game.

Progressive Power

Aristocrat is launching an impressive collection of new progressive slots in both reel and video platforms, and in several different game styles.

Perhaps the most high-profile of these is a potential blockbuster using a licensed brand—“Jaws,” a multiple-mystery progressive slot along the lines of Hyperlink, but carrying the theme of the legendary film.

The four-level progressive video slot is placed in a themed version of the Viridian cabinet. The two large video screens are framed in an aqua color, giving the whole cabinet an underwater look. The top screen displays the famous cinematic shark, baring its teeth toward the player. On top is a buoy that moves when the player hits a jackpot.

The base games sit in a bank of four with an aquatic display and overhead LCD video screen on which the bonus round plays out. “We’ve never gone this far into theming a machine physically,” says Fallon. That design is dynamic according to what is happening in the slot game. For instance, the trim of the cabinet turns from blue to red when the player goes into the mystery bonus feature leading to one of four progressive jackpots. It’s a very visible cue that the bonus round is arriving—a cue that will generate excitement in the bank, says Evans.

The progressive bonus round, played out as the top video screen displays a lost-at-sea scene (the player is waiting for a ship to rescue him before the shark puts him on the menu), is only one of the special features of this game. Mystery bonus awards and free spins crop up randomly during play, and there are standard free-spin bonuses as part of the base games. “This is big for us,” says Evans. “It will dominate our booth at the G2E show.”

Another new branded progressive, called “Pick A Box,” carries the theme of the 1950s Australian game show of the same name. It is a four-level progressive with a touch-screen bonus feature that leads to one of the progressive jackpots.

Other new progressives from Aristocrat include “Mega Millioni$er,” a bank of four base games in penny denomination with a progressive jackpot starting at $1 million; and “Fa Fa Fa Fortune King,” with a high-frequency jackpot starting at $150,000 and programmed to hit at around $250,000. The company also will release several new games in its Double Standalone Progressive and Triple Standalone Progressive groups. That includes a new Double Standalone version of “The Sopranos,” and another new Double Standalone called “Jackpot Royale.”

Some of Aristocrat’s new progressives feature both video and reel-spinning base games in the same bank, linked to the same jackpot—a first for the manufacturer.

Finally, Aristocrat will showcase server-based technology including its Download Configuration Manager, a joint-venture project with Bally that features one server with downloads of game content to both Aristocrat and Bally terminals. The “TruServe” Class III server-based platform is set for testing in Iowa in the first quarter of 2009. The system will incorporate third-party content in the Viridian cabinet.

In all, Aristocrat will showcase some 200 games at G2E, including 21 completely new game concepts. The impressive lineup can be seen as re-establishing the fact that Aristocrat has been one of the great innovators in slots during this decade.

The company’s G2E lineup shows promise that the company will recapture its role as one of the market leaders in the U.S., as well as its other core worldwide markets, as the industry approaches its next decade.

By GGB Staff   Tue, Nov 04, 2008

AC Coin & Slot turns 30 this year, and, unlike some slot manufacturers, the company is celebrating the anniversary with robust sales and a backlog of orders.

“We have our biggest order queue ever,” comments Jerry Seelig, the company’s executive vice president and general manager. “It’s awesome. A lot of the themes we brought out this year are doing very well.” He rattles off the titles—“Super Bankroll Bonus,” “When In Rome,” “Chef’s Daily Special,” “Big Game Show Gold Edition”—of all the games currently performing at up to twice the house average at casinos across the country.

AC Coin is something of an anomaly in today’s slot business: Everything the manufacturer sells is on a recurring-revenue basis—a business model that is falling out of favor in some places—but sales have never  been stronger. Seelig credits this success to the slot-maker’s size, and the comparatively low volume of new games developed every year.

There also is an efficiency of operation and low overhead at AC Coin that allow for close attention to each individual game. The company’s proprietary products are all bonus games combined with base games from slot-maker International Game Technology. This frees up the company’s game developers to concentrate on creating unique bonus events.

AC Coin has been IGT’s exclusive distributor in Atlantic City and the Caribbean since 1983—a deal founder and CEO Mac Seelig sealed with IGT founder Si Redd the year Redd’s company was officially incorporated—which provides a steady stream of revenues and another reason the company’s game designers are able to be quick on their feet in responding to what players like.

“While everyone else is chasing things that are light years away, we’re trying to create simple things that work on casino floors today,” says Jerry Seelig. “We continue to build products at a much faster pace, so it’s not a two-year time to market for new products we introduce. We’re able to provide customers with solutions they’re looking for now—recurring-revenue products that earn multiples of the house average.”

What that has meant in recent years has been a constant refining of the game concepts that have proven themselves to be most successful. For AC Coin, that means the product groups that have been the company’s franchise products for the entire decade—the “Slotto” series of top-box bonus games that utilize the lottery-style ball-blower as a bonus event; and the “Bankroll” series of games featuring a top-box bonus that appears as a scrolling sheet of banknotes.

AC Coin’s most successful games in recent years have used one of these two themes, and the most recent incarnations are communal-style games. The first, introduced two years ago, was “Super Slotto;” that giant, eight-station unit was tweaked last year and released in smaller versions. This year, the communal-style genre has been perfected with six-station versions of both Slotto and Bankroll-style games.

“We learned valuable lessons from our Super Slotto launch,” Seelig says. “We’ve reworked the product into a smaller, more manageable format that can fit anywhere on a casino floor.”

The communal-style “Super Bankroll Bonus” has been reworked into a six-station unit. Six base Double Diamond five-reel stepper games are placed in compact, upright cabinets surrounding a giant scrolling top-box bonus apparatus. Several players go into the bonus at once, and players receive the credits and multipliers that wind up above each machine.

“Super Bankroll Bonus was very fun to develop,” Seelig notes. “It gets people sitting very close to each other and sharing a pretty unique experience. The hit frequency is very quick on that game. With players on six games, if you’re sitting for a minute, chances are that bonus device is spinning around and someone is winning.”

AC Coin is launching a beautiful new version of the communal Bankroll-style game designed for the Native American markets, called “Wild Native Spirit.” The base games in this, another six-station communal setup, are three-reel, nine-line versions of the IGT game “3X4X5X Times Pay,” but the banknotes on the roller bonus apparatus employ artwork and images drawn from Native American culture.

“This was only conceived in July, and we’ve already started selling them,” Seelig says. “One of the benefits of being more stealthy is that we can see what themes are working, and we’re able to capitalize on that very quickly.”

The Wild Native Spirit game also is being released in a stand-alone version.

One other new game in the Bankroll genre is a communal version of “Sparky’s Red Hot Jackpots,” the popular theme that first appeared in a stepper with a hybrid LCD video/mechanical top-box bonus sequence. In this case, the big scrolling bonus contains both rows of credit amounts and complete rows of multiplier amounts. Each bonus event scrolls the big bonus twice—once for a credit amount and once for a multiplier.

AC Coin is launching several new games in the Slotto genre. “Double 3X4X5X Times Pay Slotto” and “Slotto Big Cash Sweepstakes” each attach the Slotto bonus sphere to one of IGT’s most popular reel-spinners.

Both games also combine the Slotto bonus round with another popular bonus event, first seen on a slot called “Big Game Show Bonus.” It is a square game show-style bonus board on the face of the slot which multiplies the bonus the player gets from the Slotto balls swirling in the familiar bonus apparatus up to 10 times.

The Big Game Show Bonus slot itself also is being launched in a communal version, with three upright five-reel slots under a giant game board display,

The communal game style soon will be applied to another legendary AC Coin game, “Empire.” In December, the company will launch a six-station version of the game, which features a miniature Kong-like gorilla climbing the face of an Empire State Building display toward bonus “floors.”

AC Coin also is launching a new series of progressive slots this fall, using several different base games and game styles under the banner “Pay Day Progressive.” The idea is that a progressive equal to a typical paycheck—between $600 and $700—is awarded very frequently. In this case, it’s once every 16,484 spins on average.

Finally, one theme that has hit several markets running is “Slingo,” a communal-style version of the popular internet game that was originally developed by Dave Lyons, former slot VP of Bally’s Atlantic City. The communal version of Slingo—a combination of “slots” and “bingo”—is a three-machine bank under a giant LCD video display that enables a very frequent communal bonus round. Every 46 spins on average, players go into the Slingo game, with numbers on the individual reels matching up with numbers on the big board, the object being to complete a “Slingo”—all the numbers in a column, row or diagonal on the big Slingo board.

Seelig says the company’s continuing mission is to find what works in each market, and then to develop products to fit those needs. “We do things in a real-time environment,” he says. “We don’t want to be one of those companies prognosticating what’s going to work in five years. We live in the here and now.”

By Frank Legato   Tue, Nov 04, 2008

For the past few years, the world’s slot machine manufacturers have been redefining the slot machine itself.

It is true that “server-based gaming” has become a catch-phrase for the future of slot machine technology, but what that term—which really defines a content delivery method—means for the games themselves is only beginning to be understood.

That includes understanding by the slot manufacturers themselves.

The world’s slot-makers are beginning to apply technology that will work on the server-based, networked floor of the future. In the process, players are being treated to a wealth of new ways to play a slot machine. The slot has been redefined only a few times in the past 100 years—and most of that during the past two decades. Digital technology is moving the games once again along their evolutionary scale.

Welcome to “Global Games,” our annual spotlight of slot machine technology, and the industry’s official first peek at what the slot manufacturing sector has in store for the coming year. The following pages will reveal game styles that maximize the entertainment value of state-of-the-art technology, while following the trends of player preference that slot developers have learned from the players themselves.

Our Global Games section highlights the slot games that will be revealed at the Global Gaming Expo in Las Vegas, which this year runs from November 18 through November 20. Much of the information on the following pages is exclusive to Global Gaming Business.

Beyond the games themselves, though, this feature will examine the trends appearing as the age of server-based gaming draws nearer. Communal play is all the rage, with several slot-makers launching themed banks of games with common bonus rounds joining players in events or in competition. You’ll find that the spinning reel is far from dead; three-reel and five-reel formats now mimic the multi-line game play that has been the mainstay of the video slot for years. And, you’ll find that the progressive jackpot in both stepper and video format is now more often than not a multiple progressive setup, with the big prizes often won through free spins or second-screen bonus rounds.

Most of all, you’ll find that the slot machine continues to tap the best of what computer technology has to offer.

We hope you enjoy our peek into the future of the slot machine. Use it as your guide to the slot vendors on the G2E floor, and as your guide to the state of the slot machine over the coming year.

By Frank Fahrenkopf   Tue, Nov 04, 2008

For more than three decades, the commercial casino industry has enjoyed a predominantly steady and successful course of growth and expansion throughout the United States. Through innovation and with agility, our industry has adopted new gaming technologies, created more diverse entertainment offerings and overall greatly enhanced the customer experience. Even in tough economic times, when other industries have experienced significant challenges, our industry has remained relatively stable.

This growth and development often has continued in spite of numerous challenges the industry has been confronted with. Whether dealing with vocal opposition in new jurisdictions or recovering from natural disasters such as Hurricane Katrina, our industry has persevered and, in fact, grown stronger after facing down these tests.

Today, our industry is faced with a challenge the likes of which we have not seen before. The current economic instability the U.S. is experiencing is affecting businesses of all stripes. In the past, some have used the term “recession-proof” to describe the commercial casino industry. This characterization always has tended to exaggerate our industry’s general stability during tougher economic times, and it is clearer now more than ever that the idea that our industry is immune to economic downturns is simply an old wives’ tale.

We are a consumer-driven industry. It therefore comes as no surprise to those of us within the industry, or those who follow our industry, that we are impacted by the current economic situation just as any other consumer-driven businesses would be, particularly those in the hospitality sector. I know we all are well aware of the impact of our customers taking shorter trips for fewer days, and of cutbacks in airline service that are making those trips even less likely. And, as more and more casinos have incorporated unique retail and dining offerings, we also have been affected by people spending less on luxury items and on eating out at nice restaurants.

As you know, another economic factor currently affecting the industry is the tightening of capital markets. Depending on which segment of the industry you work in, you may already have seen firsthand how the drying up of financing for development projects is forcing companies in our industry to rethink the timetables for some projects, both those already under way and those not yet begun.

The economic challenges facing the industry are serious, and while the economic picture looks different from state to state, our industry as a whole certainly has felt the impact of these challenges on our businesses.

The current economic situation, including the challenges it presents and how the industry can address those challenges, will be a prominent topic of discussion later this month at Global Gaming Expo in Las Vegas. G2E always has been the place where professionals from our industry come together to share the new ideas, innovations and best practices that will advance the field of gaming entertainment. This year, G2E will once again provide an important forum for our industry, with industry leaders and gaming professionals from around the world converging on Las Vegas to examine the complicated economic environment in which we find ourselves and discuss how best to navigate it.

The opening keynote address at G2E 2008 will serve as a launching point for this important discussion as Ron Insana, an accomplished financial expert and former CNBC contributor, provides his perspective on today’s top financial issues and their influence on the gaming industry. In addition to his past position as a regular contributor on CNBC, Insana has written for USA Today and Money magazine, hosted a nationally syndicated radio show, and authored three books about Wall Street. There is no doubt his considerable expertise in the financial world will be of great value to our examination of the industry’s economic health.

The following day, I will moderate G2E’s State of the Industry keynote, which this year will focus on the theme “Evolution of Global Gaming.” During this event, our panel of industry leaders will discuss the key issues currently affecting the industry, including how we can use today’s challenging economic climate as a springboard for future growth and innovation. For those of you planning to attend G2E, this session is not to be missed.

In addition to these important opportunities for learning and discussion, most of the conference tracks at G2E 2008 will incorporate at least one session examining how the current economic situation is affecting that particular sector, and how to best plan for the future. Whether you are in F&B or security, table games or corporate social responsibility, you will hear from experts in your field about mitigating the negative effects of the financial climate and developing successful strategies for your business.

At this time in our industry’s history, there is a quote, attributed to the ancient Roman philosopher and poet Horace, that I think is particularly appropriate: “Adversity has the effect of eliciting talents, which in prosperous circumstances would have lain dormant.”

Ingenuity and innovation have long been part of the legacy of the commercial casino industry, and they are traits that often have helped us overcome past challenges. And while these traits certainly have not been “dormant,” it is in challenging times such as these that they serve us best. We cannot predict what the future will hold, but we can consider this difficult time an opportunity to closely examine our businesses and use the ingenuity and innovation that have served us so well in the past to make the improvements and adjustments that will help us better weather this type of storm in the years to come.

By Frank Fantini   Tue, Nov 04, 2008

As investors rummage through the wreckage that is gaming stocks, the environment looks much different than past collapses, such as the 1990s bursting of the riverboat bubble.

Then, the damage resulted from sky-high optimism crashing down on the realities of building too much too soon, combined with the burden of expensive junk-bond debt.

What occurred was classically Darwinian. Newer, bigger boats transformed the pioneer money machines into starving relics. Big fish like Harrah’s ate up little fish like Players. And some little fish, like Penn National, also devoured small fish like Hollywood, becoming big fish themselves.

Back then, Ameristar and Argosy could be bought for $3, Isle of Capri for a buck, Hollywood for under a dollar.

But commercial casinos were still a growth industry. Casinos generated big cash, if one could look beyond the debt. Indian casinos were not yet significant competitors. The economy was strengthening following recession, and Las Vegas and Atlantic City revenues grew year after year.

The opportunity then was to buy a big company that was swallowing up the little guys, and then refinancing debt to lower cost. Or to buy a little guy like Showboat knowing that, sooner or later, a Harrah’s would come calling. Or to buy an MGM Grand or Mirage and grow with it.

Today offers more somber prospects.

It is true that gaming stocks have been way oversold and opportunity exists for 50 percent or 100 percent gains coming off very low prices. But the prospects for further gains after an initial rebound require more patience, and the understanding that investors will not get the 10, 20 and even 30 times returns they once got with Isle of Capri, Ameristar, Argosy and others.

Look at the differences:

• Growth. Though there may be some industry expansion as states seek new revenue, few jurisdictions are opening, and they are opening grudgingly.

Take Kansas, for example. It legalized slots at racetracks, but at such a high tax rate that not a single track has installed slots.

Maryland, likewise, may legalize slots, but at another 60-plus percent take. At that rate, the slot parlors will just take convenience gamblers from regional competitors, not truly grow the industry.

• Acquisitions. There cannot be as many buyouts in the future simply because there are fewer companies left to buy. And this time, buyers will be bargain-hunting, not paying up.

• Economy. In the 1990s, the United States was coming out of recession. Today, it’s heading into one.

Related to this is the new casino resort business model.

Back then, gambling was the name of the game, providing the majority of revenues and virtually all of the profits.

Then, Las Vegas casinos evolved into upscale entertainment complexes with $300-a-couple dinners, $100-plus show tickets and trendy shopping malls.

Hotel rooms, once given away to win gamblers’ losses, now were seen as valuable cash generators bringing in tourists at $300 a night. The reasoning was simple. Hotel rooms are fixed costs. Every dollar added to the room price fell to the bottom line.

But in the consumer recession we are experiencing, scrimping customers are putting the effect on profit in reverse.

• Debt, Capacity and Capital Costs. It wasn’t all that long ago that a few hundred million dollars built a really nice and profitable casino.

Then along came Bellagio. The era of the $1 billion megaresort had begun, leading to an arms race pursuing the upscale market with resorts costing $2 billion, $3 billion and more.

There are two problems here.

1. Each of these properties requires Bellagio-size revenues to be profitable, and to be profitable enough to attract investor dollars to finance more growth. And the market can handle only so many Bellagios.

2. They are all chasing the same free-spending, upscale customer.

So, in Las Vegas, revenues are falling double digits, yet thousands more hotel rooms are in the works. And the model is being exported to Macau, where it is unproven, to Atlantic City, which actually might benefit from must-see resorts, and on a more modest scale to regional casinos.

How this will play out is uncertain. Will multibillion-dollar resorts become wealth destroyers rather than creators? Will there be a survival of the fittest where the niche players such as Wynn, and the national companies such as Harrah’s and Boyd survive, while the single-property Fontainebleaus struggle? Will once-proud resorts such as Mirage and the Rio get pushed down the food chain, as has happened to others over the years?

Or will Las Vegas and the casino industry emerge stronger, and perhaps with a more realistic understanding of how much can be spent to get a return, and of the central role of gambling in the resort profit and revenue mix?

We prefer the last prospect, but understand that this is a long process to work out. The days of throwing darts and picking winners in the casino industry have ended.

Frank Fantini is the editor and publisher of Fantini’s Gaming Report. A free 30-day trial subscription is available by calling toll free:

1-866-683-4357 or online at

www.gaminginvestments.com.

By GGB Staff   Tue, Nov 04, 2008

Another casino has closed its doors in the U.K. The Grosvenor Casino at Leeds called it quits after 40 years of operation. Reasons given for the move by operator Rank Group included the 500 percent increase in gaming tax since September 2007. A new casino in the city center had opened one month prior to the closing.

Increased efforts to combat money laundering are planned by the government of Nicaragua. Casinos and other companies where money is transferred will be regulated in this area by the Commission of Financial Analysis, which is headed by the Attorney General’s Office.

Michigan’s Saginaw Chippewa Tribe has repealed a tribal law barring unions at the S oaring Eagle Casino & Resort in Mount Pleasant, which Teamsters Local 486 tried to organize. The move heads off a National Labor Relations Board ruling on unfair labor practices the Teamsters claim. “We got 99 percent of what we wanted,” says a union agent. The tribe maintains NLRB has no jurisdiction over the casino as part of a sovereign nation.

California Governor Arnold Schwarzenegger has signed Senate Bill 1369, which allows charities to run remote-caller bingo games and bars such groups from raising money with electronic bingo machines, to which state gaming tribes claim exclusive rights. Charities and tribes had pursued their goals separately; the bill was a hurried compromise lawmakers saw as preventing threatened cutoffs of tribal revenue sharing. Many small charities expect the new law to put them out of business.

The first nationwide Mega Jackpot has been introduced in Poland by Casinos Poland. The progressive system links slot machines from the group’s six full casinos. The group is 33-percent owned by Vienna- and Colorado-based Century Casinos.

Birmingham, Alabama Mayor Larry Langford wants a local vote in November to legalize electronic bingo at the Birmingham Race Course. The machines would bring the city $20 million a year, Langford says. Most city councilors favor the idea, but Alabama lawmakers would have to enact a law to put a favorable vote into effect. Governor Bob Riley opposes the plan.

As expected, the U.S. Bureau of Indian Affairs has taken an 11-acre casino site into trust for California’s Habematolel Pomos tribe of Clear Lake. The land, 115 miles northeast of San Francisco, goes into trust for the restored tribe under the Indian Reorganization Act of 1934 unless the move is challenged within 30 days. Backed by Luna Gaming of Detroit, Habematolel plans a $35 million casino with 349 slots upon gaining a state gaming compact.

The management of Slovenia’s Casino Maribor says the casino is again facing insolvency. A debt reorganization started in 2003 has not yet been completed and already there are new problems. If the court does not OK the start of the new reorganization, the casino will be forced to file for bankruptcy. If the court does agree, management will draw up a recovery plan by the end of 2008. The casino is said to be seeking a strategic partner.

The three coalition parties governing Bulgaria have agreed to regulatory amendments that could lead to regulated online gaming. The amendment is intended to benefit the state lottery and will also expand the lottery’s distribution network.

The only Jimmy Buffet Margaritaville restaurant in the Northeast had its grand opening last month at the Mohegan Sun’s Casino of the Wind in Connecticut. ”You can never have a bad time at Jimmy Buffett’s. So rock on,” announced Mohegan Tribal Chairman Bruce “Two Dogs” Bozsum. The Casino of the Wind is the Sun’s most recent expansion, and the grand opening of Margaritaville was much anticipated. It was a positive note compared to the tribe’s announcement earlier in the month that the rest of the expansion has been put on hold until the economy improves. The restaurant is nothing if not expansive, even including a life-sized airplane hanging from the ceiling.

The city council of Kansas City, Missouri is clarifying the rules of a public tobacco ban that was passed earlier this year in a voter initiative. The council last month approved a rule change that would permit smoking in establishments where more than 80 percent of the sales are related to tobacco. The rule change also made it clear that smoking in casinos can only happen in areas where minors are not allowed. The change will benefit casinos such as  the Harrah’s and Ameristar Kansas City casinos.

Empire Resorts Inc. and Concord Associates LP announced last month that it has received $250 million in financing for a $1 billion Catskills resort project from Union Labor Life Insurance Co., an insurer with close ties to organized labor.

Developers in Delaware want to build a harness racing track north of Millsboro, and plan to open in the summer of 2011. A one-mile- long track and clubhouse could be augmented by hotels, shopping and a family entertainment complex (not to mention a racino), say the developers.

By GGB Staff   Tue, Nov 04, 2008

The gaming industry is used to seeing protests of its games and devices. Now, however, it is a game designer who is asking the public to petition the government to “Terminate the Terminals” on which a version of his game is operating.

The terminals in question are the otherwise popular fixed odds betting terminals—FOBTs—which have been producing huge returns for Britain’s betting shops. The machines offer games and sports simulations that have statistically pre-determined outcomes.

The problem is that games like roulette and blackjack when played on the FOBTs do not offer the same odds as their traditional table game counterparts. But while their inventors are not around to object, the creator of the popular Three Card Poker is.

“Gambling should be fun, open and fair—but these terminals offer players little hope,” said Derek Webb, who developed and spent years promoting Three Card Poker, in a press release.

“The theoretical amount per bet that players lose on many bets is higher, and the actual percentage of player cash-ins that players lose is higher.

“In addition, the probability that players will lose all their available cash on a session is much higher.”

Webb describes the differences between the table game and the terminal version of Three Card Poker in an article on the website he created to mount his campaign, fairandopengambling.net. Although the terminal game is intellectually the same as the table game, terminal payoffs to players are lower.

“The U.K. Gambling Commission admits that these machines are ‘particularly attractive to those at risk of problem gambling and those with a gambling problem,’” quotes Webb. “The primary purpose of gambling regulation should be player protection, not the protection of gambling operators or the protection of government revenue from gambling.

“We want the regulators and the government to do their duty and effect the removal of these terminals.”

By GGB Staff   Tue, Nov 04, 2008

More jobs and more tax revenue. Those are the two main advantages for Ireland if lawmakers decide to allow a land-based casino industry and an online gaming industry to flourish there, according to a report by DKM Economic Consultants.

The report, commissioned by the Gaming & Leisure Association of Ireland, estimates 3,000 jobs will be created by a land-based casino industry. The national treasury would benefit by the annual addition of €50 million to its coffers.

But the development of an online gaming industry could produce even a bigger return, the report states, if Ireland can manage to host just 5 percent of the business.

Given a global online gaming industry that DKM estimates is currently worth €44 billion a year and which it expects will grow to between €95 billion and €130 billion annually by 2015, Ireland could see 10,000 new jobs created in information technology, financial services, advertising and other peripheral businesses over the next 12 years. For the national treasury, it could add up to €230 million a year.

John Lawlor, who wrote the report for DKM Economic Consultants, said, “As the government’s own Casino Committee’s report highlighted, there is a particular window of opportunity for Ireland at the moment, because the online sector is currently largely based in offshore locations that tend to suffer from limitations in terms of IT infrastructure or specialist skill sets. According to the industry sources we have consulted, they would prefer to move onshore to more established and larger jurisdictions, but no such jurisdiction has moved to adequately accommodate them as of yet. This window of opportunity is unlikely to remain open in the long run, however, as strong growth in the sector and straitened economic times make them an attractive target.”

By GGB Staff   Tue, Nov 04, 2008

Casino operators in France are hurting from this year’s smoking ban. Now, the damage to operators’ bottom lines might be making some companies targets for takeover.

Qatari Diar, subsidiary of the Qatar Investment Authority, has acquired 22.7 percent of luxury hotel and casino concern Groupe SFCMC—Société Fermière du Casino Municipal de Cannes.

The group’s two casinos recently reported results down by 20 percent this past year due to the smoking ban, tougher visitor identification procedures and the poor economy.

The move comes two months after Qatari Diar sought to obtain 30 percent of fabled Monaco casino resort operator SBM. That move was thwarted when SBM refused to allow Qatari Diar more than 10 percent.

The Qatar investment entity found a more receptive target in SFCMC further along the Riviera, in Cannes.

SFCMC is controlled by the Desseigne- Barrière family, which holds over 70 percent. Qatari Diar would like to have 40 percent ultimately.

By GGB Staff   Tue, Nov 04, 2008

A recent scientific study in the Netherlands has concluded that local gamblers of Moroccan or Turkish descent suffer addiction to gaming more often than do gamblers with a Dutch or other Western European background. Gamblers whose heritage is Antillean, Surinamese or Chinese figured somewhere in the middle.

The study was ordered by the Justice Ministry's Center for Scientific Research and Documentation and performed by the Center for Addiction Research.

A total of 544 interviews were conducted with frequent gamblers of various ethnicities. Of those interviewed, 181 were from non-European backgrounds.

The Moroccan and Turkish gamblers were three to 11 times more likely to be addicted than were Dutch gamblers. Those from the Antilles were two to five times more susceptible, with Chinese and Surinamese one to three times more.

The researchers concluded that demographic factors such as gender, age, income and education play a more important role in gambling addiction, but that the heritage of a person can be a predictor of the depth of the problem.

By GGB Staff   Tue, Nov 04, 2008

The state of Queensland, Australia, wants to cut back on hours of non-casino gaming clubs.

The state’s almost 130 pubs and clubs with slot machines are operating at least 19.5 hours a day. Most of the clubs are licensed to serve alcohol from 8 a.m. until 3:30 a.m. with some serving as late as 5:30 a.m. Gambling is permitted during hours when alcohol is served.

The Courier-Mail quotes Treasurer Andrew Fraser, the minister in charge of liquor licensing, as saying, “We don’t believe the community supports drinking or gambling before breakfast.”

Laws introduced in Parliament this month would greatly reduce the operating hours of slot machines outside of casinos.

The new licensing system would set standard hours for serving alcohol at 10 a.m. to midnight.

Special “Elevated Risk Permits” would be available in two categories, for serving alcohol between midnight and 3 a.m. and for serving from 3 a.m. to 5 a.m.

By GGB Staff   Tue, Nov 04, 2008

The president of the Bermuda Chamber of Commerce, Philip Barnett, was happy with the announcement in June that cruise ships visiting the island would be allowed to operate their casinos at night while in port.

But according to a report in the Royal Gazette, he’d be even happier if Bermuda had its own land-based casinos to offer visitors.

“We need to have a dialogue to move towards allowing a casino operation to be on land in Bermuda,” said Barnett, who owns the Island Restaurant Group Ltd. “We have lost our original cachet that we had 30 or 40 years ago with regard to our nightlife and entertainment.”

Barnett believes that it is unfair to have outside operators offering casino gaming when Bermuda’s own businesses are prevented by law from providing the same service. He claims that many Chamber members have come to him with their concerns on the subject.

In June, Premier Ewart Brown announced that visiting cruise ships would be allowed to “provide full entertainment inclusive of the opening of casinos after 10 p.m. while in port.”

In return, the cruise lines must contribute six-figure amounts to on-shore cultural events.

Brown is attempting to reverse the anti-gambling trend created by his predecessor, Alex Scott, who managed to outlaw Bermuda’s gaming machines in 2004. The Royal Gazette reports that the pro-gaming premier has played in poker tournaments outside Bermuda and appeared at a gaming tournament at the Playboy Mansion in Los Angeles.

Barnett fully agrees with the new policy.

“For many people, the majority of people actually, gambling is simply a form of entertainment,” he said.

Of course, there is opposition to casino development as well.

Bishop Lloyd Duncan of the New Testament Churches of God calls gambling a vice and says land-based casinos could hurt the island’s inhabitants.

“I feel as a community we just need to be very careful as to what we legislate,” Duncan said. “To me, it’s just opening the door and the vice gets its foot in the door.”

Barnett believes otherwise.

“Gaming is not a vice,” he said.

Pointing to the fact that Bermuda residents can already bet on sports, play bingo, gamble online or fly to Atlantic City in a few hours, Barnett said it is ridiculous to ban casinos.

“There’s all sorts of unlimited access to gaming,” he said.

By GGB Staff   Tue, Nov 04, 2008

The Novomatic Group of Companies recently scored a major victory in its war against the illegal copying of gaming machines, software and machine parts. It is the latest win in what has become an international crusade against copying piracy, led by the Austrian Novomatic Group, which is achieving concrete results in Russia.

The successes so far have been the result of close cooperation between Novomatic, international law firms and local police authorities. And a major international alliance may put a dent in the crime.

Several of the top slot manufacturers in the industry announced last month that they are forming a partnership to battle piracy of intellectual property in the gaming industry.

The Gaming Industry Piracy Alliance will provide a structure through which members can jointly participate in the enforcement of intellectual property rights. In addition to Novomatic, group members include Aristocrat Technologies, WMS Gaming, International Game Technology, Konami Gaming, Atronic International, Spielo Manufacturing and Progressive Gaming International.

The group will carry out joint investigative operations and other efforts targeting piracy on an international scale. Specific regions being targeted by the group include North America, South America, Asia, Central and Eastern Europe (CEE Countries) and the Middle East.

Members of the group have successfully initiated criminal and civil proceedings in various countries worldwide against parties known or suspected of product piracy and intellectual property theft. These cases have resulted in court orders and raids that permanently shut down a number of international piracy operations. The new alliance allows manufactures to pool resources in efforts such as this.

“GIPA members expend significant resources in creating intellectual property. The formation of GIPA demonstrates the importance we place on protecting those valuable assets,” said Orrin Edidin, president of WMS Gaming Inc.    

A recent press release from Novomatic described how in late September, special forces in Kazan, a city about 400 miles east of Moscow, raided a factory capable of producing 2,500 Gaminator slot machines per month. This was the biggest illegal operation broken up to date and demonstrated the immense scale of the current industry dealing in pirated gaming technology.

In all such cases the counterfeit machines and parts are destroyed. But the problem of pirated gaming devices goes beyond the loss of a few thousand potential sales.

For sophisticated technology companies, whose game software is protected from duplication, damage to reputation can occur when players think they are playing a name-brand machine but in fact it is a counterfeit copy. The accompanying false game software will not give the same player experience as the original version, and in many cases the odds of winning will have been reduced as well. As a result, a player who unknowingly encounters an imposter machine may become turned off to the legitimate version of the game. And especially in the gaming industry, a reputation for providing fair play and consistency are crucial to success.

By GGB Staff   Tue, Nov 04, 2008

One of the four groups bidding for the opportunity to refurbish and operate the Hotel Casino Carrasco in Montevideo, Uruguay, is crying foul.

The accusing party is a consortium made up of the Hyatt hotel chain and the investment group Liberman. A representative of the consortium, Marcelo Graniero, questioned the transparency of the tender process being conducted by the city council.

The problem, according to Graniero, is that the Montevideo Council’s guidelines require a certification that the financial aspects of the company and the project are sound. When the proposals were submitted, Graniero maintains, only the Hyatt-Liberman plan fulfilled the financial requirement.

The three other companies seeking the contract are Codere (Spain), with Accor handling the hotel aspects, Tsakos (Greece) and Pestana (Portugal).

The Tsakos representative, Armando Bonilla, rejected the accusation by Graniero, saying that the economic base of his company was “irrefutable.” A representative of Pestana had no comment. Codere is a well-known name in gaming in Spain and throughout Latin America.

The financial requirement is only one of several by which the Council judged the proposals in this first phase of the process. This first stage also included a description of the administrative software that would be used to oversee the licensee, the architectural proposal and the business plan for operating the casino.

By GGB Staff   Tue, Nov 04, 2008

Gaming operator Codere is having a fine year, especially considering the state of the world economy. The multi-faceted gaming concern showed a 21 percent increase in gross gaming revenue in the first half of 2008, to €504 million. EBITDA was up 16 percent, to €120 million.

But that doesn’t change the fact that the Martinez Sampedro family may have to put up for sale its 71 percent stake in Codere.

The problem is time. A €188 million payment from the Martinez Sampredo family to the Franco family is coming due October 30. The payment is the final installment owed the Francos for the sale of their 41 percent of Codere in April 2006.

However, paying the €188 million would be valuing the company’s stock at €20.5 a share for the next half, which is just shy of the €21 price the shares commanded in November 2007 when Codere went public. And unfortunately, the current price per share is about €12.

If the Martinez Sampredo family does fail to meet the scheduled payment, it sets up the conditions for one or more of the following scenarios:

Codere could become a target for takeover by another diversified gaming concern. With its mix of casinos, bingo halls, racetracks, sports betting shops and 50,000 slot machines in arcades, the Latin-world facing Codere could be of interest to the likes of Australia’s Tabcorp, Greece’s OPAP or a U.K.-based operator like Ladbroke’s.

Another possibility—although less likely with today’s credit crisis—would be a sale to investment funds like Permira or Carlyle, which showed some interest when Codere was going public last year.

A third option might be that the Martinez Sampedro family fails to make the payment and then bids for the shares at a lower price.

If a new owner does result, Spain’s CNMV could order it to make a tender offer for 100 percent of Codere.

By GGB Staff   Tue, Nov 04, 2008

Australian gaming and entertainment giant Tabcorp last month announced plans for an A$475 million investment—about US$400 million—in its Star City Casino in Sydney.

In a month dominated by worries that the international financial system was near collapse, it was unusual to see a major operator showing confidence in the future.

“The expansion will make Star City the destination of choice for entertainment in Sydney,” said Tabcorp CEO Elmer Funke Kupper. “The new license agreement with the New South Wales government allows us to make a substantial investment and make the casino an integral part of ‘Brand Sydney’ that will attract domestic and international visitors. It is a great outcome for customers, for the state and for Tabcorp.”

The new license agreement extends Star City’s exclusivity and concession deal with New South Wales for another 12 years. The casino is over 10 years old.

The casino currently has 200 tables and 1,500 slots. The number of tables may be increased, subject to Casino Control Authority approval, but the number of slots will remain the same.

The project will see Star City undergo major and minor changes in a variety of areas.

A new five-star, 309-room hotel will be built next to the casino. The hotel will also add 500 parking spaces to the casino complex.

Up to 30 bars and restaurants will be available to visitors when the project is completed. The existing ballroom will be enlarged to accommodate at least 1,200 guests. Additional conference and banquet facilities are also planned. One of two existing theaters will become a multi-purpose venue for concerts, telecasts, film and fashion shows and will hold a new sports book. The other theater will continue to be used for world-class stage productions.

The casino floor will be modernized and expanded in the direction of the harbor, which the current casino does not utilize. The entire casino will be reoriented, with a grand entrance that will face the Sydney harbor and skyline. At present, the casino entrance faces landward and makes no use of the dramatic harbor setting.

Walter Bugno, Tabcorp’s chief executive of casinos, said, “This is our chance to build a world-class casino and entertainment complex.”

The new complex will use environmentally responsible materials and systems and employ energy conservation measures.

The plans are currently being studied by the New South Wales Planning Department. Once approved, construction should start in early 2009 and be completed in 2011.

Star City was initially operated by the old Showboat company under a license issued to Sydney Harbour Casino Pty Ltd. A temporary casino opened in September 1995, with the permanent casino opening two years later. Harrah’s acquired Star City in 1999, but only operated it for a few months before selling it to Tabcorp in 2000. It is the second-largest casino in Australia—after Melbourne’s Crown Casino—and features two gaming floors.

By GGB Staff   Tue, Nov 04, 2008

The company that opened the first regulated online casinos announced that it would stop taking bets on its three websites, Lasseters Online, AusVegas and Lasseters Euro.

The casinos lost $15.5 million in the last financial year, and while parent company Lasseters International debates an outlay of more capital, Lasseters Corporation can no longer afford to accept wagers.

By GGB Staff   Tue, Nov 04, 2008

An original award of $2.6 million did not represent the full amount of money PartyGaming should have faced as a forfeiture in a trademark lawsuit with WMS Gaming, according to a federal appeals court that is allowing the manufacturer to seek more than $287 million in damages.

The lawsuit stems back to 2006, when PartyGaming used the names “Jackpot Party” and “Super Jackpot Party,” which WMS said it has trademarked as far back as 1997. The Gibraltar-based PartyGaming did not appear in court to contest the case, claming the U.S. had no jurisdiction.

WMS asked a judge to award $287 million in profits as part of the default ruling. That figure comprises all of PartyGaming’s profits from its U.S. operations in 2004, 2005 and 2006. WMS attorneys argued that because PartyGaming never supplied a breakdown of its profits from various games that were not part of the trademark violation, it should forfeit all of its profits.

The presiding judge instead awarded a “reasonable” estimate of $2.6 million, arrived at by multiplying by three the estimated actual damages WMS claimed in 2004 of $866,000.

The 7th U.S. Circuit Court of Appeals issued a ruling September 8 agreeing with WMS, and ordering the lower court to reverse its decision.

“Courts consistently find that when a trademark plaintiff offers evidence of infringing and the infringer fails to carry its statutory burden to offer evidence of deductions, the plaintiff’s entitlement to profits under the Lanham Act is equal to the infringer’s gross sales,” wrote the court.

By GGB Staff   Tue, Nov 04, 2008

The ongoing dispute between the United States and Antigua and Barbuda over World Trade Organization obligations could drag on into a new presidential administration, according to a key figure in the negotiations.

Antigua Finance Minister Dr. Errol Cort said there have not been any developments in negotiations with the U.S., and there are three likely possibilities for an outcome:

• send the matter back to the WTO and let it determine reasonable compensation owed to Antigua and Barbuda;

• let the matter drag into a new U.S. presidential administration that will take office in January; or

• simply accept the provisions that the two parties have agreed upon.

Cort ultimately concluded that continued negotiations would be necessary before a decision can be reached.

With another deadline to resolve the matter fast approaching, the two parties are expected to file another extension and continue negotiations.

By GGB Staff   Tue, Nov 04, 2008

The state of Kentucky is taking an aggressive approach to “stop illegal and unregulated online gambling” by seeking a judicial order to seize a number of domain names associated with online gaming sites.

The state won an initial ruling September 22 that gave it the right to seize 141 domain names including GoldenPalace.com, AbsolutePoker.com and PokerStars.com, but on September 27, a judge rejected the order and listened to arguments at an October 8 hearing. All the domain names are owned by European companies that are regulated and legal in their home jurisdictions.

Attorneys fighting the initial ruling laid out a number of questions for Judge Thomas Wingate to address, including:

• Do websites qualify as gambling devices under Kentucky law?

• Does Kentucky law expressly prohibit online gambling?

• Does a state have the power to seize a domain name connected to international commerce, traditionally a matter reserved for the federal government?

• Do the elements of skill preclude poker sites from being considered gambling sites?

• Do the actions of Governor Steve Beshear violate the U.S. Constitution’s due-process provisions?

Following the initial ruling, Beshear’s office released a statement condemning unregulated internet gaming for undermining the state’s horse racing industry, attracting underage gamblers, enabling money laundering schemes and failing to protect consumers.

“Unlicensed, unregulated, illegal internet gambling poses a tremendous threat to the citizens of the commonwealth because of its ease, availability and anonymity,” Beshear said. “The owners and operators of these illegal sites prey on Kentucky citizens, including our youth, and deprive the commonwealth of millions of dollars in revenue. It’s an underworld wrought with scams and schemes.”

Jennifer Brislin, a spokeswoman for Kentucky’s Justice and Safety Cabinet, said the state wants nothing more than to block access to online gaming for its residents. She said there is technology that should allow sites to identify the location from where a player is logging in, and the state wants these sites to use that technology.

“Our goal is not to enforce our laws anywhere else except within the borders of Kentucky,” Brislin said.

A major question is how many registrars will comply with a ruling that upholds the initial decision. The Kahnawake Gaming Commission, which operates a number of the sites named in the seizure order, said it would not.

The Canadian First Nation sent a letter to the governor saying it will not comply with the state.

“This is a perfect example of someone who knows nothing about the effects of their actions,” said Kahnawake Grand Chief Michael Ahrihrhon Delisle, Jr. “It’s not the first time that a government has tried to prevent us from conducting business and it won’t be the last. But, rest assured, we will always protect our jurisdiction and the integrity of the Kahnawake Gaming Commission.”

By GGB Staff   Tue, Nov 04, 2008

In a landmark case, Singapore’s high court ruled that a businessman who lost $4.4 million in Las Vegas and left the country without paying his debt must abide by a 1999 U.S. court ruling and repay the money he owes.

Traditionally, gambling debts incurred in non-commonwealth countries could not be recovered in Singapore.

Poh Soon Kit lost the money at Caesars Palace over a six-year period beginning in 1992. He has appealed the ruling.

The ruling also has implications for two casinos that will open in Singapore soon. If the country is willing to help casinos in other jurisdictions recover their debts, reciprocity is expected to benefit Singapore casinos.

By GGB Staff   Tue, Nov 04, 2008

It’s still more than a year before Marina Bay Sands, the Singapore integrated resort of Las Vegas Sands Corporation, opens, but if GM George Tanasijevich is correct, the property will be profitable from the start.

“Overall, we remain extremely optimistic about the prospects for Marina Bay Sands and the future of the tourism industry in Singapore with China, India, Indonesia, Malaysia and Thailand serving as key source countries for both the business and leisure tourist markets,” said Tanasijevich. “We are targeting the premium and high-net-worth segment, along with mass affluent leisure and business travelers.”

With access to China, India and all of Southeast Asia, Tanasijevich believes that Marina Bay Sands can attract business from all markets.

“Multinational corporations seeking to hold corporate events or participate in exhibitions gravitate towards such strong markets where they anticipate demand,” he says. “Therefore, our MICE-driven business model serves to mitigate the effects of a challenging economic climate.”

With LV Sands’ expertise in operating and marketing in Asia, and with the business market, Tanasijevich says he expects his property to prosper.

“We are confident that Marina Bay Sands will be a destination filled with buzz, excitement, and something for everyone,” Tanasijevich said.

Some experts believe that Asian gaming jurisdictions outside of Macau will benefit from the visa crackdown by the Chinese government on its citizens visiting Macau. Where Chinese nationals were once able to visit Macau twice a month, they are now limited to once every three months. It is expected that VIP operators will make deals in Singapore, the Philippines, Cambodia and elsewhere to lure Chinese gamblers to those destinations in between Macau visits.

By GGB Staff   Tue, Nov 04, 2008

The two casinos in Busan, Korea, saw a combined increase of 18 percent in gaming revenue through the first nine months of 2008.

The 60.1 billion won (around US$53 million) taken in by the Seven Luck Casino and the Casino Busan compared to 51 billion won for the same period in 2007.

The Korea Times reports the Seven Luck Casino accounted for 31.1 billion won and the Casino Busan 28.9 billion won.

Overall visitors to the two casinos—mostly Chinese and Japanese tourists—increased from 88,000 for the nine months in 2007 to 136,000 in 2008. Seven Luck, which opened in mid 2006, had more than double the number of visitors as Busan—93,750 to 42,550.

Only foreign tourists are allowed to play at these and 14 other casinos around the country. Residents are only allowed to play at the Kangwon Land Casino.

By GGB Staff   Tue, Nov 04, 2008

Macau has its Cotai Strip. Singapore has its two multibillion-dollar integrated resorts. Now Manila will get into the game with a multi-casino project on Manila Bay. Some had doubted whether the project, announced last year, would ever get off the ground. But last month the Philippine Amusement & Gaming Corporation (PAGCOR) announced that it will break ground early next year.

“We expect to begin construction of the project by first quarter of next year. The project will then take about five years to complete,” said PAGCOR President Rafael “Butch” Francisco.

Called “Entertainment City,” the project received final OK from the local government of Paranaque for tourism ecozone status. It was the final approval necessary for the project. It will be partially funded by PAGCOR, but most of the $15 billion price tag will come from operators of the hotels, casinos, theme parks, shopping malls and other recreational activities planned for the site. The 150-hectare (370-acre) site will host at least four integrated resorts.

Three prospective operators—Malaysia’s Genting International, in partnership with local real estate developer Andrew Tan; Japan’s Aruze Corp.; and Philippine retailing company SM Investments, with a site adjacent to the company’s giant Mall of Asia—are scheduled to break ground early next year with the first phases set to open in late 2010. The full build-out could take up to 10 years, however.

Several other operators have looked and passed for the time being, including Australia’s Crown Casinos, along with Wynn Resorts and MGM Mirage from the U.S.

The project will be a big boost for the Manila economy, says Francisco.

“This project will result in about 400,000 jobs, including the multiplier effect it will have on contractors, cement producers and other establishments to be built around the Entertainment City,” he said.

PAGCOR has had to battle a Philippine reputation for corruption and red tape, but so far, the process has been transparent. As the country’s regulator, as well as the operator, PAGCOR seems to understand the gaming equation from both sides of the fence.

“We want our investors to be comfortable, and above all make money here,” said Francisco.

Like other existing and prospective Asian gaming destinations, the Philippines is looking to increase tourism. In addition to the competition from Macau and Singapore, the Phillipines will go head-to-head for visitors with Vietnam, Taiwan, Thailand and Cambodia.

By GGB Staff   Tue, Nov 04, 2008

Melco International Development Ltd. Chairman Lawrence Ho has expressed interest in establishing casinos on Taiwan if the government there legalizes gambling.

The Earth Times quoted Ho, son of Macau gambling magnate Stanley Ho, as saying, “If the Taiwan government lifts the ban on gambling, I am interested in making investments in Taiwan.”

Responding to a question on the size of investment he might be willing to make, Ho put out the figure of between HK20 billion and 30 billion, about US$2.5 billion-$3.8 billion.

Ho made the comments while attending a seminar in Taipei, the subject of which was business opportunities in Taiwan and Hong Kong, and in mainland China.

By GGB Staff   Tue, Nov 04, 2008

In an effort to move more Macau citizens into management-level positions, Economic and Financial Secretary Tam Pak Yuen said beginning in 2009, the government will no longer accept applications for foreign workers to serve as supervisors in casinos, encouraging the promotion of native dealers.

Applications for foreign construction workers will be immediately halted and a review of workers currently employed by construction companies will be undertaken. The aim is to provide more high-paying construction jobs for Macau residents. Numbers of non-resident security guards and cleaning workers also will be cut in half in the next year, says Tam.

While Tam admitted that unemployment in Macau is low by international standards, he said his desire is to keep the city’s unemployment rate at less than 4 percent as the global economic downturn starts to impact Macau.

Director of Labor Affairs Shuen Ka Hung says training courses will be established by the government to teach dealers supervisory skills, including foreign language skills.

By GGB Staff   Tue, Nov 04, 2008

Dire warnings of declining gaming revenues in Macau started to come true in September when the former Portuguese colony posted lower numbers compared to the previous September. Macau gaming revenues declined 3.4 percent in September to 6.9 billion pacatas (US$863 million). Analysts blamed the decline on increasingly tight restrictions on visitation to Macau from the Chinese mainland.

Residents of mainland China can now only visit Macau once every three months. Just last year, visitors could arrive in Macau twice a month. Also holding down revenues is a current freeze on construction of new casinos and expansion of existing ones. And, there are fears of even greater travel restrictions.

“There are concerns that more visa restrictions that are more severe than the previous ones will be implemented,” said Gabriel Chan, an analyst at Credit Suisse. “The restrictions are damaging the sector.”

The bad revenue figures caused a steep decline in the share prices of Macau operators, including Las Vegas Sands, Galaxy, Wynn Resorts and others.

Chan was concerned about the ability of these and other companies involved in Macau to obtain funding for already-approved casinos and expansions.

“Because of the financial crisis, companies may face financing gap problems,” he said. “And even if these companies are able to complete these projects, there are concerns about whether there will also be demand for them.”

Also a problem for Macau operators has been the volatile VIP market, which accounts for up to 70 percent of gaming revenues. Now that payments to VIP operators have been capped at 1.25 percent by government decree and industry cooperation, the market has changed dramatically.

Melco Crown, which had achieved an 18 percent market share prior to the cap, has seen its share dip to 8 percent at Crown Macau. Wynn Macau has asserted its dominance over Crown, growing to control 19 percent of the market. Even second-tier operator Galaxy has moved ahead of Crown at 10 percent.

Crown’s $2.5 billion City of Dreams is scheduled to open next year, and the disappointing VIP results will put more pressure on that property to expand its appeal both to VIPs and to tourists.

Despite the fall in September revenue, total 2008 revenue is up more than 45 percent, and on a pace to exceed the $10 billion posted last year.

The Macau government isn’t alarmed about the revenue decline. Tam Pak Yuen, the Special Administrative Region’s secretary for economy and finance, says the industry is entering a “stable period.”

“The SAR government understands that local civilians concern about the development of the gaming sector,” he says, “and any insignificant trifle will bring up sensitive reactions, but the adjustment of staff by individual gaming operators can happen at any time.”

Davis Fong, director of Institute for the Study of Commercial Gaming at the University of Macao, disagrees, and says the government has a choice to make.

“The society must reach a common consensus on whether to maintain Macau’s gaming-led economy or extend vertically diversified development,” he said.

By GGB Staff   Tue, Nov 04, 2008

The Wichita and Affiliated Tribes plan in November to open a casino with 360 slot machines on five acres inside an old car dealership in Hinton, Oklahoma, near Interstate 40. Next year, the casino will add another 600 machines.

But a lot of questions, including questions by the newly elected president of the 2,392-member-tribe remain that are complicating  the opening.

The land was put into federal trust by the Bureau of Indian Affairs two years ago, but some are alleging that the tribe may have misled the BIA about its intentions to put a casino there.

The tribe’s attorney calls that suggestion “a non-story.”

By GGB Staff   Tue, Nov 04, 2008

The National Indian Gaming Commission’s general counsel has withdrawn the agency’s May legal opinion cautioning Oklahoma’s Fort Sill Apache tribe not to open its Apache Homelands Casino in Akela, New Mexico.

NIGC said in a court document that it is “reviewing and reconsidering” the opinion. One report said the tribe has put forth a “new argument” against it.

Fort Sill has argued that it is entitled to its 30-acre casino site 40 miles west of Las Cruces as a restored tribe. NIGC has countered that governmental relations between the feds and Apache bands from which Fort Sill descended before receiving recognition never ceased, so Fort Sill can’t be counted as restored.

New Mexico Governor Bill Richardson, who sent state police to prevent the casino from opening with 50 bingo machines earlier this year, “will continue to aggressively resist any efforts by the tribe to operate an illegal casino in New Mexico,” a spokesman said.

The 6,000-square-foot Apache Homelands now runs only a smoke shop and a cafe.

By GGB Staff   Tue, Nov 04, 2008

Without comment, the U.S. Supreme Court has declined to hear an appeal of a ruling that blocked the U.S. Interior Department from allowing Class III gaming in Texas after the state refused to negotiate a gaming compact with the Kickapoo Traditional Tribe. The court’s move could affect Alabama’s Poarch Creek gaming tribe.

Both tribes  have tried for years to get state gaming compacts that would let them supplement or replace their extensive bingo operations with slot machines. Federal law requires compacts for Class III slots but not for Class II bingo machines.

Alabama’s attorney general has sued in U.S. District Court in Mobile to prevent Interior from approving a Poarch Creek compact in lieu of one that Alabama refuses to discuss with the tribe.

Interior also stepped into Texas with “secretarial procedures” to let Kickapoo install slots at its Eagle Pass Casino. The state sued over being “forced” to accept gambling its laws deemed illegal, and the U.S. Fifth Circuit Court of Appeals sided with the state in August 2007.

The U.S. Justice Department decided not to appeal, although it disagreed with the Fifth Circuit decision to gut secretarial procedure sections in the Indian Gaming Regulatory Act. Like Texas, Justice urged the top court not to hear Kickapoo’s appeal.

By GGB Staff   Tue, Nov 04, 2008

On October 17, 1988, Congress passed the Indian Gaming Regulatory Act, and Indian Country was changed forever. While some consider it an assault on tribal sovereignty, others see IGRA as opening the door for full-scale casino gaming, creating the $26 billion industry that operates today.

Twenty years later, many of the officials who had a hand in the creation of IGRA, and others who have had a crucial role in the development of Indian gaming over the years, got together to look back and ahead.

A conference, “20 Years of IGRA: Indian Country’s Winning Hand,” held last month at the Fort McDowell Yavapai Nation’s resort and casino in Arizona, attracted almost 300 attendees to examine the roots and history of IGRA, as well as its economic, social and cultural impact on Indian Country and the communities that surround the reservations.

While it is clear that the growth of Indian gaming has been extraordinary over the past 20 years, the conference continued the debate over the role played by IGRA. An impressive array of speakers attacked the subject matter with vigor, and lively discussions were conducted between panelists and attendees.

In the end, most agreed that the American public needs to be educated about the sovereign nature of tribal governments and how they provide for their people by utilizing revenues gained from Indian gaming. Another point of agreement was that prosperous gaming tribes need to do more to encourage economic growth among non-gaming tribes and tribes with less lucrative casino locations.

A highlight of the conference was the Pathbreakers Award, honoring six individuals who played a key role in the development of Indian gaming: Frank Chavez, former chairman of the New Mexico Indian Gaming Association; Rick Hill, chairman of the Oneida Nation of Wisconsin; John James, chairman of the Cabazon Band of Mission Indians, Mark Macarro, chairman of the Pechanga Band of Luiseno Indians, Clinton Pattea, chairman of the Fort McDowell Yavapai Nation; and Ernest Stevens, Jr., chairman of the National Indian Gaming Association.

By GGB Staff   Tue, Nov 04, 2008

A jury in Clark County decided that Las Vegas could support two properties of the same name because one property will be significantly more upscale than the other.

That is essentially what the jury said when it handed down a verdict dismissing claims from Tamares Las Vegas Properties that a new $5 billion resort on the Strip—modeled and named after the New York landmark Plaza Hotel—would be confused with the existing Plaza hotel and casino in Downtown Las Vegas.

The jury deliberated for two days before issuing its verdict, which allows El Ad Group to move forward with its development plans. (The company had planned for a 2008 groundbreaking but has since pushed that date back to 2010 because of the troubled financial markets.) The jury also dismissed claims for punitive damages approaching $30 million that Tamares was seeking for allegedly having to delay a $100 million property redevelopment.

In the courtroom, lawyers for Tamares argued that the existing property has built buzz, reputation and name recognition throughout Las Vegas having used the Plaza name going back to its opening in 1971. Dennis Kennedy said El Ad is usurping a locally known brand and trading on the property’s name.

El Ad said the existing casino went by the name Union Plaza until Jackie Gaughan changed it to Jackie Gaughan’s Plaza in the 1990s. Attorneys also argued that there is no evidence that Tamares is interested in pouring money into its casino.

By GGB Staff   Tue, Nov 04, 2008

Donald Trump has high hopes for his new Atlantic City hotel tower, which opened with an official ribbon-cutting last month.

The Chairman Tower is named for Trump himself, who is chairman of Trump Entertainment Resorts but no longer runs the show on a day-to-day basis. The $255 million, 39-story addition, which adjoins Trump Taj Mahal along the Atlantic City Boardwalk, has been partially open since August, when the first 20 stories opened for business. The very first customer, Judy Parisio, was a guest of honor at the ribbon-cutting ceremony, which was presided over by Trump, his daughter and vice president Ivanka, CEO Mark Juliano and New Jersey Governor Jon Corzine.

With its sleek design and contemporary feel (a far cry from the ultra-Indian-style theming of the Taj), the Chairman Tower could propel the overall property into the rarefied strata now occupied by the Borgata, considered the “must-see” casino in Atlantic City.

Analyst Ryan Worst of Brean Murray Caret & Co. says Trump has reason to be optimistic about the new tower.

“It’s a good addition to what is one of the premiere properties in Atlantic City,” Worst said in an Associated Press report. “It should generate a good amount of additional cash flow.”

By GGB Staff   Tue, Nov 04, 2008

Maybe it was the perceived reputation for being “recession-proof,” but the impact of the current economic troubles has hit the gaming industry almost as hard as banks and insurance companies.

The decline of gaming stocks has been dramatic and troubling. Some of the industry’s “blue-chip” stocks have been hard-hit. Las Vegas Sands has seen its price decline in the past year from a high of $140 per share to less than $14 late last month. Slot supplier IGT has seen its post-split price of $45 drop to less than $15. Even companies that are no longer public companies have seen their fortunes get very complicated. Speculation last month centered upon whether Harrah’s Entertainment and Station Casinos could service the short-term debt they accumulated last year when they were taken private.

Most casinos have shelved or canceled expansion plans, concentrating instead on operating efficiently and effectively with the least capital outlay as possible. Layoffs have become a big part of the current scene. Thousands of casino employees from California to Connecticut are being issued pink slips. Cash flow has become king, as companies strive to balance their budgets and create shareholder value.

Even without layoffs, cutting restaurant hours and closing non-performing hotel rooms have an impact, says Bill Lerner, an analyst with Deutsche Bank.

“All of those carry employment,” Lerner said. “Over the last two to three weeks, the behavior of visitors to Las Vegas has changed noticeably. They’re spending very differently, and less, than they were prior to that. It’s 100 percent related to the things people are watching on CNN and CNBC with the economy and the credit environment.”    

The “recession-proof” myth dates back to the 1990s, when a mild recession was shrugged off by most casino destinations. In fact, at that time commercial gaming was legal in only two states, with Indian casinos in a couple more. Today there are 12 states with commercial casinos, 11 states with racetrack casinos and 29 states with tribal gaming halls. The increased capacity has not been matched by an equally growing market, so casinos are not immune to smaller amounts of disposable income, higher gas prices, cutting the entertainment budgets and other financial changes made by their customers.

On the other hand, many casino destinations consider themselves well positioned for a quick rebound once the economy starts to turn around. Both Atlantic City and Las Vegas offer inexpensive holidays to people who may once have vacationed in Europe or Asia. Midwest riverboats and Indian casinos expect to regain customers quickly once the economy begins to improve.

By GGB Staff   Tue, Nov 04, 2008

When he bought the Fontainebleau Miami Beach three years ago, real estate magnate Jeffrey Soffer said he had no plans to put a casino at the hotel.

That may all be changing. A quiet effort is under way to allow gambling at any Miami Beach hotel with more than 800 rooms. There is only one that currently qualifies: the Fontainebleau. Fontainebleau Resorts has also financed consumer research to see how the public feels about gambling in the area.

COO Howard Karawan insists that gambling was never part of the original plan for the nearly three-year, $500 million renovation, which includes 11 restaurants and bars, 200,000 square feet of meeting space, 1,500 guest rooms, and a 40,000-square-foot spa.

“Not one square inch of this place was designed with any thought of gambling,” Karawan told the Miami Herald.

Soffer maintains that the new push for gambling comes not from him but from a Miami developer who wants to bring a casino to a planned commercial complex downtown.

That developer is Marc Roberts, who with partner Art Falcone plans to build the 25-acre Miami Worldcenter. Roberts has spent more than $850,000 on a campaign to bring casinos to the development, with 13 petition-gathering companies on the payroll and lawyers writing an initiative for possible placement on the 2010 ballot.

At the same time Soffer, who is building the Fontainebleau Casino Resort on the Las Vegas Strip, has brought key staff with gaming experience to Miami, including former Mandalay Bay exec Glenn Schaeffer and Karawan, who worked for Kerzner International, owner of the Atlantis resort on Nassau Paradise Island.

By GGB Staff   Tue, Nov 04, 2008

It’s not one of the major casino companies—yet—but Baltimore developer Cordish Company last month flexed its muscle in two states. Cordish won a bid in Kansas against big-league opposition and nosed into the lead in Atlantic City as the “stalking horse” candidate to buy the distressed Tropicana.

In Kansas, Wyandotte County will get a Hard Rock Hotel and Casino and additional speedway races, possibly as soon as June 2009, the result of a close vote last month by the Kansas Lottery Gaming Facility Review Board to award the 15-year regional casino concession to Kansas Entertainment.

Kansas law authorizes four regional state-owned, privately operated casinos in four different counties.

The winning group is a partnership of Kansas Speedway and the Cordish Company. They propose to build a $705 million, 300-room Hard Rock Hotel and Casino with 3,000 slot machines, a convention center and shopping outlets—all overlooking the Kansas Speedway racetrack.

The decision of the board was on a 4-3 vote, with Golden Gaming Inc., of Las Vegas coming in second. Legends Sun, a proposal involving the Mohegan Tribe of Connecticut, garnered no votes. Las Vegas-based Pinnacle Entertainment Inc. withdrew from the process a few days before the vote.

To help sweeten the deal, last month Kansas Speedway promised to seek a second NASCAR Sprint Cup race, and to build a second course. It also promised to hold a lucrative recreational vehicle rally annually.

Top for Trop

In Atlantic City, Cordish was named the lead bidder for the Tropicana Casino & Resort—up for sale since last December—after months of speculation.

State-appointed conservator Gary S. Stein last month entered into negotiations with Baltimore-based Cordish Company, which has offered cash and securities totaling $700 million for the Boardwalk resort. Former owner Tropicana Entertainment LLC, a subsidiary of Columbia Sussex Corp., lost its license after less than a year of operation when the New Jersey Casino Control Commission deemed it unfit to run a first-class operation.

But the ousted owner won’t go down without a fight. Tropicana Entertainment—under new leadership and with a new board—has said it will sue to stop the transaction, which it called a “fire sale.”

New CEO Scott C. Butera says the deal would amount to a “windfall (for Cordish) at the expense of other innocent parties.”

Tropicana was granted an appeal of the commission decision to the state Supreme Court last month, despite the fact a lower court upheld the nod.

Butera, who helped Donald Trump emerge from Chapter 11 bankruptcy in 2005, was brought in to replace embattled Columbia Sussex head William Yung. In 2007, Yung was slammed by New Jersey commissioners for refusing to follow regulatory requirements and cutting almost 900 jobs at the Trop, leaving the property in disarray. Butera says the restructured company, sans Yung, is better equipped than any other organization to run the Atlantic City resort, which includes New Jersey’s largest hotel.

The Cordish Company is one of the world’s largest real estate developers, with expertise in gaming, lodging, entertainment and retail. In Atlantic City, it has already invested $49 million to build retail center Atlantic City Outlets—The Walk, in partnership with the state-run Casino Reinvestment Development Authority, and in 2007, the company sought to acquire Trump Entertainment Resorts Inc., which owns three casinos in Atlantic City. Cordish was also responsible for developing the two Seminole Hard Rock Casinos in Florida. And, the company has just recently developed Indiana Live!, a racino connected to Indiana Downs.

Also involved in the Cordish bid for the Trop is Dennis Gomes, former president of the Tropicana under Aztar, who directed the development of the casino’s highly successful Quarter shopping and entertainment center.

By Roger Gros   Tue, Nov 04, 2008

Several months ago in our Casino Connection magazines, which are read by the front-line gaming employees, I penned an article called “Don’t Worry, Be Happy.”

In that piece, I recounted the difficult times I have seen during my 30 years in gaming and beyond: The sky-high interest rates and the long gas lines of the 1970s. The malaise and regulatory intransigence of the 1980s. The recession and later explosive growth outside the major gaming jurisdictions of the 1990s. And maturation and global expansion of the gaming industry in this decade.

My point in this article was that we’ve seen hard times before and will see them again. We came out of those hard times energized and ready to grow.

After that initial Casino Connection article, I got several calls and emails from casino presidents and GMs thanking me for pointing out that it’s not all doom and gloom, that there is hope.

But because it was written in August, the article didn’t take into account what happened in October. Many observers, myself included, remarked that we’ve never seen anything like it. From the gaming perspective, the dismal revenue numbers, coupled with the plunging stock prices of all the gaming companies—large and small alike—certainly are unprecedented.

Even though things are much worse than they were in August, you know what? My attitude has not changed.

Indeed, I’m probably more excited and optimistic about the prospects for the future.

Sure, things are tough and likely to get tougher. More people will unfortunately lose their jobs. Revenues will probably continue to fall, at least through the winter. And anxiety will grow exponentially.

But let’s calm down and look at reality.

We provide entertainment services for millions of people. In this difficult time, what could be more of a noble undertaking? Yes, we’d like to see more of our customers more frequently, but we have to concentrate on those who do avail themselves of our services. They are counting on us to provide them with an escape from their stressful lives, so let’s make them feel at home.

Our employees are well-trained and hard-working. Our facilities are first-class and welcoming. And the size, quality and depth of our markets has not changed.

We know our business. We understand what motivates our customers. And we’ve created an experience that we know is unique to our facilities and communities.

The problems facing the industry are, for the most part, not of our making. There is nothing we could have done to make this situation any easier (at least at the operational level). We can’t control high gas prices, expensive and scarce airline seats, access to credit, foreclosures, layoffs, tighter discretionary spending and all the issues that our customers grapple with every day.

We can control our operations. We need to put our heads down and operate the best and most efficiently we can during this time. We need to understand that our customers are still there, and when they show up, we need to go the extra mile to show them a great time. At the same time, we need to care about our employees and our communities.

Yes, I am very optimistic about the future. If we stay strong and committed to our goals, stay true to our ideals and our philosophies, we’ll be in an excellent position to rebound quickly when this current economic downturn eases.

But most of all, the people of our industry are special. The strength of character and the commitment to family and community by our employees and executives is impressive, even in the best of times. Now, it is inspiring. Whether you work for commercial casinos, Indian gaming, racinos or the wide variety of operations in the international market, our people are our treasure.

We’ll get through this because we’ll all work together and help each other. That’s the way it is in gaming.