The National Council on Problem Gambling is an important organization in the gaming industry’s efforts to promote responsible gaming. The NCPG was formed in 1972 as a neutral organization designed to collaborate with a broad range of people and organizations to alleviate the ravages of problem gambling. Keith Whyte has been executive director since 1998 and has guided the organization to become one of the key players in responsible gaming. With a stellar board of directors and advisors, the NCPG designates the month of March as Problem Gambling Awareness Month with a variety of programs to focus on the issue. Whyte spoke with GGB Publisher Roger Gros via Zoom from the NCPG offices in Washington D.C. in late February.

GGB Podcast sponsored by IGT.com

Baltimore developer Cordish had parlayed its regional “Live!”-branded sports and entertainment districts into the casino business with the 2012 opening of Live! Casino & Hotel Maryland, adjacent to the Arundel Mills Mall in the Baltimore suburb of Hanover. It wasn’t the first casino project for Cordish, which developed the Hard Rock resorts in Tampa and Hollywood, Florida for the Seminole Tribe. But it was the first to take the Live! concept—sort of a sports bar on steroids, awash in video monitors, entertainment and a full food menu—and wrap it into a casino.

After Live! Maryland opened, Philadelphia was a natural next step for Cordish, which already operated the Xfinity Live! attraction in partnership with Comcast, Inc.

Xfinity Live! is a short walk from Wells Fargo Center, the arena of the NHL’s Philadelphia Flyers and the NBA’s Philadelphia 76ers. It is the heart of the city’s Stadium District, walking distance not only from Wells Fargo Center, but Citizens Bank Park, home of Major League Baseball’s Philadelphia Phillies; and Lincoln Financial Field, home of the NFL’s Philadelphia Eagles.

This is sports central, a perfect complement to the Live! brand. The new property would capitalize on that fact, with nods to the city’s sports teams all around the property, a collection of bars and lounges adorned with huge LED screens beaming sports contests, and its unique FanDuel Sportsbook and Lounge, a state-of-the-art facility giving patrons the ability to bet on sports while lounging in style.

But Philly is not the only amazing Pennsylvania story from Cordish this year. In December, the company unveiled Live! Pittsburgh, located in the space of a former anchor store at the Westmoreland Mall, around 30 miles east of downtown Pittsburgh.

The new Philadelphia property gives the developer bookend properties in the two largest markets in the second-largest gaming state in the country.

Eyes on Pennsylvania

With Pennsylvania one of the only gaming states in expansion mode prior to the pandemic, Cordish Companies had eyes on the market as perfect for the follow-up to its popular Maryland Live! property. The second Philadelphia casino license, in flux after successive owners backed out amid the Great Recession, provided a perfect opportunity.

Sports & Social sports bar at Live! Philadelphia

Cordish formed a subsidiary, Stadium Casino, originally in partnership with Greenwood Gaming, which owns Parx Casino in the Philadelphia suburb of Bensalem. Ultimately, Cordish would buy out its partner in 2018 to become the sole owner of Philadelphia’s second casino license, for a hotel-casino to be built in what is arguably one of the most prime locations in the nation.

Sitting in the center of all of Philadelphia’s professional sports facilities will surely result in a host of foot traffic on and around game days, and with easy access from Interstates 95 and 76, and it’s hard to argue with the location.

By the time Cordish took sole possession of Stadium Casino, the company was eager to capitalize on the new Pennsylvania gaming law, which in 2017 created a new license category—Category 4, smaller casinos (750 slots, 40 table games), created as satellite facilities for current licensees. Cordish jumped on the opportunity by securing a license to build its satellite facility in the state’s second-most populous area.

“The commonwealth of Pennsylvania has a tremendous value to us as a major East Coast operator in the casino space,” says Cordish Companies principal Reed Cordish. “Being in the two premier cities obviously has its merits, and we have great locations in both cities.”

Construction on the two Pennsylvania properties would occur concurrently. Cordish celebrated construction milestones on both sides of Pennsylvania in 2019 as both projects proceeded smoothly.

Then, Covid-19 hit.

With casinos idle around the world, it was reasonable to expect operators to stand pat in survival mode, as opposed to growth mode. But Cordish soldiered on with both projects—remarkably, completing them not far from the original targeted opening dates.

Live! Casino Pittsburgh opened as the state’s first Category 4 casino—and likely the only one ever to open before its host casino—in early December, and the Philadelphia property opened for Preview Days January 19.

But the celebration in Philadelphia on February 11 heralded the next evolution of the Cordish gaming model—the Live! entertainment concept matched up with hallowed sports ground in the nation’s third-largest city.

Pittsburgh First

FanDuel Lounge at Live! Pittsburgh

It’s no coincidence that the Cordish gaming model also happens to work quite well on the western side of Pennsylvania. According to Rob Norton, president of Cordish Gaming Group, the company moved to secure a satellite facility (sometimes called “mini-casinos”) as soon as Category 4 was created in 2017.

“Once the Category 4 options became available and the law passed, we immediately started considering the potential locations,” Norton says. “We felt like there were a handful of really great locations, and our location in the Westmoreland Mall, on the east side of Pittsburgh, we felt was the best option in the entire state. And as you saw, even during the pandemic, we went from from concept to opening in near record time.”

“It’s a great area where we’re in a fantastic mall,” comments Joe

Billhimer, Cordish executive vice president in charge of both Pennsylvania properties, who notes that it’s one instance of the original Maryland Live! property serving as a model going forward. That property is adjacent to a retail mall; Live! Pittsburgh is in a mall. “The Cordish experience experience of operating gaming (adjacent to) a mall has proven to be beneficial in terms of foot traffic, location, and locating where people like to go,” Billhimer says.

“It is a very nice, well-appointed casino, 750 slots, 30 tables, two great dining venues—we’re really proud of how that fits into the market there. We think it will be a draw for that whole part of Pennsylvania.”

That includes employing local talent. Cordish established a live dealer school near the Westmoreland Mall, augmenting what Billhimer says was a very good supply of experienced dealers from other Pittsburgh-area and West Virginia casinos.

The property itself follows the Cordish model, including the necessary sports vibe—capsulized by the popular Sports & Social sports bar concept. First conceived 10 years ago at Cordish’s Fourth Street Live! property in Louisville, Kentucky, Sports & Social blends dining, social games and various other entertainment in a unique attraction centered around sports.

“One of the signature concepts of our Live! districts is our trademark brand Sports & Social, which we consider to be the premier sports-focused restaurant and entertainment concept in the country,” says Cordish. “It’s one of the highest per-square-foot revenue restaurants in the United States, and just a juggernaut success in Pittsburgh.”

And in Pittsburgh, sports are woven into the fabric of the market every bit as much as in Philadelphia. “In Pittsburgh, we have one of the more higher-end Sports & Social facilities within the portfolio,” says Billhimer. “It’s an unbelievable spot to watch sports, and we’ll do (partnerships) in the Pittsburgh market with the sports teams.”

Category-Killer

If Live! Pittsburgh is a sure hit, Live! Philly is a sure home run. Cordish built the property in the style of a destination resort, distinguishing it from nearly all other regional casinos, which are built more for convenience-style locals gambling.

The one constant that will drive success for this destination-style business, though, is that prime location.

“I have to tip the hat to the Cordish family and the Cordish development team for doing what nobody has been able to do for a long time in securing a site here in the Philadelphia area,” says Billhimer. “It’s one of the best sites left in America.”

“What really excited us about it,” adds Cordish, “was the opportunity to create something in conjunction with the Stadium District that is truly unique anywhere in the United States. This combination of four professional sports teams and a world-class gaming resort facility sets it apart.”

Cordish adds that with the new Live! casino, the company was able to benefit a Philadelphia community it has been a part of for nearly a decade. “We’ve had the privilege of being able to operate in this market for a long period of time,” he says. “We opened Xfinity Live! with our partners Comcast back in 2012, and it’s been one of the strongest food and beverage entertainment districts of its kind anywhere in the United States. And that certainly gave us a lot of confidence going into this larger project. This is a market we know well and a market we really like.”

That feeling, no doubt, is mutual. Live! Philadelphia created 5,000 jobs (3,000 in construction; 2,000 permanent) and will have an estimated economic impact in the neighborhood of $2 billion in the first five years of operation.

If there was ever a facility that can meet or exceed those estimates, it is Live! Philadelphia. The 510,000-square-foot property features 2,200 slot positions, which includes 74 electronic table games. There are 121 table games with plans to expand to 150, a dedicated 29-table poker room, a six-room Event Center that includes 15,000 square feet of customizable meeting/entertainment event space, and a variety of food and beverage options that include a number of local favorites. An attached multi-level parking facility is augmented by some 2,000 spaces in an outdoor surface lot.

Across the property’s interior are nods to the Philadelphia region, including not only sports teams but artwork from local artists, famous local food, and even the sculpture that greets customers at the casino entrance—a bright red replica of Robert Indiana’s famous “LOVE” sculpture that marks the Love Park plaza in downtown Philadelphia. Of course, this one says “Live!” instead of “Love.”

The Prime Rib

Restaurants include The Prime Rib, the top Zagat-rated steakhouse previously located in Center City Philadelphia for more than 20 years; Luk Fu, “where the authentic flavors of Southeast Asia meet in South Philadelphia;” and 10th Street Market, a unique food hall inspired by the great food markets in Philadelphia where guests will be able to enjoy a wide variety of food, as well as a bar open 24/7.

The F&B offerings include special touches like private dining and karaoke rooms in Luk Fu, the Asian fusion brand first developed at Live! Maryland. Inside the room, a large circular table is equipped with giant lazy Susan for community dining.

The local-flavor 10th Street Market food court features favorites like two Guy Fieri outlets—Guy’s Burger Joint and Guy’s Taco Joint—Morty’s Deli, Luckie’s Liquor and Termini Brothers Bakery (a 99-year Philly institution).

The 208-room luxury hotel features state-of-the-art technology in rooms at various price points, including two levels of suites offering killer views of the city—providing one more factor distinguishing the new property from others in the Philadelphia region.

“We were the first casino development in the commonwealth to actually build a hotel with with its development,” Billhimer says. “I think our location has poised the market for growth.”

Highlights of the casino include unique offerings such as the Sports & Social brand wrapped around the Cordish FanDuel Sportsbook concept—sports wagering in a best-in-class sports bar, featuring a 500-foot-long LED screen and different styles of entertainment. There’s even a large foosball table.

“Here in Philadelphia, we’ve been able to integrate the FanDuel experience into Sports & Social, and we feel that gives us an incredible point of differentiation versus other experiences,” says Cordish. “And it’s something that we’re going to lean into heavily in our casino properties and other entertainment districts. We have a Sports & Social well under construction now at Maryland Live!, and we’ve used Sports & Social as a tremendous growth vehicle around the country.”

Other highlights of the main casino reveal the unique Cordish touch. One signature feature is the R Bar, a unique interactive area featuring electronic table games arranged facing a 40-foot-long video screen. First conceived in the Maryland Live! property, the R Bar presents all 74 of the property’s dealer-assisted ETGs in a pit configuration that puts the live dealers in front of the attraction.

The ETGs offer players the opportunity to play two blackjack games, two baccarat games and roulette, all at the same time.

The R Bar concept features what Billhimer calls “probably the most aggressive Interblock Gaming portfolio out there” in a configuration that has been copied liberally by other operators. “It’s a very interactive area with a great sports bar,” he says, “with the game offerings of Interblock arranged in a stadium style.”

Other highlights of the casino include the two high-limit gaming rooms, each with its own private bar, its own cage, and personalized service. The slots—denominations ranging from $1 to $500—are each situated in a private, Plexiglas-enclosed station. According to Norton, while the private stations provide safety against spread of the Covid-19 virus, they actually were designed before the pandemic hit, simply as a way to give the best slot players their own space.

Everything in the new casino points to the elevated Center Bar, another sports-themed bar with giant LED TV screens, communal tables, lounge seating and live music, offering a 360-degree view of the gaming floor.

Each of the property’s 121 table games is equipped with ticket-in/ticket-out pay technology, allowing players to buy in with a ticket and cash out at a kiosk. According to Norton, the property’s Aristocrat Oasis casino management system is equipped to offer completely cashless play in the near future.

This technology at the tables, which reduces player/dealer touchpoints and cash-handling, is only one aspect of an operation designed with maximum safeguards against the spread of the Covid-19 virus.

Upon entering the casino, all guests and employees pass by thermal cameras to detect anyone with a fever. Once inside the casino, the sea of Plexiglas is striking, with barriers between slot games and in front of dealers at every table. Hand sanitizer stations are everywhere.

It’s all part of “Play It Safe,” the program initiated at the Maryland Live! property early last year to effect a safe return to operations following the pandemic shutdown.

iGaming Assist

The new properties in Pennsylvania follow one more important precedent set in Maryland—building a database online. In an industry first, Cordish launched PlayLive!, its Pennsylvania online gaming site, ahead of the opening of the physical property.

Prior to the 2012 opening of Maryland Live!, Cordish launched a free-to-play social casino that allowed customers to become familiar with the Live! brand and to join the Live! player’s club online. This time, the site, launched in August, is a for-money iGaming site, utilizing the GAN online gaming platform.

“We got about a five-month head start, and we started to build brand awareness and brand loyalty in the online space, all while giving opportunities for those customers to earn entries into the grand opening celebrations and all kinds of other prizes,” says Norton. “That was just one of a number of efforts to try to build the database quickly on the front side.”

Norton adds that the GAN iGaming platform is another holdout from Maryland. “GAN was the platform that we chose back in 2011 to launch the play-for-free site in advance of Maryland,” he says, “and they’ve been our partners ever since we expanded into real-money online gaming. We did an exhaustive search of platforms, and we felt GAN gave us the best opportunity to deliver the product, the quality and the speed that we were interested in putting it into market. They’ve been good partners, and continue to refine the product.”

The success of the Live! Philadelphia casino stands to grow quickly as the Covid-19 pandemic subsides—particularly when the major sports teams resume play with full attendance, when the Stadium District is typically crowded with fans and Cordish’s own Xfinity Live! attraction a couple of blocks from the casino is packed with customers.

“Just imagine 80,000 or 90,000 fans coming in for an Eagles game, or any of the other sporting events here, and you know it’s going to play a large role here in Philadelphia,” says Billhimer.

The operator has marketing partnerships either in place or in the works with all Philadelphia professional sports teams, as well as in Pittsburgh. However, in Philadelphia, the sports angle combines with the hotel to transform the property into a regional draw.

“I think we’re absolutely a local/regional destination here for the South Jersey/Philadelphia metro market, but we’re going to extend our reach, given the fact that we operate in the Stadium District with four major-league teams, and visiting fans from major cities across the country,” says Billhimer. “We’re going to reach out to those individual cities and and extend our marketing arm out that far, and in conjunction with a lot of other Cordish Live! district developments in some of the other cities.”

“We’re treating the Philadelphia Live! casino as a true destination resort,” says Cordish. “It’s going to have great energy and expectation for our local customers, but I expect we’ll see people come here from 200 miles out. And, with the partnerships that we’re building with the teams here in the stadium entertainment district, as people come in from out of town, we have a world-class hotel, we’ve got a world-class casino, we’ve got incredible restaurants and entertainment, and we have the game.

“This is going to be one of the more exciting places you can come see a game anywhere in the country and have an experience that beats out your typical tailgating.”

Growing the Brand

While 2021 will no doubt be consumed with refining operations at the two new Pennsylvania casinos, Cordish is by no means finished expanding the footprint of the Live! brand. Upcoming projects include several in the U.S. and even internationally.

The company is in a partnership with Caesars Entertainment to develop land at the Pompano Park race course in Florida, which also houses an Isle of Capri-branded casino. “We think it’s one of the great development sites out there—200 acres in the heart of South Florida,” says Cordish. “Caesars has the existing casino, which is currently being upgraded and expanded. It will be the center point around which we’ll build this large development.

“We just successfully went through the entitlement process and can build something really spectacular, with up to 4,000 residential units, with a great Live! entertainment district mixed-use component. We’re very, very excited about that.”

Other projects include Ballpark Village, a non-gaming mixed-use retail and entertainment project at the St. Louis Cardinals’ Busch Stadium.

“Being part of the Cordish Companies allows us to do things that other casino companies can’t do,” comments Norton. “They are true developers, and everything is integrated with the Cordish development team. As we are looking at the other markets where sports betting is approved, we have the ability to do things quickly, and at a level I think our competitors are going to struggle to keep up with.”

Cordish says the company also is open to further expansion of the Live! brand in the way of casino projects. “We are approaching the Live! brand holistically,” he says. “As we look at the benefits, the rewards, the tier structure, and all the benefits of being a Live! Rewards member, that comes with multi-property benefits. The casinos are all linked. They’re all in one database. You earn in one place, you can redeem in another. And we are actually rolling that out here for the first time to allow the Live! Rewards points to redeem complimentaries and get benefits at the Xfinity Live! location. As we continue to expand the casino footprint, I think we’ll see that growth go into all the markets.”

As for possible new casino projects, “we’re definitely keeping our eye open for opportunities that make sense for us,” Norton says. “I’m hopeful that we’ll see growth opportunities, both greenfield and from acquisition in the future.”

“Speaking for my family, we would love to see the gaming division of our company grow,” says Cordish. “Whether that’s through new construction, sports wagering or through acquisition, we think the gaming division has done a wonderful job, and should continue to grow.”

Meanwhile, Cordish will continue to polish its new Pennsylvania gems, and to apply the Cordish formula to that effort.

Norton says that formula is to consider entertainment first, everything else second. “Everyone who comes into the organization embraces the fact that Live! means it’s an entertainment concept first,” he says. “It’s not a casino; it’s not about slots. It’s about the experience. And I think we bring that to the table unlike any other company out there.”

GGB: Please explain the genesis of Conscious Gaming and why you believe this organization could be very important to the industry.

Anna Sainsbury: Because I’m the founder of a geolocation company, we had the ability to see how many users would cross the border to gamble wherever we operated. As I joined the board of the American Gaming Association, where they have a lot of initiatives supporting research and education into responsible gaming, I realized we have a need for products and technology to help support the research that is coming out and to create what the regulators want to see. We’ve seen some really great research coming out, but no one has been able to take that science-based knowledge and develop it into a technology.

Because we have that oversight, we knew the need. We know that at this moment, self-exclusion is handled on a state-by-state basis. So if you’re in New York, you just have to go across the river to be able to gamble in New Jersey or go to Vegas twice a year. As more states legalize sports betting, casino, poker, lottery, the exposure is greater. So our goal is to expand self-exclusion from the primary state where they are excluded to all the states that would participate.

You’ve reached an agreement with Pennsylvania to bring your programs to that state. Are you talking to other states as well?

We’ve had a tremendous amount of interesting and insightful conversations with state regulators and legislators in numerous states about what the capabilities are. We’re also talking to multiple operators and platforms.

We don’t want this only to be Conscious Gaming. It only works if we all recognize that this is something we want to improve.

Lots of operators are putting into place their own responsible gaming programs, but they are proprietary and individual. Would you like to see a universal program put into place?

Philosophically, there’s no way that we should be competitive on responsible gaming. The only way we will all win is if we’re actually taking care of people’s needs.

For Conscious Gaming, we are more than happy to be a platform that integrates multiple different methods. We want to build confidence in this approach. We’re trying to get the greatest participation by emphasizing that there is no cost for anyone to participate. It’s completely free, completely open. We want it to be community-based, so we’re taking feedback from anyone that has an interest in this issue.

So, is this just about operators and suppliers?

No, we’re reaching out to everyone involved in the space. For example, some regulators have told us there’s a need to block players in professional and amateur sports leagues from participating, so we’ve extended the free solution to all the leagues so they can use it as a centralized database share with their members so operators would know not to accept bets from anyone on that database.

What about cashless payments? There’s a concern that this could exacerbate problem gambling. How would your system assist in the effort to combat that?

We’re doing a lot of research about what cashless means to responsible gaming efforts. We believe we can directly integrate into those cashless solutions so that someone who has self-excluded anywhere in the U.S. would not be able to participate with cashless gaming.

Sponsored by Vector Solutions, formerly Casino Essentials, the leading eLearning provider of AML compliance training for the Gaming Industry. For more information visit casinoessentials.com.

When Si Redd founded IGT back in the mid 1970s, video poker was the company’s cornerstone. When it went public in 1981, IGT dominated the video poker market. Not much has changed 40 years later. IGT is still the 800-pound gorilla in the video poker market. Darnell Johnson, the director of video poker product management, explains why video poker is one of the staples of the casino gaming market. He spoke with GGB Publisher Roger Gros via Zoom from the IGT offices in Las Vegas in January.

GGB: People forget that video poker was really the first skill-based game, and people enjoy it because they have some sort of control over whether they’re going to win or lose. How do you keep interest in video poker with the new skill games hitting the casino floor?

Darnell Johnson: The casino industry as a whole is constantly expanding. So, sports betting, casual games, skill-based games, all these things are just additional offerings that we as casino manufacturers provide as a means of entertainment for the player. We don’t really see poker as anything less, now that more of those games or venues are starting to expand. We just want to continue to provide the best type of content and product offerings for our customers that we can. We want to make sure that the player’s experience is the best experience that they have when they go on their casino floor. We want to make sure that it’s memorable, so that they can come back and play again.

IGT has a really diverse lineup of games. You are always introducing new versions of video poker. How do you decide how to tweak them, and what kind of other options to give to the players?

When we first introduced video poker several decades ago it was very straightforward. And we started to do a lot of evolutions, working with internal resources that we have, and other partners, where we can create a lot of different types of opportunities for more favorable experiences to the players. Introducing a triple/five/10-play game mechanic, where a player now has the opportunity to play not just one single hand, but three hands, five hands, or 10 hands, at any given time just creates a lot more excitement from a player’s perspective.

That’s what we continue to try to do. We look to see how we can innovate things, but we also have to be very mindful that poker players are very loyal, and they don’t like to see a lot of change. We understand that and we respect that. We’ve seen those Jacks or Better players start transitioning over to different game families, whether that’s a Bonus Poker play, or Double Double Bonus, or even Triple Double Bonus, depending on what type of volatility they’re looking to get out of their experience. We also talk to the operators, because they know their players way better than we do, as to what they’re looking for, and continue to drive content that meets that need.

The hold percentage on a video poker game is really pretty low, when it comes to the casino, and pretty high for the player, if you play the correct strategy. The better they learn the strategy, the better they’re going to do at the game. But I’ve noticed a lot of players don’t really know this strategy.

There are a few players out there that play really, really well, but there are not many that play perfect strategy. It takes a very disciplined player to be able to do that. Though there are definitely some advantages, I think the properties are well-versed in understanding how to leverage that to their benefit as well.

One of the great things about video poker is that you can sit at a bar and play it. And that was really a lot of the attraction of it in the beginning, especially here in Nevada when they had the small casinos. IGT has just introduced a new PeakBarTop cabinet that is doing very well. Explain the strategy behind that.

A few years ago, we started the exercise to look at creating a new type of form factor for the bar area. We were getting a lot of feedback from customers, that they believed that it was time to start looking at a new form factor. So, we took the challenge to create something.

We wanted to create something that is definitely going to resonate with today’s players, but could also resonate with future players as well—something that can evolve over time, to offer everything that video poker offers today. I think IGT is a clear leader in that space of innovation. I think we’ve shown over the last couple of years now that we’re looking to continue to push the envelope.

We introduced a curved monitor to the bar area. That was not something that had been considered previously. There are a lot of issues with the bars from a glare perspective, where a curved display, positioned the right way, can absorb that glare and not redirect it back into the player’s eyes.

Ergonomics was a big part of this. We wanted to create a solution that is much better ergonomically for the player as well, where the customer can play and be comfortable. The buttons are a key element of our bar-top as well. Players love those buttons, and know those buttons, so we want to make sure that we would keep that same interaction, while, at the same time, try to create more innovation to make it more appealing, from both a hardware perspective and a software perspective. And thankfully, I think we’ve done a pretty good job of that so far.

Sponsored by Vector Solutions, formerly Casino Essentials. For more information visit casinoessentials.com.

GGB: Before you were appointed to your position as president of the Americas, you worked in finance for quite some time. How did that help you when the pandemic hit, and you had to reevaluate how the company was running?

Hector Fernandez: Obviously, a strong finance background and training allows you to really look at numbers, dig in and understand trends and what’s happening. But more importantly than my finance background, to be honest, it was really around some of the broad-based experience that I’ve had across different industries. I’ve been very fortunate in my career to work in services at Deloitte, at the premier marketing company at Proctor & Gamble, in biotech at Amgen and at a tech company, Western Digital.

I’ve been through lots of economic cycles and shocks as well. In life you have skills and experiences. You can never substitute experiences. It really allowed us and the team to focus. So when we looked at the impacts of the pandemic, we needed to keep things very simple. Every decision we made would be around three principles. It would be around our people, our customers and our business. And we picked those in that exact order.

We felt if we could get our people and our customers right, the business would be there. Those experiences that the team and I have gone through in the past allowed us to keep it simple and focus on the three guiding principles.

One of the things you decided to do was keep your studios operating during the pandemic. Are you going to continue to do that, or are you going to slow down a bit when casinos start to come back and buy your products again?

You know, great companies invest during times of uncertainty and economic downturns. We’ve seen that throughout history, throughout the various economic shocks we’ve had. The companies that have doubled down and invested are the ones that come out stronger. We knew that was a guiding principle we needed to follow.

Innovation and having the greatest content is what‘s driven the success of Aristocrat, so it was not even a debate. Early on, we knew that slowing down any content development would just hurt the company in the long run. That’s not something we wanted to do. And quite frankly, we were fortunate that we had been conservative financially, so we could. We had the resources to invest, to risk, if you will.

You don’t just oversee Aristocrat operations in the U.S.; you also control Canada and Latin America. Have those two markets been approached any differently during this time?

It’s been fascinating, the pandemic. Because even in the U.S., each state has had a different impact and different reaction. And then when you elevate past the U.S. and you look at Canada, it’s obviously more government-controlled, so there’s a different reaction there. Then if you look at Latin America, they’ve lagged behind us from an impact standpoint and are also lagging behind us from a recovery standpoint.

The nice thing about Aristocrat is, because we’re truly a global company, it allowed us to actually leverage some of our coworkers and fellow employees from around the world, for example, Asia Pacific, on the impact (the pandemic) was having there, and some of the steps they were taking to address those things. We’ve learned a lot from our Asia Pacific colleagues.

The other thing that’s happened since the pandemic is that the European business has also come under my purview, which is fantastic because there are lots of similarities and things that we can leverage from Latin America across Europe. How do we make sure we think globally but act regionally? (We want to) develop these global principles, leverage the resources globally and then tailor to the regional specific problems that we’re trying to solve.

With all those different jurisdictions under your purview, there are different preferences in terms of games and themes, whether they want more volatility, and so on. How do you prepare your studios to introduce games in each of these markets?

Our roots are Australian roots. That’s incredibly important because gaming really took off in Australia and that part of the world before it came to the U.S., Latin America or Asia. So they’re ahead of us from a maturity standpoint.

Player preferences center around math and volatility, game content and other things. We’ve really taken what we learned from Australia and said, “How can we apply those here in the U.S. and across the other jurisdictions?” We focused on having the best content across the globe, then customizing it for a specific jurisdiction, whether it’s a route market, whether it’s a destination casino, whether it’s a casino in Argentina. We’ve never lost that focus around content, and we’ve leveraged our Australian roots to ensure that we have the best content in the industry.

Podcast sponsored by IGT. The new PeakBarTop poker cabinet from IGT will put your bar over the top, built with an emphasis on player comfort and game variety. Learn more at IGT.com/peakbartop.

Podcast sponsored by IGT. The new PeakBarTop poker cabinet from IGT will put your bar over the top, built with an emphasis on player comfort and game variety. Learn more at IGT.com/peakbartop.

Podcast sponsored by IGT. The new PeakBarTop poker cabinet from IGT will put your bar over the top, built with an emphasis on player comfort and game variety. Learn more at IGT.com/peakbartop.

Podcast sponsored by IGT. The new PeakBarTop poker cabinet from IGT will put your bar over the top, built with an emphasis on player comfort and game variety. Learn more at IGT.com/peakbartop.

GGB: Sega Sammy is a multi-national company that plays in a lot of spaces. How does it relate to gaming?

Winzeler: Probably the most recognizable part of our company is the Sega brand. We celebrated the 60th anniversary this year. In 2004, Sammy, which was the No. 1 pachinko manufacturer in Japan, acquired Sega. The company has a history of developing gaming products, whether it’s arcade products, console products, pachinko products, or since a few years ago, casino gaming-style games.

Because they made great pachinko and pachisuro machines, was that the reason Sega Sammy thought they could make gaming machines?

I think that’s part of it. They knew how to make great spinning-reel games, even though the regulations and mechanics are different. Also that was about the time they began discussions about integrated resorts in Japan, so I believe it was a combination of things that focused their attention on gaming.

And one of the resumé builders, I guess you would say, to make an application to run a casino in Japan was to say we’re a licensed entity. Many people told us you don’t go after the Nevada license as your first step into the U.S. There are many easier ways to get into the market, but they wanted to have that flagship license. At the end of 2017, we got our manufacturer license, and last year we got our product license.

In terms of R&D, how much has the pachinko/pachisuro business influenced game design for the slot machines?

We have about 70 engineers in Japan, and the majority of those come from the Sega side of the business. We also used a few third-party content developers, some of them here in the U.S. And, another facet of our game design comes from the Sammy side, even though we’re totally separate entities under the same umbrella.

Explain where Sega Sammy is now in the market.

When we started Sega Sammy Creation four years ago, the first thing we had to do was design a product, which took a couple of years, and then the approval took a couple of years. So when we finally rolled out a product we could sell, it was basically a 4-year-old game and cabinet. So we knew we had to refresh, and last year we designed a new product that we had planned to launch at G2E 2020.

What we are showing clients now is a new cabinet called the Genesis Crest, and we have a suite of great games we can install. We think it’s a game changer for our company. We have 300 percent more visible display space than the original cabinet. There’s a 13-inch player interface, a 49-inch display, which we believe is the largest “for sale” display in the business, and a 27-inch topper above that, which can present game content or just be an attractor.

Where would you like to see Sega Sammy Creation going over the next five years?

I have a directive from the parent company to grow this company to be a stand-alone entity so over time we’d bring more of our development resources here in the U.S., be licensed everywhere in North America and placing products in all of those jurisdictions. After that was accomplished, we’d look to South America and Europe. World domination is the ultimate goal (laughing).

Through the years, Lifescapes has been the go-to company when casinos consider their landscape architecture. Andrew Kreft, director of design for Lifescapes, explains how a well thought-out and designed concept can bring the outside in and create an environment that’s not only pleasing to the eye, but safe and secure in this difficult time. He spoke with GGB Publisher Roger Gros from his office in California in November.

GGB: How has landscape design changed over the years?

Andrew Kreft: Prior to the Mirage opening in 1989, the concept of landscape design was, you drive past the landscape to get to the parking lot, and then you go inside. And that was about it. Steve Wynn changed that. His idea was to create an environment where you’re transformed to a different place the minute you enter a property. That’s the very idea of resort. He wanted to continue that experience from the curb, through the resort all the way to the back of the property.

The concept of the volcano was that you could see it all the way down the Strip. It really drives you into the property. You make a promise when (visitors) come into the property, and you have to keep that promise all the way through.

In today’s casino, particularly during the pandemic, how important is it to bring the outdoors inside?

There shouldn’t be such a hard and fast line between what’s inside and what’s outside. We try to create a more undulated differentiation between indoors and outdoors to blur that line. We create more windows. Back in the day, there were no windows in casinos, but now it softens the appearance and makes it easier for people to stay longer.

Now we’re creating these outdoor rooms you can see from the casino or restaurants that have these unique experiences. They’re each curated for very different experiences.

How early does your company get involved in a project?

We like to start on a project as soon as possible, so we can create an integrated design. We need to be part of the master-planning process. We’ve been very fortunate with our clients, especially with the Wynn organization, in that they see value in that idea. It’s not just about the great architecture; let’s just make it look pretty around the edges. It’s how can we influence the architecture to create a more unique experience for the guests. That kind of thing isn’t possible if you come in at the last minute.

Let’s talk about the pool area, always a key component of a casino resort. How does that come together?

For resorts, the pool area can be the heart of the project. If you’re looking at multi-night stays, you want people to stay on the property as much as possible, so let’s give them an environment where they have choices.

How do you create an environment where you can create enough outdoor rooms that can speak to the different interests of your guests? Some people don’t want to be on display. They want it a little quieter, with more privacy. Other people want to be front and center and part of all the activity. So we try to create a pool area that’s interesting for multiple days. And the pool area shouldn’t be seen as something that can only be used during the day.

So you’re saying landscape architecture isn’t just icing on the cake, it can be a revenue stream. How do you communicate that to casino owners?

If we can get in there early and bake this into the design, we can create revenue or value in places where you might not have thought it was possible. It won’t end up costing you anything extra if you do it early on. But if you come in late, you end up reacting and playing catch-up.

Podcast sponsored by IGT. The new PeakBarTop poker cabinet from IGT will put your bar over the top, built with an emphasis on player comfort and game variety. Learn more at IGT.com/peakbartop.

GGB: Maryland casinos have rebounded from the Covid shutdown better than most jurisdictions. How have the state’s casinos in general, and MGM National Harbor in particular, managed to perform in these conditions?

Perez: Obviously, it’s a difficult operating environment for any leisure and travel company. But health and safety is paramount no matter what. And I think as an industry, we’re doing a really good job. Outside of gaming, the entertainment options are limited—concerts, stadium-sized sports events, even your local restaurants or bars, and the restrictions that they have. The entertainment dollar is being a little bit more limited to where it can go. So, I think the casinos generally—and we’re seeing that not only in Maryland, but all the other jurisdictions in which MGM operates—(are garnering) a larger share of the entertainment dollar.

The other thing is that travel—air travel, specifically—is down considerably. So people are staying closer to home, versus making that big trip, either domestically or internationally…. So I think that’s the biggest driver.

Did you also see a lot of pent-up demand when you opened?

Yes, we did, absolutely. In some markets, it was a slower ramp, in some markets it was a big pop, and then it slowly came down and then sort of stabilized. So, it’s a variation. But yes, we were quite surprised by the interest and demand shortly after opening.

Headline entertainment has always been a strong point at MGM National Harbor. Obviously, you can’t do shows like Cher now, but what’s the plan to phase entertainment back into your operations?

We’re an entertainment company. So the fact that there is no headline entertainment is painful. We can’t wait to have it back. But we’ve got to be respectful of the government restrictions and executive orders that are in place. As far as mass gatherings, or gatherings of groups, we just have to wait until conditions improve. And right now, trends are not moving in the right direction. But I think we’re all hopeful, for sure, that entertainment will come back next year. And as soon as we’re ready, enabled, and allowed to do so, we’ll be back at it.

What non-gaming amenities have you managed to ramp back up?

Most of our restaurants are open. From our Voltaggio Steak House to our TAP Sports Bar, to our National Market, which has multiple F&B quick-service venues. Saigon Street, Shake Shack. So, most of our F&B is open. But as far as non-gaming, that’s pretty much it. Our lounges and bars are also open.

Online gaming is usually not far behind in some sports betting jurisdictions—as Maryland will soon be. Have you been involved in lobbying efforts to bring this additional gambling option to the state?

The focus right now is on sports. The legislative process will start in January specific to sports. And that’s really what we’re focused on right now, both on the retail front and online. That’s where we are focused, and that’s where our energy has been. And what comes down the road is yet to be determined.

Virginia just approved four casinos. Are any of them close enough that it’s going to affect your market?

We’ve been monitoring that for a long time. And I’d be naïve to say that it won’t have some impact. The good thing is it’s geographically further away, towards the southern part of the state of Virginia. And most of our business, just like a lot of regional casinos, comes from an hour’s drive.

We’re very localized. But will there be some impact? There will be. What I will counter with that is, what we will gain with sports betting will far outweigh what we will lose from expansion of gaming in southern Virginia.

As far as competition within the Baltimore/Washington corridor, you’ve always distinguished yourself to maintain the top position among the three casino properties. How have you managed to do that, coming late to the market, as you did?

Obviously, Maryland Live! is the largest competitor, if you will. They’ve got a great team there. I’ve had an opportunity to meet some of their top executives. They’ve got a great facility. So, they’re formidable competitors. But we’re extremely proud of what we’ve built here. We invested heavily—over $1 billion into National Harbor. But we’re in a great market. We’re the benefactors of a large population.

But as you know, besides having a beautiful facility, it all comes down to the employees and our guest service. And that is something that you have to maintain. You have to work on it every single day. It’s not easy. The service component is big. We have a beautiful facility. We continue to invest in it. We continue to invest in the best games, so we’re constantly looking to have the best in attractive games on the floor, be it slot operations or table games. We are constantly tweaking our food and beverage offerings. We listen to our guests. We talk to them individually; we’re on the floor, and get their feedback. And to the extent that we have a lot of feedback in a certain direction, that’s where we move. We try to accommodate.

GGB: How has Inspired weathered the Covid-19 lockdowns?

Pierce: Like everyone in the industry, we’ve had to adjust and adapt. For us, there is a mix of our business that is both retail and online. Our retail business, as you might imagine, shut down on a worldwide basis almost overnight in the middle of March. By the middle of May, we started seeing some of our markets coming back and by the middle of June, we were almost at full capacity.

At that same time, our online slots business and our online virtuals business grew dramatically. And now that we’re back on schedule in terms of the retail business, both of the online businesses have maintained most of their increases.

Can you break down what your business consists of? There are several different aspects, correct?

Yes. There are a couple of different channels.

One is our gaming machine business. We are primarily in the slot route business. It’s server-based, and we put our machines into an establishment for a percentage of the play. It’s not primarily a sales market, it’s more of a recurring revenue market. In this distributed gaming business, it’s a large number of locations with a few machines in each location.

Then we have our virtual sports business, which is what Inspired is most known for. This year we’ve done some amazing events virtually like the Triple Crown Showdown, around the time the Kentucky Derby was usually run. And then just recently we did a virtual Melbourne Cup. We had the opportunity to do some very unique virtual sports events when there was a lack of live sports.

And the third leg of the stool is our online slots business, primarily in the U.K. but getting bigger and bigger in the states. The acquisition we made from Novomatic gave us a different distribution channel in the U.K. So in addition to the betting shops, we’re also now in pubs, holiday parks and motorway services, which are like truck stops in the U.S.

So it must have been beneficial to Inspired when real sports shut down. How did that go?

Amazingly well. We didn’t really want to take advantage of that situation but frankly, the players were demanding it. They were very interested in watching sports events, live or virtual. We did a virtual Grand National where something like 5 million people watched it in the U.K.

Our biggest product in the U.K. is football. With the Premier League being shut down, our products have really resonated with the players.

Explain what your relationships are with lotteries.

Many of our biggest customers are large lottery operations—OPAP in Greece, the Pennsylvania Lottery and others. We just went live with Sisal in Italy. Strangely enough, they have a license in Turkey, so you can now sit in your apartment in Istanbul and have virtual American football on your computer. The numbers coming out of Turkey have been astounding.

Tell us about what’s happening in the U.S. for Inspired.

We just had our one-year anniversary in the Illinois distributed gaming market. That’s been great. Virtually every location we’re in, we’ve been the No. 1 or No. 2 performing machine. We’re also working with the Western Canada Lottery Corporation, which is our entry into the Canadian market. We’re also involved in Oregon and West Virginia.

In terms of virtuals, just about all the operators in New Jersey have signed deals with us.

GGB: Circa is the first new project in Downtown Las Vegas in 40 years. What were some of the differences between Circa and some of the other projects you’ve designed?

Paul Steelman: I think number one, we have a superstar in the making with Derek Stevens. Derek’s vision of this property is unlike anyone else’s. And Circa has a unique spin on it. One of our unique challenges on this design—and Derek’s challenge, of course—was to design, from the ground up, a facility that was compatible with Fremont Street. And Fremont Street is a fantastic place—free entertainment, a world-class digital show, free entertainers in the circles, and parades from NASCAR, and the football and hockey games, and so forth. It was a very interesting exercise to see how any building would relate to this. We’re very pleased that Derek, in fact, did that. So, it’s the first one in 40 years, and it’s filled with unique technology design, and integrating technology with Fremont Street is a sure winner to me.

Derek told us that before they decided upon Steelman, he did a little competition. He chose four or five architects and paid them to do a conceptual design. Why do you think he chose Steelman Partners as the winner?

We competed against some very reputable firms for this project. I think that Derek chose us because we got it. We are firm believers that Las Vegas has a style. And that gambling style is not necessarily based in Rome, or even in Tahiti or whatever. It has a style all its own. I think we’re the architect who actually gets that. And we also are a business-based architect. So, consequently, our success is not necessarily based on the beautiful design. And of course, we want to create new gambling adventures for almost every single thing. Derek wanted a building that looked new and modern, but it looked like it belonged on Fremont Street. And that was really important to Derek. And I think that Derek chose us just because I respect it, and I believe in Las Vegas, and I believe Las Vegas has a style, now influenced by Derek Stevens.

Even before the pandemic hit, there was a movement to spread the slot machines out across the floor. And now, of course, they’ve got every other machine shut off, which is not a good look. How is that going to impact the way you design a casino floor in the future?

I think those casinos that do, in fact, have every other slot machine shut off will probably have to consider some serious reconfiguration. There were many studies down over the years: what is the proper length of a slot bank on the basis of “How much do you win at each machine?” And of course, the ends always win more. The slot machines are much more successful at the ends. So, I would suspect that we’re going to have a lot more ends in the casinos.

Another area that’s been impacted by the pandemic has been food and beverage. Is this something that’s impacting your designs as you go forward?

You know, casinos used to be a dark box in a big building. Steve Wynn would say, “I need brilliance and a bright casino.” But over time, we have started to see a lot more integration of outdoor spaces. Now, they weren’t necessarily integrated in accordance with the virus that we currently have. But they have proved useful now, during this virus type of situation. I’d be surprised in the future if we do a lot of indoor restaurants. I think a lot of the restaurants will have that indoor/outdoor activity.

Mohegan Gaming has received a license in Greece, for the old airport project there, and you’re the designer of that project. And what a fantastic building it looks like, in just the renderings. Tell us about what you went through to do that, especially since Greece is one of the centers of architecture in all of history.

I was an architect before I was a casino architect. So, obviously, to me, this was a unique opportunity. We’ve worked in Athens for the last 25 years. I think it’s a great place. And fortunately, I was teamed up with a great company, Mohegan Sun, and a great team led by Mario Kontomerkos and Richard Lindsay, just a marvelous group of people that were really inspired by the site, the sea, and the sky.

What we wanted to do was take a lot of our experience in Macau, and our experience in Sochi, in Russia. Put them together, and assume that we’ll have some Asian clients who will want to visit this spectacular resort. And there’s a very large market in Russia who already visits Greece. I fully believe that the project in Greece has the capacity to do to Greece, and to Athens, what the Singapore projects did to Singapore, and really increase the tourism industry there.

GGB: Explain how you got to Vegas and are now about to open Circa.

Derek Stevens: I started coming to Las Vegas a long time ago, in the ’80s. I came for pleasure. I’m a sports fan, so I came out to a lot of fights. I came out for a football weekend, basketball, things like that. But I never envisioned—forget about owning a casino—I never envisioned working at a casino.

I was pretty happy working in the manufacturing business, out of the Midwest. And, you know, as time goes by, you come out here for a lot of things. And eventually it became for business and conventions and things like that.

When we had an opportunity to get into this industry, it was 2006. I’ve always loved Las Vegas. I’ve always loved the state of Nevada, from the business perspective. It took me 18 months to get licensed. So I got my first license in March 2008. And remember, that’s when the economy just completely tanked for about a year and a half, which, ironically, was probably the most fortunate thing that ever happened to us. Because a lot of real-estate values in Downtown Las Vegas became far less expensive.

It also ushered in a new group of people. A new group of entrepreneurs. A new group of people that were willing to put equity in. Predominantly, along Fremont East and such, it was sweat equity. Tony Hsieh spurred on the development of a lot of small businesses. And it really developed into a community of people that got to know each other and were all really aligned in a manner where everyone was rooting for the growth of Vegas.

The thing that stands out most of all about Circa is the sportsbook. Sports betting is now something you can walk around with in your pocket. Why did you decide to build such a massive sportsbook?

I have always thought in years past that a significant brick-and-mortar sportsbook was something that could bring people together. Obviously betting on an app is not just the future; it’s the present. It’s easy, convenient and quick. It’s more efficient. But there’s still an element of going to a sportsbook, and the camaraderie with all the people, that creates a unique excitement that you can’t get elsewhere.

I would say there’s still something inside of a Las Vegas brick-and-mortar sportsbook that’s different. It’s not an experience they can get at Hometown USA. We’ve created a stadium effect. And for us, this isn’t really all that new. I own the Downtown Las Vegas Events Center where we’ve been throwing concerts, EDM events, food festivals, boxing matches, UFC matches, and watch parties.

We learned a lot in doing watch parties at our events center. The psychology of someone that goes to a watch party, it’s much different than someone that’s going to a live sporting event. It’s a different angle, a different perspective. People feel differently when they go to a watch party. There is more social demeanor as they come into the game—a little bit more upbeat and willing to socialize. We’ve really tried to create our sportsbook to be something where you end up picking up a lot of the energy of all the rest of the fans and customers who are there.

The sportsbook is in combination with your pool experience. What’s going to make the Circa pools so different?

First, really, the scale. Stadium Swim will be a key feature in Circa Las Vegas, with a capacity of around 4,000. And this is a stadium to watch events and enjoy the sun. We’re going to have programming that will be far more musically oriented throughout most of the day. So, as opposed to us designing a pool as an amenity for a hotel, with 512 rooms and suites, you could almost say our hotel is designed as an amenity to Stadium Swim.

So there will be six pools, and all kinds of different environments at each pool?

Yes, six pools. Two upper-deck pools. Maybe a little more privacy. Four lower-deck pools, two of which have big walk-up bars at the end of the pools. And these pools are pretty big, by the way.

How about in the winter? It’s only a short winter in Vegas, but the pools still close down for a few months.

That was another thing I always thought about over my many trips to Las Vegas. Obviously I’d been out here Memorial Day, Fourth of July, Labor Day, you know, all throughout the summer. But you come out in December, January, the pools are always closed. I always wondered why the pools close in Las Vegas, but they can stay open at Vail, or Park City, or Aspen.

Our pools won’t close. It’ll be the greatest pool in Las Vegas. It’ll be the greatest pool in America. This will be the greatest pool in the history of the world! That’s what Stadium Swim’s going to be.

GGB: Give us some background on FSB.

David McDowell: The company was founded in 2007 with my co-founder Sam Lawrence. We had spent six years working together in the online industry already, so we came at this with a really good idea how systems integrated with online gaming technology. Even then, we realized that live data feeds coming from the stadiums could be delivered more quickly and more reliably, and that those data feeds would drive real-time pricing models. We knew that this would cause a fundamental change in the architecture of sportsbook technology and the way you operate a sportsbook. Those real-time data feeds did not exist, and the systems weren’t designed to access them.

Over the subsequent years we became experts at handling these data feeds. We covered 35,000 live events last month, providing real-time data to our clients.

How were you able to bridge the gap from sports betting to online casinos?

We could see the business model around casino, bingo and poker all had a service supply business where the supplier was providing a turnkey solution. But nobody could do that in sports betting because the technology was too complex, and you needed 250 traders to run your sportsbook. We felt there was a market for what we know of today as an MTS or managed trading system. We sat down and built an MTS for sports betting, but the vast majority of casino, bingo and poker sites were run with that business model. Our strategy was to take the biggest sector and reinvent the business model using our technology.

Did you have clients on the casino side of the business?

Actually early on it was more in the fantasy sports side of the business. We were doing player ratings, we’d give advice on which players would score more fantasy points in the game, that kind of thing.

In 2012, we signed up Genting Casinos as a client for our full-scale sports betting platform. We worked with them for several years to set up their online sportsbook and integrate it into their online casino.

What kinds of services does FSB offer?

Today we offer a full turnkey service, which covers both retail and online sports betting, and it also includes our entire iGaming suite—the player account management and casino aggregation tools. It also includes the user interface—the customer experience, fully responsive website and the various apps that go with it. We back that up with employee-manager training service, AML and responsible gaming tools, and marketing support.

Did you anticipate how quickly U.S. sports betting would be legalized when you started FSB?

I’ve been in online gaming for many years, and our saying was that sports betting legalization in the U.S. was always 10 years away. When the Unlawful Internet Gambling Enforcement Act was passed in 2006, I read the entire bill, which created the opportunity for daily fantasy sports. When you watch it every single day, it moves like a glacier, but all of a sudden, pop, and it’s happening. It’s been amazing to see how so many states have moved forward with positive legislation allowing sports betting.

Podcast sponsored by FSBtech.com

Podcast sponsored by FSBtech.com

Podcast sponsored by FSBtech.com

With no funding, Gainsbury, co-investigator Alex Blaszczynski and a team of researchers were able to gather nearly 800 gamblers to ask how their gambling habits changed during the coronavirus lockdown in Australia, one of the most restrictive in the world. She spoke with GGB Publisher Roger Gros from her office in Sydney in July.

GGB: You came up with this research study rather quickly, because it was done in the month of May, just two months into the pandemic. How long did it take you to design it and get it off the ground?

Sally Gainsbury: The Covid shutdown in Australia occurred officially on the 26th of March. That’s when all land-based gambling venues across the country were closed by the government. There was no access to electronic gaming machines, which are our poker machines. Also, casinos, keno and wagering in venues all were prohibited. There was still lottery through retail outlets, although there was a stay-at-home order in place, pretty much across the country. So, it was quite restrictive, and (gambling) was mostly online.

In Australia, online gambling is limited to purchase of lottery tickets (but not scratch tickets) and online wagering. However, since all of the sports matches were shut down in Australia and mostly around the world, obviously that was very limited.

I’m the director of a treatment clinic, and we also pivoted immediately to seeing clients online. We’ve got a research team, so once we got ourselves set up in our online environment, we really started thinking, “Is this an opportunity we can’t miss?” In Australia, gambling has always been so accessible, in every neighborhood. So this was a once-in-a-lifetime opportunity to study what happens when you take all of that away. What are the unintended negative consequences? Will everyone just go online? So, we put this survey together.

Along with the shutdown of venues, obviously a lot of people were out of work, so we wanted to look at the relationship between gambling, gambling problems, financial well-being and also psychological distress. Because this was a really uncertain, stressful time for a lot of people.

How many people were involved in the survey?

We had 764 people who were recruited to complete the survey, then sent a second survey to those who agreed to be followed up. At last check, around a quarter of those had completed a follow-up survey, which is going to be more interesting, because then we can look at the longitudinal effect, particularly because in Australia we now have a differential situation. Some states have opened up. Some states are sort of opened up, but still have a sense of trepidation. And one state is still entirely locked down. So, now we’ll really be able to start seeing differences between people, based on the different availability of gambling as well.

How did you find these people?

We didn’t have any money to pay for recruitment, so essentially we begged and borrowed favors. We used social media ads. We got everything approved by (the Ethics Office), so that’s a really important step. Even though it was rushed, we made sure we went through that full process. We put ads up on social media, on Twitter and Facebook. We sent ads out to various groups through e-newsletters, and we ended up with 764 completed surveys that were usable, with no missing data. That was quite good, in terms of our response rate.

But this isn’t representative of all of Australia, and we didn’t use any kind of quotas or a panel sample. So, it’s a self-recruited sample, and that’s one limitation. It’s not going to capture everyone or everything.

It seems to be heavily skewed toward male respondents. Does that make it a problem?

Possibly, because that would be similar to the fact that 78 percent of our participants had gambled online. What that really means is, since we used online to recruit, we didn’t really capture all the people who gamble traditionally in venues. We mostly captured people who were already active betting online, and in Australia, it’s already a predominantly male sample.

What were some of the findings?

We looked at the frequency of gambling, which is a quite good proxy for understanding overall involvement. We found that nearly three in four participants actually reported spending less time gambling during the shutdown.

Some gambled more—11 percent said they increased gambling. But specifically for online gambling, most people were reducing their time gambling online. About a third had minimal change; 18 percent increased their gambling, and just 1 percent were gambling online for the first time, which again, suggests that this was already quite an active online sample.

A large number, 63 percent, said they stopped gambling online completely. That’s a pretty significant number.

I think this reflects the fact there wasn’t as much to gamble on. You’re right, there was some Belarusian soccer, Russian table tennis, there were some esports. But for people who (prefer) betting on more traditional sports, none of these were occurring.

How can people get a copy of the report?

It’s available at the University of Sydney Brain and Mind Centre research site (sydney.edu.au/brain-mind). There’s a subcategory of our gambling research within the Brain and Mind Centre.

You could email me; my email address is available on the University of Sydney website, and I’m on twitter, @DrSalGainsbury. We’re really excited to be able to share this research.

Podcast sponsored by FSBtech.com

Podcast sponsored by FSBtech.com

Podcast sponsored by FSBtech.com

Podcast sponsored by FSBtech.com

Podcast sponsored by FSBtech.com

Despite a few Covid-related interruptions, Baltimore-based Cordish managed to keep construction going on two major projects that will open within the next year. Through its Pennsylvania-based subsidiary Stadium Casino, Cordish is on track to open that state’s first Category 4 “mini-casino,” Live! Casino Pittsburgh, by end of this year.

By early 2021, Cordish will open Live! Hotel and Casino Philadelphia in the heart of the South Philadelphia Stadium District, home to all four of the city’s professional sports teams.

Meanwhile, the company is launching its iGaming platform in Pennsylvania with leading provider GAN, along with an existing sports betting deal with FanDuel. Rob Norton, president of Cordish Gaming Group, spoke with Global Gaming Business Editor Frank Legato in August about how the company keeps growing during a difficult time.

GGB: You just launched your online gaming site, PlayLive! In Pennsylvania, becoming the first online gaming site to operate before a bricks-and-mortar facility was open. How did you get the Pennsylvania Gaming Control Board to agree to this?

Rob Norton: We approached them about launching the site in advance and talked about the benefits to the bricks-and-mortar facility. There was nothing in the legislation that prevented it. The PGCB has been an incredibly good partner in helping us get through the launch of this online site. It’s the first time we’ve ever done it, and we couldn’t have done it without their support.

What went into the decision to choose GAN as your partner?

We’ve been partners with GAN for nearly 10 years in operating a social casino gaming site. We did this exact same play when we were opening the Live! Casino in Maryland, only it was a social casino, not a real-money operation. We used the GAN platform for that site to recruit potential players for the bricks-and-mortar facility. We had a relationship with GAN, and they were already active with other customers in Pennsylvania. We wanted to do this quickly, (so) it wasn’t a tough decision.

FanDuel is your other partner in Pennsylvania. Is that because they were also active in that state?

Yes, but quite candidly, we believe they’re the best-in-class operator in the sports betting business right now, and we believe we’re the best-in-class operator in bricks-and-mortar casinos. So, in this case, one plus one equals three. When we bring them on board for the Live! Casino in Philadelphia, it’s going to be one of the most exciting products to ever hit the East Coast.

There’s a lot of competition in the Philadelphia area for sports betting—not only the casinos that all have books now, but the Greenwood Turf Club as well, which is right across the street from your casino. How will you differentiate the FanDuel sportsbook from others?

It’s part of our corporate DNA that we don’t shy away from competition. We believe competition makes you better. In this case, I’m very excited what we’re bringing to the market. Our sportsbook in Philadelphia is being developed in a way that will be a market leader.

How were you able to maintain construction of the Philadelphia casino throughout the Covid crisis?

It really started at the corporate level. We took the Covid-19 situation very seriously, starting in late January, when it was becoming apparent this would become very serious. We started working on plans on the operations and construction side to deal with this. We did have some modest closures on the construction side that were mandated, but we implemented “Play It Safe,” which is our brand for how to respond to Covid in both our operations and construction divisions. Safety and health is our top priority, because if we do it right, everybody benefits.  

“In the case of the theater, you can’t build it for 5,000 people and then plan to operate it with only 2,000. It’s not built that way.”

—Scott Sibella, president, Resorts World Las Vegas, who hopes to be “past all this,” meaning Covid-19, by the time the $4.3 billion resort opens in summer 2021

Podcast sponsored by FSBtech.com

Podcast sponsored by FSBtech.com

Atlantic City’s Borgata, Lupo was able to grow revenues, increase loyalty and capitalize on a market he knows like the back of his hand.

When Atlantic City reopened, casinos scrambled due to a prohibition on indoor dining that was announced just before customers returned. But according to Lupo, the properties are making it work. Lupo spoke with GGB Publisher Roger Gros over the phone for an Atlantic City executive panel to be published in the September edition of Gaming Law Review.

Podcast sponsored by FSBtech.com

GGB: You’ve had a tough time in Atlantic City over the last few months. Why don’t you fill us in on how it’s been going since it opened up in early July?

Joe Lupo: We’ve been making the best of the hand that we had dealt to us. People are pleased with what we’ve been able to provide. It was important for us to be transparent, specifically about what we could not provide. I think that’s been really helpful, to set that expectation.

Here at Hard Rock, we have some great outdoor balconies that look over the ocean, and we’ve set up some great dining for our customers to sit outside. We’ve tried to do the best job we can. We’ve got probably as much Plexiglas around the property as anyone, if not more. We were quick to jump on that. It’s been important that we really impress this—our “Safe and Sound” protocols with the help of our Hard Rock corporate protocols.

It’s been really important that we set that tone, that we’re safe, we do have a clean property, we’re enforcing the wearing of masks. As far as playing, you can play safely and have a nice experience here at the Jersey Shore.

Let’s go back to the beginning of the shutdown. How much guidance did you get from the regulators when the order was given?

We heard a lot of things from the regulators and the governor. Obviously, we were working closely with everyone. We started having meetings the week before, and I got the management staff around the table to anticipate what might happen.

When we did get that notification—I think it was on a Monday morning—we literally were shut down by 2 o’clock that day. It was a tough issue for everybody, but we had good guidance, and we’ve been working well with the New Jersey Division of Gaming Enforcement. The governor’s office has been communicative as well.

What was your strategy to stay in touch with your customers throughout the lockdown?

That was really important. We kept on some of our player development staff, and we were in touch with a lot of our customers. Obviously, it wasn’t about promoting the business, it was just making sure they were OK and asking if they needed anything.

You develop some strong relationships in a high-frequency market like Atlantic City, where many customers know how many kids I have, their names, and saw them being raised over the years. You really develop friendships.

Hard Rock has one of the best online casinos in the state. Did you direct people to that if they still wanted to stay active in gambling?

We did if they were interested. We weren’t pushing it too much. Obviously, a lot of people were out of work and going through some tough times. Here in New Jersey, when it started out, New Jersey’s (online gaming) numbers were through the roof.

We wanted to be sensitive to the issues that people were going through. The online team did increase their spending on advertising, on TV and some other advertising mechanisms. But I didn’t think it was the time to push too hard.

It was more about how people were doing, concern over friends and family that we’ve known for years here in Atlantic City.

Another group you wanted to stay closely in touch with was your employees. How did you stay engaged with them through this period?

They’re the backbone, aren’t they? We heard from them a lot. I kept on a few human resources individuals. We really went over and above to try and communicate with them, both through email and direct mail, and we set up some phone systems so they would have direct access to ask us questions. We wanted to hear their feedback and see how they were doing.

We heard a lot of feedback, and we could not be more thankful to our owners showing their support. They wanted to make sure our employees had food on their tables. We gave away over a $1 million in ShopRite (grocery) gift cards over a few different periods. Everyone wore masks, and they drove through the porte-cochère, and we would hand those out. I’m telling you, it was dramatic. People were just in tears and thankful and could not have been more happy.

How much of a curveball were the dining restrictions, which were announced just prior to opening?

We just took a very aggressive approach towards trying to be ready. Cleanliness was not an issue. Our rooms were clean. The real scramble was for outdoor dining. I believe we didn’t get that notice until Monday, and we opened on Thursday. At that time, we believed we were going to have 25 percent indoor dining.

That was a little bit of a scramble to come up with. We currently have three outdoor balconies where we can serve food. Our food and beverage team had our toughest challenge, but they came through and worked hard.

Then it was more about hotel rooms. How many should we book? How many can we feed? What’s the experience going to be like? What about the promotions? People cannot stand on line. They cannot congregate. So what kind of promotions can we do?

We didn’t have a lot of notice—just over a week, but we were able to get the job done. I really could not be more proud of the team for doing so.

Podcast sponsored by FSBtech.com

As a prime catalyst behind the growth of AGS as senior vice president of slot products, it wasn’t surprising to see Andrew Burke named chief executive officer at Quebec-based Bluberi in January. Bluberi has been bought by the Catalyst Capital Group private equity firm, and is eyeing a significant move as a game manufacturer and system provider. Burke’s expertise with slot product and Class II systems makes him a natural for the Bluberi role. He spoke with GGB Publisher Roger Gros at the Bluberi offices in Las Vegas in June.

Podcast sponsored by FSBtech.com

GGB: Congratulations on the new position with Bluberi; it’s such an interesting company. Why don’t you start with just giving us a little background on the company?

Andrew Burke: Bluberi’s a business that’s been around for almost 30 years, in various kinds of formats. For many years, it was run by the founder of the company, Gerald Duhamel, who started it in Quebec, in a town called Drummondville.

It was primarily technology and game development—a heavy focus on that. It had never really taken a foray into manufacturing. The roots were this Class II gaming system. It was great technology and great games. In the mid-2000s, they tried to become a full-scale manufacturer. Unfortunately, they ended up bankrupt in 2015. Out of that, they became owned by a private equity firm that is taking a different approach with the business. They had a CEO before me, and had various initiatives they were going after. But they just couldn’t get the traction that they really wanted. I’ve known the company for a really long time, from a distance. At AGS, when I started there, we didn’t actually have a game development studio, and all of our product was Bluberi product.

How did you get involved?

I got a phone call saying, “Bluberi’s looking for a CEO; are you interested?” I said, “absolutely.” So it was a very natural fit for me. I grew up in the Class II business, and I think there’s just so few of these businesses left, that have really good bones, some really great technology, and just need a cohesive strategy and some discipline.

I believe our technology is some of the best in the space, and our Class II business is amazing.

We really see a parallel between the ramp-up of AGS and your role at Bluberi. AGS was mostly a Class II business when David Lopez took over, and this seems to be the same thing for you.

Yes, the playbook’s similar—find a good asset that has good people and good technology, and then fill in skill gaps with smart people that have lots of industry experience. We recently hired Casey Whalen as our chief commercial officer. He’s got a tremendous amount of Class III knowledge, as well as Class II experience. And so, the more we bring those types of skill sets on the manufacturing and sales side of the business, the better off we’ll be.

Your expertise is in game development. I understand the Bluberi game development lab in Quebec is pretty strong.

They have a great team there. The things that they’re really good at and strong at, I can just help from a distance, and help our strategy. That’s always been my biggest strength on the commercial side of the business, thinking about how those two things marry up. I really am excited about the game plan they have. I feel like the team there has just never been given the chance to run it themselves. They’ve had a lot of outside consultants brought in, and for some reason it never worked. And so I think it’s really good for them to have a shot to run it, and create something special.

What are your main markets right now?

We do mostly tribal-based businesses—no surprise on the Class II side. Alabama is a large market for us. Washington state, the TLS market is very big for us. California is starting to come along and develop. The Class II business down in Florida is also big for us. We have very little business in Oklahoma, which was very big for me in my previous roles, so there’s a lot of opportunity there. I feel like I was a partial Oklahoma citizen. So I think there’s a lot of white space in front of us—a lot of opportunity to grow the business.

How has the pandemic affected Bluberi? I’m assuming you were shut down like everybody else.

Yes, that’s right. And it was very difficult. But we have a lot of great people who made a lot of sacrifices for the business, and that’s not lost on me. I told everybody that was staying, it’s our job to make sure that there’s a Bluberi for people to come back to. And that’s the most honest thing I can say—that we can’t waste that time. While everybody else is at home or people have been furloughed, our obligation is to maximize the amount of work and effort we put in during that time. And I feel like we’ve really been able to achieve that.

Your new Las Vegas office is taking shape, and they’ve been in Quebec for all this time. What will be the ratio of employees in each office?

It’s interesting. People up there ask me that question. “Are we closing the Quebec office?” And I said, “No, look; when I started at AGS, we had 100 employees. And when I left AGS, we had 700 employees, and all over the place.”

Despite the COVID situation, I came here to grow this business. And I think we’ve got a lot of great, talented people there. I hope to add a lot of great talented people here. Also there. So, I think we’re just really getting started. We’ve got really good technology and R&D up there. We’re building the stateside infrastructure you need to run one of these businesses.

Podcast sponsored by FSBtech.com

Podcast sponsored by FSBtech.com

GGB: What are some of the things operators are concerned about and how does KPMG advise them?

Rick Arpin: The main concern, on the human resources side, is how we can make sure that our employees are protected, which includes things like temperature checks, understanding the symptoms, and how do we track their whereabouts should they become infected? We have high-risk populations that we have to treat differently when they come back to work.

We look at it on a risk basis. Something as simple as scheduling teaches us how we can segregate our population so that this doesn’t spread, even years from now, when we might have a bad flu season. There are lots of applications here to control an outbreak.

How do you think the Las Vegas casinos have responded so far?

I think the jury’s still out, to be frank. The governor, health officials and the Gaming Control Board have said they would closely monitor how it’s being handled. I think the additional requirement that everyone, including guests, wear masks is indicative of that oversight. The results need to be used to make decisions going forward.

But I think that they’re throwing everything at the wall here to make sure the employees and the customers feel safe. We’ve seen this in the past, with security tightening up after an incident with a visible presence. This is no different. We want visible measures, to make sure the customers feel safe.

Would the current trend of smoking bans in casinos be part of those visible measures?

Certainly. We know not everyone agrees with it, but now is an opportune time to do it. This period will also give us a good chance to rethink how we operate.

Las Vegas was poised to break out in 2020 with new properties, a new football stadium, an NFL team locating here and more. The NFL Draft was supposed to be held in Vegas, but of course was presented virtually instead. How should Las Vegas approach the future, since this is all so disappointing?

When you take some of the emotion out of it, we have to consider this as just a pause in what was a very good strategy from the visitor-tourism perspective. Sports and entertainment as a big element of a diversified long-term strategy makes sense, and we should continue to pursue those goals.

People have different predications on when we’ll be back to “normal”—three months, six months, 18 months, three years. No one knows what that will be. And let’s not forget, people will still want to be entertained, people still want to see sports, people are still going to want to have meetings and trade shows.

Will the industry look different? Do we have some changes to make? Of course, but this is temporary and we’ll come back stronger than ever with those changes. We just have to think carefully of what that future will look like.

How do we look at the changes we have to make?

At KPMG, we’re looking at previous events and how we responded to them, and whether those changes were temporary or permanent. When you consider 9/11, we now have the TSA (Transportation Security Administration), which is clearly permanent, but that continues to change. We now have pre-check, so we can get through faster.

So I think we’ll see the same thing in gaming. Can they sustain extra staff for cleaning? Possibly, but I believe we’ll find ways to do that in a more automated fashion. So we’ll see new ways of doing things, whether it’s cleaning or social distancing. You’ll see a lot of innovation and technology in these areas.

Slane now runs her own consultancy for organizations looking to bring legal sports betting to new jurisdictions or get into the business. She spoke with GGB Publisher Roger Gros from her home in June.

Podcast sponsored by FSBtech.com

GGB: We just passed the second anniversary of the repeal of PASPA, certainly a landmark in the casino and sports businesses. What does it mean to mark this second anniversary of the repeal?

Sara Slane: I feel like the gaming industry has kicked the door open now on sports betting. I definitely feel like this has moved a lot faster than anyone had anticipated, certainly with states enacting legislation. And with that there’s been a huge discussion now—really understanding how it works, the benefits of legalizing sports betting, and tremendous growth now for the industry. And so it’s been incredibly exciting to be a part of it.

Of course the coronavirus threw a real curveball to the sports betting industry, with the shutdown of all major sports around the world. Do you believe there’s a real pent-up desire for bettors to get back into action?

Yes, without a doubt. And even during that time when sports around the world essentially shut down, some very creative stopgap measures were put in place. Who would have imagined that we would create a whole new market around table tennis? But I think that there is, without a doubt, a huge pent-up demand.

Now being able to be back to the typical sports people bet on, it’s going to be interesting to see the numbers that come out as a result. Because I think everyone was looking for some entertainment when they were locked in their homes.

Since the introduction of legal sports betting, the dominant sports betting companies have been the same companies that were leaders in daily fantasy sports: DraftKings and FanDuel. Did the casinos understand that this was a possibility when the AGA was pushing this bill? Was there any indication that they would become so dominant so quickly?

That’s a tough question. Certainly FanDuel and DraftKings are dominating the marketplace right now. And at the time, when we were looking at PASPA, they were in the daily fantasy sports sphere, but they did quickly pivot to offer legalized sports betting.

It’s a question that comes back to regulations, honestly. On one hand, the industry has kept out a lot of competition because of the high bar of regulation and how hard it is to cross that threshold, and how expensive it can be. On the other hand, there have been some complaints that it’s not really led to a lot of innovation.

DFS was in this massive gray area for a couple of years. And they did the work, they legalized DFS and were continuing to operate. Casino operators had known for years that this could be a potential opportunity. It’s a double-edged sword; I get it, on both sides. I’m empathetic to the fact that the casino operators feel like they were sidelined from an opportunity to participate in a gray market with daily fantasy sports. I also understand from the daily fantasy sports side, when they were shut down, they did all the work they needed to do to legalize it, and took advantage of the sports betting opportunity that came along.

Another thing that happened really quickly—more quickly than people would have thought—was the spread of mobile sports betting. In New Jersey, within a year, 75 percent of the market came from mobile devices. Did you think that would happen so quickly?

Not at all. I’m not surprised that mobile has overtaken retail sports betting, certainly given the locations of retail operations in New Jersey and the easier accessibility of mobile in the state. No, I wasn’t surprised. That’s where the customers are, that’s where the industry should be heading, and I think that that will continue to happen in other states.

One of the goals of legal sports betting was to eliminate illegal offshore sports betting operations. This hasn’t happened to the extent that the AGA wanted. Do we need to concentrate on this to really get rid of illegal sports betting?

We had long said that the most effective way to shut down the illegal sports betting market is to have the most competitive legal sports betting market out there. But in order to compete with the illegal operators, you’re going to have to have a good regulatory model in place and a good tax structure. That’s going to empower that operator to thrive and offer good odds to compete with the illegal market. I think that truly is going to be the way that you’re going to shut it down.

Are there other simple tactical things that should be happening right now? Absolutely. Legitimate media companies that have deals with gaming operators should not be taking advertising dollars from illegal operators. I think the leagues have done a good job at educating their owners about illegal markets and illegal advertising, and preventing them from taking money from any of those websites.

There’s always going to be a struggle with law enforcement, and getting them to pay attention to go after illegal operators… so that will always be a challenge.

But, all in all, I think that the most effective way to do it is to be able to compete with it, and empower the operators to do that.

The city hired Convergence Strategy Group and principals Scott Fisher and Suzanne Leckert, to handle the process, which just ended with the city choosing Caesars Entertainment out of seven original bidders.

Fisher and Leckert explain how the process was developed, who they worked with and why Caesars was deemed to have the most compelling plan for a casino at an abandoned industrial site. They spoke with GGB Publisher Roger Gros from their offices in New Orleans in June.

GGB: Why did Danville decide to issue an RFP rather than simply negotiate with one company?

Scott Fisher: There are so few opportunities in the country to develop some great properties in relatively non-competitive markets. While Caesars is a great company, by issuing an RFP Danville was able to see proposals from many other great companies to bid against them. The city got to see some great opportunities through the bidding process and ended up getting what we think is a really attractive plan by Caesars.

In addition, the city manager wanted to make sure they had an open and transparent process, so there could be no allegations of a backroom deal with a gaming company, and they clearly accomplished that.

What’s the next step in the process?

Suzanne Leckert: Danville will hold a referendum in November. While we’ll be providing some information, the campaign is mostly going to be handled by Caesars. The city itself is being neutral. They’re not advocating for or against having a casino, they just want all the information to be out there, even though the fiscal impacts will be substantial.

What was the city looking for in the proposals? What did Caesars propose that put them over the top?

Leckert: When we first got involved, the city manager of Danville, Ken Larking, told me he wanted to put any revenues they get from casinos directly into education for the town to make Danville’s school system the best in the state. So the city was most interested in the tax revenues it would earn off any casino project.

But they were also looking for redevelopment of brownfields, these abandoned industrial sites that are a very visible sign of the city’s decline. The Caesars proposal did just that, proposing a development at the Schoolfield and White Mill sites. The city also realizes it can also use some of the Caesars money to incentivize other developments on these sites.

Why is Danville such a good market, according to your report to the city? It is on the border with North Carolina, which has a couple of tribal casinos.

Fisher: We started by doing a market assessment and arrived at a pretty broad range of what the market potential was, depending on the scale of the resort that was built. But we also did an alternative model, which recognized that North Carolina as a state is also looking into the possibility of allowing commercial casinos.

Since the market potential for Danville was going to be driven very much by North Carolina residents, especially in the Greensboro and Raleigh/Durham area, that could chop the revenue potential in half. But the Cherokee properties really don’t have any overlap of the market for a Danville casino.

Caesars is in the middle of a purchase by Eldorado. How did the city take that into account when considering that application?

Leckert: We requested information about the merger to find out if Eldorado would still be on board at the end of the day. We received assurances by Eldorado and Caesars management that this project has the full support of Eldorado, and they remain committed to it going forward.

Economist John Restrepo has been studying the Nevada economy for more than 20 years and he points out the devastating impacts of the lockdown and how the state can rebound from it, although there are still plenty of uncertainties. Restrepo’s RGE Economics publishes the widest and most complete set of data on the Nevada economy. He spoke with GGB Publisher Roger Gros from his offices in Las Vegas in mid-May.

By April 30, Morgan was already deep in preparations. She spoke by phone that day with GGB Publisher Roger Gros, discussing how casinos would reopen, the rules they would operate under, and how those rules would be enforced.

GGB: Governor Sisolak, in his address to the state, said that reopening of the casinos would be determined by the Gaming Control Board. What does that process look like, in your understanding, anyway?

Sandra Douglass Morgan: We’ve been working diligently with state and local providers. I foresee the board, in short order, issuing a policy to non-restricted licensees, our large casinos, and then our restricted licensees, mainly our bars and taverns, as to what we would expect from a health and safety standpoint when they reopen.

I really have to publicly thank the University Medical Center. We had a chance to meet with Dr. Luis Medina-Garcia, an infectious disease physician there. We’ve also met with the Southern Nevada Health District, which covers Clark County and Las Vegas, and the Washoe County Health District, which covers Reno. They were kind enough to lend their expertise to review the policy and the guidance that we issue.

The guidance would require casinos to submit plans to confirm that their properties have been deep-cleaned and disinfected prior to opening, and ensuring that signage is posted so employees and patrons are reminded of proper hygiene. Employee training is obviously going to be very important to ensure that employees understand their responsibilities and knowledge of how to combat the spread of Covid-19—everything from hand-washing and sanitization (to) personal protective equipment, such as masks that may be recommended or even required by the Centers for Disease Control and Prevention.

Can you envision a process that allows locals casinos to open first, with strict social distancing requirements and the things you just mentioned?

I don’t see a legal or regulatory basis for carving out one section of the city or county. I think we’ll set out guidelines and policy expectations, and those operators will have to make business decisions as to whether or not they can operate within these parameters. I don’t really foresee saying one section of a city is opening first. If they can meet the guidelines that we’re setting forth in a safe way, then they will be able to reopen.

Even though the non-restricted casino licenses are grouped together, there are some big size differences. I imagine there has to be some flexibility there when it comes to the larger and smaller casinos.

Absolutely. This is a fluid situation. Nobody knows everything about this virus, but we’re learning more about it every day. We have more than 2,000 unrestricted licensees, and I only have 400 people on staff.

So we do what we can, and we answer questions when we can, either by email or phone. I’m very, very proud of the Gaming Control Board—not only the board members, but all the employees as well.

How deeply are the regulators going to get involved here? Are these guidelines you’re issuing, or will they be strict regulations that will be enforced?

Remember, the ability for the Gaming Control Board to do this was under the governor’s emergency directive, so there is an enforcement mechanism. But I will be very blunt. This is a pandemic. No one has gone through this since 1918. Our goal is not to go out and arrest people; the goal is truly compliance. And compliance in this new reopening phase is going to look different.

You know, our enforcement officers and our agents are going to be looking at different things. Licensees are going to have to find different ways to operate. We definitely want to make sure that we have a presence, and that the Gaming Control Board is communicating with the properties.

Obviously, the policy of the state is to have a strict regulation for gaming; we will enforce it while allowing the industry to change and flourish and kind of find new ways to reopen. The goal is ultimately compliance. But yes, we will have enforcement ability for this.

As the vice chairman of the International Gaming Standards Association, Hall is keenly aware of the technological challenges facing the industry today. He spoke with GGB Publisher Roger Gros at his offices in Las Vegas in March.

GGB: You’ve just been appointed vice chairman of the International Gaming Standards Association. What does that mean to you?

Hall: I’m really scared right now. We’re heading into a quantum world. Quantum computers are not so rare anymore; you can buy one for $35,000, which means I can pop in and out of networks, I can put a spider or crawler on top of a server, and I can get out without anyone ever seeing me. We’re going into a phase of technology that, in my opinion, is the scariest we’ve ever seen, because we’re the most decentralized, and the ways of being intrusive inside of a network now are infinite. I’m very scared about what operators are going to go through over the next three to five years unless we can implement blockchain technology that will create the highest level of security and bring in a standard for ethical behaviors.

Isn’t blockchain as hackable as any other security system?

I’m not into absolutes, but I’m going to say a proper blockchain technology is much more secure than any other network technology we have today. What blockchain does—and I’m not talking about bitcoin, I am so not a fan of bitcoin—is that it inserts passwords inside of every single transaction. Those passwords have to match up to make a change in the information inside of any transaction. And remember, these are private transactions, not public. When you say “public” to me, I run away, because I cannot control the information residing in that network.

Why hasn’t blockchain been embraced already, if it’s so secure?

Blockchain is a new technology. It’s only been around for three to five years. And no technology ever really takes hold unless it’s been around 10 years or more. Right now, we’re in the phase where everyone lost their initial investments and they’re scratching their heads (laughs). But the core technology is still moving along.

Blockchain is confusing because 80 percent of the people who try to explain it don’t know what they’re doing, but that’s normal, because it’s new. Remember in 1997, when everyone was an internet consultant but didn’t know how to log on?

Do regulators understand blockchain?

Surprisingly, many of them do. At last year’s international regulators conference in Jamaica, I was blown away by the level of knowledge of some of the regulators from Australia, Africa and especially three or four in Europe.

The wave of regulators with blockchain knowledge is growing quickly, because they see that blockchain is more risk-averse than the way they’re doing things right now.

How would blockchain aid the industry to encourage responsible gaming?

Blockchain is capable of looking at literally billions of pieces of data. My company collects data from more than 50 countries now, and it gets very deep. If you’re in a casino and having a great time, you’re getting that adrenaline rush that makes you feel great. But once you go into a cortisol response—a “fight or flight” response—it means that what’s happening in the real world is not meeting your expectations. Like an animal, you’re going to fight to survive or you’re going to run to survive.

Inside of our database, we’ve found a pattern in every single country—speed of click, change of betting pattern, and then change of machine. We’ve got seven parameters that identify this. I don’t care who the player is, when I see the pattern, I know something is wrong, and we can do something about it.

GGB: Tell us how you reacted when the virus hit and all casinos across the country eventually closed down.

John James: Working in partnership with the Mashantucket Pequot Tribal Council, we monitored the breaking COVID-19 developments hour-by-hour. With guidance from the tribe’s chief medical officer and state and local authorities, we made the painful decision that Foxwoods Resort Casino would shut its doors for the first time in over 28 years. The safety of our team members, and our loyal guests, was always the driving factor.

Much like the rest of the world, we are being responsive to the changing developments of the COVID-19 crisis. We are continuing to closely partner with our chief medical officer, the state of Connecticut, and the CDC to decide when it is recommended to safely reopen our doors. This is being evaluated day by day.

It’s an unprecedented situation, and as bad as the health concerns are the economic impact is even more devastating. Explain why that is so difficult for the owners of Foxwoods, the Mashantucket Pequot tribe. 

We don’t know much about what the aftermath will be, but this pandemic will surely have long lasting effects on everyone, and we are, of course, no exception. What we do know is we carry the determination and resilience to help us pave a realistic path forward.

We remain committed to our 5,500 loyal team members, who’ve shared this journey with us for over 28 years. They are the true heart of Foxwoods Resort Casino and are responsible for creating countless memories and moments of wonder for our guests throughout the years. We will continue to cover health insurance for our team members who have been furloughed.

This is the best path for us to preserve jobs at Foxwoods and the Mashantucket Pequot Tribal Nation and show compassion for our team and loved ones during these unprecedented times.

Some people seem to think that once the casinos reopen, whenever that will be, the crisis will be over. You don’t believe that. Why is that?

Lives have been dramatically altered and the recovery back to our once “norm” will be slow. With record unemployment and significant economic impacts, rebuilding our nation will take time.

You are approaching this recovery as basically a “one day at a time” challenge. What do you mean by that?

We must remain nimble and flexible to the changing environment around us. While we can plan, success includes the right reactions at the right time to substantial recovery.

You also recognize that this crisis has hit so many of your constituencies, just some of what are tribal members, employees, vendors, tenants, partners, and charities. This is obviously the human side of this crisis. How do you take care of so many people on the way back? 

We recognize the significant stress this has on our team members, partners, Tribal community and beyond, and are working tirelessly to minimize the impact. We are looking to provide as many resources as we can to our teams.

Our goal is to continue to communicate new developments and to bring everyone back to Foxwoods safely and as business levels allow.

You believe that there will be a new normal once casinos reopen. Explain what you mean by that and how casinos will be able to adapt to that. 

It will be a good time to challenge the status quo and think outside of the box on how we operate. With social distancing remaining in place, we’ll have to change how we do business and look for new ways and new technology to keep our guests and team members safe. The new “normal” is to react to new developments and use critical thinking to find solutions.

Decision making is going to be most important once the properties get the OK to reopen. What will those decisions be tied to? 

At this point, it is all about team member and guest safety first. We recognize guests trust us and come to the Wonder Of It All because it makes them feel and experience something special. We will continue to infuse that optimism in all our programming regardless of the changes to operations.

What will some of the realities of this “new normal” be in the short term?

The impact to the future of how we responsibly gather will be one of our biggest priorities. We remain committed to offering a safe and healthy destination for team members and guests. We will stay adaptable and resourceful in the way we offer experiences.

The long-term health of the tribal enterprises are crucial for tribal members, employees and all the other constituents. How can that be achieved? 

We must have our state and federal leaders work with tribal leadership to help rebuild the future. Native casinos should not be excluded from funding programs benefiting the gaming industry.  It’s imperative they recognize the substantive contribution these enterprise make and those who give back to team members and their local communities.

In this special edition of the GGB Podcast, Hall discusses the industry’s response to the current coronavirus crisis, and how people can remove or reduce fear. He spoke with GGB Publisher Roger Gros from his offices in Las Vegas on Wednesday, March 18.

GGB: Explain what your role is with KPMG. And who are your clients?

Mifsud: I’m an economist and I have the pleasure of looking after all the “fun” industries for KPMG. Gambling is my bread and butter and my main focus. My role is to provide insight on gaming to our clients on a local and global scale. We try to keep our fingers on the pulse of the industry, which isn’t always easy as it’s growing and maturing. We try to give our clients a 360-degree view of the risks and opportunities for our clients.

Our clients are a combination of investors and companies in and out of gaming. When I first joined KPMG, I was scratching my head because I’m not an accountant, but I’ve been able to do everything from audits of the largest online gaming companies to the tax situation, for example, what will happen now that Brexit is a reality. My area of specialization is online gaming.

It’s been a challenging time for gaming in Europe from the regulatory perspective and responsible gaming angle. Why has this come to a head now?

Let’s take it back to 2003, when online gambling really started. The EU had just gotten up and running and Malta wanted to establish some gambling regulation that could be ported across Europe. Yes, we had a good tax regime, but a license in Malta would allow an online casino to target jurisdictions that did not have any form of gaming regulation. So Malta became a one-stop shop. The EU told countries with no gambling regulations that they either had to develop some or accept the licensed entities operating from Malta.

As time went on, whether it was for tax reasons or for player protection and responsible gaming policies, most countries have developed online gaming regulations. So what does this mean for the operator? Before all these countries developed online gaming regulations, it was easy to enter the sector, margins were wonderfully high, and they didn’t have to worry about aligning their regulations through the various territories.

The industry is now struggling and trying to change the image of gambling, but in order to do so has found itself in tricky situations, regulatory-wise.

Is part of the problem the sphere of gaming in Europe—bookmakers, small casinos, online gaming, sports betting, etc.?

Yes, and the lack of harmonization across all those kinds of gambling. Regulation has always struggled to keep up from a technology standpoint, particularly with remote gambling. Malta’s goal was to always keep pace with technology and not lag behind innovation. Of course, that’s no easy task, especially when you include esports, daily fantasy sports, skill games and the like.

As the industry matures in Europe, the big players are getting bigger, making it tougher for startups.

So Europe is becoming more like the U.S., where every state has different regulations. It seems Malta isn’t the one-stop shop anymore.

Correct. If you’re going to operate in the U.K., France, Spain, Italy… they’ve all got their own regulatory regime. Then you have the grayer markets, comprised of jurisdictions that haven’t got the regulatory landscape, and then at the other end you have your black markets, where it’s illegal for licensed companies to be targeting players, but where also it’s illegal to be placing bets online. The value of a license in Malta, now that other jurisdictions have set up regulations, has been diluted, but can be of value in the gray markets. But here is where your legal counsel is going to have to be very aware of all the ramifications.

Now that Brexit is a reality, is there any more oversight from the EU on British gambling, online or land-based?

Frankly, I’m not exactly sure. From a Brexit standpoint, we’ve seen speculation and uncertainty for several years now leading up to the final break. Over the next 11 months, we’ll find out what will happen as negotiations progress. The EU, of course, holds the U.K. in very high regard because it’s the most mature and robust online gaming market. So I believe the U.K. will play a defining role whether or not it is part of the EU.

GGB: Give us a little background on the European Casino Association.

Per Jaldung: The European Casino Association has been around for about 15 years. It started as a loose network of casino operators, and has developed into more of a professional trade organization, year by year. It is built on the membership of 30 European countries. It’s more than just European Union countries. It’s also a couple of countries outside the European Union. But we are all united in the common interest of the land-based casino industry, and the regulation of this industry. We speak for about 1,000 casinos in Europe.

Let’s talk about the image of the gaming industry in Europe. There’s been a lot of negative publicity about the gaming industry; some studies found that about 75 percent of all media coveage is negative. Why?

I don’t know the number, but it does not surprise me. The absolute majority of articles are negative at this point. And most of the time, the articles are about lack of responsible gambling and money laundering problems. It’s not only on the local level, where the regulators are working with the industry, it’s also on the pan-European level, where there are different opinions on how gambling should be regulated.

There are some parts of the industry, like the online industry, that would like to have a harmonization and a European licensing system, where they can operate across all countries. But the regime right now—the decision that’s been made in the European Union—states very clearly that each country has the right to regulate and make laws about gambling, on the national level. And that’s a principle the ECA defends. We want each country to be able to manage its own gambling, depending on the culture, history, and relation to gambling.

A complicated part of the European industry is that there are many different parts. You represent land-based casinos, but as you mentioned, there’s an online industry, a betting-shop industry, not to mention the lottery, which is always a very big part of the industry here. Is there a chance everybody can get together and speak with the same voice?

On some subjects, for sure. You know, we are open to speaking with everyone, and also to debate with everyone. We don’t need to agree on everything, but certainly on some areas we definitely can join forces. We all agree about fighting crime in the industry. Nobody wants that.

And responsible gaming? Is everybody on the same page with that?

Everybody’s on the same page, but then it’s a question of ambition. I would say that in the land-based industry, which goes 100 years back, we have a lot of experience in this field, and we have worked with it for a very long time. I know there are companies also, in other parts of the industry, that do a tremendous job in this area.

But there are also examples where this is not sufficient at all. And it’s more window-dressing and whitewashing going on. But the politicians and the regulators and the media, they can see through this.

The American Gaming Association has reached out to tell the good news about the industry—the taxes produced, jobs created, community involvement, those kind of things. Has the European Casino Association endeavored to do that as well?

Yes, we have, actually—we’re in the middle of an information campaign right now. I really think that the land-based, regulated and licensed industry has done a tremendous job creating value in society. Not only job opportunities, but also a lot of tax money, or surplus, if it’s a government-owned company, which it is, in some cases.

So, a lot of times the casino in a community is really an economic and financial motor, with a lot of different services that it attracts.

In the U.K., there seems to be a pretty big crackdown going on, and a lot of fears of over-regulation that will impact all parts of the industry, not just the casino end. How are the regulators approaching that, and how are you approaching the regulators?

We are very happy to consult regulators, lawmakers and other stakeholders, and we do that in a lot of different cases. We are all involved in a lot of policy work, in the EU institutions, with good contacts. And we feel that they are listening to our voice.

We are not trying to fight regulation in any way. We need regulation. But we need fair regulation, a level playing field, and the respect of the law. That’s all. Everybody that has a license, we are happy to talk to and work with anyone, for the good of this industry.

Over the past year, we’ve been reading about a lot of difficulties that Macau is suffering, but what is the reality on the ground there?

Jay Chun: We just had a new government take power on December 20. In a speech by the new secretary of the finance and the economy, he talked about the casino market and the forecast for 2020. He was thinking the mass market would be getting stronger, and he is very confident about the entire market. This is also very good news for our gaming equipment side, because expanding the mass market will be very favorable for the gaming equipment and EGMs.

It seems that we’ve seen the VIP segment shrinking quite a bit. Is it because the Chinese government is being a little stricter in terms of visitation to Macau, or transfers of money, or some other factors?

This one is a little bit more complicated. I think the most important thing is the entire regional economy, because we saw a little bit of a slowdown overall. But the things you mention all impact the VIP sector.

How about the trade war between the U.S. and China? What impact has that had on Macau companies?

Well, for the Macau side, half of the operators are American companies. But the signing of the first stage of the trade agreement is good news for everyone. I think it will benefit the Macau market.

Has the opening of the bridge between Hong Kong, Macau and Zhuhai helped?

Yes, very much. From the Hong Kong airport to Macau, about 40 minutes. So I think this bridge has really helped those visitor numbers grow.

What’s the opinion of the new chief executive, Ho Iat-seng? Did he have a view on gaming before he came into office?

No, he didn’t talk too much about the gaming sector before his election, but in his early statements, he said he wants to continue business as usual for now. I don’t think there will be too much change.

The Chinese government has always been interested in growing the non-gaming amenities in Macau, so it’s not all focused on gaming. How do the casinos respond to that?

For the long term, the conditions of any license renewal will focus even more on non-gaming attractions, and how to diversify the economy. There are plans for theme parks, esports arenas and more meeting space.

Paradise Entertainment was one of the first companies in Macau to introduce electronic table games (ETGs) and electronic gaming machines (EGMs). How has that helped the casinos in Macau?

Typically, the ETG sector is the only sector still growing in the past 15 years. And it’s still growing.

The Macau casinos face a lot of the labor issues—mainly the cost of labor, which is extremely high for table games, but also because they can never find enough dealers. Because of that, the minimum bet must be very high. In most Cotai casinos, the minimum bet is 100 Hong Kong dollars. It’s very expensive.

ETGs give the operator the chance to offer a much lower minimum bet, which is helpful to the mass market and is something they can afford.

Are ETGs counted as slot machines or table games?

Those stadium ETGs are considered one big table that can be linked to up to 100 terminals.

Your ETGs can incorporate with all the systems involved in the casinos, which can often have different accounting systems or player rating systems.

Of course. In Macau, we do have many kinds of systems for the associated products and market. We also have some table systems that are similar to our slot systems. We have some cheating issues, and so we have several chip tracking systems.

How has technology improved ETGs since you introduced them 15 years ago?

There are many new developments that have come on the market in the past few years. And where we once had live dealers, there are now games where we have robot dealers that still use real cards. We call this semi-auto, because we still need a real dealer to change the cards.

You’ve been making a big push into the U.S. with Paradise and LT Game. Does IGT still distribute for you?

We sold the rights to IGT a few years ago for outside Macau, and it did well initially, but 2019 was much better. IGT isn’t distributing the games anymore, but they still get a royalty.

You were also one of the founders of the Macau Gaming Equipment Manufacturers Association and have been involved in their trade show, MGS Entertainment Show. Why is that so important to Macau?

We promote this to the Macau government because we want to encourage them and educate them on how important the gaming equipment market, specifically the EGM market, is for Macau.

GGB: How important was legalization of sports betting in the U.S. to Kambi?

Nylen: In Europe, online and mobile sports betting has been very prominent, and Kambi has two and a half decades of experience of working with operators there. Because of this experience, we were ready when the U.S. came online. That was always part of our plan when we formed Kambi back in 2003.

We have been developing the product over so many years, it gave us a big advantage over what has been available here in the U.S. The depth and the breadth of the products has been much bigger in the U.S. that anything another company offers.

What are some of the Kambi products in sports betting and what are the companies that you’re working with?

We offer pricing and risk management, and we can build the front end of the sports betting site if that’s what the owner wants. In many cases, the operators have us build the front end and the back end of their sites.

We have been very successful so far in the U.S. signing some very important clients. We of course have DraftKings and Rush Street Interactive, both of which have huge market access in the U.S. We have Parx in Pennsylvania. We have a couple of our European clients who have U.S. businesses, 888 and Kindred. We’ve signed Mohegan Sun and Jack Casinos from Ohio.

Of course, your biggest deal so far is with Penn National. Why is that so important for the company?

One of our big targets when we started was to get involved with one of the multi-state operators, and except for the DFS companies, Penn National was one of the most prominent. They took their time in making a decision, about two years. We were very fortunate that we had a good, strong track record in the U.S. and a strong credit. At the moment we’re operating their sportsbooks in Indiana, Iowa and Pennsylvania.

As a European company, how long did it take you to understand American sports?

As a Scandinavian company, we’ve had lots of experience with ice hockey. Basketball has been very popular all across Europe for many years. And (American) football is growing massively in popularity in Europe. They’re selling out the stadiums in London four times a year. So on all these sports, we’ve had a strong offering for a long, long time.

The big challenge for us in the U.S. was to understand more deeply the college sports. We’ve always covered the top colleges but to manage a local offering, we’ve got to go much deeper.

Obviously, the online/mobile market is the most lucrative, but you also handle retail sports betting. How does that work?

In states where mobile is not yet approved, we try to bring technology to the casino itself. We operate retail in Indiana, Iowa, New York, Pennsylvania and elsewhere. It’s pretty much the same system we use for mobile, but one thing that has been very successful for us has been the self-service terminals. Since you don’t have to go to a cashier, you can handle many more bettors at one time. We’re also experimenting with a “bring your own device,” which is more or less mobile, but limited to the casino property.

Now with MGM, Butera is in charge of the company’s interactive efforts including sports betting, social casinos and iGaming. He met with GGB Publisher Roger Gros at his offices at Bellagio in December.

GGB: You’ve had such a varied career. What made you take on this challenge at MGM?

Butera: This is a really important job to me. I enjoyed being an operator, and I love the gaming business. But I also had a real passion for sports. My time with the Arena Football League allowed me to understand the business of sports. I began to realize that people are changing the way they consume sports. No longer do they just watch games or matches. They want to interact—to be part of the action. You could almost see the writing on the wall for sports betting.

So this was a great opportunity for me. I had a background in gaming and sports. I’ve always had tremendous respect for MGM. I’ve known Jim Murren for years. It’s a big company and we do things in scale. So rather than just look at sports betting, we want to have a really broad interactive platform and use sports betting as a portal to many other things.

What is MGM’s approach to sports betting?

Even before I got here, MGM had realized that the sports fan is a really meaningful customer for everything we do in the resort business. People who watch sports and engage in sports betting also go to hotels, they eat at our restaurants and bars, they play our table games and slots. It’s a robust customer base, so let’s create a platform that has sports betting, both retail and online, social “play for fun” gaming in states where online gaming isn’t legal and iGaming, and then tie that into our casinos and resorts. It’s about a five-year proposition.

For us, it’s about building the brand, building the platform. We’re not in a rush. We’re not paying huge bonuses or doing extensive advertising. Our approach is that there are no billboards for Ferraris.

Tell us about Roar, MGM’s partnership with GVC.

One of the things we didn’t have when I got here was a sports betting platform. We spent a lot of time deciding how to approach this. Rather than develop one ourselves (very risky) or buy a company that already had one (an expensive proposition), we decided to partner with GVC Holdings, which was the largest sports betting company at the time, based out of London. They have their own proprietary technology.

They have thousands of developers and 600 traders, so now we have that proprietary technology that few other companies have. It’s an important joint venture for us.

IGT helped develop a sports betting app in Nevada for MGM. Are you still working with them?

Not in sports betting, but we have a great relationship with IGT across the board. They’re one of our biggest partners. They did a great job in the sports world, but we couldn’t pass up this opportunity with GVC.

What has been MGM’s experience with online gaming in New Jersey?

We’ve been very successful in New Jersey, but it’s very competitive. They’ve done everything right, from a good regulatory process to a reasonable tax rate. But because they were the first and the best, everyone flocked there, and the competition is fierce. Now that we have our New Jersey app out, we’ve become more competitive.

We’ve always done well with iGaming in New Jersey, which is a great complement to sports betting. They go extremely well together. When they’re not betting on sports they’re playing casino games, either tables or slot games. It’s a great fit.

Allen led the tribe’s 2007 acquisition of Hard Rock International, the first acquisition of a major international company by a North American Indian tribe. Within two weeks in late October, Allen opened four properties: Hard Rock Los Cabos, the Guitar Hotel at Hard Rock Hollywood in Florida, an $800 million expansion at Hard Rock Tampa, and Hard Rock Sacramento.

He spoke with GGB Publisher Roger Gros during the opening of the Guitar Hotel in October.

GGB: Tell us about the new Guitar Hotel and what it means to the company and your customers.

Allen: We’ve got $1.5 billion in this expansion. Our customers have been so loyal and tremendously supportive of what we do here. But they were very patient. One day a wall was here, the next day it’s over there. We moved restaurants around, we moved roads. So to put all this major construction behind us is great for the property, but more importantly, for our guests.

The original facility was beautiful and we had a lot of success with it, but we wanted to create something that was more of an integrated resort—something more than just a locals casino. That was the goal and the budget mirrored that thought process, and hopefully the guests will love it.

Very humbly, we’ve had a lot of success with this business (both Hard Rock casinos in Florida) since I joined. Our business has increased more than 1,000 percent. We truly needed more rooms, so we looked at the options of a standard hotel tower or something different. We were trying to make a major statement.

When I came up with the idea to buy Hard Rock, I explained to the tribe that this is a long-term commitment. It will take time to grow the brand. We knew we had some work to do. This building has become the iconic statement. The tribe owns Hard Rock and we’re creating something we want the whole world to see. And now the brand is coming up on its 50th anniversary.

How difficult was it to build this hotel?

I went to the legendary structural engineer DeSimone Consulting Engineers. I know Vince DeSimone back from my days with Kerzner and Trump. He called me up and asked me if I was out of my blanking mind—how we were going to design a building that has structural integrity in the shape of a guitar? But it worked out and it looks great!

How were you able to open all these projects so quickly?

We’re a glutton for punishment. We just finished an $800 million expansion of the Hard Rock in Tampa. We took over Jack Casino in Cincinnati. The same day we opened the Guitar Hotel, we’re opening our brand new Hard Rock Hotel in Cabo. And we’ll open Hard Rock Sacramento next week.

We were really able to restructure the company. We expanded the hotel and casino divisions. We never want to forget the cafes and the relationships with our franchise partners, but the restaurant business is very difficult on a global basis.

And now you’re going international with integrated resorts.

We were selected in Barcelona after a very competitive process. We’re still working with the government of Catalonia, but frankly, there’s uncertainty with that government again, so we’ll navigate through that. We’re 100 percent committed to Spain and Catalonia.

We are competing in Athens. Two have qualified to be the finalists, ourselves and Mohegan Sun. We respect Mohegan. I worked directly for Sol Kerzner when we built it, so I know what was created there back in 1995. We know their facility and respect them, but we have a lot more experience internationally. We’re in 75 countries around the world and have been doing that for almost 50 years with experience working with local culture, government and currencies. When the dollar is strong, people think that’s good for our business. The opposite is true—it’s better when the dollar is weaker. When companies haven’t experienced that, it’s a learning curve. There’s no learning curve with Hard Rock International.

How about sports betting in Florida? Is the law that says no expansion of gaming without the voters’ approval going to apply?

Yes. Disney and Seminoles are two big names in the state of Florida. The voters spoke. They overwhelmingly—by more than 70 percent— said they no longer want the legislative body to be involved in gaming. They hadn’t been able to make a decision or set a clear direction in how to use that $400 million they got from us each year. The voters spoke. We’re a little surprised that now (the legislature) is saying they’re not going to listen to the voters. We’re happy to work with the state, but their ideas seem to change on a weekly basis.

When we were discussing different options with the state last year, sports betting was 100 percent on the agenda. We weren’t sure what they wanted to do with internet gaming, but we think internet gaming is the future, and any state that hasn’t figured that out is making a mistake, in my opinion. So we do believe it will continue to be a topic of conversation between the tribe, the sports teams, the parimutuels and others.

GGB: What was the state of gaming regulation when you took over?

Ronnie Jones: It was fairly stable. It was 180 degrees from where it was when it first began. I was a frequent critic at the time, because I was in State Police, and we had actually voiced our concerns about legalizing any forms of gaming, until the governor told us to shut up. And we did.

In 2013, I would not have taken the job had it not been a stable industry. I was able to see that it was a legitimate industry. We weren’t fighting the same battles we were in ’93. So, it’s stable, but there’s room for growth in the industry for sure.

What is the scope of your oversight? There’s a lot of different forms of gambling in the state. Are you overseeing all of them?

Yes. This board was created out of the mess that had been created in ’93. This was recreated in 1996, by Governor Mike Foster. He saw that there was some dysfunction in the regulatory structure, and so he created this board. We have oversight of all legalized gambling in the state, except for the lottery and charitable gaming.

I think it’s a good structure because it relies on the supervision of two elected officials: the governor and the attorney general.

How about tribal gaming?

There are three tribal casinos in Louisiana, and we have very limited interaction with them. They are sovereign nations; I understand all that. I get that. I’m not here to intrude. But I want to be able to call them if there is an issue, and talk. So we’ve got a good relationship with them, but we have very limited responsibility with respect to the regulation.

You are considered one of the enlightened regulators in the industry. Explain why people view you this way.

Well, one of the first things that I did after I was appointed, I reached out to the American Gaming Association. Geoff Freeman was there at the time, and I just called him one day, and got him to call me back. I said, “I’m the new chairman of Louisiana, I’m trying to learn a little bit about the industry, and I would like to come visit and meet your staff.” And that was beneficial. And those relationships, I have sustained in the last six years. I remember a meeting I had with some of my fellow regulators. A couple of them said, “Why are you meeting with those guys? That’s the industry.” Well, how do you regulate an industry without having some dialogue? I find that there are more areas of agreement that I have with the industry than disagreement. And it’s OK to disagree.

What happened with the legalization of sports betting in Louisiana last year?

My staff and I have been attending every sports betting forum that’s been conducted. We basically copied a lot of what New Jersey had in terms of the rules. In Mississippi, Alan (Godfrey, gaming commissioner) has been very gracious about helping us. So, we were ready with rule development, promulgation. We knew that it was going to be a close vote, but we did not anticipate that it was going to crash and burn the way it did.

It was really surprising. You can bet on just about everything in that state. Most people don’t realize, Louisiana—within the last five years—finally outlawed betting on cock fights. I mean, you could bet on a cock fight in Louisiana, but not on the Saints.

So sports betting didn’t pass because the legislature today is comprised of people very different than the people who were there in 1991. It’s much more conservative, there’s a lot of bias against expansion of gaming, and they saw sports betting as an expansion. And if it’s an expansion, they’re against it. But sports betting is a reality. People are going to Mississippi, they’re going online, they’ve got their barber who’ll take a bet. I think it will come up again.

I’ve shared with every CEO that I’ve talked to, “Between now and next year, you need to figure out what you’re going to get behind, and everybody needs to be on board, if you want this done.” We all know that sports betting is not a cash cow, in terms of revenue. There’s risk involved for the operators. We also know that New Jersey has done it the right way; they have a mobile application. But I counseled those who asked me, I said, “Go with brick and mortar, go conservatively until the state feels more comfortable with it, and then we’ll move to mobile.”

Are you concerned about Texas getting gaming?

Oh, absolutely. Absolutely. But Tilman Fertitta is a smart man. And I don’t think he would have invested in the Golden Nugget property in Lake Charles—which is a world-class facility—the way he did, if he reasonably expected that Texas would legalize it in the short term. I think long term, they’re going to get there. But if what I read is correct, there’s still an awful lot of church opposition to expansion of gambling there. That’s what I’ve been told, so we’ll have to wait and see.

Now, as president of the company, Soll is navigating a new world of market saturation and limited expansion to provide tribal, commercial and international casino companies with a path forward to organic growth. Soll spoke with GGB Publisher Roger Gros.

GGB: The Innovation Group has had an exciting year, with lots of success and accomplishments. What stands out for you?

Michael Soll: We really solidified our fourth partner and our Las Vegas presence through Brian Wyman. His joining us as a partner is symbolic of the major shifts we’ve had under way for the last four or five years, moving into data analytics and marketing analytics, which has become our window into most new technologies and gaming platforms, whether it’s online, sports betting or traditional operations.

We also were honored to be selected by Virginia’s Joint Legislative Audit and Review Commission to provide, with our partners at RMC Legal, much of the background research they relied on for their “Gaming in the Commonwealth” report. Market analysis and feasibility has long been the bread and butter of this company, and it was fulfilling to bring that expertise to a new category of client.

And, of course, through our relationship with GGB, we’ve had a stellar response to this year’s Emerging Leaders program. These young leaders are really starting to interact with one another through get-togethers and meetups at different conferences all over the world. It’s very organic.

The class this year was really special. The fact that we had to choose from 200 nominees was pretty amazing, and the level of people who were nominated, or even nominated themselves, was really high. I’m really happy with the way it turned out this year.

You mentioned Brian Wyman. Who are your other partners?

Interestingly, we have a partner per office. Brian is in Las Vegas. Tom Zitt, a longtime partner with the company, still works out of our original office in New Orleans. He drives the majority of our domestic business. He’s in tune with about half of the tribes we work with, particularly in the Eastern U.S. In Denver, the office is led by Michael Zhu, our partner who handles most of our business in Asia.

I’m still based in Orlando, handling both Latin America and Europe from there. So, we have a geographic approach to handling the industry’s global needs.

What major challenges will operators, manufacturers and governments face in the near future?

Starting from the government side, which affects everything else, and a lack of new greenfield markets—places like Virginia, Japan and maybe one day Brazil—you’ve got governments that are looking at their gaming product and asking how much they can squeeze in. This is what we saw in Illinois and Pennsylvania last year. The key questions they’re asking are reciprocal to what the industry is asking: How much capital can we invest? Where can we invest it? And how much additional exposure in a market is an advantage to us, as either a defensive strategy or an offensive strategy? Governments are asking: How much can we absorb, and what types of gaming should we be offering, even if it’s just layering in sports betting?

How about players? Can you expand the pool of players from any one group?

I don’t find the characterization of the new group of players as millennials useful anymore. It’s almost become a term that’s too vague to explain the challenges the industry faces. We’ve done some survey work on this recently, about what amenities are valued now, outside of gaming. How popular are they among guests? Who are the drivers? Also, we included all kinds of questions about skill games and esports.

Our view is: Be flexible, have enough floor space to try things that are hitting the market, and don’t assume that every potential future player is the same as every other potential future player.

How can a company like The Innovation Group help established casino companies and manufacturers understand these challenges and develop solutions, particularly if they don’t have those kinds of experts in-house?

There are several routes. The tools we use are relatively similar, although they’ve evolved in terms of how we deal with data, database analysis and loyalty programs. But as far as answering these questions, it’s about research, in the sense of survey research and taking temperatures and benchmarking.

It’s also about qualitative research—sitting in rooms with people from different demographics and player groups in different countries, and seeing what they believe a gaming property should offer. What do they believe the online experience is like, compared to the bricks-and-mortar experience? And where do they draw lines around a social experience versus a personal experience?

The research we do builds a database of research around these areas. So, as we did with our early feasibility work and tracking penetration, we’re building a history and benchmarks around these attitudes and trends. When we start to segment them by age group, by nationality, by jurisdiction, by ethnicity within the market, we start to have trends that we can watch.

GGB: What are some new developments at the property within the last couple of years?

Ray Pineault: In our market we’ve had over $2.5 billion in investment by competitors coming in. So we’ve been working on things and solidifying the property and solidifying our player loyalty. Two years ago, we added 400 hotel rooms. We added the largest expo center in Connecticut, which has been a tremendous success. Our hotel is still running at over 97 percent occupancy. In addition to that, we’ve been working on non-gaming amenities, like the new Roadhouse comedy club and a new lounge. So we’re looking to continue to enhance and grow our non-gaming amenities and give people more reasons to visit the property.

MGM opened last year in Springfield and Wynn opened Encore Boston Harbor. What’s been the impact of those openings?

We’re talking about $2.5 billion in investment in Massachusetts, and both of those markets were feeder markets for Mohegan Sun. But when we look at our top-line revenues, we’ve been pleasantly surprised with the loyalty our guests have shown to Mohegan Sun. Obviously, they’re going to try those places, but many are coming back to visit us. They may not visit as often, but they’re still coming to Mohegan Sun because of the offerings we have.

Entertainment has always been a big part of the Mohegan Sun experience. How important is the arena?

This is a huge driver for us. Every time we run a show, we have the opportunity to bring 8,000 to 10,000 people to the property. And while a few may not be gamers, they may stop and spend $20, $30 eating or drinking. We know they’re using the hotel. They’re certainly using the spa and shopping at our retail, so we’re getting additional spend from them.

And of course we’re very proud of our WNBA team (the Connecticut Sun). Unfortunately, they lost the championship, but they battled really hard. They had a tremendous season and we look forward to bringing them back next year and hopefully finishing it off.

We saw a change in the tribal leadership earlier this year. Is there still a big commitment from the tribe to the success of the entire gaming enterprise?

I can’t be prouder or happier to work with the tribal council that we have. But we have an election for our tribal leadership every two years. So there’s always some transition, whether it’s through retirement or people coming up through the ranks, like any politics.

The tribe has always been committed to Mohegan Sun. It’s their property, it’s their homeland, and they are exceptionally committed to the growth and overall well-being of the company.

What about sports betting in Connecticut?

From my perspective as the operator, we need to come to the realization that we now have Rhode Island and New York doing sports betting. And it’s not that sports wagering is the economic panacea that people were dreaming about, but it’s a competitive disadvantage for us. So if a guest has a spouse or family members who want to go enjoy a facility, but they want to lay a wager down on any particular game or sporting event, we could lose that guest, at least for that trip. So when you don’t have the full complement of product it’s a lost opportunity.

GGB: What was the state of revenue management when you left Wynn Resorts to form the company nine years ago?

Bosworth: Revenue management has been around since the mid-1980s. It’s just that they haven’t been used to their full potential, partially because, particularly in gaming, the systems didn’t reflect the way casinos actually run their business. You were using technology like Excel, which had a hard time handling all the data, and you had to ignore most of the recommendations. It was one of the reasons we decided to start the company. So we built the company using the tools for the purposes that were intended. You’d use most of the recommendations suggested by the tool instead of overriding them. And frankly, our timing was good. It was a time when gaming and the overall hospitality industry was looking toward automation and using analytics to a greater extent. That tailwind has helped us.

How much has changed since those days?

Unfortunately, many of the big companies still use Excel spreadsheets. Employees spend the entire day hand-keying in overrides and doing things manually when intuitively you know there should be a better way.

So what are you doing differently than other companies were doing at that time? How did you fix what was broken?

You pull together as much relevant data as you can. You configure the system to match the strategy of the casino resort. And then you develop algorithms to help automate, first the most routine decisions, because the vast majority of your day looks like other days. There’s a lot of commonality between certain days of the week at certain times of the year. Then you have to empower the people at the properties to take a hard look and understand more deeply the exceptional days.

You still need to have a prediction about the future, but you’re arming your people in your revenue meetings with the information they need to exercise their own judgement to interpret the more exceptional things they see.

Duetto was recognized in the hospitality business early on, but you had some great experience on the casino side, too. Why did it take longer to get noticed in gaming?

The short answer is that casinos are the most complicated part of the hospitality business because of their size and complexity. It took us some time to build the products necessary to take into account all of the variances in gaming.

For example, casinos had a very inflexible system where you were either a comp customer or casino rate or cash customer. That was costing the casinos a lot of money, and providing a worse customer experience.

Say you’re a borderline casino rate customer who the casinos would love to comp on certain days. Under the old system, that wouldn’t have been allowed. With our system, you can show your borderline customers that they are valued and offer them comps on days when it makes sense, but other days they might have to pay the going rate. That way, you’re sure you have the right players in the building at any given time.

How important is real-time data to your products and services?

It’s crucial. The goal is always to get as close as we possibly can to real-time data that’s wider and deeper than any external analyst has sent before. We have to make sure it’s always accurate. We’re constantly running data checks to assure data quality. That becomes the key to establishing trust from our customers. The data has to be accurate, as do our predictions for the future.

In addition to adding meeting space, renovating hotel rooms and casino space, and introducing more F&B outlets, Giannantonio has guided the casino through the openings of two nearby casinos. He spoke with GGB Publisher Roger Gros at his offices at Resorts in July.

GGB: It’s been one year since your neighbors opened last year, Hard Rock and Ocean. What kind of impact did that have on Resorts?

Mark Giannantonio: Well, it’s an unprecedented amount of capacity to open all at one time. It’s unlike anything I’ve ever seen.

The great thing is that we’re attached to Hard Rock (via a pedestrian connection). Jim Allen and Joe Lupo are great operators. And you have the commitment from the Jingoli family and Jack Morris family. So it took that type of brand and that kind of leadership to take over that property to get it up and running so quickly. They’re doing a really good job there. So we’re happy that we’re connected to them. We try to work collectively, and we’re working as a group with Ocean as well, to try to rebrand this part of town. We think that’s very important.

You were up here on your own when those two properties at the end of the Boardwalk were closed. Does the opening of the two properties give you critical mass now?

There were pros and cons about being the only one. Clearly, when the five casinos closed, there was a lift in everybody’s boat. But at the end of the day, Atlantic City’s about bringing as many people to town as possible. So having Hard Rock connected to us, it just makes the synergy so much better.

But you just didn’t wait for the new properties to reopen. You make preparations.

When Morris (Bailey) was looking to buy something in Atlantic City, he looked at a number of different properties. He selected this property with the vision of bringing it back to life, but he needed to spend money here to bring this property back, which he’s allowed us to do. We really prepared for this day with the new casinos opening.

How do Morris Bailey and Mohegan Gaming & Entertainment work together?

After the unfortunate passing of Dennis Gomes, a dear friend of mine, Morris was about a year and a half into this, and he had to decide exactly what to do, and whether he was going to sell and get out, or double down.

He brought in Mohegan after a pretty extensive search for a management company. So, Mohegan is responsible for the management of the asset. They own 10 percent of the company. It’s like a match made in heaven. (Mohegan CEO) Mario Kontomerkos and his team do a great job. They’re doing a lot of expansion elsewhere, but this was one of the first assets that they took under management, so it’s important to them. They really have helped us and guided us about how we deploy capital.

Probably the most important thing is that we have the access to their database. They are a very good partner and with Morris, there’s no better person in the business.

The competition in Atlantic City has always been tough, and this round is no different. You’ve got these crazy tier-matching programs in all the casinos. How can you respond to that?

It really is crazy. I think it’s just everybody’s reaction to what is an extremely difficult period of time. Organically, the same store is just not growing where we’d like it to be. We’ve been bucking the trend a bit, where our tables are actually growing, and you know, we have great Asian business as well. But at the end of the day, it’s a hard market, and I don’t think it helps with all these aggressive offers. Some people think it’s a race to the bottom, and I can’t disagree.

You’ve been lucky enough to have DraftKings under your roof as one of the leading sports betting sites in New Jersey. How much has that helped bring new customers in here?

DraftKings are professionals beyond belief. Morris cut a great deal with them, and we’re excited about their success. We partnered and opened up what we think was the nicest and best sportsbook in Atlantic City back in November, and it’s immediately transformed our property. It’s a state-of-the-art sportsbook, but it’s coupled with a great sports bar, great food, and then we opened a sushi restaurant right next to it, and refined our Asian restaurant. So, that whole area has been livened up, and there’s no question, a whole new customer is coming to the property now. And that helps in so many ways. The ancillary revenues and gaming revenues are all going up. So we are thrilled about the success. And we’re certainly thrilled that DraftKings is doing so well online, too.

GGB: The CRDA has been an important tool in the development of Atlantic City. How are you helping to direct the CRDA funds to the places where they do the most good?

Doherty: We work with the mayor, city council, along with Leutenant Governor Sheila Oliver, who is also the commissioner on the Department of Community Affairs, on what the priorities are. And those were laid out pretty broadly in the Jim Johnson report (authored by a former Treasury under-secretary and the leader of the state takeover of Atlantic City government) that was issued in 2018. We use that as a guideline for how we should appropriately allocate CRDA funds within the four corners of Atlantic City.

Over the years there have been degrees of dissatisfaction with the CRDA from the casino perspective. What have you done to shore up the agency’s relationship with the casino industry?

We have 17 members of our board of directors and two of them are casino executives appointed by the governor. They have adequate representation on the board.

I’ve had meetings with the top casino executives around town. Overall, it’s been a positive response to recent CRDA activities.

The Tourism District was established about 10 years ago. How do you work with the city in the CRDA oversight of this area?

When the CRDA was given authority over the Tourism District, I thought it was very odd. When I was mayor of Belmar, myself, the council along with the planning and zoning boards controlled land use. About 45 percent of the land is Atlantic City is controlled by the CRDA. I’m very cognizant that this is a city that has a mayor and a council, and has a planning board and a zoning board. So we take special care to inform them on what we plan to do and get their feedback on whether they think it will be a positive or negative step. If it’s not seen as a positive, we re-evaluate it.

The CRDA is also responsible for public safety in the Tourism District. How do you work with the Atlantic City Police Department in that regard?

We’re now up to $3 million in grants to the police on an annual basis. That’s for Class 2 officers, who are not full-time police officers, and for NCOs, neighborhood coordination officers. These are officers who are out of the car, who walk door-to-door, who talk to residents and businesses to address quality-of-life issues.

We also interact with land-use, planning and development, code enforcement and others. Any projects that come to us, we take it to the city and vice versa. We also have responsibility for the Special Improvement District (SID), which does a lot of public works-type of functions in the Tourism District.

Some casinos have criticized the CRDA’s efforts to bring entertainment to the city. They believe it’s the casinos’ responsibility.

Well, Hard Rock has really changed that dynamic. They’re extremely aggressive in bringing high-class entertainment to town. I don’t see CRDA’s role as competing with the private sector. Having private-sector dollars bringing in entertainment is a good thing.

Where we do run into a challenge is the operations of Boardwalk Hall. This has a capacity far exceeding any other venue in Atlantic City. Because we own and operate Boardwalk Hall, we have to generate as much money as possible to defray the costs. So there’s a delicate balance there between not interfering with the private sector and at the same time recognizing that we do need to operate Boardwalk Hall as a business to generate revenues to decrease the costs there.

Miller has accomplished much in a few months. In August, he sat down with GGB Publisher Roger Gros in his Washington, D.C. office for a GGB Podcast.

GGB: You weren’t an unknown quantity when you were appointed to head the AGA. As a lobbyist, you worked hand-in-hand with the AGA. But there were people that you hadn’t met on the board. How did you go about introducing yourself and explaining your agenda?

Bill Miller: One of the really exciting things is we have a diverse but reasonably limited membership. We have commercial operators, tribal operators and suppliers. We have our friends from the U.K. and Europe who have become more interested in sports betting that aren’t actual members. In total, you’re talking about 100 or so different entities.

I know how the American Gaming Association started, where it started, the importance of Las Vegas as kind of the epicenter of the gaming world. I made a couple trips to Las Vegas to meet with people both during the search process and before I started, in order to try and have them get to know a little bit about me and about my agenda.

The first two leaders of the AGA had different styles. Frank Fahrenkopf’s job was to keep an eye on Capitol Hill and make sure no bad legislation was coming out of there. Geoff Freeman was more proactive about getting the good news about gaming out into the community. What’s your philosophy?

I think I take some good from both. I know that both Geoff and Frank shared the same view, that our industry is so well-regulated at the state level, any kind of federal interference or federal regulation is something we should work to defeat. And that has continued to be the mission, whether it was Fahrenkopf, Freeman or Miller. We all share that view.

What happens on Capitol Hill matters a great deal to us (but) we’re not under constant assault. In fact, most members of Congress recognize that the gaming industry is an economically powerful driver. And we’re in 40-plus states. What I try and bring to this job every day is the ability to tell the story to the right audiences, and many of those audiences that are most important are up on Capitol Hill.

Sports betting has been the big story in the industry over the past couple of years. Are there some hurdles we have to overcome before it’s completely accepted?

Prior to the Supreme Court’s ruling, there was one state where you could bet on sports. Now there are more than 20. We’re learning from each of those.

One of the most important reasons that the AGA was involved in the sports-betting lawsuit was we recognized how much sports wagering was being done illegally. Our contention all along was if you’re able to legalize sports betting in states, you’re going to begin to destroy the illegal offshore online market that funds other criminal and illicit activities. People have always bet on sports. They’re going to continue to bet on sports. And it’s a better dynamic when they bet on sports in a legal and transparent manner. That’s a worthwhile goal for all of us, including the Department of Justice.

Geoff Freeman forged a great relationship with Ernie Stevens at the National Indian Gaming Association; I think both being from Wisconsin and Packer fans helped. Are you planning to continue that relationship with Ernie as a person and NIGA as an organization?

I spoke to Chairman Stevens on my first or second day here. I believe very strongly that that the 11 tribal operators we have as members are critically important. The story of gaming in the tribal nations is an incredibly important one.

I spoke at NIGA in San Diego. I’m planning to go speak at their mid-year conference in Connecticut. I was on a panel with Chairman Stevens at ICE in London. I’m not a Packers fan, but we’re both big boxing fans, and we’ll talk about boxing. We figured out our connections, and I have great respect for him as a leader of NIGA. And I have a personal affection for him; he’s been very kind and very welcoming to me.

The new AGA State of Play campaign not only looks at commercial gaming in each state, but includes tribal gaming also. Is that because people see gaming as one industry that, whether it be tribal or commercial, still benefits the state in various ways?

Absolutely. Most people who enjoy a regional casino property don’t necessarily care that it’s commercially operated or tribally operated. What they want is an entertaining experience, with good amenities and good restaurants, nice hotel, maybe a golf course. They want an atmosphere that’s lively and fun.

We’re proud to have Native American tribes as part of our membership, along with our commercial operators, the suppliers and manufacturers. We are one. We want the American Gaming Association to be that one source—an honest, clear and transparent source for information.

GGB: Now that you have a year under your belt, how have you been able to plan for G2E 2019 now that you’re familiar with all the exhibitors and processes?

Carrison: As you can imagine, the G2E team begins planning for the next event edition even before the current show ends. We hear feedback on-site and are always looking for ways to improve year-over-year. Following an amazing 2018 event and jackpot year for the commercial casino gaming industry, there has never been a more opportune time for G2E to keep growing and improving. G2E must continually deliver content and experiences that are relevant and exciting to our attendees. We strive to make G2E a better platform every year.

Sports betting has been front-and-center on the past two G2Es. Now that almost 20 states have legalized it, what are you planning to offer to attendees on that side of the business?

Sports betting continues to be important with many states still considering legalization, and for those that have legalized it, learning how to implement and regulate. States are deciding whether or not this opportunity is right for them and if it is, who the technology providers are that match well with for their particular jurisdictional needs. So we are looking to build on the education that we presented last year, and dig a little bit deeper into all of the different questions that the operators may have.

This will be the second G2E Sports Betting Symposium, and it has eight dedicated sessions, including a tour of several technology vendors that make products specifically designed for sports betting markets.

This must be an opportunity to attract exhibitors and attendees who have never been to G2E in the past. How are you reaching out to these people?

With the gaming industry always evolving and changing, there is always an opportunity to attract new exhibitors and attendees. A lot of international sports betting companies are bringing their technologies and programs to the U.S. market to help states implement sports betting in each area. Another growth area that is taking the gaming industry by storm is alternative payment applications. We’re focusing a lot on growing this segment with both exhibitor and attendees because those technologies are already used by consumers in their daily lives. Their casino gaming experience should be no different.

Tribal gaming has always played a large role in G2E. It looks like you’ve expanded the tribal gaming track. With Victor Rocha curating it, I’m sure it’s going to be very informative. What’s in store?

G2E will once again present a robust lineup of tribal gaming-related content for this year, including a Monday keynote speaker, D.J. Eagle Bear Vanas, the internationally acclaimed motivational storyteller, leadership speaker and member of the Odawa Nation of Michigan. Vanas, who is a celebrated author and former military officer, shows organizations how to practically apply the power of the warrior spirit to perform at their best, and stay resilient and thrive in tough, changing environments. He is a pioneer in the tribal community.

Tribal gaming education will again take place over all four days of G2E including feature sessions on sports betting, esports and tribal leadership.

It seems that technology is the byword of the year for G2E. Tell us how you’re stressing that in 2019.

We are not only stressing innovative technology, but disruptive technology. Attendees come to expect new technology across the expo hall floor, but it’s also a theme in this year’s Innovation Lab. Our theme in the Innovation Lab on Tuesday is Disruptive Technology, and Wednesday is New Uses for Existing Technology. Each day features a series of quick, 15-minute presentations and discussions that promise to really get outside the box with the thought processes related to technologies. Many of the concepts that will be discussed here are not yet ready for the expo hall floor, but we will be sure to see them there in years to come.

Speaking of technology, the G2E app is new and improved. How can you improve the attendee experience if they use the app?

The mobile app, once again sponsored by Konami, is the best resource to find all information G2E-related. It not only has the most up-to-date education sessions and exhibitor list, we’re launching new features designed to empower the attendee to personalize and maximize their experience at G2E.

This year, we’re launching direct messaging in our mobile app, where attendees will be able to reach out directly to exhibitors to set up appointments and begin conversations. We’ll also be building on the success of the G2E Recommendations Program, delivering a personalized list of exhibitors, education sessions and special events based on search activities within the app.

Attendees will also be able to look up booth-to-booth directions and have access to interactive show floor maps, or visit Ask G2E, for real-time answers to questions.

We recently did a survey on the GGB website asking our readers to tell us what trade show or conference they considered the most important in the industry. The winner was clearly G2E with nearly 60 percent of the vote. Other shows didn’t get half that much. To what do you attribute that?

The networking and business opportunities at G2E are second to none. The industry convergence on a single venue to meet up with current and former associates to conduct business and socialize is unparalleled. We continue to push the envelope, look at the current landscape and see how we can best activate G2E in a way that’s most valuable to the gaming industry.

Gaming veteran Aaron Gomes is COO of the company that owns and operates these parlors, Peninsula Pacific Entertainment, which also owns Del Lago casino in New York, Kansas Crossing in Kansas and Diamond Jacks in Bossier City, Louisiana.

Gomes spoke with GGB Publisher Roger Gros at Colonial Downs in August.

GGB: Congratulations on the opening of the Rosie’s properties in Virginia. What has the response been?

Gomes: It’s been overwhelming. All the feedback has been very positive. We put a lot of money and effort into it, and it’s great to see this kind of response.

We now have three facilities open. In addition to Colonial Downs with 600 games, we opened a location in Vinton, outside of Roanoke, with 150 games, and just last month we opened one in Richmond with 700 games and have another 700 games scheduled for Hampton in the fall, and then a location in Chesapeake with another 700 games early next year.

So that will give you close to 3,000 games? And you’ve got approvals for 10 locations.

Yes, 3,000 is the limit that is approved through the temporary regulations, but we’ll be asking them to raise that cap as the regulations progress. And we do have the right to build 10 locations as long as we hold a referendum in those communities and get their approvals. Of course, the cap on the number of games would have to be raised in that case.

For those of us who have not seen or played an HHR, what’s the experience like? And are your customers new to gaming, or have they gambled somewhere else?

It’s similar to a Class II bingo game; it’s very similar in terms of time on device, payouts, hold percentage and more. The only difference is you’re not playing against the house; you’re playing against other players in a parimutuel pool. Other than that, the experience is very much like a traditional slot machine. The themes are similar, even down to a players club for the customers.

As for our players, it’s a combination of both. We have a lot of customers who have played elsewhere and are grateful to have their entertainment hobby closer to home. Then there are other players who are new to the market or have previously been horse racing fans and have fun playing the games.

What is the tax rate on these games?

The tax rate is actually a percentage of the handle. We pay about 1.25 percent of handle, which based on the hold of each machine is roughly 15 percent to 20 percent tax. And then we supplement the purses of the horse races here at Colonial Downs, which is about 6 percent or 7 percent of the revenue. And then we have a technology fee paid to the manufacturer which is another percentage of the revenue. When you blend it all together, the effective tax rate is around 35 percent.

The Virginia legislature recently considered a bill that would legalize casinos in the state but pulled it back to conduct a study. Where does that stand now?

There’s a lot of moving parts right now, especially when you add the Pamunkey tribe that recently received federal recognition. The state has commissioned a study by The Innovation Group about introducing gaming, the risks and benefits, so we believe that much of what the state decides to do with gaming will hinge on that study.

GGB: You just celebrated the first anniversary at Hard Rock Atlantic City. You’ve had some bumps along the way, some adjustments. Are you happy with the direction that the property is headed right now?

Joe Lupo: Yes, I’m really happy with the direction. Any time you open up a property, there’s going to be bumps, and Hard Rock worked

really hard to get it up and going, especially so quickly after purchasing the property. It was a lot of hard work for the team, and you’ve got to give them a lot of credit for doing it so quickly, and the property looks beautiful. But there’s growing pains that you have, understanding the market and things like that. Obviously, we opened the same day as Ocean, and you have two properties that came into a flat market, from just a pure casino gaming revenue standpoint.

I came on board about eight months ago, late October. And so during that time, we were able to look at the business over the winter. We put some things in place, and now, a couple months ago, we became No. 2 in casino revenue. And to do that before our year anniversary is a great milestone.

You started from scratch, basically, with your database.

That’s probably the toughest thing to do for a property, especially in a high-frequency market, where all the customers have loyalties. They’ve been going to those other properties, and they know the waitresses’ first names and have accumulated points. To draw a customer away from a loyal market is really difficult. But we’re probably gaining more new customers every day than any other property. It really takes time to build that database, and while we’re getting customers in, they’re still getting offers, and they might be staying at other properties, and we’re only seeing a part of their play.

You worked at the Borgata for a lot of years. What kind of advantage did that bring you when you came to Hard Rock Atlantic City?

Well, I know the market pretty well, that’s for sure. Coming from the No. 1 property across town for so long, we worked hard over there to figure it out. One of the things that we do here is that we develop all of our own promotions and look at our reinvestment. Everything about this property is done from a couple of offices. There is no direction from a corporation that says, “Do it this way.” There’s no team from Las Vegas, that are saying, “We should do this.”

We have some great team members from other properties, from Caesars, from Golden Nugget, from Borgata, that are giving us some other ideas. So we’re just taking a very aggressive approach. We realize we have to do that with a limited database. But, again, being in town, the entertainment aspect that obviously we had at Borgata, there was a lot of entertainment here. And having the biggest room in town gives us a big advantage over everybody.

Hard Rock has a unique corporate culture. After a year, how much do your team members get the Hard Rock philosophy?

It is unique, and I think we’re jelling. I don’t think we’re there yet, to be honest with you. I think it’s good that we have a lot of different perspectives from a lot of different entities. The same thing happened at the Borgata. We need to keep working at it. I think teamwork in the end will make us click.

As you come into the shoulder season, what are you doing to maintain the momentum you’re building this summer?

We have the biggest promotion this summer; we’re giving away a $1 million to one person. And that’s coming off our car-a-day in May. Who gives away a car every single day? But we guarantee that, and we’re really trying to raise the eyebrows.

What does it mean that your chairman, Jim Allen, is a native of the Atlantic City area?

Well, it’s not only Jim, but our other partners and owners are from New Jersey—Jack Morris, and Michael and Joe Jingoli. They’re very community-driven. I think the city needs to come together a little bit, and we need to work together, and we’re starting to do that with the North Beach initiative—Ocean, Resorts, Steel Pier, the Absecon Lighthouse and us and the Tennessee Avenue folks—who are revitalizing that street.

We’re trying to highlight the excitement that you find at this part of the Boardwalk. Overall, we need to ensure that we work together, create more infrastructure, organization and safety—and a clean city I think is really important.

To obtain a copy of the study visit Stockton.edu/light/research.

GGB: What did you find when you first arrived at the property in terms of a marketing plan?

Donovan: Over the last 100 days, we’ve taken the property in a much different direction. When I got here at the beginning of March, the property had historically had good table games business, good non-gaming business, but it lacked slot business, which we all know is the core of every property in Atlantic City.

I saw several things that we were not doing or we were doing poorly. We weren’t communicating with the 1 million-plus people we had in the Revel database. We knew exactly who they were, we knew how much they spent the last time they were here, but we weren’t talking to them. We are now. And we’re talking to them in a very influential way. Before, they were getting weekly offers that were lower than other places in town. Now they’re getting daily offers that are better than anyplace in town.

So we’re combining a value piece with the exceptional product we have here, and people are responding.

What other things did you change?

Just from a physicality standpoint, we saw other improvements we could make. One of the complaints was that it was too big, too cavernous and you can’t find your way around. We installed simple-to-understand wayfinding signs that direct people easily. We put in a new elevator that makes it easier to get from the hotel to the casino, so you can get to the casino much faster. We built a separate promotions area that eases the burden on the main desk area, and made it easy to find. We added kiosks like most other Atlantic City casinos. So, we’ve addressed key deficiencies of the property and brought it up to a level that makes people comfortable.

Ocean has some great meeting and convention space. Is that a focus in the new regime as well?

Yes, and it’s getting easier the longer we’re open. The largest segment of your meetings book a year or two out, and with the uncertainty around the property before, they didn’t know if the place was going to be open that long. But now there’s a lot more certainty.

It’s always been a great setup for meetings with great rooms, accessibility and amenities. And now they have the understanding we’ll be here for a while.

Ocean has also been set up for great entertainment with Ovation Hall and the smaller venues.

How important is that for the property?

Incredibly important. The property is big, so you can definitely see a difference when there’s a major event going on. We’ve had entertainment in Ovation Hall pretty much every weekend since the spring and plan to continue with that for the rest of the year.

We have a great partnership with AEG Live where we’re beginning to get some big-name acts.

Food and beverage has always been an important element to this property. How have you begun to use it?

The property has always had great food and beverage—we need to tell more people about it, but it’s always been there. In some of the surveys we did, however, people complained that it was too expensive. Now we give weekly dining comps so people can come in every week, which softens that blow a little bit. And we’ve added some more casual dining options that are affordable, like a food court that will open soon. We’ve opened up Sky Café on the hotel lobby level, along with a coffee shop. We’ve got a frozen daiquiri bar on that level. So we’re starting to add components for the peak season.

Wong spoke with GGB Publisher Roger Gros at the Gambling and Risk Taking Conference (the “Eadington Conference”) in May.

GGB: You were recently appointed to a new role at Sands China, as head of the responsible gaming efforts there. Why is that such an important issue for your company and the officials in Macau?

Winnie Wong: Macau sees responsible gaming as very important. The Macau government has a committee that is made up of scholars, researchers, public officials—not only regulators, but also the social welfare bureau. They have regular meetings and give the casino operators guidelines and regulations to follow. They really see responsible gaming as all stakeholders’ responsibility—not just the government, not just the patrons themselves, but everyone who has a part to play in the industry.

Are these regulators and public officials educated about responsible gaming?

Yes, they do a lot of research, primary data collection, which is done by the local government for policy design purposes. At the same time, I do see them attending international conferences from time to time.

Las Vegas Sands has always had a very robust responsible gaming program. What kind of expertise did they bring to Macau?

In 2004, when my company opened its first casino—Sands Macau—we already had our own self-exclusion program. The Macau government’s self-exclusion program didn’t start until 2012, so our exclusion program was well before that. Today, the government requires casinos to train their front-tier staff for responsible gaming-related issues, but we go beyond that. We train 100 percent of our staff, be they casino-related, non-gaming related, admin staff or operation staff. We train every one of them.

Las Vegas Sands also has developed a global training program. We call it the Responsible Gaming Ambassador’s Training Program. Every year, we rotate and train about 100 staff members in each region. And this goes beyond the training that I mentioned, which is included as part of orientation training. It is eight hours of intensive university-level training, developed by University of Nevada, Las Vegas Professor Bo Bernhard. These team members are on the floor 24 hours a day, and they are there to see if any patrons may have a gaming disorder problem. If they see that, they will help and refer these customers to seek professional help.

We don’t replace the government. We are not treatment centers. We are not counseling experts. But we are there to help, and to provide help when customers need it.

Is there a cultural difference between what is considered problem gambling between Asian gamblers and American gamblers?

From a practitioner’s perspective, I would say people in the Asian culture don’t normally reach out for help. They are quite laid-back. So we’ve used a lot of community support. And the reason why we see training as so important is because Macau has about 600,000 population, with a working population of roughly 380,000. Of that, about 110,000 work in the gaming and hotel industry. So, 30 percent of the working population works in the gaming-related industry. If we train our staff to have high awareness of problem gaming behavior, they can reach out to people, and those people could be their family, their friends or someone they believe needs help.

Part of responsible gaming education is informing players about the odds of winning—that every game has a house edge. Do Asian gamblers understand that?

We as an operator design a lot of training programs for our staff where we mention about what is a game of chance. What is probability? What is the house advantage? So we help teach people to play with a sense of having fun. It is entertainment, instead of a tool to make money. In short, we help people make informed choices.

How much research is being done in Macau to understand problem gambling in the SAR?

My job requires me to do research regularly, to keep myself abreast of responsible gaming trends. And I must admit that I find much more information on Australia and Canada and the U.K. There aren’t too many studies that focus specifically on Asian people. There are scholars from universities in Macau who are now doing lot of research which is Macau-specific. But I do see opportunities to do more.

Do you think Macau is doing a good job at making sure that people gamble responsibly?

I think we are. There is always more that can be done, but Macau has been doing a lot. And I think the government cares, and the operators care, so that makes up a very good ecosystem.

Last year, the government did research to understand people’s awareness on what is meant by responsible gaming. The percentage has increased dramatically since just a few years ago. Over the last five, six years, it went up from single-digit awareness to last year, more than 60 percent of people are aware what is meant by responsible gaming. So yes, I would say Macau is keeping up.

Feldman has long been the industry spokesman for responsible gaming, and is chairman of the National Center for Responsible Gaming. He spoke with GGB Publisher Roger Gros at the Gambling and Risk-Taking Conference—the Eadington Conference—in Las Vegas in May.

GGB: You had an incredible run at MGM Resorts, and at Mirage before that. You played a huge role in the development of both of those companies. Congratulations on what you accomplished there.

Feldman: Yes, it was 29 years. I was incredibly lucky to come into the industry just as the Mirage was being born and to have seen the incredible growth—not just in Nevada, but globally.

You’re certainly not retired. You’ve still got a lot on your plate.

Oh, no. As I’ve told my family and friends, I’m working the same number of hours; they’re just a whole heck of a lot less stressful.

First of all, you’re still a consultant for MGM. Are you still working in their responsible gaming area?

I’m working mostly right now on the responsible gaming component of MGM’s bid in Japan, which is going to be critical. And I continue to keep my hands involved in responsible gaming across the rest of the portfolio. But it’s really the UNLV work that’s taking over, and I hope to take on an even bigger role as time goes on there.

Explain what you’re going to be doing with UNLV.

I’ve been given the opportunity to work with the team at the International Gaming Institute: Bo Bernhard, Brett Abarbanel, Jennifer Roberts, Becky Harris and others who really are leaders in their areas of expertise. I’m going to start working with them on responsible gaming programs and policy development.

think what’s most important for the industry is the notion of changing the culture of responsible gaming from one that’s compliance-based to one that’s customer service-based. That’s going to require a lot of work, some research, some academic development and curriculum development. But all of that is possible. With the incredible team of professionals at UNLV, I think we’re going to end up with a pretty amazing program that we can then travel around not only the United States, but jurisdictions all over the world.

It’s a crucial time in the industry when it comes to responsible gaming. Some countries in Europe have banned gambling ads, reduced stakes on slot machine-type of devices, things like that. The United States really needs to sit up and pay attention, because that could happen here in a heartbeat.

It absolutely can, and we must pay attention to it. In that cultural change I spoke of earlier, there are too many parts of the industry that have taken a look at responsible gaming and seen it as a minimum-standard objective—that they need to meet the minimum standard that the jurisdiction they’re in has outlined. And that’s not the way it ought to be. We ought to be taking control of this topic, marketing this topic, being assertive and aggressive with this topic, if for no other reason than that now we have the benefit in the U.S.—and Canada as well—of more than 20 years of research on this topic.

There are a couple of things that come shining through over and over again, and the real key to research becoming policy is to be able to replicate it over time. You can do prevalence studies across all kinds of time frames; you’re still going to find about a roughly 1 percent addiction rate. Of those folks, casinos aren’t the place that they generally tend to go. They generally tend to go into other forms of gaming.

It doesn’t mean that casinos are left out of it. I think we’ve been too defensive about this topic. The industry needs to just go out there, take this subject by the collar and own it. Tell the public about it, tell policymakers about it. Act responsibly when it comes to advertising. We have to.

I think the AGA has done a wonderful job not only with the original Code of Conduct, but more recently updating it. There’s now a responsible gaming task force that’s doing a lot of work. I’m hopeful that’s where this all is going to lead, and that you’re going to see more and more companies here literally advertising responsible gambling on their casino floors.

So the casinos have a pretty good handle on problem gambling. But we’ve got a new type of gambling coming up with the legalization of sports betting and mobile sports betting. Is that something the NCRG and all these gambling organizations should pay attention to?

Everyone needs to pay attention to it. The NCRG is trying to put together funding for a center for research and study of sports gambling to specifically understand whether or not there is in fact any difference. We’re all walking out there assuming that there is. Well, no one really knows. Maybe there is, and maybe there isn’t.

The other part of it is whether or not—in an online form, whether it’s slot machines online, or sports betting online—you can detect problematic behaviors and patterns. There’s the theory that you can. But I would suggest rather strongly that this is entirely unproven. Having said that, I think that there’s some truth in it; we’ve just got to get to what that really is.

GGB: Nevada has had gambling longer than any other state in the country. Having been around that long, is there a payback in terms of knowledge and experience in problem gambling?

O’Hare: I guess there is and there isn’t. Gambling’s been legal in Nevada since the 1930s and the council didn’t come along until the 1980s, so after 50 years of experience with gambling, the last 30 we’ve been able to study some of the consequences of problem gambling.

How is the council funded?

I like to tell people that we’re a private nonprofit and we’re funded any way we can get it. We’re fortunate that we have support from several of the big gaming companies, who are corporate sponsors with an annual membership contribution. We also receive grant funding from the state of Nevada. We have fundraisers. We accept contributions, and we do generate some revenue from fees for services such as training.

What kinds of numbers are you dealing with in terms of the people you treat?

It depends upon how you find the numbers. The number of people who are accessing treatment is increasing as we make that more available.

We’ve been running the help line that is required to be displayed in all the locations in Nevada. What we see there, however, is a decrease in calls. But that’s true across the country.

How many people dial 1-800 numbers for help anymore?

We’re getting more people accessing our website for problem gambling information, and we’re not sure how many of them actually show up for meetings or even seek help.

A gambling court has now been set up in Las Vegas. What role does the council play in this court?

We’ve been advocates for the law that made this possible for a very long time, and now it’s finally become a reality. It took 10 years to get this up and operating.

When a crime is committed and that crime wouldn’t have happened in the absence of problem gambling, you need to get into treatment and not be subject to criminal penalties. It doesn’t mean you didn’t commit the crime or you don’t need to make restitution for the money that’s missing, but we know that these are folks that if we treat the addiction, there won’t be any repeat of that crime.

This is a huge opportunity for us to address something that could be life-altering. Our role is to be an information provider and to link up the offender with the help they need.

What advice would you give to states that are currently rushing to legalize sports betting, particularly mobile betting?

The advice I would give is not to the state but to the gaming industry itself. There are already 35 partnerships between major sports leagues and gaming companies. So I would advise the gaming companies to educate the sports fan. This is a new industry that knows nothing of problem gambling, an entire new employee base that may have been told nothing of problem gambling.

So my dream has been that those folks in the casino industry who have been faithful to responsible gaming will hold their partners to the same standards as they’ve held for all these years. And then exceed them because there’s going to have to be a new approach to this new industry.

GGB: Congratulations on the opening of your expansion. I have to say, it was one of the most impressive expansions I’ve ever seen.

John Dinius: Wow, thank you so much. And coming from you, Roger, I mean, that really does mean a lot. So, I appreciate that.

I particularly liked the way you seamlessly incorporated the new construction into the previous property, which always looked good. How is it performing?

We’ve had incredible results thus far. It’s only a couple of weeks in, but the kind of occupancy numbers that we’re seeing, and some of the revenue numbers—we’ve never seen numbers like this, so we’re very excited about the future.

Let’s talk about the Southern California market. Some properties like San Manuel, Pechanga and Morongo do incredible numbers, but you’re a little more remote. Where do most of your guests come from?

Actually, it’s about a 25-mile radius. We get about 80 percent of our business from that area, but we’ve never had the kind of amenities like we have today to cast a wider net and attract a different level of clientele. And one thing we wanted to be cognizant about was not alienating our current clientele, because we’ve operated a very successful property for 35 years, and we didn’t want to do anything to impact those guests that were there with us for those 35 years.

So, we really tried to create this consistent flow between the old side of the property and the new. We tried to do a lot to create that seamless connection between the two sides, and we’re trying not to refer to it as old and new, but east and west. So we think our current customers will blend well with the new players.

Do you feel like you’re competing with those larger properties now?

You know, in the past, we really haven’t shared a lot of the same customers—just being a hyper-local. But I think that these new amenities allow us to cast a wider net, and who wouldn’t want to come to San Diego, and play in San Diego? Hang out with us and float down that lazy river. But I think it really does step up the game here in San Diego in particular, and I think that the level of finishes that we have, the décor, the kind of service in all the various amenities and venues that we have, is going to force our competitors to step up their game as well.

There are lots of different market niches. Do you get a lot of Asian play?

It’s very important. I think the Hispanic market is an opportunity as well. It doesn’t feel that many of the properties in our area have really captivated either of those demographics, so, we’ve got some focus strategies to address that, and maybe in three to six months or so, I can let you know how successful those strategies were.

It’s only been a week, but how have your customers responded to the new place so far?

Incredible. And I’m not just saying this, but we haven’t had one negative comment from our guests. They’re just blown away by the level of finishes and the décor.

I think what was really important to us was ensuring that our level of service matched that level of décor. So, we revamped all of our organizational commitments as they relate to guest service, and just redefined those commitments and really inspired our team to put forth their best effort, and so far they’ve done just that.

We’ve also worked hard trying to build our executive team, and one of the gentlemen that has recently joined our team is Andrew

Kerzmann, our hotel VP. He was at Mirage for quite a few years, and that facility was 3,000 rooms… So, this was a little bit different scale, but just having him onboard from the outset of the development was really helpful.

We hired 850 new team members, and trying to get them onboard, and get them up to speed with our expectations was a massive undertaking, but our team executed at a very high level.

You’ve risen from a line-level employee, all the way to the top. Tell us about that journey.

When I started, it was back in what we referred to as the gray days: before the compacts were approved. And we had slots for a little while, but when I got hired , there were no slot machines. So I started in a bingo hall, selling pull tabs. I’m sure you remember those.

I felt like I walked into the job of a lifetime. It didn’t feel like work. When you go to work you go in and socialize, and somewhat entertain, and I just fell in love with the guests and the team members. And then when I got exposed to the tribal members, it just felt like home. It’s been an incredible journey for me. As soon as the slots came on board, I jumped over to that department and worked just about every position within slots. And then back in 2014, I stepped into the general manager role. So, it’s been an incredible ride. I’ve learned a lot. I used to say I was growing up out there, but now I’ve got to say I’m growing old out there.

GGB: What does Rush Street Interactive bring to tribal and independent casinos considering sports betting and iGaming?

Schwartz: We’ve invested a lot of effort and time in creating high-quality products for the industry—sports betting, both retail and mobile, social gaming and real-money iGaming. We want to find partners to work with to help them develop their own products in the market and train them to run their own operations.

What’s the background of Rush Street Interactive?

Rush Street Interactive was created more than seven years ago with the goal to be ready when laws were passed to allow iGaming and sports betting. We invested heavily in the development of our own technology and platforms, which is a risky proposition. Many companies that try it fail, but we’ve been able to execute on our vision. Our platforms allow us to be nimble and differentiated from our competition. We’ve focused on the user journey to create that differentiation.

What have you learned about that user experience over the last few years?

Players are very aware of what operators are doing and how you’re treating your players. Our competitors were doing things that weren’t creating a level of trust and transparency that the players want. They’re making a decision to gamble and they want to be treated fairly. When customers play on our site, they know exactly where they stand in terms of loyalty points and what those points mean. They know what our play-through requirements are. We’re trying to create player loyalty through a retention model that includes a great experience and community building.

Rush Street has a physical casino as well—SugarHouse in Philadelphia—tied to New Jersey and now Pennsylvania internet gaming. What have you seen in the crossover to the bricks-and-mortar facility?

It’s very strong. This is often underestimated in our business—the value of online gaming as a way to enhance casino play. We believe the land-based property should be the brand, and you can utilize that brand to drive traffic to both the physical and the online casino.

How has sports betting performed for you?

We surprised a lot of people in the New Jersey market. While the DFS sites have dominated because of their built-in database, we’ve been either third or fourth in the market every month, so we’ve gotten off to a strong start.

We’ve also seen the ability to cross-promote sports bettors with the online casino. It’s been an incremental growth that has been way beyond what we expected in terms of players betting on sports and then playing other products. We’ve integrated our loyalty and bonusing programs with the sports betting site, so we make it easy to jump between the two products.

GGB: You had to hit the ground running when you were named to lead the LVCVA because there’s a lot of action, such as the expansion of the convention center, the development of the Raiders stadium and other changes going on in the market. How did you keep up with it immediately?

Hill: How I keep up with it is, I’ve got a great team here, and one of the easiest products in the world to sell, and I have a lot of help. So, that’s really the key to being able to operate any organization this size.

Let’s talk about the expansion. How many square feet are there in the expansion, and now overall?

The building itself is a total of 1.4 million square feet. It will be 600,000 square feet of exhibition space, and 150,000 square feet of meeting space. And then the rest of the facility is back-of-house support, and that kind of thing.

Overall, we currently have 3.2 million total square feet—1.9 million of which is exhibition space. So, the expansion will take us to 4.6 million square feet of total space. And by the time we open, somewhere between 2.4 million and 2.5 million in the exhibition space.

In addition to the LVCVA expansion, the Sands Convention Center, Mandalay and MGM have opened expansions, and Caesars is building a 400,000-square-foot convention center behind Harrah’s and the Linq. Do we ever get to the point where there’s too much meeting and convention space here in Vegas?

I suppose that’s possible. But I think what we’re seeing, and what the properties are seeing, is real demand for meetings in Las Vegas. Show managers know that when their shows are in Las Vegas, they get a pretty significant bump in attendance, because people just want to come here. And so, we’ve seen a lot of demand, and we think that what’s being built now responds to that demand.

And we’ve actually restructured a little bit here, in anticipation of those expansions coming online. We’ve worked to help the properties fill those facilities, so we’re aware that there is a lot of meeting space. We’re going to have a 30 percent to 35 percent bump in total meeting space in the destination. And we want to make sure that’s all additive, and it doesn’t become something where shows are just shifting around in the destination.

The Las Vegas convention center is so big right now; you have just announced you’re talking with Elon Musk about doing kind of a people-mover system, and that sounds pretty interesting. Give us some of the details of that.

We’re excited about that. One of the things that we’re really focused on here is innovation—both at the convention center and the destination itself. And obviously, the Boring Company project is a really innovative with the use of existing technology. What we’ll have is a set of parallel tunnels. They’ll be one direction each way. Those tunnels have a 12-foot interior diameter, and basically just a road lane at the bottom. So, you can drive anything through those tunnels. What we’re planning to do, though, is operate autonomous vehicles. There will be Tesla Model X’s, or Model 3s, or potentially an autonomous tram that can move people from the expansion hall, the West Hall, back to the Central Hall area, and to the South Hall, and cover easily the entire campus. We’re over a mile and a quarter from one end to the other, once we get the expansion built. We think this is an opportunity to easily move people around the campus, which is important, but also to do it in an innovative and fun way.

The year 2020 is going to be a big year for Vegas. How is the arrival of the Las Vegas Raiders going to change what’s happening here?

Being an NFL city makes a statement. I’ve been here 31 years. I’ve had the opportunity to watch Vegas grow and mature. And this is a recognition of that growth. It will just bring a huge amount of excitement. But, on top of that, having the stadium here opens up opportunities that we just haven’t had a place to provide in the past. It’s the one venue size that was not available in Las Vegas, and so, events that are going to attract 45,000, 50,000, 60,000 people, had to skip Vegas, because there was no place to do that. That stadium is going to bring interest from people that we haven’t had the opportunity to draw in the past. And it will make a difference in the community. This is going to be one of the turning points we’ll look back on 30 years from now, and think, “Yeah, that mattered.”

Tell us about the new Edge-X cabinet.

We’re excited about the Edge-X cabinet in the premium video category. There have been a lot of advances in the bigger slot machines, and we look at this cabinet as a smaller version of those “jumbos.” The key in this cabinet is providing the player with a more intimate experience than the very large machines.

The Edge-X has two 43-inch curved screens in the “landscape” or horizontal position placed on top of each other. If you think back to our Arc Double cabinet, which has two screens positioned vertically on top of each other, these are horizontal. And what that provides is a very cinematic experience that extends all the way across your peripheral vision. It allows our game designers a really amazing palate.

And it gives the players a little more elbow room since it’s wide instead of tall.

Yes, that’s one of the key attributes that’s going to make this cabinet popular. We’re also using our revolutionary i-Bench technology, which is a connected bench that allows couples to game together. It allows people to spread out and have a more comfortable experience while playing.

Did you want it to be grouped together in a carousel setup?

Yes, it’s the legacy of our Wonder Wheel cabinet that was wall-based and meant to be grouped together. We were very keen on making the Edge-X bankable—something that would sit in the center of the casino floor and attract attention. Casinos are being more opportunistic about putting these kinds of machines where customers can see them. We built this with the expectation we could do three-pods or back-to-back. If someone wants to go bigger, we have that capacity.

Player engagement is always what you’re seeking with new cabinets. How does that work with the Edge-X?

Even though it’s a large cabinet, it’s a private feeling because you feel engrossed in the game. It takes up so much of your eye-line and it has such a cinematic feel that you feel like you’re playing alone or with your partner.

What games are you launching with the Edge-X?

At Aristocrat, we have some great licensed titles that are a little on the darker side—Mad Max, Walking Dead, etc. With the Edge-X, we decided to go with a little more brighter palate that has a different feel.

Madonna is a great example of that cinematic feel. There’s a very acute awareness of what Madonna is, her songs, her images and her videos, which we use extensively in the game. That is key to that game. You get engrossed in her early career. The Edge-X has a very big button panel—the biggest we’ve ever made. When you try to find ways to engage players, we’ve added a karaoke screen where you can read the words and sing along with the game. It’s an example of bringing the player engagement into the panel.

FarmVille is a very successful online social and slot game. It has a huge following and a collection of great characters and art. We picked these two titles because they were vibrant and cheerful. But of course, we’ll follow it up with our newest Mad Max title and get back to the darker side.

GGB: Let’s start at the time you joined Evolution. It was a big leap of faith for you. Tell us how that came about.

Todd Haushalter: It’s actually an interesting story. I’m at MGM, I’m VP of gaming, thinking about how to grow the slots and tables business at the corporate level. And I really believed, “This is my dream job. I’m never going to leave this job. I like everybody I work with.” It was just awesome.

So Evolution called and said, “We’re public now; why don’t you come on out, and just chat with us?” So I came out and they convinced me that this is the future. They were growing at 40 percent and were going to continue to grow at 40 percent for a long time, and basically, we can do anything. They’ve got these dealers working from studios, streaming it live; it’s kind of a crazy business, but I get table game operations, and then the players play live on their phones. It felt like the future. So I moved to Malta three and a half years ago, been making games with them ever since. It’s been a lot of fun; it’s really cool.

It’s really just a table game operation broadcast out over the internet. Right?

It’s literally that. But if you came to one of our studios, you’d see 3,000 or 4,000 people working there. And it’s just studio after studio. It looks more like a television studio than a casino, but you see dealers moving cards around, and spinning roulette wheels. And what’s fascinating is, we’re not limited to physical space. We have roulette games where there’s 1,000 or 2,000 players playing at any given moment. Here’s a fun fact: All five of the biggest roulette tables in the world judged by gross gaming revenue are with Evolution now.

In blackjack, we see players in Vegas playing the 6:5 rules, and it’s migrated to other parts of the country now. Do they understand that that’s not a good bet for them, your online players?

Collectively, there’s a big group of them that are just agnostic about it. But as you move up in limits, everything starts to change. And so, for the first time in my career, I can literally see every decision a blackjack player makes, because it’s digital. And so, we can ask questions like, “How do $10 players play differently than $50, versus $5,000 players?” And literally, as you move up in average bet, the quality of the play improves.

Do you use eight-deck shoes, and do you worry about card counters?

Yes, we have eight-deck shoes, and we have this interesting dynamic where everybody is effectively anonymous, and they can all use digital equipment to count the cards, so the counter-measures that you have to have in place are severe. But we deal four of the eight decks, as the most aggressive counter-measure. But you just have to; otherwise you would get eaten alive by card counters.

How does it work in New Jersey, where everything has to be dealt inside a real casino?

That’s burdensome, but that’s the rule. We partnered with Hard Rock, and we’ve got 30,000 square feet inside the Hard Rock casino, and it’s a beautiful environment. And so, in that space, at maturity we’ll have, depending on how you configure it, maybe 30 or 40 tables. And so, from that casino, not only will we service Hard Rock, but we’ll service all of our clients online, and then hopefully we’ll also be able to service clients in Pennsylvania, from New Jersey. If you have to do that every time—add casino space and dealers, and add a whole operation—it becomes very difficult.

Looking at some of your new products here at ICE, it became evident that you’re not just about table games. Explain some of the new things you’re getting into.

We’ve started to broadcast game shows that you can bet on. We’ve recently licensed the rights to Deal or No Deal, and we asked, what if we can build a game that is literally like a game show, but you can play along at home?

So we started looking across the horizon line at all the different game shows that are out there, and what might make sense. Deal or No Deal has some heritage already in our industry, and it’s kind of a great gambling game. And so, we hired these British actors, and nobody’s ever done it before. A game round lasts three minutes. By our standards, that’s crazy. But look: not everything has to be blackjack and baccarat.

Evolution Gaming seems to be changing the industry.

Yes. As an industry, we should assume it very well could be an alternative to land-based. Everything else across our lives—the way we watch movies, the way we buy stuff—has transitioned from land-based to digital. So, we should assume that like everything else in our lives, online gambling could be a preferred way of playing, for some people.

Land-based operators are all wondering how we become more experiential. As Steve Wynn used to say, “You’ve gotta get people from over there, to come over here.” And you’ve got to have something compelling. We’ve all got the same blackjack tables and slots, but you want to be on people’s phones. That’s where they’re living their lives.

GGB: Tell us how SBC came about and how you got involved.

McCarron: We’ve been active with SBC for 10 years now. It was originally set up just as a networking function so everyone could stay in touch, and it truly became a community. I joined in 2014 after a career in trade journalism. I was the editor of Betting Business magazine. During that time, I was frustrated that there was never enough emphasis on sports betting, so I joined SBC to really build a business. Poker was the big game at the time, and sports betting was a bit down the priority list. So we started a conference, Betting on Football, at Stamford Bridge Stadium, home of Chelsea FC, and it was an immediate success. And now we use seven or eight times as much space as we did originally with 2,000 attendees.

What was the inspiration for bringing the show to the U.S.?

We felt it was time to bring what we do to America. We want to help to educate the market on best practices and the like. Networking is always a big part of any of our events, and we invest quite a bit in that, so that’s a big focus with Betting on Sports America. So, it’s a mix of high-quality content and great networking.

The conference itself is at the Meadowlands Expo Center, but there are networking events across the river, correct?

Yes, we believe New Jersey is the right place for this event because it was one of the pioneers of U.S. sports betting. The Meadowlands Exposition Center is a great location because it’s only 30 minutes from Manhattan.

We do networking parties on both ends of the conference. We’re having the pre-registration party at the 40/40 Club in New York City. On the first night of the conference, we’ve hired out the rooftop terrace at the Meadowlands racetrack. And the closing reception will be held at the Sky Room in Manhattan, with great views of the city.

Tell us about the Sports Betting Hall of Fame, and how you’re going to implement it in the U.S.

We started this in 2014, and we have 11 members. It’s a bit trickier in the U.S. because there’s not that big tradition of sports betting, but we’re adding former New Jersey Governor Chris Christie as the first U.S. member.

What kinds of topics can attendees expect to see covered at Betting on Sports America?

We’ve got several different tracks that last an entire day, including betting and regulations, trading and operations, sponsorship and marketing, sports and betting, demystifying sports betting and more. We’ve got a master class on affiliate marketing, a very important element of sports betting. So we’ll cover just about everything.

GGB: Your first year at the helm of Scientific Games was pretty eventful. The Supreme Court sports betting decision made the decision to buy NYX Gaming very wise, and then the Don Best acquisition solidified your role as a sports betting provider. How did those acquisitions work in your favor?

Barry Cottle: I think it puts us in a great position, really, for three main reasons. Number one, with the acquisition of NYX and Don Best, what we have now is a best-in-class, full-service, end-to-end sports betting solution, from platform through managed trading services that we can now offer as North America begins to regulate. In fact, today we’re already in Pennsylvania and Mississippi and New Jersey with Caesars. It puts us in a great position as that market starts to unfold.

The second thing with NYX is that it brought us an iGaming platform. Today in New Jersey, around 50 percent of the iGaming bets come through our platform. As iGaming potentially rolls out, along with the sports betting, again, it puts us in a nice position as that happens.

You recently oversaw a restructure of top management at Scientific Games. What was the strategy behind those changes, and how has that worked out so far?

Just recently, we promoted Jordan Levin to be the head of digital, and Pat McHugh to be the head of lottery. And I can’t even tell you how excited I am for both of these guys to take this position. Both have proven experience within Scientific Games, within those respective fields, in driving the operations and execution. They are hungry and passionate, smart guys, and I really have a ton of confidence that they’re going drive the business. Additionally, Jim Kennedy will continue to support our lottery group as chairman.

Scientific Games has always been about the games, and particularly with your brands, WMS and Bally, certainly that’s impressive. So, how do you maintain the distribution across all the channels using these games?

First of all, when we think about building our products, it’s a player-first mentality. So, we focus on delivering games that our players enjoy and want to engage with. And we really look at it across all platforms. Whether you’re playing in land-based casinos or on a phone or device, we think about delivering that experience, for those franchises, wherever a player wants to play, on whatever a player wants to play.

And then second is the optimal combination of art and science, which is perfectly, appropriately named, since we are Scientific Games. The science piece is really understanding the player behavior and motivations, and then combining that with the fun and the imaginative execution of each game.

And the third is that we create a culture of creative passion across the organization to innovate and deliver on that. The combination of thinking “player” and using both sides of our brain, and doing it across the organization, ends up resulting in us being able to execute on our plans.

Another hallmark of Scientific Games has always been the innovation. How do you keep your R&D teams on that cutting-edge technology?

Again, it really comes down to the player focus. We don’t innovate just for innovation’s sake. But we try to think how we enable a better player experience on two different levels: on the platform or system, which enables the content, and then the content itself. An example of a player innovation is personalization. So, when we talk about SG Vision and facial recognition, that’s about understanding the player and being able to customize an experience for them. If you look at one of our recent slot games, the Cash Wizard game that just came out, that actually has social elements. So, we’re starting to see that players like the social component within the games that they play. And so, our innovations are really about delivering on what we think the player motivation is driven by.

We had a bump in the road recently with the Wire Act memo just a few weeks ago. What is your impression of how that’s going to impact your business?

As you know, we deliver our products and solutions across many regulatory environments of all sorts, which are constantly evolving. We just work to deliver the best products and services we can, side by side with our partners, and we’ll just continue to monitor it closely, and react accordingly.

What do you see as the biggest opportunity in 2019?

There are just a plethora of products and services that we’re excited about this year. We have an embarrassment of riches, I like to call it that, going into 2019. The exciting thing is that we have great opportunities across all business units.

We have a nice mix within each business in areas and markets that we can enter. We have four product business lines, where we see what we call “gap upside,” and improvements that can be made. And then we have new markets, such as sports betting, or iLottery, or a new business line that we could go into. So, it’s nice to have a mix, where you have core growth that can be accomplished across that diverse area.

GGB: You started your career as a journalist, worked for such major companies like Las Vegas Sands and Wynn Resorts, and then, of course, you were the first marketing VP for the Vegas Golden Knights. What did you learn at each of those steps, that allowed you to make the next step?

Nehme Abouzeid: Going to journalism school and my experience of five years as a journalist really helped me become a quick study at everything—ask the right questions, learn how to flesh out a subject. So I think journalists are underappreciated, especially in their ability to tell a story and relate very complex subjects in simple ways. And then going into an industry like gaming, that has many lines of business under one roof, all of which could be independent companies on their own, and doing $20 billion in development I helped work on at Wynn and Las Vegas Sands, it really guided me well.

What is it that makes Las Vegas so special, and why do you call it your home?

I didn’t expect to be here, to be honest. I was a Boston guy, went to college in D.C., lived in the Middle East and Los Angeles when I was a journalist, and Vegas was the last place I’d expect to be. But it’s going on 15 years now, and I believe the quality of life here is sort of that best-kept secret, nationally. I’m also invigorated by Las Vegas’ constant reinvention. When you think about it, with 400 casinos in 40 states, we all could be looking at the Strip and they could be rusting hulks of steel. I’m proud of Nevada, I’m proud of Las Vegas, because we all roll in the same direction, when a project is good for the economy.

The next reinvention of Las Vegas will start in 2020, with several new projects slated to open. How can people prepare for that change that’s coming up?

If you’re talking about locals, you know, Vegas always had this real unique dynamic, where 2 million locals are spread out, and 43 million tourists are highly concentrated. We have 200,000-plus people working in gaming and hospitality, so it’s a really interesting dynamic. But it’s not your typical market. It’s not like L.A., it’s not like Chicago, it’s not like New York; it’s quite different.

How does your company LaunchVegas participate in this next phase of Vegas?

I’ve been doing this 15 years, helping big brands with big development projects launch and scale—especially with the $500 million hockey team. I personally had spreadsheets that I was cataloging for years, of how to launch a project with a critical path, how to do it right, how to launch and scale. So, I realized I kind of have this Vegas playbook, and I could give this expertise to companies that wanted to come in and enter the market the right way. So, that’s really what I focused on, and I called it LaunchVegas because really I wanted to focus on early-stage, yet big projects. Right now, I’ve got clients in the sports betting, tech and the health care spaces. So we’re really not just limited to casinos.

Why did the Golden Knights work so well for Las Vegas?

Tourists wanted to follow their team—that was obvious. But when Las Vegas locals want to brag about how good their seats are, how much merchandise they own, it really came together, and credit to Mr. Bill Foley for pushing the idea, and the Maloofs for having the vision, and then hiring the right people to make it happen. I remember, I joined the team on November 7, 2016. We unveiled the logo and name November 22. And at that time, (NHL Commissioner) Gary Bettman said, “I’ve never seen that many people come out, just for a name and a logo unveil.”

GGB: Tell us about the sale of Tropicana Entertainment to Eldorado Resorts. Why did you get back into the business so quickly after the sale closed?

Rodio: Well, it was a six-month process, from the time the transaction was announced until the time it closed. The Eldorado folks were wonderful. They offered me a position to stay on. But I thought it was time for me to move on.

I’m too young to retire. I love the industry; I’m passionate about it. So, I felt like I had one more good run in me, and this was one of a number of opportunities that I looked at. This one seemed to fit me best.

What was it about Affinity that really attracted you?

I think there are a lot of similarities between Affinity today and where Tropicana was when I first got there, seven or eight years ago—a regional gaming company, operations throughout the Midwest, and no real cohesion within the company. I really look to draw from my experience at Tropicana of building a company and creating a new culture, and discovering some new ways of looking at things—with a fresh set of eyes.

You worked for a pretty demanding billionaire in Carl Icahn at Tropicana. Now you’ll be working with another one, Jim Zenni, the head of Z Capital, which is a majority owner of Affinity.

There are similarities, and there are some differences. Tropicana was publicly traded, but Mr. Icahn owned 80 percent of the company, so there was only one vote that mattered. So, for all practical purposes, it was privately held.

They’re both very passionate, obviously both great investors. I think the difference is, Mr. Icahn didn’t get involved in the day-to-day operations. Given how this company has been operating before I got here—it was four or five months without a CEO—Mr. Zenni was, in essence, the CEO. So, he’s much more intimately aware of each of the properties, each of the businesses, and the positives, the negatives, and what we need to do to move forward. So, that is a big difference. He’s passionate about it, I think his leadership is certainly a big support, and you know, he’s looking for us to grow the company.

In that sense, they’re both identical. They want me to add value. That’s why I’m here.

Affinity has so many different parts, not an overarching brand and diverse operations.

Well, they are diverse. I’ve now visited each and every business, and they are unique in the customers that they serve, the markets that they operate in, and the size of the facilities. Some of our properties have hotels, some don’t. But the philosophy that I used at Tropicana is going to be the same philosophy that I use here, which is a little different than previous management. I believe in more of a decentralized model. I will give a lot more autonomy to the general managers and the local business leaders. And I think it certainly plays well with this company, because they are so diverse. What works at Primm, at Stateline, isn’t necessarily going to work at Rail City in Sparks, outside of Reno. So, I’m getting to know each of the businesses, and again, we’re going to operate in a more decentralized function.

What do you consider the strengths of the company at this point?

I’m pleasantly surprised by the strength of the corporate staff and the management teams at each of the individual businesses. The GMs that I’ve gotten to know, I think they all do a great job. We’ve brought in some additional talent to support the people that are already here: Eric Fiocco is on board and we’re bringing in the CFO from Tropicana, Joe Long, as well.

So, the talent that was here, and really long-term loyal employees, interact with customers, and you can see that it’s a family atmosphere, in those respects.

How about the shape of the properties? Do you need a little more capital investment, or were they in pretty good shape?

They’re in good shape from a physical standpoint, but similar to what I did at Tropicana—and I think what’s incumbent upon all of this in this industry—we have to diversify the experience. You no longer can just offer slot machines and table games. We have to look for opportunities and ways to partner with brands, and to diversify the experience. It’s more challenging in smaller, regional markets, but there are definitely little things that we can do to tweak the experience and add new amenities.

But like Downtown at that time, the Plaza was down on its luck when Jossel came to the hotel.

“The simple thing would have been to knock down the Plaza and start again,” he says. “But that’s not my philosophy.”

Jossel admits to having a soft spot in his heart for the Plaza, even before he arrived, because it was owned by the master or Downtown for more than half a century, Jackie Gaughan.

“Jackie Gaughan, in my opinion, was one of the best operators in gaming because he understood what people wanted and how to give it to them,” he explains. “I studied how he operated over the years and committed myself to meeting our customers, getting to know them well and staying in touch with them as much as we can. So it was important for me to be able to learn the history of the Plaza and to continue the personal service that Jackie started.”

Jossel rolled up his sleeves and started changing things. His latest addition to the property is the Core Arena, an outdoor equestrian center that he believes will attract a different demographic Downtown, particularly during National Finals Rodeo, which dominates Las Vegas for two weeks in early December every year.

“We were never able to really take advantage of that event,” he says. “Now we’re sold out that week, and there are a lot of other things we can do during the year in that space,” which was formerly a parking lot.

“Now, we’re going to be the only place Downtown that has this amenity.”

Today, there’s not an area of the hotel or casino that hasn’t been spruced up or improved. But Jossel says there’s no silver bullet or grand solution when trying to turn a property around.

“The truth is there is no one answer,” he says. “It takes a lot of time, commitment and dedication. It’s paying attention to details. Slowly but surely, we’ve been able to take the Plaza from where it was to an entirely different position. I attribute that to so many different factors we don’t have the time to list them all. You focus on one thing, take it a day at a time, and try to do one thing better.

“I think we’ve been proven right not to knock it down. We’re growing. Every single month is better than the one before. And we’re very proud of that.”

Some of the areas that have been totally redone under Jossel’s leadership have been the pool deck, the convention area, the bingo room, most areas of the casino and a new gym. And now he’s starting on a revamp of the rooms, which was last done before he arrived.

“It’s been seven years since the last remodel, so we’re in the process of doing 150 brand new rooms, which are going to be some of the nicest rooms Downtown,” he says of the hotel, which is the second-largest Downtown with 1,003 rooms.

If there is a secret, he says, it’s to be different from your competitors.

“I’m a big believer that you have to differentiate to succeed,” he explains. “It helps us stand out from the crowd, so whether it’s pickleball (including an annual convention and tournaments), a blues festival, which we do once a year, bingo or now the rodeo… all these things differentiate us from other properties Downtown, but are also good for Downtown because we bring lots of people here with those events.”

Despite not being a member of the Fremont Street Experience, the casinos clustered around the audio-visual canopy that ends at the front door of the Plaza, Jossel says he’s committed to Downtown. He says the Plaza is a sponsor of the Life is Beautiful festival, the Santa Run that brought 8,000 people dressed as Santa Downtown, the performing arts Smith Center, and the Las Vegas Lights soccer team.

“Anything that is good for Downtown is good for us,” he says.

GGB: Where did the idea for a gambling court come from?

Cheryl Moss: I met now-retired Senior Judge Mark Farrell from New York—as is the case with most of the people I’ve met in the gaming world—through my mom, Dr. Rena Nora. My late mother was a psychiatrist at the VA Medical Center in New Jersey. She would go around to these conferences and introduce me to people, and I was just the young kid that was carrying her briefcase and tagging along at these conferences, so she introduced me to Judge Farrell, and Judge Farrell had the very, very first gambling court in the United States, and so, that’s how I learned about gambling court.

Is this similar to a drug court, then?

It is a certified specialty court, and I want to thank Chief Judge Linda Bell for giving me the opportunity. I had been asking for it for 10 years since the statute was amended, that we would have a gambling diversion program.

Chief Judge Bell assigned me a specialty court coordinator who also works with our other family court judge, Frank Sullivan, to handle drug court cases in the juvenile division. This guy is on top of things. He will prep the cases and staff the court, and we’ve got a couple of cases that are going to be heard in a few weeks.

What are the criteria for getting assigned to the gambling court?

Well, It goes back to the statute. Nevada Revised Statute, Chapter 458A says that if a crime is committed in furtherance of the gambling, it is up to a criminal division judge to make that determination for eligibility, subject to certain exceptions of course, but if it is found that it is in furtherance of the gambling and they have a gambling problem, then they are eligible for diversion and then, they would be referred to my court for treatment and monitoring, and ensuring that they are able to successfully complete the drug court program or the gambling court program.

How do you determine whether the person has actually stopped gambling? There’s nothing like drug testing for gambling.

Well, as they say, in the world of drug addiction and recovery, you’re never a recovered gambler or a drug addict; you’re always recovering, so it’s the same kind of concept, like the AA program and the NA program, and the GA, Gamblers Anonymous, program. But yes, it’s difficult to tell; we don’t know unless something actually happens. In my family court cases, it’s not known unless somebody accuses the other side.

I know you are just starting this court, but what do you think a typical penalty will be for somebody in this situation?

It’s a very detailed process. It’s called “sanctions”—if there is any kind of lapse or relapse, we start off to make sure that they are already in treatment, or we’ve assigned them a treatment provider. The Nevada Council on Problem Gambling will help provide a list of people that are certified problem gambling counselors that can do the treatment, and then we will have status checks every two weeks to ensure that they’re doing that. Our goal is to encourage and be supportive.

Executive Development Program, held for 10 days each November in Lake Tahoe. He talks about the recently completed program, the IGI Innovation Lab, which encourages students to invent new games and products for the gaming industry, as well as other issues related to the IGI. He spoke with GGB Publisher Roger Gros in his offices at the Stan Fulton Building at UNLV in December.

GGB: You just completed the most recent Executive Development Program (EDP). During the welcome to the students this year, you said it was your favorite event of the year. Why is that?

Bernhard: This is a really special program. Bill Eadington started it in 1990. That first year there were 14 attendees. This year we had more than 60. But in the original event in 1990, a young Andrew MacDonald sat next to a young Mark Lipparelli. Andrew is now the chief casino officer for Las Vegas Sands, and Mark became the chairman of the Nevada Gaming Control Board and a leader in the manufacturing side. The two of them didn’t know each other but became fast friends and created a network that plays out exponentially over the years.

Every year, the graduating class sends notes out to me and others, and this year, the gentleman who just got promoted as general manger of the Star in Sydney was talking about how he was up for that position and believes one of the reasons he got it is because of his involvement in EDP.

It just builds this family where you make friends from all over the world, spending nine intense days in Lake Tahoe, the most gorgeous place in the world that you never get to see because they’re working hard 8-5 each day hearing from some of the most amazing people from inside and outside the industry, and then spend the evenings working on a really difficult team competition. That’s what makes it so special.

When you were asked by Dr. Eadington, the founder of EDP, to take it over when he was sick and dying, how did you feel?

I remember it to this day. I was in the car when he called to ask me. It was hard enough to take in the difficult news about his health, but wrapped up as it always was with a teaching moment, he asked me to take it over. My first thought was that I was clearly not qualified, but what could I say? I was overwhelmed that first year when we did it together. The following year was very emotional, and we weren’t sure about what we were doing. The final slide we show on the first morning was a picture of him just erupting into laughter at something one of the students said. It gives us the opportunity to stress that if you’re someone who just sits in the back and doesn’t ask questions, this isn’t the place for that. So another teachable moment from him.

How do people sign up for EDP?

It’s an application process, and we read those applications very, very closely. After all these years, I think the industry has a pretty good sense of the kind of person who would benefit from this. The admissions process, while it’s formal, we’ve gotten good at spotting the kind of people that would graduate. And by the way, it’s got both the UNLV and the UNR (University of Nevada, Reno) stamp on it. Like in many states, the in-state schools don’t always get along, but this is one instance where we are both on the same page.

Tell us about the Innovation Lab at IGI.

I was asked to lunch one day by Dr. Mark Yoseloff, who is himself a legend in the business. He was a prolific inventor of table games, had a stint as CEO of Shuffle Master and before that was COO of Coleco when they did Coleco Vision, which essentially transformed the American living room. He’s very accomplished, as well as having a Ph.D. in math from Princeton. He told me he didn’t want to die with this knowledge, he wanted to share it. But he didn’t want to have tests or midterms or papers. The final exam would be to invent a game or product for the gaming industry. Up until that time, there was no class on how to invent a gambling game or device and unveil it before industry leaders at a showcase presentation, kind of like Shark Tank. These games are completely creative and unique.

Unlike at other universities where the college owns the work of the students, at the Innovation Lab, the students keep the vast majority of ownership. Why did you structure it like that?

First of all, we believe it’s their ideas and hard work that make the game or product viable. And we’re here for the kids in the end. Both Dr. Yoseloff and myself agreed on that. So you don’t have to partner with some stuffy old professor, who would be paid lots of money and grab the credit.

We’re very proud that our students have been granted 12 patents on their games or devices, at a time where it’s getting increasingly more difficult to patent gaming ideas.

GGB: You did a great job running the FireKeepers casino in Michigan. What’s the difference between Firekeepers and the Snoqualmie Casino?

Brian Decorah: Just like at FireKeepers, I’ve got a great team here. But Seattle’s just a different market—when you go there, just the natural beauty of where you are, and the market that we’re in. We’re the closest casino to Seattle, 27 miles out. So, we’ve got some of the most affluent neighborhoods surrounding us. We’re right off Interstate 90. We say we’re minutes away, but a world apart. We have these sweeping views of the Cascade Mountains. We have elk and blackberry all around the property. It’s just a stunning location, but very affluent. And what’s a little bit different, compared to that FireKeepers market, it’s a little bit smaller property, but the win per player is substantially higher. Our market has many players employed by Google and Microsoft and other tech companies.

But we also have a very high percentage of Asian play. We estimate it’s around 50 percent, but it’s not Chinese. It’s Vietnamese and other Asian segments, and we’ve got the full offerings to target that demographic.

Does the tribe have a lot of land up there? Is there land to expand?

It’s actually a pretty small footprint—around 60 acres. And it’s built on the side of a mountain, so it gives you great views, but it’s really difficult to build on. So, we’re actually in the process of taking a look at what can we do to expand right now, and the topography is certainly one of the things you have to think about a lot.

Tell us about your competition up there. Are there other casinos close by?

Yes, there are close to 30 casinos in Washington. We’ve also got a lot of card rooms around Washington. But the closest casino to us is Muckleshoot. They’re about 30 miles south of us, but it takes about an hour to get there, with the traffic. And Tulalip, they do a great job, on the north side of Seattle. But we almost don’t compete in some respects, because of the traffic barrier—it can be 20 miles, but it’s an hour and 45 minutes in rush-hour traffic. We’ve also got Emerald Queen over on the other side of Seattle, closer to Tacoma, and they’re in the process of building a big Vegas-style casino property there.

But, you know, one thing that’s really

different is that it’s a friendly competition and serious collaboration in Seattle. Everyone works together, and they’re willing to share things. And it’s taking some getting used to, compared to where I come from, but they welcome me with open arms, and that’s not something you always experience when you go to a new market. There were a lot of different things to learn, because it’s a pull-tab-based slot product there. And there’s a lot of learning the nuances of a regulatory environment. So it’s different, but I had help.

Tell us about the card rooms, or what they sometimes call mini casinos.

It’s really the same things that you see across other card rooms—they aren’t as heavily regulated as our casinos are. There have been accusations of loan sharking, money laundering and even murder.

Some of our higher-limit baccarat players would go to those card rooms, so we’ve converted a former deli into a high-limit private gaming salon for those high-limit bacc players. And that’s because we do have a lot of those players who do like that private experience in those little card rooms. We want to be able to replicate that, but with a tighter game, more regulations, more consumer protections.

So are those pull tab machines Class II gaming?

It’s still Class III gaming, but it’s based off a pull-tab system. Essentially, if you go up to a Wheel of Fortune game, and make a bet, the 50-cent bet and the dollar bet come from different buckets of pull tabs. And once it gets down to, I think, 10 percent of what the total pull-tab base is, it dumps more pull tabs in, so it’s not quite the same as traditional slots. Our slot director is great, a former IGT executive. And he was telling me, if you go play video poker at a bar, it’s a certain experience you get here in Las Vegas, and if you’re a skill-based player, you can do pretty well. But in Washington, if you get dealt the full house or a royal flush on the first hand, you can throw all those cards away, and you’re still going to get the same result, because there’s no skill involved. It’s all based on pull tabs.

Can you use Class II games?

Yes, those aren’t regulated by the state compact, so that’s more advantageous for us. They also have other restrictions, as far as types of games, and we really do need more Class II premium product, with those affluent markets that are so close to us, in Bellevue and Seattle, and Seattle proper, so we have an opportunity with a more upscale customer, just to have a higher-limit bet on each of the games. So, that’s really important to us, but we need premium content for it. Not all games are created equal, as we know.

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GGB: What is Kambi?

Bichsel: Kambi is a global B2B sports book supplier. For operators around the world in regulated markets, we’re able to supply sports books from the trading to the management, everything required to operate a sports book.

Kambi has a couple of contracts in New Jersey with the Hard Rock and Rush Street Interactive’s PlaySugarHouse sports books. What has the experience been like so far?

It’s been in the process for a long time, but we’re pleased with the results in New Jersey. And now we’re looking toward the rest of the country as legislation gets introduced and passed.

How has Kambi navigated the regulations in New Jersey?

We take the compliance and regulatory aspect very seriously. We have in-house counsel to guide us. We’ve created relationships not only with the regulators but the legislators as well, to make sure they’re knowledgeable about what they’re hoping to regulate. It’s gratifying for us to get into some of these markets. Our goal is to be regulated across the U.S. and in any other regulated market in the world. We’re a listed company on the exchange in Stockholm, so regulation is very important to us.

Kambi is known for its technology. What do you offer that others do not, or how is your technology better than others?

We come from a long line of traders that make markets, so we take it very seriously. We trade everything in house. We don’t scrape other sites or take information from other sources. We’re able to set odds on almost anything, not only pre-match, but also on outcomes in game. So if your team is driving down the field, Kambi can not only increase the entertainment value, but offer a wide variety of wagers. Take golf, for instance. There are some significant time stoppages in that sport, giving the opportunity for players to wager on whether or not one player will hit the green or make the putt. All these micro-markets make it very entertaining, and make it much more attractive for the player to stay with that offering.

If you’re going to accept sports bets in states across the U.S., how do you account for the “local” bettors? For example, in New Jersey, you’ll have lots of bettors on the Jets, Giants and Eagles.

Good question, but for us, the price is the price based on the information we have. We have a relationship with our operators to make sure we’re setting the lines effectively. There are outliers, of course, about what that handle looks like and how we need to accommodate that. If you are a local or regional sports book in a regulated market, that is going to happen. That’s the nature of being a bookmaker, and it’s something we have to take into account. Volatility happens, and that’s why there’s such a small margin in sports betting.

GGB: What drew you to Inspired Gaming?

Pierce: A couple of things. First, in my past, I had looked at the company and saw the technology and products and thought it was really interesting. And then when Lorne Weil, who I had worked with for 24 years building Scientific Games, became chairman of Inspired, it was an attractive opportunity.

I knew they had a very well developed business in Europe, but virtually no business in North America. I thought it was a great complement to my skill set and background since I had spent the majority of my career in North America. And quite frankly, starting from a zero baseline in the world’s largest gaming market is always attractive.

How does virtual sports betting work? Is it RNG-based?

Yes, that’s exactly what it is—like a ball drop in keno or a slot machine. But the outcome is displayed in high-tech, ultra-realistic fashion. So what would essentially be shown as a reel spin on a slot machine is displayed as a sporting event—horse racing, football, auto racing. It’s a slot machine pull but highly entertaining at the same time.

How do you work with all segments of the gaming industry—casinos, sports books, iGaming, lottery?

It’s great because our content is ubiquitous. So it’s not only the geographic disbursement of the business but also in all the different segments. Our customers can be as diverse as William Hill and the Pennsylvania Lottery. So every prospect out there is a potential customer for us.

How do you work with lotteries?

In Pennsylvania, we have a deal with Scientific Games, which is the central system for the state lottery. If you go into a bar or a restaurant, there will be three screens. We have two for our football and car race games, and Sci Games has the third for their keno game.

But the lottery is an important vertical for us. In Greece, we have the best-performing slot machines, as well as 100 percent of the market in virtual sports.

Doesn’t the legalization of sports betting make virtual sports betting less popular?

No, quite the contrary, actually. It’s a very complementary product. In every market around the world, our product is offered wherever sports betting occurs. Typically, what we see is that virtual sports are about 15 percent to 20 percent of what’s bet overall. And from the operators’ perspective, it’s (viable) product at all times because this is simulated and not on a schedule. If a player is betting a live football game or soccer match, it’s something they can play while awaiting the outcome of the live games. And while the hold on live sports betting is something around 5 percent, the hold on virtual sports betting is significantly higher than that. So it’s really complementary, not competitive.

GGB: Tell us what Unikrn is all about.

Rahul Sood: Unikrn is a global esports bookmaker. We create our own odds. We permit live betting on our platform. We’re a “fan first” company. We embedded ourselves into the esports community. We create content like ESPN would for sports. We own teams, we run tournaments… We’re really a participant in the community rather than just a betting operator. And most importantly, I think, we’re the only wagering company on earth that’s built entirely on blockchain. We can accept 9,000 transactions per second, and we’re soon going to be able to offer our platform over multiple countries and accept bets in multiple currencies.

And you produce your own currency as well, correct?

Yes, back in 2015 we introduced Unikoin and created UnikoinGold last year. UnikoinGold can be used in a number of different ways. It’s not only tied to wagering. Customers can come to our platform and connect their gaming accounts—League of Legends, DotA, Fortnite, whatever—and start playing games and collecting tokens. They can win tokens, digital items and jackpots. And then we use UnikoinGold as a betting bonus. There’s lots of ways we can go with this using our ecosystem. In the wagering space, I think we’re light years ahead of anyone else with this.

Can you bet on teams or is it head-to-head betting?

It’s both. You can either bet on professional esports teams or you can bet on yourself when you go up against a friend. We do buy-in tournaments at MGM, for example, where you buy in for $15 and can win a prize, like a poker tournament.

What regulatory bodies have given you a license, and how do they oversee your activities?

We’ve worked with the strictest regulators in the world in Australia, the Isle of Man, Malta and the U.K. We’re about to get licensed to take wagers and for our cryptocurrency activities. And it’s frankly very hard to get, because you have to show them your AML and your KYC programs on the platform, and we’ll be the first in the world to accomplish that for cryptocurrency.

Esports is quite bifurcated because of the various publishers of the games. How do you work with so many different entities?

Right now, it’s kind of a spectrum. You have some that willingly share their data with us and think about the future of the space and others that say they can’t do anything because of the optics of gambling. When we built Unikrn, we built our platform to be completely publisher-agnostic. It doesn’t matter what the publisher does, we can put a wagering experience on top of all the popular games.

GGB: Give us a thumbnail of GVC today.

Batram: We are one of the biggest online sports wagering companies in the world. We got there largely through acquisitions but also through growth. Every business we’ve acquired, we’ve accelerated their growth.

It’s a fascinating story. Over the past 10 years we’ve gone from an unregulated gray market to a largely regulated business. Today, 95 percent of our revenue is taxed by jurisdictions regulated now or in the process of being regulated.

GVC is built on technology, isn’t it?

Yes, technology is very important to us. We own everything from the casino to the poker room to the sports book to the back end, and even bingo now, and the platforms that run them. That gives us a number of advantages. First, it’s quite efficient. When we do acquire companies, we’re able to plug in synergies easily. You saw that with the bwin deal in 2016.

The Bwin.Party transaction made everyone sit up and take notice. What did that mean to the company?

That meant a lot to GVC. It propelled us into becoming a big company and allowed us to do an even bigger deal with Ladbrokes Coral.

The Bwin.Party acquisition was the result of a failed merger that happened in 2011. Bwin historically was a pioneer in European sports books. PartyPoker, prior to the Unlawful Internet Gambling Enforcement Act in 2006, was the largest online gaming brand in the world. Post-UIGEA, business shrunk significantly, but had been built up, and casino was added. But Party didn’t have any sports and bwin didn’t have any poker, so what could possibly go wrong? It had a ₤1 billion market cap, and prior to our acquisition it had slumped to ₤750 million… There were only two suitors—GVC and 888. And there’s always the danger when you’re buying a distressed company if you’re trying to catch a falling knife or actually got something where you can create real value. Fortunately, it was the latter.

The Ladbrokes Coral buy is the big one. That brought you some brick-and-mortar outlets for the first time. How has that worked out so far?

It’s very early days, but we’re very pleased with what we bought. There’s no question that, being a 100 percent online business, buying a retail business in the U.K. raised a few eyebrows. But we’re pleased with the U.K. legislation that limits the machines in the betting shops. There could have been a number of scenarios. But that uncertainty permitted us to acquire what we think is a fantastic brand with a very good business underneath. We managed to do a transaction that insulated our shareholders from a worst-case scenario.

Tell us about your new agreement with MGM Resorts to operate their mobile sports betting.

There were a number of ways to get into a regulated U.S. sports betting market. Our preference was to be more than just a technology supplier. From day one, we wanted to do a deal with a big partner so we could leverage our experience with their brand and multi-state footprint. MGM fits that description. Our existing relationship with them, originally worked out with bwin, has been a valuable learning curve. We know each other and there’s a common belief about where we see the market and how we can address it.

GGB: Korbi, this is your first year as show director at G2E. Tell us how you expect the show to grow this year.

Carrison: The Global Gaming Expo continuously evolves to reflect the growth of our industry, and this year will be no different.

The recent repeal of the Professional and Amateur Sports Protection Act (PASPA) opens the door to immense business opportunities for the sports betting industry. We’ve curated G2E’s first-ever Sports Betting Symposium, designed to arm the industry with the knowledge and resources needed to help stakeholders best move forward from business, operational and legislative perspectives. It will be an in-depth exploration of the sports betting industry from all angles.

Also new for G2E 2018, we’ve hand-picked entrepreneurs to showcase their innovations within the gaming and hospitality sectors. One addition we are very excited about is the Innovation Incubator at G2E, which will give students, startups and industry veterans the opportunity to pitch their greatest gaming and hospitality ideas to FUBU Founder and CEO Daymond John, as well as The Pink Ceiling and Sprout CEO Cindy Eckert (Whitehead).

The winning presentation, dubbed the Shark’s Choice, will be awarded a cash prize, as well as a complimentary booth at G2E 2019 to showcase their technology. The audience will vote for a second prize, the Customer’s Choice, which will also receive a complimentary booth at G2E 2019. Other innovators will have the opportunity to pitch their ideas at the AGA’s Innovation Lab in the expo hall.

We recently saw a nice increase in exhibit space and attendance at G2E Asia in Macau, which is also organized by Reed Exhibitions. Will G2E have a similar increase in 2018?

The success of this year’s G2E Asia is the latest example of the growing popularity and awareness of the Global Gaming Expo brand around the world. G2E is the marquee event for operators and manufacturers to grow their businesses. While the exhibitor and attendee bases for G2E and G2E Asia differ somewhat, we have seen an increase in the exhibit space booked at G2E, and attendance is trending to surpass previous years.

Sports betting was a big part of the show last year and will of course be important this year. What do you have planned in this area?

We are very excited to have confirmed ESPN’s SportCenter anchor, Scott Van Pelt, as a keynote speaker on Wednesday, October 10 at 9 a.m. The interview-style discussion, led by AGA’s Senior Vice President of Public Affairs Sara Slane, will focus on the implications of a legalized sports betting market for key stakeholders, such as sports leagues, the media and the gaming industry, following the Supreme Court’s decision to overturn PASPA in May.

Additionally, this year will be the industry’s debut of the Sports Betting Symposium at G2E, which will bring together the world’s foremost experts and business leaders to provide a specific vision for the future.

Indian gaming has always been a big part of the G2E conference program. What are you doing to ensure that tribal government gaming remains an important element of the show?

Tribal gaming is a vital part of the gaming industry. A core focus for this year’s show is supporting the development of tribal gaming enterprises and addressing their unique business needs. An entire educational track—organized in partnership with NIGA—is dedicated to discussing how the biggest topics in the gaming industry will impact tribal casinos. With the legalization of sports betting, we created an education session specifically to address the impact on tribal casinos with “Sports Betting: The Path Forward for Indian Country.” I also recommend everyone attend the “Tribal Leadership Roundtable,” where the leaders of the tribal sector will engage in a compelling discussion of the most important issues of today.

Tell us about the interactive tools that G2E is offering to assist both exhibitors and attendees to get the most out of the show that they can.

We recommend the show’s pre-show planning tool, My Show, which is available on the G2E website and on the G2E mobile app. Not only does it allow users to build out a schedule, but it will also recommend custom exhibitors to visit and education sessions to attend based on your registration profile and what you are looking to achieve at G2E.

The G2E show floor is the most impressive in the industry in its focus on all members of the industry, including non-gaming. Tell us how that’s going to benefit the attendees and exhibitors.

The gaming industry has evolved as casino patrons increasingly demand an integrated resort experience worldwide. To continue to discover new revenue streams and engage with new audiences, it is important for gaming operators to begin thinking about non-gaming entertainment such as esports, expanding food and beverage programs, spa offerings, and more. We want to give the gaming industry the tools to make the right partnerships that are a perfect fit for each individual operator.

With such a dynamic plan for this year’s G2E, what does this say about the growth and health of the casino industry and its largest trade show and conference?

As the casino industry grows and evolves, so does G2E. The industry is in a very exciting time where innovation is at an all-time high. G2E looks to meet that passion by giving those ideas the opportunity to shine, which has led to one of the most dynamic programming schedules we’ve ever put together for the show. The possibilities for the gaming industry in 2018 are endless, and it all begins at G2E.

Deifik: I’ve lived 30 years in and around Las Vegas. When I joined the Greenspun Group, they were actually exiting their involvement with gaming because of the downturn in the economy. But I continued to be involved. Over eight or nine years, I picked up the Silver Nugget with some partners. We bought the Lucky Club, out on the 15 near the Speedway. So I have two unrestricted gaming licenses and I’ve also learned through other investments in smaller casinos.

What was it that first appealed to you about Ocean?

Walking the property for the first time, I had some idea of what I was going to see from reports I had heard. I of course knew of the problems here, but I saw through that. I also saw a very heavy lift to open the property. The property was in immaculate shape—the power never had gone off. So when you take the building at $2.45 billion, add the central power plant at $157 million and a couple hundred million in furniture, fixtures and equipment, you’re approaching a $3 billion write-off. So I felt that on a price-per-pound basis, here was not only one of the greatest assets in Atlantic City, but also one of the great assets in North America.

How did you address some of the problems that existed at Revel that you knew needed to change?

First, we went through the posts on social media and began a list based on the comments people had made. We put together focus groups to determine the issues we needed to address. Non-smoking. If you were a smoker, there was no place for you at Revel. We fixed that. Two-night minimum stay? That was silly when the average stay was 1.2 to 1.4 nights. We fixed that. The wayfinding? The signage they had was poor. We made an investment in better signage and ambassadors showing people around. The layout of the casino floor was a problem. We fixed that by opening things up and making it easy to get around and added at least 50 percent new machines. The main escalator was scary. We invested several hundred thousand and put wings on the escalators so now everyone feels safe. It’s made a huge difference. And we got rid of the prison wall on the Boardwalk. Now we have a grand staircase with a sign. That is symbolic of what we’ve done at Ocean.

How about the operational issues? They didn’t really go after the gambler.

My attitude is we ripped the rear-view mirror out. So when we opened the doors on June 28, it was like we had never been opened. With our great CEO Frank Leone, we created what we think is one of the greatest four-tier loyalty programs in the industry. If you’re a member of our rewards system, we built a beautiful players lounge. The comps are coming. What they didn’t do before we’re going to do now.

Why the name Ocean?

That was my wife. People were telling us we had to get big consulting firms to create a catchy name and brand. But my wife looked at me and said, “Let’s just call it Ocean,” and that was it! We wanted to just call it “Ocean” by itself, but Carnival Cruise Lines was protecting that, so it became Ocean Resort Casino.

GGB: It’s a credit to you that New Jersey Governor Phil Murphy has kept you on since he took office in January. What is your relationship with his administration?

Rebuck: Governor Murphy hit the ground running and is very much involved with casino gaming and sports betting in particular. Attorney General (Gurbir) Grewal, my immediate boss, has been a great asset for us in helping us to perform the duties required of us. It’s been quite a hectic six months since the governor took over, and so far we have a great relationship with him, his staff and the attorney general.

How hectic has it been in the last six months?

We knew Hard Rock was on target to open this summer, so if it had just been that, we would have had no problem completing that investigation. And with the resolution of the sports betting case before the Supreme Court, we knew something was going to happen. But the total victory meant we had to get up and running quickly. And finally in January, just hours before the deadline, Revel was bought by Bruce Deifik and his team, so we had to add that to your list.

June was especially busy with sports books openings at Monmouth racetrack and Borgata, and later at Ocean Resort. And with the two new casinos opening on June 28, the pressure was on.

How worried are you that the increasing supply of gaming in Atlantic City will force other casinos to close?

Before the Taj closed in 2015, we had an eight-casino market that was fairly stable. So with the opening of two new casinos we go to a nine-casino market, and the question is whether we can sustain that. And I don’t know. But I will say this: I really don’t care. I hope it does. But I will say this to anyone who comes into this market. If you cannot compete in this market, you have no business running a casino. We have a very low tax rate, second only to Nevada. We have the best regulations in the country when it comes to overseeing and working with the industry—these are not oppressive and onerous and costly like many other jurisdictions.

There are now more diverse gaming products available here than in any state in the country—sports betting, full-blown iGaming, any product you can think of in traditional gaming—it’s here. And in non-gaming amenities, we’re second only to Nevada. We’ll never catch Las Vegas, but we’re a strong second.

Sports betting in New Jersey got off to a good start with two racetracks and two casinos running sports books as we speak. Any idea why the other casinos haven’t jumped on board yet?

The casinos are being very deliberate and conservative in their rollout. They’re taking their time to build the perfect offering, and most of them have opportunities in other states, as well, and have to take a multi-state approach, as opposed to the racetracks, which will not.

We’ve had a number of heart-to-heart discussions with casino operators and told them I need them to be more aggressive. I think they’ve gotten my message and are picking up the pace now.

I think we’re on the right track. And I’m very optimistic now that New Jersey will be a leader in this area. By the time we hit the end of the fourth quarter of 2019, I want New Jersey to be in a position to be the leader in the country. That’s a tall order because Nevada is on top now, but I think we have a shot.

Do you think the market is that big?

Let’s consider where we are now. We’re only doing ticket business using business practices like it’s been done in Nevada since the 1970s. We have the potential for 14 licenses, with three skins each. So we’re not very robust. In fact, we’re rudimentary.

But we’re off to a stunning start. Once we get all the licenses up and running, mobile apps working at full speed, you’re going to see a huge increase in play once we get (further) into the 21st century.

What about the growth in iGaming? Are there too many sites now?

It continues. For months, we’ve been posting double-digit increases and it was the same in June. I don’t know how long this is going to continue—there has to be a ceiling somewhere—but for now we’re enjoying it. And remember, right now, it’s just New Jersey. So when other states come on, we’re going to continue to grow.

And no, there are not too many sites. And competition is good. If you can’t compete, you fall by the wayside. We encourage innovation and experimentation, so come to New Jersey and give it your best shot.

Fahrenkopf was well-known in Washington, D.C., and led a defensive strategy as AGA head. He successfully led an effort to de-fang the National Gambling Impact Study Commission in the late 1990s, which was formed to dig up dirt on the industry. Fahrenkopf helped to get several pro-gaming commissioners appointed, so the final report actually told the truth about the industry.

He recognized the dangers of a “tobacco-style” inquisition in Congress, so he directed the formation of the National Center for Responsible Gaming, which pursued research into the then-little-known field of problem gambling in a balanced and independent manner.

But under Fahrenkopf, the AGA was a stagnant, inward-looking organization playing defense. Freeman had other ideas.

Expansion Plans

Freeman laid the groundwork for expansion of the AGA immediately upon taking over. His appointment was anointed by MGM President and CEO Jim Murren, who was also the chairman of the AGA at that time, and Freeman put his plan into place with Murren’s blessing.

The AGA was formed and was still controlled by six Las Vegas-centric companies, which included the biggest operators and manufacturers in the business. A seat on the AGA board was coveted; it was a small club. Freeman wanted to expand the membership of both the AGA and the board.

“The suppliers who were members believed that the AGA only wanted their dues money,” says Freeman. “The organization didn’t represent regional casino operations and didn’t represent tribes. We’ve changed that, and we’ve built an organization that I think effectively represents the totality of the industry.

“You can’t say you represent the industry, if you don’t represent the industry. You need to have people around the table.”

To get those people, Freeman was tasked with expanding the association, even though it might diminish the power of the original members and founders. Murren became chairman of the AGA at the same time Freeman was appointed.

“We felt strongly we needed to evolve the AGA into a more inclusive, contemporary and forward-looking organization,” says Murren. “We had an opportunity to take a fresh look at the leadership of the AGA, so we looked for a leader who had enthusiasm, intellect, collaborative skills with energy and experience in other similar industry that had a more contemporary view of government affairs.”

Tim Wilmott, the president and CEO of Penn National Gaming, is now the AGA chairman, and believes expanding the membership made sense.

“As a board member and now as chairman, I was very involved in all the strategic decisions we made at the AGA as members,” he says. “Clearly, we’ve become a much more inclusive organization. We made the decision to include tribal membership as part of the association. Geoff provided the structure and the understanding about how a trade association should work.”

Tribal membership was a little more controversial, since for the first 17 years of the AGA, tribes had been excluded. But because tribal gaming and commercial gaming have common issues and interests, most believe it makes sense.

“I believed that there should be ways for the commercial gaming industry and the Native American industry to work together,” explains Murren. “There will always be areas of competition, as there are very passionately today, but I was the first advocate to bring in Native American tribes. Yes, that’s a bit ironic given my position with MGM, but I felt that was important and so did Geoff.”

Wilmott expects the tribal drive to continue.

“I think we’re a stronger organization having tribal membership from California or Florida or Oklahoma or Connecticut,” he says. “These are significant businesses in our industry, and their input is important to the direction the AGA is going.”

Jana McKeag, a former member of the National Indian Gaming Commission and now the president of Lowry Strategies and a tribal consultant, says there are still differences.

“The tribes have some issues that coincide with those of AGA but not all,” she says. “The AGA has to be careful to make sure those differences are respected.”

McKeag says the National Indian Gaming Association was initially upset about the AGA’s outreach to the large gaming tribes.

“I’ve been impressed by NIGA and how they’ve navigated the fact of some of their larger members also joining the AGA,” she says. “But I have concerns that the large tribes might leave NIGA, and it would then become an organization of the smaller tribes. But this is all to be determined by whoever becomes the new leader at the AGA.”

Jan Jones Blackhurst, executive vice president of public policy for Caesars Entertainment, member of the Gaming Hall of Fame and longtime AGA board member, agreed with the decision to bring tribal members into the organization.

“Bringing the tribes in made sense because we have similar issues and a common focus,” she says. “But remember, how do you build consensus when you have such a broad membership?”

Freeman remembers Gary Loveman, the former chairman of Caesars, giving him a similar warning.

“I remember early on, Gary Loveman saying to me that if we can’t get six people to agree, how are we going to get 36 people to agree? And I think one of the great ironies in association management is that when people feel that they have a seat at the table, when they feel that their voice is heard, when they feel that they’re isn’t somebody else, on the inside or outside, trying to screw them, their ability to find consensus is greater.”

Adding the tribes has been tremendously productive, says Freeman.

“When I speak to the average person on Capitol Hill, they don’t delineate between tribal casinos and commercial casinos,” he says. “It’s all casinos to them. So, the first thing you have to accept is, if you want to keep out $30 billion, you have to swim upstream in trying to get people to understand why your industry is different than that industry. I believe we have more in common than we do that divides us. Don’t get me wrong; we have things that divide commercial gaming and tribal gaming. We have things that divide commercial gaming and commercial gaming. But what we can accomplish when working together, is worth working together.

“We have two members—for the first time ever—of tribal gaming, Seminole Hard Rock and the Chickasaw Nation, on the executive committee of the AGA—not just on the board, but on the executive committee, which has been tremendously productive because of their participation. So, I think the comfort level is only becoming greater, and the opportunities are only becoming greater in terms of what we can accomplish when we’re working together.”

Sports Betting Victory

Maybe the hallmark of the Freeman era was the campaign to overturn the Professional and Amateur Sports Protection Act (PASPA). The AGA partnered with many different organizations—law enforcement, leagues, other associations and more—to educate the public about the failure of PASPA and the consequences of leaving it in place.

Wilmott says the goal was to educate the public—and the media—to get public opinion on the AGA’s side.

“We knew the facts were on our side, so we just brought in the right resources to counter these arguments and the outcome reflected those facts,” he says.

Murren says the sports betting campaign went to the core of the AGA’s mission.

“The greatest opponent I’ve ever faced in the gaming industry is the lack of information or misinformation,” he says. “The AGA very clearly, very objectively, very calmly provides fact-based information so we can find out if there is common ground on any issue.”

But the more the arguments were laid out, the more sophisticated was the message.

“We started working on the issue in 2014, and we certainly became smarter over time,” says

Freeman. “We did refine our message, and the one thing that everybody could agree on, and nobody could argue with, is that we have a huge illegal market that’s not doing anybody any good. And now, as leagues go out there and push things that add undue cost to a legal market, we’re able to talk about what effect that has, and how that drives the consumer into the illegal market. So, I think that the ability to talk about an illegal market, the size of the illegal market, was a winning message.”

Caesars’ Blackhurst says it was a good message but questions its effectiveness.

“The AGA had a good argument for sports betting, but they had nothing to do with the decision,” she says. “I’ll give credit to Chris Christie and Ray Lesniak on that, and all the lobbying on the part of the AGA wasn’t going to influence the Supreme Court.”

Dave Rebuck, the director of New Jersey’s Division of Gaming Enforcement and an individual directly involved in the Supreme Court suit, was more circumspect.

“As a lawyer, I know a marketing campaign can’t influence a Supreme Court justice,” he says. “But they did a great job of educating a public who knew nothing about how sports betting was conducted, the economics of the business, nor the depth of the illegal market. So I believe that spreading those facts educated lots of people, and who knows, maybe a Supreme Court justice or two.”

But now that sports betting is permitted in the U.S. and states are considering legalization, what should the AGA role be? Opinions vary.

“We’re not going to be all aligned on sports betting,” says Blackhurst. “They shouldn’t be trying to negotiate something they don’t have a consensus on. We’re happy to have conversations with states about access to data, but we’re not interested in having any kind of legislated ‘partnerships’ with the leagues in U.S. sports betting. We’re just not.”

Murren understands that each state will approach sports betting differently.

“Individual members of the AGA will likely have different opinions on how the AGA should approach the individual states,” he says. “With every state approaching sports betting slightly differently, it’s going to be important for the AGA to provide information and common thoughts, but it’s probably less advisable to take any particular stance one way or another.”

Wilmott says the campaign of education should continue, but with an understanding about the differences between states.

“(AGA vice president) Sara Slane is leading that effort, and she’s been very plugged in with all the states,” he says. “So even with Geoff’s departure, and we’re discussing state by state, we’re not going to miss a beat.”

“Honestly,” says Blackhurst, “most of the members don’t want them in the states. They have state organizations that are more plugged into the issues and the players. They have the best of intentions but they may do more harm than good.”

And when it comes to tribal gaming, where complications like compacts and other state activities are considered, McKeag believes there is no place for the AGA.

“The AGA will have a hard time addressing tribal issues as they pertain to sports betting,” she says. “This is going to be a challenge because legal sports betting will affect each tribe differently.”

Perception Drives Policy

One area that began under Fahrenkopf and was greatly expanded under Freeman was a focus on gaming’s impact on the communities where it operates. Freeman’s AGA launched the “Get to Know Gaming” campaign, which researched the economic and social impact of gaming on various states, followed by a highly publicized press conference featuring the AGA and local politicians and regulators. And it worked.

“Policy doesn’t happen by accident,” says Freeman. “It happens because there’s a point of view about our industry. We need to create an informed point of view, and nothing can help us do that more than research. Nothing can help us do that more than telling the story of this industry. Gaming is not a white-hat industry, but we always found a way to tell a good story. And the stories we tell are actually true. And I’m joking when I say that, but the stories we have in this industry are good stories.”

Blackhurst says this should continue to be a priority of the AGA.

“The AGA’s primary goal should be to keep the federal government out of our business and to communicate the multiple benefits that the industry brings to the economy of the state in which you do business,” she says. “Those are two very good things. But getting involved in regulatory conversations or on issues where we’re all not aligned is going in a different direction.”

AGA of the Future

Wilmott says the departure of Freeman is a bump in the road, but because the AGA members approved the “Strategic Plan 2020” in 2017—a roadmap to the future—the course is set.

“No one’s happy that Geoff’s leaving at the time he is, but the AGA is in very good shape,” Wilmott says. “Membership is strong, the financial situation of the organization is very healthy. We have a plan in place going forward.”

Murren says the plan is comprehensive and was signed off by all the members.

“The issues we identified were more community engagement, more congressional engagement, tackling issues like diversity, promoting and improving the workforce through training and education, collaboration with other industries, addressing sports interaction with our entire industry—not just betting but the entire spectrum of how we interact with sports—looking at trade and tourism issues, and getting a clear understanding how important gaming is under the umbrella of tourism,” he says.

Murren says it’s a continuation of the diversification of membership and outreach to partner organizations.

“We know the value of our industry,” he explains. “We know the economic, social and political importance of our industry. Many non-members at the time felt the same way but felt they weren’t being invited into the discussion. I knew there would be a high degree of receptivity but I was very happy with deliberative and very focused efforts by Geoff and his team.”

Blackhurst feels that the AGA has lost some influence on Capitol Hill that it had when Fahrenkopf was in charge.

“They should look at building their federal strengths. I don’t think anyone at the AGA today has a particularly strong voice on the Hill,” she says. “I think we need an AGA leader with more visibility on the Hill. We just had someone in place for five years who was charged with building up the organization, and we’ll see if that’s going to work, but in my opinion, we need someone with the respect and stature in political circles.”

Wilmott and Murren are both on the six-member search committee to find a replacement for Freeman.

Murren says he’s encouraged that the gaming industry in general is now able to attract people from outside the industry because of the higher visibility it has and its perception now as a form or entertainment, not just solely gaming.

“At MGM, we’ve attracted interest from people who would have never been interested in the gaming industry previously,” he says. “And now they’re not only interested, but they’re enthusiastic. And I’m sure that will come to play here in the search.”

While the path forward is clear with the strategic plan, Wilmott is open to hearing what a new leader would have to say.

“Anytime you bring someone new in, they’re going to want to put their stamp on an organization,” he says. “And we’re open to considering things that could be additive to that plan. We’ll be open-minded and we’re willing let the new CEO put his or her imprint on the direction.”

Most people understand that the AGA under Fahrenkopf was very different than the organization led by Freeman.

“For me and for many of the members—but not all—there was a feeling that with the AGA, born out of necessity at a time when the federal government was attacking us unfairly, Frank Fahrenkopf and the founders of the AGA were incredibly effective by being very focused on protecting the commercial gaming industry, which was literally under attack from every direction,” he says.

When that pressure was off, the AGA needed to become a more typical trade association.

“That was a philosophical change that not everyone immediately embraced,” but it moved forward with broad consensus.

Murren understands that the board won’t agree on every issue. Even today, there’s not an AGA consensus about online gaming. But Murren believes the AGA can survive and thrive with some differences.

“I would be disappointed if there were not division within the board because that would mean we’re not thinking independently or creatively,” he explains. “We’ve come to multiple conclusions and decisions at the board level, but if we can gain general consensus, that is more powerful than being inert.”

Freeman moves on to new challenges as president and CEO of the Grocery Manufacturers Association, a group that makes the AGA look like a love fest. But he’s excited about the future both for himself and the AGA.

When asked about his legacy at AGA, he demurs.

“I don’t think you really have a legacy after only five years,” he says. “But there are things that stick with me. I’m proud of the unity, I’m proud of the consensus, I’m extraordinarily proud of the team that we’ve built here.”

GGB: There still is quite a bit of difficulty in making and receiving payments for online gaming. Why is that?

Justice: In the credit card world, it’s definitely a significant issue. While a financial institution may underwrite a cardholder for a particular credit line, that doesn’t necessarily mean that a bank is willing to stand behind that cardholder when placing a bet. It’s one thing to spend $500 on a purchase at Best Buy, but it’s another entirely to put $5,000 down on your favorite team to win. If you don’t win, the bank might not want to make good on that particular transaction. And banks still have a significant apprehension about being in the gaming market, just due to the reputational risk associated with those transactions.

Isn’t it somewhat odd, since good players have high credit limits and usually pay quickly?

Yes, that’s true. They have good standing within the community, but banks are continuing to restrict their funds.

And that’s where Global Payments comes in from an iGaming, iLottery and sports betting approach. We deal with close to 500 brick-and-mortar and digital casinos all over the U.S. and Canada. And we also deal with every one of the iGaming properties in New Jersey. Depending on the site, we are 40 percent to 60 percent of their actual wallet. We provide that high level of authorization that the players expect when trying to participate in gaming. And the sites need that high approval rate, as well. It all boils down to the company’s longstanding expertise, technology and process.

Why wasn’t the special code created for legal iGaming the answer?

Visa and Mastercard create these “merchant category codes” and adjust them twice a year for market conditions. They did create a code for legal iGaming, and now with the repeal of PASPA they’ve created codes for sports betting. So they’ve got the rules and the infrastructure, but that still doesn’t require a financial institution that is holding all of the risk for the cardholder to actually participate. Even though it exists, it still doesn’t mean the major banks want to participate in iGaming or sports betting.

Tell us how the legalization of sports betting is going to impact online gaming payments.

I don’t think it’s going to do anything to improve approval rates on credit or debit cards. While Visa-Mastercard have created codes and procedures, it doesn’t appear that this is going to change anything that financial institutions have already decided to do.

From the Global Payments perspective, with our VIP program, we’re still providing approval rates exceeding 94 percent across all of the locations we service. We’re still providing the stability of an $18 billion company standing behind and underwriting the players.

Even though Nevada allows mobile sports betting, you still have to go to a casino or bar to make a deposit or collect winnings. Will that change?

I would certainly hope so. A lot of the reason those problems exist is because of regulatory constraints. I wonder now that sports betting is going to go nationwide whether with the added competition, Nevada regulators get together to see how they create frictionless commerce. If I can buy a bag of dog food on Amazon and have an Uber driver deliver it within four hours, I should be able to fund my wallet to make a sports bet in a similar manner.

GGB: Were you surprised about the clarity and decisiveness of the Supreme Court decision?

Joe Asher: No, I wasn’t. I wasn’t surprised. I was in the courtroom in December when the case was argued, and obviously, anyone in the courtroom, on our side, had a pretty good feeling that day. But you never know. So, while I thought this was the most likely outcome, and that’s what we’ve been saying internally, you’re really reading tea leaves, and trying to determine votes by questions and the like. So, surprised, no. But obviously happy to read it.

What will be the immediate impact first on the industry, and then on your company?

Clearly, just about everybody in the industry is now focused on sports betting. Before the decision, it was one of those things that was a priority among a lot of other priorities that folks had. But now, it obviously went to the top of the pile. Folks that we’ve been having discussions with over the last couple of years were on the phone that day asking us what they needed to do now. So, it certainly crystallized attention, and people now will go forward and make the investments that are required to be made.

On our side, we’ve been doing a lot of work and spending a lot of money in anticipation of the ruling. Not because we were certain what the ruling was going to be, but because we felt we had to invest in order to be ready in the event of a positive ruling. But, clearly, there were some things that we were deferring, pending the outcome—long-term leases for additional office space, contracts with other operators, those types of things. Now we’re comfortable pulling the trigger on those sorts of things.

Now we’re looking at states considering legislation. It seems as though a lot of the politicians don’t have a realistic view of the business model for sports betting. Is that your impression?

Obviously some are more informed than others, clearly, as is the case with every issue. But it is so important to have a tax structure in place, and a regulatory environment in place, that is going to allow us to be competitive with the black market. If you look in Nevada, we pay the gross gaming tax, which caps out at 6.75 percent. And there’s a well-developed regulatory system.

Contrast that with Pennsylvania, where the bill that passed requires a sports book operator pay $10 million up front, for the privilege of then paying 36 percent at the state and local level. And of course, that’s in addition to quarter of a point of handle tax you pay to the federal government, which is about another 5 percent of revenue.

How in the world can the legal market possibly compete with all of the bookies, in Philly and Pittsburgh and other places? An illegal bookie can offer a 25 percent rebate on all your losses, and he’ll still have a 16 percentage point advantage over us. And he hasn’t paid the $10 million up front. He doesn’t have all these infrastructure costs that you see if you come to our office. He doesn’t have a compliance department. He’s not paying payroll tax. We really haven’t spent a whole lot of time in Pennsylvania, because of the tax issue. So, that is going be an absolute critical aspect of all of this.

What do you bring to the table when you go into a casino to run their sports book?

This is our little niche of the world. You know, I’ve been around the gaming industry my whole life, and if you want to talk to me about slot machines or table games or hotel rooms, I can have a very superficial conversation with you. But, if you want to talk about sports betting, that is the tiny little sliver of the world that we happen to know an awful lot about, and that’s where we focus our efforts.

For casino operators who have a whole bunch of other things on their plate, outsourcing it to William Hill is a great option. They’re going to have a better product; they’re going to make a lot more money because they’re not going to have all the costs associated with doing it. And it will be attractive to their customers. So, that’s really the proposition, and they can rest assured that they’re dealing with a company that is licensed and a known commodity, has good relationships with regulators, and is going to do things in the proper manner.

Global Gaming Business: Your term is officially over now but you’ll still be serving until a new chair is appointed by the Trump administration. What is your focus now?

Jonodev Chaudhuri: I’m focused on tying up as many loose ends as possible. I don’t anticipate being at NIGC forever. I do anticipate being at the agency through a significant part of the summer. We’ve been working as diligently as possible to serve Indian Country and the general public to the best of our abilities, knowing that my time is coming to a close. We’ve been working for many months to get important regulations out the door, to take care of things that are specific to the chair’s duties. But, I will say it has been an absolute honor to serve as chairman of NIGC during this period of time.

When I became acting chair, it was the 25th anniversary month of the passage of the Indian Gaming Regulatory Act, October 2013. So, my term will have spanned, as chairman—either acting or confirmed—the 25th anniversary through the 30th anniversary year of IGRA. And we’ve seen a lot of changes, but there are many more changes to come.

Your term has been relatively calm in comparison to some other chairmen. Why is that so, do you think?

We recognized early on that IGRA carved out an important role for NIGC, and that was to first and foremost serve as a regulator. In my professional career, I’ve always been immersed in Indian Country. I’m proud of the work that I’ve been able to do as an attorney, as a judge, as an organizer in Indian Country. I’m a supporter and believer in sovereignty, first and foremost, to the core. But I also understand that Indian Country has needed and will continue to need NIGC to be a credible regulator. So, our challenge when I first started was, given the history of the agency, how you hit that balance, to be supportive of tribal sovereignty, while at the same time not shirking your regulatory responsibilities. It’s a fine balance. I think after 30 years of IGRA, we’ve hit the correct balance point.

What do you consider some of your other accomplishments?

After 30 years of IGRA, I am convinced that we’re on the cusp of a new age of gaming. Gaming is an industry that’s inherently driven by technology. The technological developments that are on the horizon are going to drive important policy decisions, both nationally and on a regional basis, and I think we positioned the agency, and by extension, positioned our partners to be in a great place to meet the challenges of those changes, and take advantage of the opportunities that those changes will present.

Some of the accomplishments break down into two categories. One is on the technology side of the equation. One of our first orders of business was to create a technology division, in recognition of the changing technological landscape of Indian gaming. And that division has done what we intended it to do. It has informed every aspect of our agency, since it started. I’m very proud to have a great division director, Travis Waldo, who comes from Indian Country, who understands the technological changes. That division has helped inform our regulatory and decision-making. It’s helped inform our guidance. It’s helped inform our enforcement functions, and it’s also informed our training and technical assistance. We now have IT vulnerability assessments that we do free of charge, for Indian Country.

So, we’ve made all sorts of huge advancements, in terms of technology. That’s the first bucket. The second bucket is, back to the perfect balancing point in everything that we do as an agency, to balance our credibility as regulators with our support of tribal sovereignty and tribal decision-making. You see that in our enforcement philosophies.

That balance point has influenced our ramping up our numbers on the training and technical assistance side. Through our virtual trainings, we now train more people each and every year since I’ve been at the agency.

Now that you’re coming to the end of your term, what surprised you, what was something that you didn’t expect?

I’ve always been a policy person. I’m very honored to have served in the interior secretary’s office immediately before NIGC, and beyond that, I had advised and worked with tribes in a number of capacities over the years. So, I thought the biggest challenges would be advancing sound policies, which I think we’ve done. But what I didn’t anticipate was how much hard work there’d be, just in the day-to-day administrative functions of the agency.

That was the biggest challenge. I thought it would be instituting large-scale policy, or perhaps working through some tough enforcement actions, or working through some critical matters that involved Supreme Court decisions. But the hardest part was the administrative work, and keeping folks moving in the same direction, and keeping folks energized, and really being part of a team—in order to get the job done, we all have to believe in the same approach. And I think, collectively, we’ve done it.

GGB: You’ve been involved with some very progressive companies in the industry. Why did you choose to come to work for Gaming Arts?

Dreitzer: I had been having discussions with David Colvin, the owner of the company, since late last year. David used to own the Sienna casino in Reno, so he’s got a good gaming background, and we realized we had some very complementary skill sets. He’s very creative and is the mastermind behind the product. He’s very involved in the design of the games both from the mathematical side and the graphics side. I’ve been more focused on operations, sales and marketing in my experience.

Tell us what it was about the products that attracted you.

For a very small company, we have a very diverse set of products. We are in the traditional keno space with a keno system called Optima. We are the leading provider of keno in the world, and there is a lot of growth internationally.

We have developed a keno kiosk where a player can enter up to 999 games. You can connect that to an app on your phone to track your winnings.

How about your bingo products?

In the bingo space, we have “Super Games,” which are side-bet or overlay games that can go over traditional bingo systems. We can coordinate and interface with any bingo system in the world.

Most notably, we have Bingo Millions. This is a product where if you cover a certain amount of numbers, you can win up to $1 million depending upon the pay table. It’s an interesting product for a few reasons. First, the odds of winning the top prize are one in 1.5 million. Compared to the lottery or even top-award slot machines, it’s quite a good set of odds.

In addition to the odds, Gaming Arts insures the jackpot. So if it hits on an operator’s floor, Gaming Arts pays it. You would think it wouldn’t hit that much with those odds, but it hit just before I started in January at a property in Phoenix, so we paid it. Operators can advertise a big jackpot and have zero risk.

How did you get up to speed on bingo and keno?

As you know, I had little experience in this space, just the traditional slot machines in the pure casino environment. So learning about bingo has been amazing. You’d be amazed at the number of bingo players and the amount of money they play. In fact, bingo globally is more popular than slot machines. And many of the tribal and commercial casinos have large bingo rooms, so I feel very comfortable there.

So, Gaming Arts can offer both paper games and EGMs? Are the games Class II games?

Yes, we can put our Super Games across any system. It’s just a matter of how the bingo operator wants to spice up its bingo offerings. We have very diverse pay tables and great opportunities for all operators.

It’s interesting, but when we’re talking about bingo in this context, it’s not Class II. In many casinos around the country and also in charity games in a true bingo hall, we’re talking about “session” bingo.

Our Super Bingo and Ultimate Bingo EGMs are also not Class II. They’re Class III bingo—stand-alone RNG gaming devices, which happen to be bingo games.

Global Gaming Business: What brought you to Las Vegas?

Igelman: We came to Las Vegas about two and a half years ago. At that time, the company was primarily a tournament organizer with a competitive gaming platform, which allowed people to play games against each other. That was the original model.

We identified Las Vegas early on as the perfect place for eSports. We built this arena in Downtown Las Vegas, the first of its kind, purpose-built for eSports.

In the back of our minds, we know eSports has a very active wagering side—maybe not in North America—but we knew that one day you’d be able to walk into a sports book and make a wager on an eSports event. But of course, our focus is on the millions of people who visit Las Vegas for all it has to offer.

How can casinos monetize eSports?

The easiest way for an operator to monetize eSports is as an event. If executed properly—and that means it has to have some authenticity about it by bringing in someone who understands eSports—it’s an opportunity to make money as you would on any event. In that regard, you’re trying to attract a demographic that you haven’t experienced at your casino before.

Then you could hold a tournament, as you might a poker tournament. There are some capital expenditures there if a casino wanted to have a permanent facility, but there are numerous tournament organizers who could arrange this. It’s a very specialized, niche market. You really have to know what you’re doing. It could be a loss leader until casinos figure out the right model.

What is that eSports demographic?

We’ve done a lot of research and determined that the average eSports aficionado is male and about 35. So we’re not talking about young kids. It’s a valuable demographic. And you have to remember, not only will you get the customer who likes to play eSports, but you also get people who like to watch professionals play eSports. That’s a huge segment.

We’ve seen several different models from Las Vegas operators from building eSports venues inside a casino to a production studio for eSports tournaments. Do we know what works yet?

I think it depends on the risk that the casino wants to take. In the eSports arena at Luxor, the relationship with MGM is more of a landlord. At Caesars, they’re using a production studio to host a full season of eSports with H1Z1. That’s a different kind of commitment and may attract a younger demographic.

But these are all the things you have to consider when examining eSports, and in time they will develop.

How would wagering on eSports work? And can you really prevent cheating on these eSports games?

In Nevada, being very progressive, they decided to accept wagers on specific events. It’s not a blanket acceptance, but each event has to be approved. It’s not the most ideal situation, but it’s a start.

As for cheating, the fact that all of the play takes place in a digital format makes it very auditable, and there are certain algorithms that will detect any abnormality in play. At that point, referees would look into any kind of match fixing. So in that respect, I think it’s easier to track, since you won’t have to read someone’s mind.

GGB: When did gamification really become a thing?

Epstein: The concept is quite old. You might remember—I do—S&H Green Stamps or Plaid Stamps. You’d go to the market and they would gamify it by giving you Green Stamps that you’d put in a book and take to a retail redemption center.

Inside and outside the casino industry, gamification has been viewed as “pay for play.” So to a certain extent, a players club program is gamification. Other applications are points for your credit card use, airline miles and the like.

But the modern way that we see it is you’re paying people for their investment. You’re rewarding them and driving them to your property ultimately to generate incremental visits and revenue.

Why has this taken so long to get a foothold in the casino industry?

Everyone says they want to be a leader, but they don’t want to be first. Gamification a very misunderstood and often misused term. It’s not just slapping a logo on a game; it’s offering an experience to a player to keep them coming back to the property. There are a lot of different ways you can implement these programs, and the casino industry is just starting to realize how powerful they can be.

What’s the theory behind this game play?

We immerse them in the experience. It’s very much like what the casino industry is trying to create on the floor—have fun in an immersive experience that is rewarding and challenging. When you put it together in the right way, you’re bringing people in or online and we’re educating them about the property so they actually become brand ambassadors. And for their investment of time—they do have fun while they’re doing it—we reward them with virtual currency or instant rewards like a drawing entry that drives business.

Sounds like there is real science behind this.

For sure! Gamification is changing motivational behavior to the desired outcome of the casino. And to get this desired result, the casino needs to determine what the goal is. Is it reactivation of old customers, acquisition of new customers? It really is a science.

So gamification allows a casino operator to touch his customer on an ongoing basis, even when they’re not at the casino?

Funny, but just a couple of years ago lots of casinos were saying, “My baby boomer customer doesn’t engage in technology.” Well, that’s absolute nonsense. They engage just as much as or even more than millennials.

Even if they did admit that they were tech savvy, they said they didn’t want to engage them at home, they wanted them in the casino. Today, a mobile device is a portable entertainment center. Do you want them to engage with you or play games with someone else? The opportunity to keep them connected with your brand, with your messages on an ongoing basis is really the foundation of what we call continuous engagement.

GGB: We were covering the development of the Borgata fairly closely in those days, and I remember you walking us through a layout of the casino in the Atlantic City Convention Center to see how far it was to walk between parts of the hotel or how close together the chairs were in the theater. Why go to such detail?

Bob Boughner: We saw that those efforts that the team put together—and everybody contributed in a great many ways—came to understand and appreciate the fact that we are a very visceral business. We are a business that focuses on many aspects of the experience. I tried to talk to the team in that environment, to say this was really about scene 1, scene 2, scene 3, scene 4, and scene 5.

When you walked in the front door, what was scene 1 all about? What were you trying to say? What did you want to communicate to the consumer when they walked in the door? Then scene 2, the same pathway—depending on which direction you went—you wanted to give something that was inviting and provide something that created a desire to see more, to participate more. And then we wove in the various amenities on a logical pathway. We, as humans, I think, are very much inherently lazy. Especially with the long walk, and a long walk gets dull and boring, and lacks interest completely. So, we tried to minimize the instances in the building of those long walks, but where there was going to be a long walk, make it interesting. And also, take advantage of the people that were in the building.

Atlantic City had a negative perception in those days. How did you convince people to come back? We used to call them the “rejecters.”

We put a heavy emphasis on non-gaming amenities. Non-gaming amenities helped us differentiate ourselves from the competition in that marketplace, and very early.

We talked to the rejecters often during the course of research, and in unique ways. We did focus groups, but were actually interacting with them in a room, and they were carefully selected to be sure that they hit the “who we created for,” and “who we invited” groups. They told us many things that they did not like about Atlantic City, and things that they felt would make Atlantic City a more interesting place. So, we used that good and sound advice, and we put it to work. We put it to work with designers, we put it to work with architects, we put it to work with the folks that helped create the wardrobing for us. We put it to work with people that helped us craft our voice to the consumer. And again, one area that we felt was very important was to provide a food product offering that was different: Our dining component. Our nightlife component. There was nothing like it in Atlantic City at that time.

Today, the Borgata is by far the best gaming performer in town, by sometimes triple your competitors. Is that because the non-gaming components are so compelling there that people want to gamble there, as well as go there for other reasons?

I think that non-gaming has played a role from the beginning, and it still plays a role at the property. But, frankly, it was a superior gaming product to what was in the marketplace at the time. Because it was designed at a certain level of capacity, and not added on to over the years, unlike many of the operations where they started small, or they didn’t know what the future held, and so they added on in bits and pieces, and sometimes those bits and pieces never got knit together, so that it was not a cohesive experience.

We started out with a pretty cohesive experience, and essentially kept that pretty cohesive experience over the course of time. I recall when I would tell folks that Borgata did gaming revenue that was greater than Bellagio, they would think that’s not possible.

But it was. Sometimes we did double what Bellagio did—obviously, a very, very successful and enjoyable property. I’m not comparing one to the other, but there was a level of non-gaming appetite that existed in Atlantic City. We helped create an appetite among customers, because they were really very fatigued by the restaurant product in the city at that time. They were very fatigued by the entertainment product, except in some rare instances.

And we put a little bit of energy behind dining, nightlife, entertainment, and that little bit of energy paid significant dividends, not only in terms of the performance of those areas, but also to help us bring a new customer to the marketplace, and then that also manifested itself in the significant contribution on the gaming side.

GGB: Congratulations on 20 years of progress with the Gaming Standards Association. Tell us how it started.

Peter DeRaedt: In 1997, we informally met with about five companies on behalf of John Acres, who at the time had patents with respect to bonusing. The only way that he could promulgate these patents and this technology was with some kind of a standard that would be agreed to by the industry. Following that, the organization was officially created in California as a nonprofit organization in 1998.

What were some of the first actions taken by the organization?

It shifted quickly to the creation of the exchange of information data standards, which predominantly was SAS. We wanted to come up with something that’s more open, more flexible, that’s architected for the future, and we did that. That was in 1998, and we soon attracted the attention of some of the larger operators like Park Place, Mandalay and Caesars.

So, moving forward, it was a challenging time. Operators joined us, a company would leave and come back. Intellectual property became an issue, antitrust laws, all the things you have to do in an organization to make sure that people are comfortable participating. And I think we did that. It’s not been an easy road; I’m incredibly grateful for all those engineers and especially those companies at the beginning and today that support us. I think we created a significant number of standards to a variety of success. But do not ever forget that the mission of the organization is trying to help the industry.

The mission of the organization is not to become an innovator and go out there and find out what the industry needs. Generally, the industry identifies a problem, and they come to GSA for a solution. And we will do that.

So it was the operators that really were the genesis behind this. In the early days, slot machines had to be connected by the two- and three-wire systems because they were all talking different languages.

It was a challenge. Don’t forget this is a very small industry, with a few suppliers—and now there are even fewer than there were at that time. So when we moved from a manufacturers’ association to the Gaming Standard Association, meaning where the operators, which are part of the industry, participate, that was a big shift. Everybody needed to start feeling comfortable; we did that.

Initially it was BOB—Best of Breed, which was demonstrated at the gaming show at the time, and that evolved into the G2S, the Game to System, which was a combination of BOB and SuperSAS. Then the industry decided, “Let’s create a single standard.” Remember that creating these kinds of standards with these kinds of technologies, in a gaming industry that’s very heavily regulated, takes time. And it takes time from multiple levels, including resources: you might have had the right resources to deal with the XMLs, and the Ethernet standards. If you don’t have the right hardware, hardware needed to be redeveloped and redesigned and approved. These are cycles of multiple years.

Once that was done, we got finished, probably about 2007, when G2S was first released as an open communication standard. I think the value we created at the time, and the flexibility, if operators would only understand, I think it would circle back around. But some operators have left. And that’s very unfortunate, because we all understand that if customers want something, they demand that things happen. If you don’t do that, well then, you have to buy whatever is on the shelves.

And that is what happened in this industry, for now, even 20 years later, almost. Canada is a bit different, and Europe and the rest of the world are different, as well.

You recently started GSA Europe.

Yes, last year. It’s taken us a year to work through the mechanism of the legal issues, as to how to establish it, where to establish it… a lot of policies. We chose the country of Malta because of the large number of online gaming companies located there. They have very clear regulations for the online gaming, which is important for us. They spoke English, which was a benefit. And they were less expensive than some of the other English-speaking countries in Europe.

So iGaming is a big factor in Europe?

Yes, GSA got involved in identifying needs in the online gaming industry in 2012, believe it or not. And it was our land-based casino suppliers who identified certain areas that we should be focusing on. And we did. It’s taken four years. By that time that we got some of the larger online gaming manufacturers and suppliers on board—the Playtechs and the Microgamings—because they saw the need for standardization in this space. We’re just about to release our first product, TPI, which is a third-party game content interface. In other words, TPI connects the remote gaming servers with the platforms. It reduces the stack of the software needed to accomplish this. That is one of the first initiatives of GSA Europe.

It’s been a wild year for security and surveillance in the casino industry. From several mass shootings at casinos around the world to the brazen cage robberies at casinos on the Strip and elsewhere to data breaches and hacking incidents, professionals in this field have been overwhelmed. But there’s help on the way.

Former casino surveillance executive Willy Allison has been producing the World Game Protection Conference for 13 years. This year’s show, held at Bally’s Las Vegas from March 12-15, will drill down into the recent troubling incidents as well as focus on its core roles of game protection and asset protection. He spoke with GGB Publisher Roger Gros about the conference in Las Vegas in February.

GGB: This has been a really long time coming for the Catskills region. They’ve been talking about casinos in the Catskills for decades. What’s the general mood in the company approaching the opening?

Kevin Kline: There are a lot of folks who have been really focused on this opportunity for a very long time. Many of our executives at Empire Resorts have been part of this journey, dating back quite a while. I will tell you that, as someone who’s just joined Empire Resorts and is embedded now here at Resorts World Catskills, there is a tremendous anticipation, as you would expect—just an amazing energy throughout the property. And there is a genuine pride to see this magnificently designed and programmed property come to life.

What’s the reaction in the community so far to the debut here?

There are many stakeholders who have been very engaged at the government and community levels, making the case that this was the right location for one of the upstate licenses. So there’s a high degree of anticipation to see this finally come to reality, and similarly, there’s a lot of pride up here for what the Catskills was, and for what we have the opportunity to re-create in this new form.

How many employees have you hired, and are they mostly from the surrounding areas?

(As of) right now, we’ve hired close to 1,300. We’ll continue to ramp as the rest of the property scales to about 1,700 team members. As somebody who gets around to all of our team member orientations, one of the things that I like to do is to ask folks to raise their hands and ask how many people are from Sullivan, Orange and Ulster counties. We have done an amazing job of activating the local community, and finding some amazing team members as part of our Resorts World Catskills team. There’s so much enthusiasm and so much pride from the team that we’ve hired to be part of this opening, and to really be part of that revitalization of this region. It’s been a great story from a local employment perspective.

How far is Resorts World Catskills from Manhattan?

We’re 90 miles from New York City. It’s a pretty straight shot. And obviously, that’s to Manhattan; the surrounding New York metro is much larger, and so we have a great opportunity within that captive market to get our fair share and more of that business. We expect to have a major presence in this Northeast market.

This is the fourth casino approved several years ago by the state of New York in the Northern Tier region. The others ones haven’t performed that very well. Why will Resorts World Catskills be different?

We’re very different. We are not a regional casino. I mean, being 90 miles away from New York City, we’ve created an integrated destination resort, and that experience is meant to complement our location here in the Catskills.

The hotel product is 332 all-suite rooms, penthouses and villas, along with 100,000 square feet of gaming. In addition to competing for the premium mass market, we’re also focusing on VIP premium gaming, and we think we can be very competitive. Our property’s been designed to accommodate the premium Asian customer. We’ve built a very authentic Asian gaming and food offering, that provides both traditional and modern cultural influences.

We have a world-class upscale full-service spa and fitness, and a multi-purpose entertainment venue, with 27,000 square feet for entertainment, conventions and meetings.

We are redesigning and bringing back the iconic Monster Golf Course in 2019.

Part of our campus is going to include the Kartrite, a luxury lodge and indoor water park, that will open up early part of next year, with another 350 rooms.

We’re looking to build a service environment and a guest experience that will reach five-star, five-diamond standards. So, everything has been added within our footprint to be a true integrated destination resort that becomes a major draw.

Genting runs the most lucrative casino in the country, in Resorts World New York City. Do you have access to the list that they’ve built up down there?

One of the benefits of being a Resorts World brand are those cross-market opportunities. We’ve coordinated some efforts to come out of the gate and ramp up our property. We’ve been able to leverage the Resorts World database to get folks in here and get them excited about Resorts World Catskills as a premium experience to keep tourism and gaming revenues in the state of New York.

It’s a nice way to start, knowing that we can go out there and contact those who are familiar with the brand, and begin to introduce them to a new and unforgettable experience of Las Vegas-style gaming in the Catskills.

Founded in 2005, the company—then called American Gaming Systems—spent its first years as a small Class II supplier with strong markets in Oklahoma and elsewhere. The company first made a play at Class III markets early this decade, after former Bally chief Bob Miodunski came out of retirement to guide the company to its first Class III licenses as CEO.

But the company’s first real renaissance would come with its late 2013 acquisition by private equity firm Apollo Global Management. Apollo’s first move was to place gaming supply veteran David Lopez at the helm as CEO, charged with transforming the company from a Class II supplier into a full-service gaming supplier. Lopez—who formerly was CEO of Global Cash Access and COO of Shuffle Master, where he spent 14 years—would spend the subsequent four years crafting that transformation.

In a whirlwind of acquisitions, key hirings and implementation of a development plan, Lopez and his newly assembled team grew AGS into a major supplier of Class II and Class III slots, created a table-game division from scratch that has fast-growing sales in side bets and proprietary games, and most recently, launched an interactive division that offers a white-label B2B social casino and a B2C social app.

This year, AGS is being reborn once again, as public company PlayAGS, Inc. On January 26, the AGS senior team rang the bell of the New York Stock Exchange to commence trading of shares under the ticker AGS. The company then completed a successful initial public offering of 10.25 million common shares with an opening price of $16 per share. The price went up quickly, reaching $18 early in trading. Shares were $19.55 at press time.

The company had announced that it hoped to raise $160 million with the IPO. After the initial success, that prediction was raised to $174 million.

According to Lopez, the proceeds will be used to deleverage the company, freeing up cash to continue its growth plan as a publicly traded company. Less than two weeks after the IPO was launched, the company announced the repricing of its existing term loans in a move that will save around $6.4 million in annual interest payments. “After executing our initial public offering, we immediately started work on repricing our term loans to reduce our annual interest expense and provide us with more cash to grow and operate the business,” says Lopez.

“We’re also sponsored by Apollo, which is a private equity firm. And right now, it’s a good market. At some point, they had to pick an entry point for liquidity. We issued enough stock to cover our PIK notes. It’s a good time in the market, and it’s a nice time to establish that liquidity platform.”

Lopez credits the leaders of Apollo not only for providing the financial muscle to reinvent AGS as a supplier, but for what will be the equity firm’s continuing support as the largest shareholder of the public company PlayAGS, Inc. (Apollo was expected to control 69 percent of AGS following the IPO.)

It was Apollo that afforded Lopez and the management team the ability to craft AGS into what it is today. “Before I was even hired, we talked about what AGS needed to become,” Lopez recalls of his initial contact with Apollo. “AGS was primarily a Class II distributor. We wanted to become more of a Class II and Class III diversified global gaming supplier. What would it take to get there?”

The answer was a combination of acquisitions and organic growth, with the financial backing to accomplish it. The first two acquisitions would set the tone for the company’s slot division. The acquisition of large-format slot supplier Colossal Gaming would give the company its first big hit in Class III markets, Colossal Diamonds on the Big Red cabinet.

Next, the AGS acquisition of Georgia-based supplier Cadillac Jack combined two very similar companies—both traditional Class II suppliers beginning to move into Class III. With little overlap in the markets of the legacy companies, the AGS Class II footprint essentially doubled, and the former Cadillac’s Atlanta-based technology team provided AGS the basis for what would become its core video slot platform, ICON—soon to be followed by Orion, the company’s first premium slot platform.

“We doubled everything—employees, revenue, EBITDA,” Lopez says of the Cadillac acquisition.

That acquisition has one thing in common with subsequent moves that have led to the emergence of AGS as a top competitor in slots, table games and interactive products—it brought in quality executives that strengthened a management team that is the envy of the industry.

People Power

Lopez also credits Apollo with helping him build his team. “From the perspective of Apollo—the sponsor—and myself, we determined success was going to require making some acquisitions and doing other things organically, but we would have to start with people,” he says. “We’d have to start with hiring and establishing a great management team to lead us forward.”

One of the most important additions came midway through Lopez’s first year at the helm, when he brought in former Shuffle Master colleague John Hemberger as senior vice president of table games, charged with creating the new table division. Hemberger, who had run the proprietary table game division for Shuffle Master, acquired products such as the Buster Blackjack side bet, Casino War, Criss Cross Poker and others, in addition to adding new proprietary games such as Chase the Flush. Within three years, the table-game division completed more than 2,350 installations worldwide.

The Cadillac Jack acquisition also would strengthen the management team, with Sigmund Lee filling the role of AGS chief technology officer, the position he had held with Cadillac for nine years. Lee also had been vice president of engineering for Bally Technologies.

It was Lee’s team that developed the former Cadillac operating system into ICON, getting the slot division moving in Class III in concert with Andrew Burke, the senior vice president of slot products who had been with AGS since 2008.

In 2015, Lopez brought in Julia Boguslawski, formerly a longtime investor relations and marketing executive for Shuffle Master, Scientific Games and Bally Technologies, as executive vice president of investor relations and chief marketing officer; and longtime Aristocrat sales executive Robert Perry as senior vice president of sales. The team would further be augmented with the addition of Matt Reback as executive vice president. Reback was a longtime marketing executive with Konami in addition to a history on the operations side with Station Casinos and Caesars Entertainment.

“We thought about it from the very start,” Lopez says. “This was how we were going to build the company and build the product lines. We kept some folks on board from the previous team, and our goal was to hire All Stars who understood the culture, who could adapt to the culture, in a very unique environment where people speak very openly in front of one another but there’s no hard feelings.”

The culture that the executive team created for AGS is one in which operations are efficient but relaxed, and everyone gets a say—at least in the board room (“or the Death Star, as we call it,” laughs Lopez). “This room is where all disagreements are handled, and when we’re done in here, it’s done, because we’re not going to win by being political,” Lopez says. “We’re going to win as a team of 550 employees, as the late (Shuffle Master CEO) Tim Parrott said, all pulling oars in the same direction.”

“The pace is great,” adds Boguslawski. “David has created a culture where we get issues out there on the table, and we move quickly on decisions. It’s even part of our mission statement, which essentially says, ‘The bigger that we get, the smaller we need to act.’”

Lopez says it is different than the traditional corporate environment in which there are layers of management to go through before actions are taken—the culture makes for a nimble company.

“That’s part of our culture, and also part of the Apollo culture—there is no tomorrow,” Lopez says. “Why not today? There’s no need to wait. We’ve had executives who join the company and say, ‘We’ll talk about a problem, we’ll talk through a solution,’ and then, ‘What do we need to do to get this done and move it forward?’ And I say, ‘Well, we just did it.’

“They’re surprised to see how quick and nimble we can be. We don’t have to send it up to Galactic Headquarters for an approval. We’re the approval, right here, sitting around the table.”

“It’s something that all employees know,” says Boguslawski. “We never lose sight of those things we do that got us to the position where we are, where we’re able to grow and grow quickly.”

It’s a culture Lopez says he built from his experience with executives who have been role models in the past—from Parrott to prior Shuffle Master legends including Mark Yoseloff and Joseph Lahti, to Apollo Managing Director David Sambur.

“You take a guy like me who grew up in Troy, New York, and didn’t get very good grades in high school or UNLV, and ask, ‘How the heck did I get anything accomplished in life?’ And the answer is Joe Lahti, Mark Yoseloff, Tim Parrott, David Sambur—folks like that,” Lopez says. “If you were willing to listen and willing to learn, each and every one of those guys brought something to the table.

“Clearly, Mark Yoseloff had the most years with me, and I think that there was a lot that he shared with me. Joe Lahti, in my early years, really taught me a lot about being a CEO, although I was just an analyst at the time. And Tim Parrott was a huge influence. I think we carry a torch of customer service and community service culture that Tim instilled in us. And then, of course, David Sambur is one of the smartest people I’ve ever worked for, and has been tremendous in tutoring me along the way as well.”

Business as Usual

The emergence of AGS as a publicly traded company will not change the company’s culture or product plan moving forward. “(The change) should be transparent to the customers and the players,” Lopez says. “We don’t want customers to feel any bumps in the road, or any changes.”

The transition is easy for AGS, whose operation has mirrored public companies, at least from a financial perspective. “Kimo (Akiona, CFO) has already been doing all the quarterly reporting, the Qs and Ks, as if we were a public company,” Lopez says. “However, it’s not like we’re going to sprint to the end of every quarter. We’ll probably settle on annual guidance, because we know what we’re going to do over the course of the year. Quarter to quarter, things may change. We don’t want to change the way we behave, transitioning from private to public.”

Boguslawski adds that the investors the company’s executives dealt with leading to the IPO include a lot of “long-only institutions” that AGS will continue to target. “That’s always been our priority—we want investors who are committed to the story for the long term, who believe in the team, believe in the fundamentals, and who are looking out two years, three years,” Boguslawski says.

For this reason, Lopez says he expects the product roadmap to continue to grow at the pace it has established during the company’s phenomenal recent past. In the second quarter, the company’s slot segment will release the Orion Slant. “We’re developing content for that,” he says, “and I don’t think you’ll see us veer stylistically from what we’re doing right now. We’re developing games for core gamblers.”

Other additions on the slot side will include another new cabinet, a new style of linked progressive, and game programs designed for the medium- to high-volatility space.

The Class II segment of the slot division is stronger than ever, thanks in part to the acquisition in December of the installed Class II base of Rocket Gaming Systems, a transaction that instantly added 1,600 recurring-revenue games to the company’s footprint. “That puts us over 23,000 units on recurring revenue,” Lopez comments. “We like the opportunity to take that footprint, tack it on to what we have, manage it, optimize it, and make the most of it.”

Lopez says around 83 percent of the company’s revenues come from recurring sources, not only in Class II but in Class III standouts such as Colossal Diamonds. “As we expand internationally, that could grow,” he says. “We will continue to grow that base—it gives us great stability. It will allow us to plan accordingly for the future, and look out two to three years and have a lot of confidence in what we’re doing.”

“Equally important,” adds Boguslawski, “we believe that there’s great opportunity to optimize some of the existing base”—not only with the Rocket units, but with about 4,700 units she says are “great candidates to upgrade with some of our new high-performing content. We have a whole team of analysts that work on that, and look all the time at what makes sense in different properties. That’s a a strategy we believe will grow the recurring revenue dollars moving forward.”

That recurring revenue base also contributes to the company’s ability to experiment with new product styles. “It allows us to take some chances that maybe you wouldn’t take if 93 percent or 95 percent of your revenue came from sales instead of recurring sources,” Lopez says. “It gives you the ability to plan, look forward, and understand what your needs are from a capital point of view.”

On the table side, the company will continue to expand the division with new products. “At G2E 2017, I looked over into the table games section of our booth, and I was able to sit there and say, ‘This is coming together beautifully.’ We have an absolutely phenomenal product portfolio,” Lopez says. “I think any customer that came to see us was impressed with the diversity of the portfolio.

“Going forward, we will continue to take a look at expanding that portfolio, but that said, we’ve been able to do it because we hired the right people. We got John and his team in here; he has experience, he understands the pieces and parts, and how to put together a portfolio like that.

“So, nothing’s done—either on the slot side, the table side, or on the interactive side. We’ll always be active trying to improve those divisions.”

Some of the biggest successes on the table side so far have been the Buster Blackjack side bet and the Bonus Spin wheel for table games. “Buster Blackjack is just a great testament to what we can do when we acquire a game that might have limited installs, but under our umbrella of sales channels and licenses, we’re able to then quadruple the install,” Boguslawski says.

“And Bonus Spin has been great. We are excited with that rollout. It’s in Caesars, Las Vegas Sands, MGM, Golden Nugget, Graton and Foxwoods. That’s been a tremendous product, as well as the launch of the shuffler, which will be this year. We’re very excited about that, based on operator feedback.”

And how does AGS compete in these areas with a well-entrenched competitor such as Shuffle Master (now part of Scientific Games)—a.k.a. the “800-pound gorilla” of the segment?

“We worked for the 800-pound gorilla,” answers Lopez. “Each and every one of us has worked for the 800-pound gorilla. I was there for 14 and a half years, and I understand the ins and outs of the business. John Hemberger was there for a number of years; he ran the table game division.

“There was once a time in the slot division where we all asked the same question, because somebody had 75 percent to 80 percent ship share. Things have changed quite dramatically there, and there’s no reason that the same thing can’t happen in the table game space.”

He expresses similar confidence in the prospects of the new interactive division, another area where there is entrenched competition. “We’ve been primarily a B2C supplier of social gaming, but we now provide a white-label B2B product,” says Lopez. “In 2017, in the second half, we won about six deals. This year, we’ve already won two more deals, in the first month. Each one of those deals exceeds the combined total of all the deals we did in 2017, so we’re starting to scale up a little bit. We didn’t want to jump out there too fast, so we started with smaller customers, and now we’re stepping up to larger customers and still winning deals, so that’s exciting.”

The AGS product lineup will be augmented with changes to the industry, from expansion of online gaming to the search for games that appeal to the emerging millennial generation. Lopez says the company already provides skill games and other games that permit the kind of socializing younger players seek—they’re called table games.

“A lot of companies are focused on skill games because this millennial generation spends a lot of time in the nightclub, and they spend a lot of time in experiential stuff,” Lopez says, “but just as with Generation X, it starts with the table games. They’ll migrate to those table games, and are already starting to migrate. Table games are social. You can sit down, you can have your drinks, you can hang out, talk to your friends. At the end of the day, that’s a social, skilled game that we believe millennials will play.”

Expanding Markets

With licenses secured across the U.S. Class III market, AGS plans to expand elsewhere in North America—the former Cadillac Jack already was one of the top suppliers in Mexico, and the company is now looking toward Canada as well.

“We think there’s a huge opportunity in Canada for us,” Lopez says. “Our early returns on installs tell us our games are performing very well. We’ve hired a salesperson for Canada. Mexico’s been growing two years in a row, after multiple years of contraction.”

AGS also is looking to new markets in South America and Asian markets, beginning with the Philippines. “We have our first installations in the Philippines in Q1, and of course, we’re prepared for Brazil, should the gaming law pass,” says Lopez.

“The great news with going into the Philippines,” says Boguslawski, “is that this will help us grow our recurring revenue base—that market is a participation market, same as Brazil. We’re very selective with the markets we go into, and those two markets make great sense for us.”

With the company’s balance sheet improving and the continued support of Apollo, there will be sufficient cash moving forward to fund additional growth opportunities.

“Since we have so much great white space ahead of us, especially in the Class III market, we want to be able to capitalize on those opportunities,” Boguslawski says, “to make sure that we can get all those units in the field, and definitely prioritize use of the cash to go to that, and also to R&D, which is our lifeblood.”

And to continue that culture—AGS was recently named one of the “Best and Brightest Companies to Work For” by the National Association for Business Resources.

“David is so focused on his people,” says Boguslawski. “Everyone really enjoys working with one another, and this is a culture where people are very empowered, able to speak their minds without repercussion, and there’s this tone of playfulness with all of it. So, no matter how busy we are and how fast we’re moving, we can’t forget to have fun.

“That all comes from David. People meet him, they say how accessible he is, that he’s kind of a no-BS guy. Investors certainly felt the same thing. Everything stems from the top, and it’s trickled down in the organization.”

That extends to the “GameON” conference, an intimate gathering of AGS team members and around 100 key customers, during which operators get to know the company, its products and its product roadmap going forward. The event will be held this year at California’s Pechanga casino. “We’re keeping GameON about the same size every year, based on demand, because it allows everyone to feel that over the course of three days, you can mingle with everyone and it still feels intimate,” Boguslawski says.

There may be more M&A activity for AGS in the future, but for now, the company will focus on maximizing the product pipeline for its growing base of customers. “We’ve done over 20 acquisitions since Apollo acquired the company,” Lopez says. “Clearly, we’ve raised the bar. We don’t need to be as risky as we once were. That said, we’re still out there; we’re always looking at M&A.”

And of course, any future acquisition will bring more strength to the team. “When you talk about our culture, each person has had to fill a role,” says Lopez. “I’m not a fan of the New England Patriots or (coach) Bill Belichick, but his slogan is that we need all of our people to understand what their job is, and then we need them to do their job.”

That’s Lopez’s mantra at AGS, with one additional football slogan: “We’ll do anything it takes to win.”

GGB: Affinity Gaming has so many diverse properties: destination resorts in Primm, Nevada; a convention/locals casino in Las Vegas; locals casinos in Reno and several Midwest states. Is there an overarching marketing philosophy for all?

Vincent Lentini: To understand our properties over the last three years has been a journey, which involved fixing the properties on the marketing reinvestment side. When I first arrived, we had properties that were giving 110 percent in marketing reinvestment. We had to change that, and that was very painful for customers and for employees. They didn’t understand why we were doing it. But now in our third year of a new management team, we’ve completed that task. So we’re calling 2018 our pivot year, which means we’re going to focus on quality, value and experience for all of our guests, no matter what property you visit.

How do you segment the properties?

This is going to be a property-by-property approach. We’re going through a brand-positioning exercise at Silver Sevens (the Las Vegas property) and Rail City, our Reno property. For the first time, we’re going through consumer insights and brand development hypotheses, and they test that to set up a framework of what it means for these properties for value and quality for our customers. It’s pretty exciting, and we’ll be doing this for all our properties, but will approach each of them differently.

Marketing a property used to be relatively straightforward focusing around advertising and direct mail. What has changed in today’s world?

What has changed for us is our reliance on technology. This year, we’re building a data warehouse that will allow us to give specific offers to specific customers based on their preferences and what they play. We’ve created CRM technologies such as pinging cell phones to send a host out to greet a customer who hasn’t been there in 90 days, for example. We’re moving casino hosts to a more sales-oriented experience where we try to discover how we can extend the stay, convert more trips, or to simply thank them for being there at each stage of their trip.

What is some of the technology that has really performed for you?

We’re lucky because early on in our tenure, we brought in Duetto, and as soon as we plugged it onto the cash side of the business, we saw a 30 percent increase in our cash revenue. We have a motto here: “You can’t beat the machine.” So as a yield manager, the computer program and the machine are always going to be more perfect in the pricing strategy than we could do on our own. And now that Agilysys and Duetto are integrated with our booking engines, we make sure we take advantage of all the technology they have available.

How effective is social media?

It’s pretty important now and becoming more important within our demographic, which is mostly 55-year-old female slot players. Facebook is huge. It gives us the opportunity to interact with our customers at a level which is unprecedented in the marketing world. We use Facebook Custom Audience to go after specific entertainment acts that we have at Primm. For example, we target everyone who likes Styx. And oh, by the way, Styx is at Primm sometime in 2018. It’s an incredibly powerful tool that allows us to target a great but specific market.

What was TransAct’s product that really made your name when ticket-in/ticket-out (TITO) was introduced?

For TransAct, the product that put us on the map was the Epic 950 printer. We brought that out to be the next-generation TITO product that would meet all the needs of the casinos. We did a lot of research to find out what the needs of the casinos were, what they wanted from a technology standpoint. Our first installation was at Wynn Las Vegas when it opened.

The Epic 950 has been our flagship product for all these years, but we recently launched the Epic Edge. We’re excited about the performance of TITO in the marketplace for the player and the casino, and how the Epic Edge will improve performance. And every customer has the ability to upgrade to add couponing to the ticket. The Epic Edge offers a higher-resolution print. It’s a 300 dpi vs. 203 dpi with the Epic 950 and all its competitors. It gives us better-looking coupons and better read rates on the bill validator. But the Epic 950 isn’t going anywhere. It remains our flagship.

How have the printers improved over the years?

The 950 has been enhanced with firmware changes and minor alterations, but overall it had the right set of features, and has the upgradability that has been very popular. We have over 15,000 games with the 950 installed. The addition of real-time couponing has been the biggest change. It’s all about more time on device, creating loyalty and growing your revenue by offering a better experience.

With the convergence between gaming and lottery, TransAct’s role in lottery is interesting. How do you work there?

We are very active in the lottery space. Our Epic printers are in lottery terminals manufactured by IGT, Novomatic and other companies. They have to be extremely reliable. If you think about Powerball, in one weekend they may have to print tens of thousands of tickets. They are highly reliable, high-volume and very professional printers. In addition, our Epic 950 is installed in many video lottery terminals.

With no more coin-out slot machines, reliability is critical. How do you ensure that your printers don’t go down?

It is a critical function. It’s something neither casinos nor VLT operators want to think about. They don’t want to have to worry about down time. We’ve got an excellent quality control department that monitors all the components that go into the printer, the manufacturing process and the reporting process once they’re in the field. For the Epic 950, less than three printers out of 10,000 are returned for any failure in the warranty period. That’s extreme reliability. Even once they’re in the field for longer periods, they are very reliable. It’s all integrated with our quality group to ensure that reliability.

Tell us about your applications for table games.

Table-game technology is a big trend in the industry, and TransAct is part of that. At G2E this year, we brought out two new products that will assist operators in their pit games. The Epic 950 TT, for tabletop, and the Epic Edge TT. We had a number of table-game innovators showing the Epic products in conjunction with their table games. The idea is rather than have them take their chips away to the cage, they turn them in at the table and receive a TITO ticket to take to a kiosk in return for those chips. That will save time for fills and depleting the chips on the tables.

GGB: Everyone is waiting for the Supreme Court decision in the New Jersey case challenging the Professional and Amateur Sports Protection Act. But does it even matter these days? There is so much attention being drawn to how PASPA has failed so miserably that there seems to be some momentum in Congress to fix it, no matter what the Supreme Court says.

Salerno: Oh, I agree with that. I think that if (SCOTUS) allows it to stand, Congress will go and change the law. We all know illegal sports betting is happening. It’s not regulated and nobody’s benefiting—not a city or a state, or at the federal level. And it’s getting more popular, and it’s harder to detect now, with the advancing technology.

Let’s say PASPA is overturned or Congress passes something that puts it in the hands of the states to legalize it. What will the shape of the industry look like if that’s the case?

I think it’s going to be a Pandora’s box, if it opens, because every jurisdiction—and you’ve seen it in the past with gaming—creates different tax rates and different regulatory limits that will really affect it. And states don’t like to get along with each other, or do things the same way. They could take the Nevada model, and do it tomorrow; it’s worked for us for 60 years, or more, so why not take that? But states will want to do it their own way.

I think the biggest fear that I have is the states don’t understand the business is really gambling, and it’s really a low return on your investment. You can see that here in Nevada; it’s 1 percent to 2 percent of our gross revenue, paying a tax rate of around 6 percent. We have a hard time making it with 6 percent, so if you consider the rate Pennsylvania wants to impose—approximately 36 percent—I don’t know how people can make it.

When Delaware approved sports betting, before the courts said they had to limit it to parlay wagers, there was one property that built a Vegas-style sports book, spending millions, and ended up having to eat that investment. How do you recommend casinos approach sports betting?

Well, if you take Nevada, for example, the sports books are coming down in size, even in the big properties. They’re not as large. We used to build them for the Super Bowl, but it’s the same thing that’s been said many times. If you build a church for Easter, what do you do the rest of the year?

So I think that they should start off minimally. Use existing space. They all have conference or ballrooms where they can televise the events, and with today’s ways that you can wager, especially with the mobile application, why do you need to build these huge theaters? And I don’t think it’s going to attract that many new people. Especially in New Jersey, I don’t think people are going to drive to Atlantic City just for a Sunday football game, if they can wager on a mobile device or go to a racetrack that may be closer.

Let’s talk about mobile betting. That has really exploded here in Nevada. How important will it be for states to approve that kind of wagering? You were a pioneer in this field.

It is the convenience. Other states will come around, just like anything else in gaming. We saw what happened to Native American gambling, going across the country. We saw racinos come in across the country. I think the same thing’s going to happen here. It’s going to be a progressive thing, and the states that have the lower tax are going to do much better than the other states, because they’ll be able to give the customer the benefit.

So, if you have a budget, do you want to spend it on a huge facility, or would you rather spend it on marketing to a mobile app, where the person’s going have it 24/7? To me, it’s really a no-brainer.

You mentioned what a narrow margin sports betting has. How would you go into a state and convince them that you can’t tax this out of existence, because you won’t get the benefits that come from it?

In our good years—let’s say the average of the past 20 years—we averaged about 5 percent of the handle that we put through. Of that 5 percent, first of all, we have to pay the 6 percent to the state, and then the federal government has an excise tax, where whether we win or lose, we pay one quarter of 1 percent. So, you start off with those, and then you have your overhead.

So, I think the customer is going to go where he gets the best deals. We see that play out here. The places that have the better odds do much better than the other places.

Anika Howard has always wanted a career tied to technology. She got the break she needed when she was recruited for the President’s Associate program at Harrah’s Entertainment (now Caesars), where she helped to open the permanent Harrah’s casino in New Orleans. She later took on responsibilities for interactive programs at Caesars, where she developed innovative interactive marketing campaigns that increased profitability and drove hotel occupancy. She also developed strategies for on-line advertising, social media, email marketing and acquisition and on-line customer service. Since joining IGT, Howard is responsible for overall strategy and marketing responsibilities for expanding IGT’s mobile and sports betting services and solutions in North America. She spoke with GGB Publisher Roger Gros at the IGT headquarters in Las Vegas on the occasion of being named one of GGB’s 25 People the Watch for 2018.

GGB: When you joined the AGA it was somewhat disjointed. Do you believe the industry is more unified today?

Freeman: Here’s what stands out to me, and I think it’s typical of anyone coming into a new role. Whatever you thought you knew in year one or year two, you didn’t have a clue. You learn something new every year. I do finally feel like I’m beginning to get my arms around this industry, and some of the great opportunities we have in front of us. You mentioned unification; that has certainly been a major priority of the AGA. I think that for any industry organization to be effective, the prerequisite to that is a certain degree of unity among the membership. I think this industry has a lot of experience in fighting battles at the local level, the state level, and various countries around the world, where a market’s open. Obviously, unity is not necessary for fighting for a license. But unity usually is necessary for opening up a market. Unity usually is necessary for defending yourself against attacks. Unity usually is necessary if you want to advance some good ideas. And that’s why we’ve placed such a premium on unity, at this point in time. And I think it’s paying off. We now represent more than 90 percent of all commercial gaming revenue and more than 95 percent of all the supplier gaming revenue, and at this point, we represent more than a third of all tribal gaming revenue. We do that because with that unity comes power.

Sports betting has been your major initiative over the last year. Where do we stand now?

Sports betting has certainly been a high priority for us; it’s a big opportunity for us. We’re the American Gaming Association; we’re not the Sports Betting Association, but we can walk and chew gum at the same time. This is an opportunity to grow the market by billions of dollars. And we are very much focused on that with a two-track strategy: one through Congress, and one through the court.

We see three potential outcomes. Two of those are good, varying degrees of good. I think the least-likely outcome at this point is that the Supreme Court simply concurs with the lower courts and tells them they’ve done a great job. That’s not what the Supreme Court’s in the business of doing. It’s possible, but I think it’s the least likely.

The two more likely outcomes are, one, simply declaring the Professional and Amateur Sports Protection Act unconstitutional, which would instantaneously turn this thing over to the states, to regulate sports betting the same way they choose or choose not to regulate other forms of casino-style gaming.

Or, two, more of a nuanced position that sides with New Jersey’s workaround, and throws the ball back into Congress’ court, to address this issue once and for all. If we had to lean one way, I think we see that as probably a more likely outcome, which, again, this industry is well positioned to address, because of the great work we’ve been doing as an industry over the past several years.

A contentious issue when you first came on was online gaming. Just recently, we saw Pennsylvania approve online gaming, becoming the fourth state in the nation to do that. What is the AGA’s position today on iGaming?

Two things I’ll say about the issue of online gaming—and, as you said, it was a big issue when I joined in 2013 and the AGA did have a public position of supporting a federal poker-only solution. That was a flawed position. It was a flawed position then, it’s a flawed position now, and the AGA, given the lack of consensus in the industry, has taken more of a neutral position. So, two things I’d say about it. One, I wish I could put that genie back in the bottle. I wish we could do that process over again, because I think that the sports betting experience is informative as to what can happen when you’re patient, when you keep your discussions internal, and do the due diligence necessary to determine if you have common cause. I am of the belief that with the right information, with the right process, there is greater common cause in the industry on online gaming, but we didn’t go through that process, at the time.

Number two, the other big issue in online gaming is people certainly know the biggest proponents of online gaming. And they assume that the industry isn’t succeeding, or isn’t engaged, because of the opponents or the proponents. I would say the biggest factors to the lack of industry engagement on online gaming are the entities in the middle. And that’s where most of the industry is. Most of the industry doesn’t know what it wants to see in online gaming. Most of the industry isn’t yet convinced of the business opportunity there. And it’s because of that neutrality of most of the industry, rather than the people on the other end of the spectrum opposing, or pushing online gaming, that we have not been able to see any consensus to date, and why I don’t think you will see a rapid change in that position, at least specific to poker or other casino-style games.

GGB: You took over as CEO of Galaxy just a few months ago. What did you find when you got here, and have you made any changes at this point?

Cravens: When I got here, I found a team that was kind of hungry for some management, some leadership. I also found customers that were looking for more from us. So, one of the things that we’re focusing on is opening up new markets and bringing new products to those markets. But overall, I found a team here that was very interested in growing the company, very interested in growing themselves. And so, from a standpoint of coming in as a new manager, it was enthusiastic people who were saying, “What are we doing next?” That’s made my job a lot easier.

Galaxy just got licensed in Nevada. What does that mean to the company?

Nevada means more than just Nevada. It’s the gold standard of regulation, and other jurisdictions pay attention. It’s huge for us. And we’ve already had really good response from customers. We’re doing a number of field trials currently, and the first quarter of next year we’ll be rolling out more of our electronics, the progressive Bonus Jackpot System, so that’s really important for us. And obviously, a lot of our big, major corporate customers have a lot of properties here. So, that’s important.

You replaced Rob Saucier, who was the founder of the company. What role does he play in the company right now?

Rob oversees product, and business development. Rob is the guy who created Lucky Ladies (side bet), and he has a tremendous mind for games. And at the end of the day, I think that’s where his passion is. He remains the majority shareholder of the company. He’s on the board of directors. When we talk about a new game, or we talk about some business development work, he lights up. And I would be silly to discount 20 years of running this company, if I don’t go in and ask him some questions from time to time, to get some advice.

How important is technology? You have some great products, some great content, but technology is really the cutting edge of the business. How important is that to the company right now?

More than ever. Of the four areas that we’re focusing on, product is No. 1, and technology is a big part of that. I’ll give you an example. In the state of Washington, the No. 1 game for the last 20 years has been Spanish 21. And as you know, it’s hard to dislodge a game in a market like that. So, we came out with a game called Player’s Edge, and it was a similar product, but we put our BJS and our electronic progressive system on there, and it caught fire. And so, we have now roughly 45 percent or 50 percent of the market in six months. So what’s interesting to me is not just the progressives, but our methodology on it is that we are looking for a higher frequency, a lower payout.

Baccarat has been a growing table game in Las Vegas and beyond. Is this a trend in the gaming industry now that baccarat is becoming a much more important table game to the casino operators?

Absolutely. It’s not that we just see it here on the Strip, but a lot of our customers in the state of Washington need to do something a little bit different. And other places that maybe you wouldn’t think about. In Kansas City, they’re running baccarat tournaments.

I think baccarat is a really, really important part of it. EZ Bacc has been out there for a while, and we’re trying to think about this differently. But I think baccarat—not just for now, but in the long term—becomes a really, really important game for everyone.

GGB: Agilysys has a lot of technology solutions for the gaming industry. But there’s other companies that do that, too. What is it that differentiates Agilysys from your competitors?

Ramesh Srinivasan: Especially with respect to gaming, our history includes a lot of gaming DNA. For example, our InfoGenesis POS solution started with casinos as the primary users, and shortly after that, we added LMS property management with a large gaming customer base. In fact, nearly all our products have some measure of the gaming industry’s needs built into their DNA.

This gaming-centric focus is not just evident in our products, but also in our people. You will find a lot of the Agilysys team has 10, 15, 20 years’ experience in gaming, and that includes me. Of course, this deep industry experience also applies to the non-gaming hospitality industries we serve. In addition, Agilysys is the perfect size for our markets. We’re in the $100 million to $300 million annual revenue bracket, which means we provide a higher level of customer service than very large vendors. We are very close to our customers, and they each get a personal level of attention that only a company of our size can provide.

Lastly, the breadth and depth of the products and services that we offer also sets us apart. Many of our solutions have been in the marketplace for well more than a decade, and we are constantly adding new features and capabilities. This, combined with the fact that Agilysys is the only comprehensive solution provider to focus exclusively on the hospitality industry, is how we provide a clear advantage for our customers.

Even before you left Bally, there was a strong trend toward non-gaming revenue. How important do you think that is today?

It is no longer only about gaming spend; it’s about non-gaming spend as well, and that has always been the key area in which we play. Between our solutions for the non-gaming parts of the casino resort and our robust integration with casino systems, we understand what our casino customers need in order to track and grow non-gaming revenue.

To accomplish this, our customers tell us they need a single view of the guest. They need to understand how much the patron plays in the casino, and how much the patron spends outside the casino. At Agilysys, we offer not only hotel property management and point-of-sale systems, but we also have software solutions for managing golf, spa, retail and food service. So, we are in a position to bring all that patron data together to facilitate the desired single view of the guest.

In addition, we have integrations with casino management systems, and other solutions that our customers use. With a product like rGuest Seat, for example, we can help customers to better understand the guest. When a patron comes to the restaurant, we provide the ability to address them by name, to understand their preferences, their allergies, their favorite table, and the food they prefer. So, as non-gaming is becoming more and more important, our role becomes more and more important as well.

In evaluating gaming and non-gaming spend, profit margins in a restaurant are smaller on food, but larger on alcohol. How do you balance that, and give the casinos a good picture of their non-gaming spend?

It’s about understanding the guest’s behavior, understanding their preferences, and thus their value. The casino industry—as is true of other industries—is only scratching the surface to address this challenge today. We have not yet taken it to where it needs to be.

With our products, we already provide a lot of information about guests, but we plan to do a lot more. Currently, the value of the guest is directly proportional to their spend. Agilysys’ technology is capable of providing insight into whether a guest normally stays in your hotel on a discount day, or even on a premium day.

Customers also want to know more about their guests. How often they play golf, for example. And what they prefer to do after golf. Access to this data is available, but the way each operator wants to look at it varies. We are progressing toward helping more of our customers access and analyze this information. That said, we acknowledge there’s still a long way to go.

Agilysys has been very good at buying companies, and also partnering with companies. How important is that to Agilysys that you acquire and partner with these other top-line companies?

We have very good partnerships with solution and service providers in every area. And we are good partners with competing companies as well. Not only companies that compete with each other, but also partner companies that compete with some of our ancillary products. Our philosophy and vision clearly is that we want to help our customers improve their guest experience and guest loyalty. That’s why we are in business. In fact, where we provide our own solution in some of those areas, but the customer happens to choose another product, we gladly integrate with them. We will do whatever we must to provide value to our customers so that they can increase their guest experience and loyalty. That is the only reason we are in business.

GGB: Tell us about the formation of the Hartmann Group.

Jeff Hartmann: We formed the Hartmann Group in 2012, and over the last couple of years we’ve had a lot of success. We do two things: We work with Native American and commercial casinos and do the Hartmann Group 360-Assessment, which is a deep dive on the complete operations—everything from operations to marketing to game protection to slot floor layout. And then we also focus on retail, dining and entertainment—what are the cutting-edge restaurants, entertainment and stores?

Non-gaming revenue is such an important element these days. How do you advise tribal casinos about how to enter that space?

It starts with the technology when the guest arrives. We need to recognize every guest. A lot of operators only focus on the gaming data, but we look at all the customer spend. What’s the holistic view of the customer and how do you acknowledge the guest? Are you using any retail beacons, and how do you recognize guests for some of their non-gaming behavior?

F&B is so important. The industry is moving away from food courts to food halls. In retail, the trend is now for personal shopping, so we try to bring some of that to the retail ventures.

It all starts with integration. You’ve got to have great service and all the touch points as well.

We look at the marketing data and reinvestment. We see a lot of tribal operators who get caught up unfortunately competing on price, like free slot play. We try to get them to focus on their products and their service and look at trends in their database.

How do you work with tribes? Each tribe is different and the approach has to be different.

I learned a long time ago you have to listen and ask questions, rather than tell the tribes what you have to offer. Tribes have been free of compensation for a long time, and now states are considering getting into the game or allowing other tribes to open casinos on non-tribal lands. There are additional pressures, so we try to get tribes to think less gaming-centric and more about the integrated resort. You have to take certain snippets of that if the tribes are in remote locations, but we try to help them think long term.

What has been a recent effort where you helped a client?

We recently worked for the Lucky Eagle Casino, which was facing the opening of the Cowlitz casino right in their market. We were able to come in and refine their operations and their marketing strategies. Some of the pundits said there would be a high-teens or low-20s impact on their revenue. We’re happy to say it was just a low-single-digit impact. We’re proud of the work we did at Lucky Eagle.

Tell us about the joint venture with Foxwoods in Biloxi.

It’s been a pleasure to reconnect with the tribe and Felix (Rappaport) and his team. That’s where I got my start, so it’s a great opportunity. Our project has 500 rooms, 70,000 square feet of convention space, 1,200 slots, 30 tables. It will truly have an authentic Gulf Coast experience. The site we have at Point Cadet is kind of like the Borgata site in Atlantic City. It’s on the back bay with great brands from the Gulf Coast. It will be an entertainment-centric experience. It’s been a fun project so far.

Hanlin, who he leads product and marketing strategy for the Gaming Operations Division, has wide operations experience with Caesars Entertainment, and explains why he believes Aristocrat will have a strong entry in the premium slot market with the new RELM cabinet. He spoke with GGB Publisher Roger Gros at the Aristocrat headquarters in Las Vegas in October.

GGB: You came to Aruze from a career in casino operations. How did that experience help you approach the job at Aruze?

Eric Persson: When I knew I was going to leave Las Vegas Sands, the only company I wanted to consider was Aruze. And they’re exactly the company I wanted to go to. And that had a lot to do with the fact that my career has been spent mainly working with very successful businessmen—people like Michael Gaughan, Sheldon Adelson and Jeremy Jacobs at Delaware North. Coming to a company that’s very entrepreneurial by nature, with a true owner, like (parent Universal CEO Kazuo) Okada, was very appealing to me. And the reason is, I thought that I’d be able to effect the change more quickly by coming to an organization that had an individual owner that would allow some entrepreneurial freedom. And that’s exactly what it’s been at Aruze.

I wanted to take all the things that were hidden disrupters for me, as one of the largest buyers in the world at Las Vegas Sands, and the things that I didn’t like about buying slot product, and then solve those customers’ needs, because they weren’t just my issues; they were many customers’ issues. For example, I never liked it when I would buy hardware, and then the game didn’t work, and they’d want me to purchase a conversion. So, one of the first things we announced was a two-year performance guarantee. So if your product’s doing 80 percent or less of floor average, the first two years, we’re going to give you conversion. We’re going to make sure it performs.

From your first six months as GM of Aruze, what are the main lessons you’ve taken, that will help point the right direction forward?

One of the big things was getting back towards being focused on electronic table games, because it’s a space where we’ve been incredibly successful historically. We started competing more in the video space, and I understand why—because it’s appealing. It’s easy to create software titles. But the truth is, it’s a highly, highly competitive market. We’re never going to outspend our competitors.

But from an ETG standpoint, we’re a leader. You have to see our craps table, which solves a huge customer need, because at the end of the day, it’s a real craps table; you’re playing craps, you’re throwing dice. It takes one-fourth the labor a traditional craps table takes. Many more rolls per hour, never has dealer error. There is no theft. And also, when you normally would shut down the table for graveyard, it has an auto-play mode where you’re able to throw virtual dice and still continue to play.

We have a new roulette wheel that uses a technology called DLP Projection Mapping. It takes a traditional wheel, and it has a real ball. The ball spins around, so it’s an actual roulette wheel. But it has a lot of projection mapping technology involved. And so, it’s integrated into the game play. You can see the trends of what numbers have been coming up, just by eyeballing the board. When the number comes out, it will read the number to you. It has a meteor—when the ball’s spinning around, it looks like a meteor is falling. It’s just a lot of fun.

Do you still want to be a disrupter?

There’s no question about it. I came here, because I thought this would be the most amount of fun. I’m blessed in my life, because it’s not about economics, although I love getting paid. But what I really love is competing. And I felt like this was an industry we could compete in. We could compete really hard; I got with the right company. When you’re small, and you’re not tied to certain economic strategies, you can do so much more.

You’re dealing with some controversy with the clashes of the parent company and Mr. Okada. Is that a distraction for you?

No. At the end of the day, what you have is a company that is vibrant, that is very successful. And we have a shareholder, Mr. Okada, who is having issues—a lot of them are family issues; he’s lost control of his trust, although I think he’s taken a lot of steps that (will lead to his) regaining control of his trust formally over the next month.

You have to separate Aruze from the shareholder. I believe Mr. Okada will come out the other side. We’ve taken steps to mitigate risks. For example, I’m a trustee now. Mr. Okada has no management control, or economic benefit. (CEO and Chairman of the Board) Takahiro Usui and myself, we run the company. And so, we do have to take pragmatic steps, but we believe at the end of the day, Mr. Okada couldn’t say more forcefully how he believes that he’s been wronged here, and he’s going to prove it.

GGB: Bruce McKee and Brian Decorah left a healthy operation with lots of customer loyalty and employee enthusiasm. What was your first goal when you took over at Firekeepers?

Kathy George: Brian and Bruce did leave a great foundation on our property, so I just wanted to continue moving forward, continue our great service we already provide and expand our revenues. We want to keep growing and take our service even to the next level.

You came from the hotel side, so how did you get up to speed on gaming?

I was a general manager for Seneca Gaming Corporation, so I had experience in that area. But even when I worked on the hotel side, we did extra projects that exposed me to the different departments in the hotel. When the position opened up, the other people asked me to apply because they didn’t want someone from the outside to come in and change things, and it all worked out.

The Nottawaseppi Huron Band of the Potawatomi is a real example for other tribes. Casino gaming was introduced very carefully and thoughtfully from Laura Spurr to Jamie Stuck. How has it been working for the tribe?

The ownership is so good to us as employees and the community that I’m really proud to be part of the family. They work very hard to do the right thing and make the right decisions. Sometimes people might not understand our decision, but we’re not going to build or open something that’s not right for those involved.

It’s all heart-driven. Yes, we’re in business and we’re there to make money, but they also consider all the heartfelt things as well.

Brand recognition is important, and Firekeepers has done a remarkable job marketing to a wide region via the golf tournament and race sponsorship. How important is that to your success?

It’s huge. The partnership we have with Michigan International Speedway for the NASCAR race gives us millions of imprints around the world. To go in and see the tribal flag and the Firekeepers logo is incredible. And our relationship with the LPGA is just as good. It’s great to contribute to women’s golf and Battle Creek Country Club, and to see our logo and flag is just as exciting. It’s important to get our name out there.

You can have the greatest facility, but customer service is of course the most important element to success. How do you motivate your 1,700 employees to provide that great service?

My expectations about the service levels have been clear. Right after I started, we had team rallies that allowed me to get my message out. Between myself and the vice presidents, we’re out on the floor, we walk the property, they see us everyday. I think that helps a lot. They know what we expect and everyone wants to meet or exceed those expectations.

We also work for some great owners. The benefit package they provide us is very motivational. And just to have a great job in Battle Creek right now is a motivation in itself.

Everyone wants to be recognized. We have secret shoppers that identify exceptional service and we reward them with Keeper of the Month or Keeper of the Quarter. And we have programs where we can award cash, prizes or paid time off for those who give exceptional service.

Storm explains how BMM is active in testing products for land-based gaming, online gaming, lotteries and more. He discusses the trends in the industry when it comes to skill games, eSports and more. He spoke with GGB Publisher Roger Gros at G2E in Las Vegas earlier in October.

GGB: Let’s start with Las Vegas. The town took a hit during the recession but now it’s come back. Who’s coming to Vegas now?

Schwartz: It’s a different customer than was coming in 2006. They gamble a lot less and some don’t even gamble at all. The city has been smart, and adjusted to that new reality. Instead of trying to force people to gamble, they’re now valuing the customers by their non-gaming spend.

Jeff Hwang did a piece in GGB saying that the value on the Las Vegas Strip has gone down because they’ve replaced the small bargain joints with massive 5-star developments. Is that a danger?

It can be. I think what’s dangerous is a trend we’ve seen in the last year where room rates have gone up a lot and we didn’t see other ancillary spend rise, and some of it actually fell. So if you’re cannibalizing your F&B spend with higher room rates, you’re not giving players enough value. I wouldn’t say that if you lower your room rates other spend will go up, because we saw during the recession that didn’t happen, but you can’t go 180 degrees the other way, either. It’s not sustainable.

Has Downtown become the place where value has gone in Las Vegas? They’ve been producing some really good numbers the past 18 months or so.

I think it is. They’ve been employing a really successful strategy. They’ve known for 30 years they can’t have the white tigers, exploding volcanoes and all that. They’re going to compete on value and gaming conditions. If you want to come to Vegas and see a show and be wowed, you go to the Strip. If you want to come to Las Vegas and have a couple of beers and play blackjack or craps, you go Downtown. They’ve done a very good job at that. These sharp operators have shown you can be successful even in the shadow of these huge multibillion-dollar integrated resorts.

You’ve been doing a lot of research into eSports. Tell us what kind of opportunities that offers for the casino industry.

There are lots of opportunities. It’s not going to be a replacement for gaming, so it won’t be a question of someone making a decision to play slot machines or play in the Madden tournament. It’s more of an event type of thing where you’ll attract thousands of people to attend and watch eSports events.

As for betting, I don’t think it’s going to be big at all. Even if you could bet on it at a sports book, it will be a minor item. Given that sports books only produce 1 percent or 2 percent of total gaming revenue, eSports will be a small portion of that. And we don’t even know if most sports books will take those bets.

Do you think sports betting has a chance to be legalized across the U.S.?

I think it’s so popular, it’s going to be hard to keep it contained. Once you have the major leagues dropping their opposition—even if they’re not technically in favor of it, but just stop opposing it so broadly—I think it will be much easier to pass it. They’re really the only people who care. You have the typical anti-gaming people, but they don’t carry the clout of the major sports leagues.

GGB: There’s somewhat of a perception that Caesars has not reinvested in its properties in Atlantic City over the last few years, because of the financial shape of the parent companies. Is that true, or not?

Kevin Ortzman: It is not true, but I do recognize that perception out there. I constantly address that. Over the last two years, we put about $200 million in the three properties. The majority of that went to Harrah’s, with the meetings facility, which was really intended to create new demand for Atlantic City, and which has been wildly successful.

And on the Boardwalk—also in the spirit of trying to create new demand—we created a new Wild Wild West, with a focus on entertainment and value. We are trying to go after what we believe is an underserved demographic, which we often refer to as the millennials, and that also has been wildly successful.

We certainly have a desire to continue to reinvest in the rooms, and we expect, once we emerge from bankruptcy, that we will be able to continue doing that. Fortunately, we just completed a 500-room project over at Harrah’s Resort, really intended to prioritize to be able to provide the overall product to benefit the meetings facility.

The Wild Wild West project has been impressive. You’ve spread out the games, there’s a big dance floor, a concert facility, and of course there’s a great bar that extends out onto the Boardwalk. How has that been working?

The intent was to create this immersive, fully integrated experience, because one of the few attributes that we understand about millennials is that they’re very social. They have a short attention span, so to be able to have a variety of stimuli, we feel that this has been very successful. We have an open-air bar right on the Boardwalk, the first of its kind. We have bull-riding, basketball and football games. We have live entertainment, beer pong, air hockey; so, a variety of different stimuli. And of course, the only $5 live table games in Atlantic City.

At Caesars, you’ve got the Gordon Ramsay Pub & Grill in the lobby. How has that been performing?

Very well. We continue to look at opportunities to create that excitement in our point of entry. It’s a bit of a challenge, because it is also where our front desk is. So, we don’t want to distract from the experience of checking in, yet create this great vibe that makes people realize they need to go there.

We just finished renovating nearly 300 rooms. What was formerly known as the Temple Tower is now the Forum Tower, which is essentially a replica of our Forum Tower in Las Vegas. So, we’re trying to create that expectation of a particular standard, when you go to any of our brands, like this particular one that’s in Caesars.

The conference center at Harrah’s really has made a difference. Tell us how that’s worked.

It obviously brings a different type of guest to Atlantic City, and lets them see what the entire city has to offer. It looks just like a Las Vegas conference center. Between the meeting space, and then all of the amenities that we have to offer, with the Pool at Harrah’s, the Red Door Spa and the restaurants, we have it all. The Pool is such a unique space to have a reception. We have so many things that professional and meeting groups want to have in a property.

At the Pool, we brought a gaming space downstairs to give it more energy. And then upstairs in the loft, we’ve really actually been looking at what they’ve done over at Bally’s, and seeing what we can do to model after that—just to create those stimuli that millennials want, and create new experiences all the time for those guests.

Caesars CEO Mark Frissora and MGM’s Jim Murren recently met with Governor Chris Christie and discussed a possible new convention facility connecting Harrah’s and the Borgata. Do you think Atlantic City would support a large meeting facility like they do in Vegas?

I don’t see any reason why not. Given the critical mass in the Northeast region, and the proximity, particularly as airfare continues to increase, we’re a more viable option for the region. We have a much larger selection, more cost-beneficial for these corporations than the major cities around us.

But there’s no real concrete plans one way or the other, other than we want explore opportunities to continue to create demand in Atlantic City.

Are you growing the non-gaming revenue in Atlantic City?

If you recall, it used to be 70-to-30 percent gaming in Las Vegas, and now it’s 70-to-30 percent hospitality. So, we hope to see that continued improvement here in Atlantic City. And we know lots of people are less patient than we are. We recognize that takes time. But Caesars is leading the way in trying to transform Atlantic City.

GGB: Gamblit Gaming is producing skill games. Is that your primary business?

Meyerhofer: That’s the term everybody is using. There is activity required by the player—some type of aptitude. You can call them skill games, but I like to think of them as a more interactive game experience. But yes, all of our games have some sort of skill required; it’s not just chance only.

People have called Gamblit a disrupter in the gaming industry. Do you agree with that?

We don’t see ourselves as a disrupter; that’s an important point. We think the market is bifurcated. The older generations that play slots and like them are perfectly happy. But there’s an entire second market that lies alongside it. We don’t disrupt those people from jumping into slot machines. We don’t think they’re going to go there anyway. For casinos, it’s going to be very challenging.

You’ve recently placed your first games on the casino floor. How is that going?

We’ve run focus groups prior to putting it on the floor, but you can’t really simulate real-life gambling. We needed to get it on the floor to see how people would react. So now we’re getting live play experience. The good news is that the first two games we’ve released are multi-player games, and they seem to be resonating with players.

There are many operators who are willing to take a chance. It’s going to take a while to figure it out, but from the data we’ve seen in the preliminary results, we’re pulling newfound dollars. That’s very clear, and our players are 15 to 20 years younger on average than the traditional slot player.

Why did you choose multi-player games first, rather than one of the single-player games you’ve also developed?

I think it had as much to do with what was going to be ready first in our own internal development process than anything else. We always wanted them to come out in close proximity to each other, and we plan to roll out TriStation (single-player machines on a carousel) very shortly.

Who is the player for your games?

Our target demographic is usually with a group of friends. We do see individual players walk up to the table, watch and study it, before they decide to sit down with strangers. But the majority of people who have been playing it are there with friends.

The player who is walking around on their own or the player who values time on device is going to be able to find that with the TriStation games. They’re very different, much more like video games than anything else. The multi-player games are simpler because you’re competing with other players, which adds a dimension of depth. The solo-player games are deeper games and bring a more immersive experience.

The last time we talked, Atlantic City was in dire shape, having lost five casinos in a little more than a year. Are things more stable now?

Anyone who looks at the numbers in Atlantic City over the last 24 months would say we have stability, even though we had the Taj Mahal and two of the three Caesars properties in bankruptcy. We weren’t seeing that continued downturn in revenue that was in play for five or six years before that. For the eight months or so since the Taj closed last October, we’ve had a real upbeat. But we have to be cautious because Atlantic City is still a very sensitive market to outside influences. The government is under a state monitor, trying to get its feet under itself. The casino industry, however, now has a very strong foundation.

When the Taj reopens as the Hard Rock Atlantic City next year, will the market be able to absorb it?

Yes, because I think Hard Rock will expand the market. With their database and brand awareness, people are going to want to come here. They’re being very aggressive, putting significant capital into the property, but they have a lot of work to do over the next nine months.

Last November, New Jersey voters overwhelmingly defeated an effort to bring casinos to North Jersey. Is that the last we’ve heard of that issue?

A lot of things are going to happen in the next year. We have a gubernatorial election and all the seats in the legislature are up for grabs, so we have completely new leadership. Whether or not that becomes an issue will be up to them. If Atlantic City can turn itself around and this market improves, you’re going to have less need from a public policy standpoint to expand gaming in other parts of the state. The operators here have that completely under their control.

While casino executives in Atlantic City are almost unanimously impressed with your actions since you’ve been head of the DGE, they are still concerned that regulatory costs are too high. How do you respond to that?

I can give them two numbers. When I started in 2011, $70 million was expended on the oversight of gambling in Atlantic City. Last year, it was $46 million. We had 343 employees overseeing the work of 11 casinos. Today, for seven operating casinos, we have 255 employees, and 25 people on the books for internet gaming.

I’m conscious of their concerns about the cost of regulation. We’re constantly looking at ways to reduce costs. But it’s all about integrity. I tell them if I can’t guarantee your integrity then you’re in big trouble. So I won’t sacrifice integrity simply to cut costs.

In the online gaming world, why hasn’t New Jersey completed interstate compacts with Nevada and even with the United Kingdom, which you were examining last year?

I have re-opened dialogue with AG Burnett (chairman of the Nevada Gaming Control Board) to determine if we can get an agreement to share liquidity for online poker. But since 90 percent of our revenue comes from online casino games other than poker, it really doesn’t matter too much until Nevada allows all casino games online.

With the U.K., we tried. We have three common operators between the U.K. and New Jersey, but the stipulation that we are required to house our servers in Atlantic City was a hurdle we just couldn’t overcome. Maybe the legislature will address that in the future, but it’s something we can’t change at our level.

GGB: You’ve been open less than a year and are already dominating the Maryland market. That isn’t a coincidence, is it?

Bill Boasberg: We’re getting better every single day. The business is stabilizing every day. Our service is getting better every day, we’re learning about our customers every single day. When you open something this big, you can do a lot of planning but there will always be things you could have done better. So we’re making tweaks to things that we think we can do better. And we’re listening to our customers, and our company gets great feedback and surveys from our customers, so we’re better able to make adjustments based on the customer feedback. So, we’re real pleased with where we are right now.

How long did the curiosity factor last? And now have you determined who your core customers are?

Probably the first 90 days we had a lot of people really just walking through, coming to see the place. And while it’s not quite as crowded as it was in the first 90 days, the people are still coming to enjoy the restaurants, go to the shows, spend time in the casino, and so forth. And it’s good that it’s not as packed as it was in the first 90 days, because now people who are here can breathe and enjoy the space. Obviously, it’s easier to service the customers, and you can get a better handle on the crowd. We recently had our first concert out on the plaza, and we thought it created a great vibe and energy on the property. I think we’ll continue to be busy. A lot depends on what shows we have, special events and entertainment. And our convention business on property now is really taking off, and so, we’re in a good place.

You have a beautiful 3,000-seat showroom. How has that worked so far?

It’s been fantastic. We do a couple shows a week—sometimes three or four. I don’t think there’s been one show that hasn’t sold out. And we’ve had great acts in here so far—Bruno Mars, Stevie Wonder, Sting, Billy Crystal and others. So we have had comedians and concerts, and we had our first Vietnamese Asian act and it was a huge success. It sold out, and we had people waiting in the lobby, in the conservatory, to get in the show.

You have a very good Asian business—a full pit of baccarat tables. Is that a core business of yours?

It sure is. In our Asian pit, we have 16 midi-games, and we also have midi- and mini-bacc in our high-limit area. Within a 10-mile radius, there are about a quarter of a million Asians, so obviously it’s a core focus of ours. It’s been very successful, and we think it will grow even more.

As the name implies, MGM is in National Harbor, adjacent to an area that was really built around conventions and meetings, with the Gaylord Hotel as the flagship, really a meetings and convention hotel. How do you work with that facility?

Our facility is more intimate, more high-end than the Gaylord. We have about 40,000 square feet of convention space. The Gaylord has 500,000—one of the largest on the East Coast. We have a very good, positive relationship with Gaylord. If there’s a big group—and their groups are generally large-scale—which we could not put on, they’ll come over here, they’ll do dinners or break-out meetings in our rooms or theater. We’ve established a great relationship with Gaylord since we came to town, and we consider them a partner of ours.

Let’s talk about gaming. Your slot VP (Alex Alvarado) created a slot “draft” where the slot manufacturers could place the machines on the casino floor you were going to buy from them. Pretty innovative. How has that worked?

Alex came up with the concept of letting the different manufacturers help with the placement of the machines. They helped us lay the floor out. That’s been successful, but like any casino, we’re figuring out what machines are working, and which aren’t, and what’s popular and what’s not, what location is better than the other, and we’re making adjustments based on that feedback.

I understand the table games have exceeded your expectations.

Yes, the table market’s been fantastic, and it’s really been all games. I’ve never seen such a craps volume as we have here. Roulette is extremely popular, and obviously blackjack does very well. And it’s the same thing with poker. Our poker room has been No. 1 in the market right from the start, win per unit, and we think there’s more to grow as well in the poker room.

GGB: Explain what impact the opening of the Parisian has had on the other Sands China hotels, and on the company as a whole.

Wilfred Wong: This latest addition to the Cotai properties really complements what we already have. The Parisian is a themed resort and particularly targets the mass market. We think that’s where the growth is, and the performance of Parisian after its opening testifies that this is the right approach. We have a retail mall that is targeted at fashion. We have another 14 to 15 F&B outlets. And of course, we have all kinds of non-gaming amenities. We built a half-size replica of the Eiffel Tower. We have a themed swimming pool, and a children’s play area.

What people normally worried about is whether there’ll be any cannibalization of the business, and in fact, what we saw was, there was no cannibalization. There was a net increase in our business volume, the revenue, as well as the overall growth of the Cotai property.

What has been the reaction of the customers to the property?

The reaction has been good, because we really targeted this property as an affordable luxury. It is luxurious but also affordable. And a lot of the visitors come for the MICE business. They like the theme, they like the public space, they also like the gaming and non-gaming facilities. And a lot of them like the restaurant in the Eiffel Tower, which is unique.

How did you handle staffing the resort?

We have a mix of about two-thirds experienced staff, and one-third newly recruited. So, of the 6,000 employees, 4,000 had worked in our properties before. And this really gave us the opportunity of assembling a very effective team, from day one. We started training six months before opening, so, from day one, there were very few hitches.

Let’s talk about the rebound of revenue in Macau. Luckily, Sands China wasn’t hurt as badly as some of the other properties, because you didn’t depend on the VIP market as heavily as some of the other properties did. Now that it’s coming back, where do you see most of your revenue coming from?

The mass market is still very much the growth area. The market has been growing very fast, and we grow faster than the general market. So, we are focusing still a lot on the mass market, where the contribution to profit is better. But, we never forget about the VIP segment, which is equally important. We remain very competitive. We still try to improve our services to our VIP customers. So I would say that we’re trying to cover both the VIP and the mass segments, but obviously, with all the non-gaming facilities available, we have a better chance of growing the mass market than the other competitors.

The Hong Kong-Macau-Zhuhai bridge is getting close to completion. When the bridge opens, how do you expect that to operate, in terms of how the ferries have operated in the past?

We are in constant touch with the Macau government. I think at this stage, they are still talking to the Hong Kong government on how the bridge would operate. I envisage that there will be a limit on the number of private vehicles being allowed into Macau, because Macau is a small place, but there should be licensed shuttle bus routes, which will be able to take passengers straight from the Hong Kong airport to Macau. And hopefully, that is going to overcome one of the major hurdles that the MICE event organizers normally face, and that is you have to clear customs twice.

I think Zhuhai is going to be another important link, because the high-speed rail in China goes to Zhuhai, and if we have the bridge, we can have shuttle buses picking up passengers from the rest of China, through that bridge, to Macau. That’s also very good for our business.

Is it difficult to really get the message out to Chinese markets, because you can’t even mention gambling in China?

Well, if you look at the building area of our properties, only 5 percent is gaming and 95 percent is non-gaming. So, it’s not difficult for us to show that range of services and facilities that we are offering. Plus, the entertainment that we’re promoting really gives us an edge in any overseas promotion.

There have been some reports in the media that the government may require all Macau operators to reapply when the concessions start expiring in 2020. What do you know about the process?

We haven’t heard anything from the government. Obviously, it’s getting closer to the period where the government needs to tell us what to do. But certainly, the government is having to evaluate the huge amount of money that all six of us have invested into making it work, and especially in contributing to the community of Macau.

Any suggestion that there might be additional concessions issued?

We don’t know. And obviously, this has to take into account President Xi Jinping’s comment about Macau not over-relying on gaming. I think the government has to consider that.

How has your role changed with the additional responsibilities you recently took on?

I am now looking after the marketing group, handling marketing events, promotions and communications, as well as continuing my duties looking after the product management both on the games and systems sides.

You debuted a game at the NIGA trade show that was very impressive, Castlevania. Give us the genesis of that game and how it was developed.

Castlevania is very near and dear to the Konami heart and to anyone who has been playing video games since the early 1980s on the Nintendo-style game systems. There have been almost 30 versions of it over the years, so it’s a very popular game for Konami.

We felt if we were going to bring it to Konami Gaming, we had to treat it right. So we’ve created a hybrid of the different versions, from the 8-bit versions all the way to the modern 3-D style graphics. At the heart of it is a romance game, with the hero trying to rescue his princess. And having the palate of that 43-inch curved display, we can use some incredibly high-definition graphics. And you really get involved in the game.

You debuted Frogger as a skill game at Level Up in MGM Las Vegas earlier this year. How’s that been doing?

It’s been doing well for the location. It’s not in the most heavily trafficked area of the floor, but it’s been hitting the demographics we’ve been looking for. Frogger Get Hoppin’ is the first skill-based game that was approved in Nevada via the new Innovation Beta program. We’re very happy that Konami could participate in this groundbreaking experiment by introducing variable payback into the games. The player actually moves the frog, and it’s all about you.

Tell us about your new tournament program.

Our True-Time Tournaments have been very well-received. In addition to being able to offer on-demand tournaments, where the players can enter and play the tournaments where they’ve earned entries at any time, we’ve got the ability to synchronize tournaments as well. We’re able to use our True-Time Window, a picture-in-picture on the screen that can access the tournament and play in real time. This way the operator doesn’t have to take any games out of play for the tournament.

And how about the Fortune Cup horse-racing game?

There’s a huge demand for Fortune Cup. We’re in the process of making sure we’ve got all the elements right. We’re known for our quality and reliability, so when we bring out new products like Fortune Cup, like Frogger, we want to make sure we’ve got everything right and fully tested.

Now, Fortune Cup has been running in Japan for 30 years or more, but we want to make sure that when we bring it to the U.S. it has the same quality and reliability that it has in the Japanese arcades. We also had a math engine we had to build. We’re pretty happy with this product, and you’ll see it soon on the casino floors.

GGB: Tell us about the recent departure of Crown as co-owners of your company.

Lawrence Ho: We think it is the conclusion of the most successful gaming partnership ever, because in the gaming space, there aren’t many partnerships that last very long. And most of the time, when they end, they end in very bitter disputes and major lawsuits. James (Packer, Crown executive chairman) and I are still great friends. We’re both young. We’re both optimistic about the future, and we still might do something down the road together. So, who knows?

But at the same time, for Melco and myself, it’s extremely exciting. Because I really see the market turning around, not just in Macau, but literally, in all markets driven by Chinese economies and China’s export of tourism.

We just got a chance to see Studio City for the first time and it’s a pretty spectacular property. How is that performing now?

Studio City is doing much better. Studio City opened in October 2015 at a time where Macau was going through a much tougher time. And so if you look at Studio City, and the company that opened before, the Galaxy Phase 2, both of those properties really opened during some kind of tough times in Macau. Studio City is doing better.

But Studio City’s main investment thesis was always based on the coming of Lotus Bridge, which is the second border gate between China and Macau. But today you see the footbridge that the Macau government is currently building is not completed. And between us and the immigration building, the government is also building a massive light rail station. And so, the Lotus Bridge, which was supposed to be the most popular route to Studio City, is still blocked, and it has been blocked since its opening. Hopefully, sometime in the second half of this year it will be completed.

The new tower at City of Dreams also looks pretty spectacular. What’s the opening date on that tower?

Morpheus Tower, which is the last phase of City of Dreams, is due to open before next April. We’re less than a year away, and we really look at the opening as CoD 2.0. When City of Dreams opened in 2009, it was a very different market, and a different property, but over the last few years, we’ve solidified our position as the top premium mass and premium direct property. And with the unveiling of Morpheus, it really completes the retail loop, and we’ve done a lot of work on upgrading and improving the retail proposition. And so, it’s a significant moment for City of Dreams.

We’re very proud that this was one of the last properties designed by the late Zaha Hadid. She was amazing. But at the same time, what she designed was very difficult to build, and that’s why it’s taken as long as we have, and really taken a lot of resources, capital and expertise.

You mentioned the rebound of the gaming revenues in Macau. What do you think is driving this?

First of all, mass-market, for the last 12 months, has already taken over. Mass has taken over. It’s over 50 percent of the revenue. Since mass is four times as profitable as VIP, for operators, that’s very significant. And I don’t see that trend going away.

Deep down, when you look at Melco Resorts, it really is a company that is focusing on the growing middle class. We think of ourselves as pioneers, focusing on the growing middle class of the world. That’s really what this company is about. And we’ve had this feeling over the last 10, 12 years, which is, China is going to be the biggest contributor to that growing middle class, and we should take advantage of that.

A few years ago, Macau CEOs kept telling us that Macau has only penetrated 1 percent or 2 percent of the Chinese market. Is that still the case, or has that percentage gone up a bit now?

It’s gone up a bit, but again, if you look at Macau, it’s really been mainly about Guangdong. Guangdong is really just about the business of Macau. So it’s not just like 1 percent or 2 percent of China anymore, because Macau has broadened and reached through more parts of China, but it’s still a very low penetration base, compared to most mature gaming jurisdictions.

Tell us about your interest in Japan and how you would feel about being a minority partner in a Japanese casino, as the government seems to be favoring.

I look at Japan as the future of growth of the north Asia market, or north China market.

We’ve always wanted to be a very open and transparent company. So being a minority partner would be a tough one. But Melco has already been very open-minded and innovative, and our single goal is to be part of that market. So, I wouldn’t say it would be a flat “no,” but we would really want to understand how many licenses and work out the possibilities first, before we would even consider signing up for a deal like that.

GGB: You were appointed chairman just in time for the introduction of iGaming, the initial wagering on eSports, the definition and introduction of skill games, the expansion of sports betting, and dozens of other issues. Does it seem like it’s always just been one thing after another?

A.G. Burnett: I’ve been here for 19 years, and as luck would have it, or chance would have it, or skill—one of those—I would not have been here this long, had it not been for the great people here. We’ve got 400 people on staff. It’s just been an incredible working environment, to work with some of the greatest people I’ve ever been able to work with. But yeah, you’re absolutely right; it’s been one thing after another, continuously, but that’s gaming.

When you took over, there had already been extensive hearings on iGaming. What were some of your first concerns in Nevada, when iPoker was launched?

When iPoker was first being launched, I was on the Gaming Control Board, and I knew that it was going to be a big event. I knew that it was going to be something that we had to look at strongly as regulators, and I think we all collectively had a feeling at the time that it might be a game-changer for the state of Nevada.

My greatest fear was twofold. One, that it would flop immediately, and not get off the ground. You would have a green light, launch, and things would shut down. And two, that some patron would be ripped off, both of which would be embarrassing events for the state of Nevada. We don’t want anyone to be harmed when they play a game or a slot machine; that’s why we regulate in the way we do. It went off well. There weren’t any of those types of scandals or events or hitches. Things went up, and they were off and running.

More than a year ago, Governor Sandoval signed a bill, reaching an agreement with Delaware to share poker liquidity. What’s happened with that agreement, and is it working?

It’s the Multi-State Internet Gaming Agreement. It’s working well. Our colleagues in Delaware have been great to work with. It is something that is not on my list of problems, day to day. Staff at the Gaming Control Board has meetings, periodically, with Delaware, and the numbers aren’t big enough, or the number of licensees aren’t large enough to require much more than that at this point. But I think that it has been a success from our perspective.

Sports betting revenue in Nevada has grown pretty substantially over the past five or six years, mainly because of in-running betting, as well as mobile betting. What kind of role will Nevada play if and when sports betting is legalized on a national basis?

That’s a really good question. And I don’t have an answer, because I think it depends on what a federal law does. If (the Professional and Amateur Sports Protection Act) is just repealed, without any further guidance from Congress, that’s one thing. If there is a law passed in its place regarding sports betting, and the states’ ability to do that, I would imagine it would look a lot like the other gaming laws that are promulgated by Congress, which would be to ban it, but say that if a state wishes to do it, it can enter into that activity, as long as it’s legal within the state. So, if that were to occur, I would imagine other states would ask us questions as to how we regulate sports betting. Our licensees will be in those states. It’s going to be the Nevada licensees exporting their knowledge and expertise into that, which I think is incredibly important with sports betting, because it is so nuanced, and so highly specialized.

Let’s talk about skill games. Why was Nevada so quick to figure out how this was going to work?

There was a body created to study the impact of technology on gaming. I was part of that, along with Chairman Pete Bernhard of the state Gaming Commission, and that committee’s duty was to study what’s next, and try to determine what Nevada should do. The result of that, obviously, Nevada needs to continue to be at the forefront. What does that mean? For me as a regulator, it meant that we regulate to the statutes.

Eventually we called it a hybrid game, and I consulted with my technology division staff, and they agreed. And so, that’s what ended up being SB9—this concept of the gaming device, the traditional slot-machine gaming device, and then there’s a hybrid game.

The mandate that I gave my staff was this: Right now in Nevada, there’s an end zone. The very first statute says, gaming has to be regulated strictly, it has to be competitive, and these are the things that we have to do to protect the state, and the industry, the state’s population, and all 40 million visitors that come here every year. I said let’s move the goal post. Once we do, it’s going to be up to the industry to fill that space.

GGB: For many years, casinos were very in touch with their players. They knew who their players were, they had VIP and casino hosts, and direct mail that was very successful. But a lot has changed over the past decade. How do analytics help in knowing the player?

Andrew Cardno: The way the industry has adapted to analytics is something that we all should be proud of. We’re a leading industry in analytics. It always brings me back to one of my good friends, a GM at a casino in Tunica, who told me that we’re like this collection of small businesses. We’ve got food and beverage, we’ve got hotel, of course we’ve got gaming, and we’ve got different kinds of gaming. And that drives a need to be able to be fully informed about our customers.

The industry has a greater need to bring data together in real time than any other industry I know of. If you don’t have a complete picture of your player, you’re not giving that customer the right kind of service.

Tell us about how VizExplorer came to be. What was the inspiration?

When I founded the company, I set out with a goal of never having to build another data warehouse again, and it’s a bit of a joke, because it’s what I was doing for many years.

But to leverage the technology platforms that are out there, to bring together all the data in real time, we developed our integration hub that allows that data to come together and to be used to its greatest gaming optimization. So, we used the data infrastructure we put in place, for this one application. We proved the value of having that real-time data, of having all the data about gaming machines, so I could understand what games people like. Or, how are my preferences for games changing?

We just solved one of the hardest questions that I’ve worked on in gaming, which is: If I bring a new game onto the floor, taking out participation and all the other costs associated with it, what is the incremental revenue from that game—how much of it is truly incremental to the casino? We’ve solved the math behind that, and we’re really proud of it.

Do you provide any information to help casinos make those decisions about what slots to add or remove and where to place the machines on the floor?

Absolutely. At one point, I won a Smithsonian Laureate for Heroism in Information Technology for slot floor optimization. And that was even before I understood how important the customer was. We kind of have this joke at VizExplorer, in the data science team, that we keep learning new math models, and then inventing even better ones through replacement, but at the core of understanding how to do that is the customer. So, we used to analyze gaming machines based on theoretical win per day, or actual win per day, or handle pulls, or some other metric that was a measure of the performance of the game. And it worked really well. But we were mostly under-supplied and there was plenty of opportunity for growth in the industry. It wasn’t that difficult.

So, what changed?

Well, in today’s world, we’re mostly over-supplied. So, no longer can you optimize your games in that way; it just doesn’t work. Just think about the simple example of the high-limit room; it just doesn’t work to add more games in the high-limit room.

So, you need to look at the floor through a different lens. And the lens that we bring forth is the lens of the customer. We do a market-basket analysis. We have an issued patent on preference filters, for analyzing the market basket in the casino. It’s one of the hardest math problems we’ve solved. So now, irrespective of the performance of the game, I’m looking at what I need to do to make my customers get the experience they need to get. So, I’m optimizing the customer experience. Very different math models. We’ve been really successful with that.

It’s completely flipping analytics on its head. This is something slightly provocative, but I don’t really care about the slot win-per-day metrics. We need to focus on optimizing the customer experience, that every customer gets the games they need, so it can fill out all those market baskets and optimize all those market baskets on the floor. And just to defend that a little bit, because I know some people might be a little bit agitated by me saying that, just think about video poker. It’s not the greatest-performing game on the floor, but it would be unthinkable to remove it, especially in Las Vegas. You just couldn’t remove it, because you would lose those customers.

So, you have to work really hard on optimizing your video poker games, and then you go to your video reel, and your video slot, and your different types of games. It completely changes the way you look at a gaming floor, and we’ve got a deep track record of doing that.

GGB: You’ve been concentrating on the eSports discipline since you joined the UNLV International Gaming Institute last year. How did you get into that?

Brett Abarbanel: I’ve been doing that for a very long time. Decades actually, but casually. I’ve never played that frequently, mostly because of time constraints. As fun as it is, I simply am not 8 years old anymore, so I just don’t have the time. And as I was playing, my husband actually plays quite a lot of video games, and I was noticing that gambling kept sort of cropping up in all of these, even if it was in just a simple RNG function in World of Warcraft, where you can bet on random games with coins of value.

So, this kept cropping up, and we started seeing, as these tournaments were getting more and more popular, the sport was starting to become legitimized. And it’s fairly established, sociologically speaking, and as something becomes more and more mainstream and acknowledged, we generally see gambling on it. And once I started seeing that coming up around January or February 2014, I really started paying attention to how the two were merging together. And previously, I’d been doing a fair amount of research in online gambling, and that’s a lot of the gambling that you see in this space. And so, the transition to include videos games and competitive video games, eSports into that, was fairly natural. It also allows me to play video games at work and have it actually be work, so that’s always a nice bonus.

What does eSports mean for the gaming industry?

We still seem to be in the somewhat preliminary stages. We’re certainly farther along than we were when I first started looking at this a couple of years ago. We’ve had initial interest, I think, in many of the tournament events. Last spring, Mandalay Bay brought in the League of Legends Championship Series. Since then, we’d had major eSports events in Las Vegas, but this really seemed to be the major catalyst for change, in terms of bringing in major events.

But we’ve also seen other applications of eSports. So, usually when we talk about eSports, we are specifically referring to competitive video gaming. This is the professional stage of video gaming. And then, in some cases, we also have used it to refer to amateur competitions as well. The eSports Lounge at the Downtown Grand is one of the manifestations of eSports that we’ve seen. Then we also have Level Up over at MGM Grand, and that also is a slightly different iteration of the gaming space, but I’m not sure I would call it “eSports space.”

You recently formed an organization dedicated to the growth of eSports in Nevada. Tell us about that.

Seth Schorr (chairman of the Downtown Grand) and I have been talking about this now for about a year: How does eSports look in the gambling world? Narus Advisors’ Chris Grove came in. We both like him very much. And then, Jennifer Roberts, my colleague here at the IGI, is the associate director of the International Center for Gaming Regulation.

And so, the four of us have been having meetings for about eight months or so. The eSports world, as quickly growing as it is, and as huge it is, as much interest as there is, it’s still fairly fragmented. There are a number of different developers.

It’s unlike traditional sports, in the sense that nobody owns football. The National Football League runs a league for football, but so does the Canadian Football League. And football exists in many different forms. You and I could go down to the park right now and throw a football around, and nobody’s stopping us from doing that.

But if we wanted to sit down and play a game of League of Legends together, we would have to pay for that. That game belongs to Riot Games. So, that’s one of the ways in which it’s fragmented. It’s not necessarily a bad thing; it’s just that the proprietary nature of these games means that there are different segments who have different interests—and that’s just in the game development component.

We also have different tournament organizers who are trying to put together their own tournaments, we have different teams, and there’s no formal league like there is with the NFL. There are a number of different leagues. So, it’s almost as though we have NFL 1, 2, 3, 4, 5—some of course with more prestige than others.

And why the focus on Nevada?

This is a state that has a very large established tourism infrastructure. Las Vegas is not just gambling; it’s a major tourist destination, and at the Las Vegas Convention and Visitors Authority, we can back that up with about a thousand different data points. Las Vegas has the capability to bring in these types of events.

And then as far as the gambling component goes, Nevada has one of the highest standards of gambling regulation in the world. We see Nevada as having the opportunity to be a major hub for eSports. It’s a global phenomenon, this eSports thing, and we’re trying to establish Nevada’s place in that global network.

But what could accelerate the growth of tables (and by “tables” we mean the ones staffed by humans and featuring actual human interaction)? Some believe technology will be the savior of table games. But technology thus far has played a small role in the popularity of the games. Sure, there are scoreboards, bonus counters and some electronic betting spots on the table that recognize chips, but it’s usually been clever design, quirky rules or the chance at a big jackpot that have spurred the popularity of the games.

But times may be a-changin’.

Table Tech

For more than 20 years, the industry has been pursuing the Holy Grail: a table game that prevents collusion and cheating, while delivering data as rich and as detailed as the modern slot machine. It started in the 1990s at Bally Technologies (and others) with systems with names like “SafeJack” and “MindPlay.”

The systems had most things in common: optical and RFID tracking of chips and cards so the game would instantly report who was playing, what they were betting, and how the table was doing (winning or losing). But challenges with the RFID systems and the optical readers were slow to be resolved.

Roger Snow, the table game guru at Shuffle Master, now a division of Scientific Games, likens the development of this technology to scaling Mount Everest.

“I imagine this occurred to Sir Edmund Hillary more than once looking up at the summit,” says Snow. “‘Oh, I’ll get to that; oh, it’s not that hard.’ Then you get up to about 28,000 feet and you can’t breathe.

“It’s analogous to what’s happened here. Everybody wants to get to the top of the mountain. Everybody wants to do this. But that mountain is littered with a lot of corpses. And I think some of my coworkers over the years, smart people with great ideas, have really tried to do this. But I think we’re getting closer.”

Robert Saucier, CEO of table-game developer Galaxy Gaming, believes there is still some work to do.

“There is a need for the casino operators to be able to have meaningful data,” he says. “And I think the advantage that the slot department has over the table game department is that they have lots of data, and it’s highly accurate.

“The problem was that MindPlay was too much, too soon. I think that if it came in certain stages, it could have been more accepted. I also think that we have realized that RFID is not the answer. It serves a function in places like the cage, or the vault, or being able to verify that the chips are not counterfeit. But I think that as far as being able to track play, and being able to use it to track patterns of play and specifically, to use with player tracking systems, RFID is not robust enough or accurate enough to really give that picture.”

Both Snow and Saucier agree that the most promising technology in this area is currently being developed by Walker Digital Table Systems (WDTS). Longtime gaming executive Steven Moore, who is president of the company, acknowledges there are still some hurdles to overcome, and his company has to provide a product that satisfies three desires from casino management.

“Accuracy, efficiency, and integrity,” he says. “With our technology, there’s a 25 percent to 30 percent increase in game speed, there can be no collusion or cheating, or even dealer mistakes because of the accuracy of the system. Payouts are always accurate. So, if the game goes faster, the payouts are always accurate—because in table games, mispays are always in the customer’s favor. It’s like giving them free play, which reduces hold percentage.

“So if you speed up the game, and you get rid of the free play through mistakes, the hold percentage gets driven massively up. And then you add in all the efficiencies of watching that game, so the computer system manages and understands everything that’s going on, so you don’t have to have as many eyeballs on it. You save a lot on staff, as well. Sometimes staff goes down from one supervisor per table in Asia, to four tables per supervisor.”

WDTS acquired all the MindPlay intellectual property, so Moore understands how the process has evolved and that it’s a granular process.

“The parallel, we like to say, is the electric grid,” he says. “When electricity was invented, the only use for it was to light a light bulb. There may or may not have actually been an ROI on that, but it was exciting enough that people did that. But after the light bulb, you started being able to plug other things in to the electrical grid—washing machines, refrigerators, stoves, microwaves and computers, and now everything runs on the electrical grid. So right now we’re building the electrical grid for table games. The best applications that are going to ride on that, we haven’t even thought of yet. That will take more people in the industry with the same vision we have.”

John Hemberger, vice president of table games for AGS, says accuracy is the most important aspect.

“It’s reliability,” he says. “That’s the No. 1 thing. Anytime you’re trying to provide real data, you have to be 100 percent accurate. There’s a lot of different technology that probably can even get you up around 92 percent or 95 percent of the time. But if you’re missing that other 5 percent, that’s a problem. It gets you closer, but it doesn’t quite give you the level of confidence that you expect in that type of data, to be able to invest from the casino side.

“And the investment isn’t cheap. You can give them the degree of certainty that they need to be able to say, ‘We’re rating these players accurately, 100 percent of the time. We’re capturing their true average bet. We know their win and buy-in and everything else that goes along with it.’ Until that time, unfortunately, you’re going to see a little bit of a resistance to make that sizable investment.”

Randy Knust, president of Genesis Gaming Solutions, says table game executives have never fully embraced technology.

“Some might argue that when RFID first emerged and was adopted by operators, the technology wasn’t nurtured appropriately,” he says. “Today, we all recognize how sophisticated analytics have become and how important the value of detailed and accurate data is to an operator. This, coupled with the fact that integration with technology has become much more seamless nowadays, suggests that we could start to see more RFID and other technology adoption quickly taking place.”

Tristan Sjöberg, president of TCSJohnHuxley, says cost has always been the barrier, and is still a concern today.

“There’s no shortage of innovation in this area, and we have been continually developing and evolving our smart table products, as have other suppliers,” he says. “However, some of these technologies being developed are extremely expensive to implement, and the value they return can be disproportionate. Data is a powerful tool, but too much data or inaccurate or out-of-date information is worthless to the operator if they don’t utilize it properly. “

But Knust says the value offered to casinos will soon outweigh the costs.

“With the increasing demand for accurate reporting, we believe that RFID is coming back to the forefront,” he says. “Yes, it is still considered to be an expensive option. However, when evaluated over the long term and taking into account the proven data accuracy it delivers, we believe casino operators will make the investment. Our belief is that the value of accurate data for player reinvestment, cage security, marketing, chip tagging, AML compliance, etc., will deliver ROI and operating efficiencies that will justify the investment. It is extremely hard to ignore the overall value that RFID offers.”

Game Centric

Because the basic casino games haven’t changed since the demise of faro (the most popular game of the 19th century), Snow says any successful proprietary game should be a derivative of what people know.

“I’ve always warned people about deviating outside of blackjack and poker,” he says. “I use the metaphor of language, that people know the poker language, they know the blackjack language; don’t make them learn another language.”

And while the game has to be easily explained and simple to play, Snow says you have to walk a tightrope.

“Keep your game simple, but you have to keep it interesting,” he says. “If simplicity were the only criterion, then Casino War would be our most successful game, where it is not. Yes, it’s a successful game, but it’s not in the upper echelons with Ultimate Texas Hold ’em and 3-Card Poker, and games like that.”

Saucier agrees that games must be simple.

“It’s been said, and I agree with this, if the game of craps was invented today, it probably would not succeed,” he laughs.

As the company that bought out the industry’s most successful table game inventor, Derek Webb and 3-Card Poker, Saucier says his company is constantly approached by individuals who claim to have invented the next 3-Card Poker.

“For every hundred games that we look at, there might be three that might warrant further consideration,” he says, adding the secret to a successful table game is numbers—the numbers that prove it would be successful in a casino environment.

“When you find that person in a table game operation that has an interest, what you need to do is make a deal with them. And I would say that the deal to make would be, ‘Give me numbers on how it performs, and you can have this game in your casino for life.’”

Baccarat is an up-and-coming game, not just because of the explosion of the Asian casino market, but also because it’s being discovered by mainstream casino gamblers who never understood the game.

Hemberger says AGS is coming out with a new version of baccarat called Dai Bacc that has a variety of different side bets enticing players with payouts as high as 40-to-1.

“The baccarat commission-free games that have these side bets with the high house edge, I think there’s energy and excitement that comes from those tables. If you’re in California, for instance, they’re three deep at a bacc table, and there’s just natural curiosity. That leads other players to maybe take a look at what’s going on.

“And when they find out it’s that simple, and that in a lot of instances, you’ve taken the whole commission idea out of the game, I think it really simplifies it, and keeps the excitement at a high level. So, it’s been a long process, but baccarat has really transitioned from the traditional game, to what it’s morphed into today, which is with some widely popular variations.”

“Mathematically, baccarat is one of the best games in a casino,” says Snow. “A lot of the blackjack games have been 6-to-5. Astute players are leaving that game. So, look at baccarat. The house edge is something like 1.1 percent if you blend it between a player and the banker. And no strategy necessary.”

Scientific Games recently acquired DEQ, which, among its products, distributed EZ Bacc, the first no-commission baccarat game introduced into the casinos. There is nothing to stop casinos from also using a no-commission game with rules like EZ Bacc, but Snow says there’s a certain loyalty there.

“The thing with EZ Bacc is our company tried to create a copy (before the DEQ purchase)—and we’re the biggest player, by far, in the table game industry—but could not make it work. That brand, the brand those guys created, has been incredibly resilient. And table games players like what they like. So the brand is important, but they also have a couple of proprietary side bets on the game. People are used to it, people are loyal to it, and we learned the hard way that they don’t accept imitations.”

People vs. Machine

How far can technology venture into an area where the human element is so important and attractive?

Snow believes that it is the interpersonal aspect of table games that will attract the coveted millennials.

“Everyone has been talking about skill-based gaming as being the Holy Grail that will attract millennials,” he says. “Well, skill-based gaming, that’s table games. Community-type gaming, that’s table games. I don’t have to do anything. I just have to wait for the customers to show up. And you see it, and I like to be a customer of our own company.

“I will go out there and I’ll play games, and I’ll look around, and you notice younger people playing table games, more so than slots. My opinion, from what I’ve seen, is that if you look at everything that young people do with their phones, it’s just a vehicle for some sort of interaction. And, table games give you that interaction. And it’s something you get to touch.”

Saucier believes it’s also the experience of the table that attracts the players, something that technology can’t reproduce.

“If you take a traditional table game and remove the ability for the player to see and touch the cards, hold and wager the chips, you take away a lot of that tactile experience that people enjoy about table games. I’ve never been a fan of placing, in the felt, a touch screen where people place wagers, because you can do that on your computer.

“Now, that being said, I think that we’re finding that some of the stadium-type games are actually doing well. Even some of the e-tables are doing well. From what I see, however, those games are not necessarily taking away from the traditional table game players, but rather, they’re acting as somewhat of a feeder system for people who are gravitating from slots into electronic table game play.”

TCSJohnHuxley is all in on table-game technology with its Gaming Floor Live platform.

“This complete network platform and gaming table management system provides a groundbreaking solution for operators and their table games,” says Sjöberg, “allowing a wide range of data gathered from each table to be analyzed in real time, enabling active and proactive management of gaming floors. For the first time, it’s possible to provide the same levels of real-time data collection that operators currently enjoy from their slot systems. You only have to think about the multiple vendors’ products there are on a single table that stand alone unable to connect and interface, to understand how compelling the GFL solution is.”

Genesis, which offers a robust poker-room solution, has developed Bravo Card & Chip Detection, a tracking and ratings management system.

“This system significantly improves overall efficiency, as it can measure exact hand counts and side bet participation, resulting in major improvements in the overall measurement and management of pit ratings, game performance and dealer audits,” says Knust.

For those mobile gaming applications within a casino, Sjöberg says his company is developing Qorex Terminals, which feature touch screens that allow customers to play live table games.

“We don’t believe there will be any detrimental effect on table games when handheld devices are approved,” he says. “In fact, we believe our system will only enhance and improve the player experience, as they have the freedom to play their favorite games in all areas.”

Table Game Growth

Optimism about the growth of tables is almost universal. Moore believes technology will drive this growth by speeding up the games, making them more accurate and providing operators with a rich data set.

“In the end,” he says, “a gambler is a gambler is a gambler—a real gambler. There’s really no difference in an Asian gambler, an American gambler or a European gambler. They want to play a lot of things, and as they gamble, they like incremental volatility. And a fast game’s a lucky game. Baccarat and roulette are historically slow games. So, you speed them up, and a player is going to enjoy it. You make fewer mistakes, then you frustrate the player less. If you under-pay a player, they get upset, they have to stop the game, it kills the mojo, everybody gets upset. It’s just not good for the flow and the momentum of the game. So providing a fast game, where the dealers can’t make mistakes that stop the flow and the mojo of the game—they all love that.”

Hemberger believes the human element will ensure the continued success of table games.

“As everybody focuses on millennials and younger folks gambling in casinos, it certainly appears that the data supports the fact that these folks are playing tables,” he says. “I think that’s a great thing. I think tables have the ability to be social, and that’s what these people are looking for. I think they have the ability to not focus entirely on cash awards, but on things that winners could share with their friends or family, or make things experience-based. That’s a very natural segue to capture the attention of young people and get their interest, and also have the skill element at the same time. They feel like they’re maybe not just pressing a button and getting a random outcome, but they’re influencing the outcome through their decision to play, or raise, or whatever it may be, that the game is allowing them to do.”

Sjöberg says casinos must be prepared to serve the changing desires of younger players.

“There will always be space on the casino floor for table games, and they continue to be popular with all demographics,” he says. “However, in order for the segment to grow significantly and gain new, younger players, operators will need to offer cross-platform table gaming and a greater variety of games.”

Knust says Genesis will be ready.

“We believe table games will continue to grow, given the wide demographic that they appeal to,” he says. “Evolution will certainly take place, and we will continue to work on the operational and the technical challenges that still exist.”

Snow is a bit more pragmatic.

“Table games will continue to grow,” he says. “But everything in the industry is always changing. You’re so close to it, you don’t feel it. But it’s changing constantly. If you go back maybe 10 or 15 years, they were ripping out table games to put in more banks of slot machines all the time. I wouldn’t say that we have re-conquered that territory, but we’re making some progress in table games.

“But that could change over time. You can never be satisfied. One thing that I hope people know about Scientific Games, when it comes to table games, is that we’re relentless. We are constantly working on things for the benefit of the casino industry.”

Snow applauds his competitors for some amazing innovations, and hopes that will continue.

“I love table games, I’ve been in table games for the last 20 years, and anything that can move the ball forward, advance the cause of table games, is something I think is terrific. As to where it lands, I think you’ll see more and more table games going in. Hopefully they’re ours, and hopefully they have a shuffler on them.”

GGB: What was your idea for 3-Card Poker, and how did you roll it out?

Derek Webb: I wanted to design a three-unit bet game that incorporated what I thought was the best of Caribbean Stud and the best of Let It Ride, and it was going to be naturally faster than Caribbean or Let It Ride. But also, the design needed to make sure that we got the three bet units out more frequently than Caribbean or Let It Ride. And those two combined features meant that it could go with a lower house advantage than either of those games, and give the player a more positive experience, and at the same time, create a higher win for the operator. So, in effect, you’re serving both sides of the table better than what was already out there.

The game started in Europe at several small casinos. But tell us about your first introduction to the U.S. casinos.

Eventually, we got started in Mississippi and Nevada at a pretty similar time. Mississippi was a great installation, and to some extent, that was a personal contact with Lyle Berman, who I played poker with, and he owned the Grand in Gulfport. That was early ’96, over 20 years ago. And they did a great installation, because they put it in a great location, and they gave me all the statistics on it, they allowed me to help write their internal procedures—they spent time with me to get it right. They allocated one full day to train the dealers, get the installation correct. So Barry Morris and the executives there really deserve the credit.

In Nevada, we ended up going with the Stardust, and unfortunately—and I’m afraid this is still true today—Nevada operators do not do a diligent enough job with new game installation. They expect their dealers to be able to learn the games quickly, but do not pay attention to the nuances, they do not try to maximize the revenue from the game, and unfortunately, while the game did enough to pass its field trial, and the volume of revenue was adequate, the volume of participation was adequate, the hold percentage was pretty low, and there was a problem with the old shuffling machines at that time.

So the rule of thumb for new games is, if you’re going replace a game that’s already performing, that’s already making revenue for the casino, your game has to be at least to that level, if not higher.

Yes, in theory. But the operator needs to give it a chance. They’re not really trying it if they’re not giving it enough exposure. They have to be willing to put it in a good location on the floor to start with, so it needs to generate as much revenue as the game it is replacing, theoretically. But, for example, a casino could be rearranging its pit—moving a $100 blackjack table out of the pit, and wanting to try some specialty gaming. In that case, you wouldn’t expect it to do as much as the table it’s replacing, so there are exceptions to that rule.

Do you recommend that game inventors sign with an established table game company?

Yes, but you’re probably not going to get a very good deal. In the early days, everybody saw Caribbean and Let It Ride and thought it was easy, and you could get a 50-50 deal.

Now, the vendors say they are licensed everywhere, and have a wide portfolio of games, a lot of intellectual property. So it’s unlikely they’ll give you more than 10 percent or 20 percent of the game.

What do you think technology has in store for table games now?

The suppliers will want to introduce technology, because it’s easier to get something exclusive, it’s easier to patent it, so it’s a supplier-driven angle. And anything that can help reduce labor costs is also a consideration. Anything that can speed the game up is also a consideration, from an operator’s point of view. But, I’m a little old-fashioned; I’ll look at it from the player’s point of view, from the gambler’s perspective, right?

Generally speaking, in most consumer areas, technology benefits the consumer. But in general, technology in gaming actually benefits the operator.

The Plaza is one of the most historic hotels in Downtown Las Vegas. At one point, the legendary Jackie Gaughan owned it. What is the ownership structure of the hotel today?

In 2004, Tamares, which is a privately owned real-estate development company, purchased it from Jackie Gaughan and his partners at the time, and have owned it since then. Tamares owns the real estate. Today, I am the CEO and licensee of the operating company, which is called PlayLV. So, Tamares owns the physical property, and I own the business of the Plaza.

Give us a timeline of what happened during the renovation process, and where we are today.

As you mentioned, Jackie Gaughan was a very well-known individual Downtown, a pioneer of Downtown, and did amazing things here, not just in terms of physical development, but in terms of how he made people feel, how he made the employees and team members feel. We have a lot of team members that have been here 25, 30, 40 years—longer than I’ve been alive. And they have very fond memories of those days, and obviously the evolution of the Plaza.

From about 2004, 2005 onwards, the Downtown properties obviously were older, and they had had a lot of wear and tear. They needed a little bit of new life added into them, and that took place at the Plaza in 2010 and 2011, when we closed down for a full remodel.

During that time, I was invited by our architect to go see all the furniture at the Fontainebleau, which was sitting in the basement. And I called the owner and told him about the opportunity to buy this furniture, and fortunately for us, he gave us the go-ahead to buy it on the spot. And so, that was the beginning of the remodel of the Plaza.

No one knew at the time that it was going to become such a big project, because it was, at the time, just a room refresh, which morphed into more restaurants, more casino remodels, and everything else that we ended up doing.

Since I got licensed two years ago, the main physical improvements have been to the pool deck. We did a $4 million remodel of our 60,000-square-foot pool. It has way exceeded our expectations of what a pool remodel could possibly do for this property, in terms of driving occupancy to the building, revenues at the pool, and just general awareness of the property. It sits in between the two towers, with a magnificent view of Downtown. We have 16 pickleball courts, which is the fastest-growing sport in America. We do music events up there. We have a great bar now. So, it’s really turned into an amenity.

We have live music, seven nights a week in the casino. We added a party pit in the front of the building. We’ve added about 150 new slot machines to the floor. We’ve really focused on the guest experience, and creating a bit more energy in the casino, because that’s what people want when they come Downtown. We added a new show, with the Scintas, which has been a big hit. We’ve added more bingo games, because we’re the only property Downtown to offer bingo.

But, I would say that the biggest change hasn’t been physical. It’s been more about the experience of our guests, really focusing on what people feel when they come to the Plaza. And that comes from changing the morale of the team to one dedicated to the customer.

What do you consider your target market? Tourists? A mix of tourists and locals?

There are two separate answers to that. I don’t think that anyone has a true target market in the hotel. You can’t control who’s going on Expedia, searching by location, price, whatever it is. So in the hotel, I think our target market is somewhat of a moving target. We’re seeing great growth in occupancy, and I think that’s driven by all the changes we’ve made in terms of the property and the advertising. In terms of the casino, it’s a little bit more strategic. We know who our target market is. We’ve seen a lot of great growth in terms of our Hawaiian market, our Midwest market, and the people that come here to play bingo. But I’d say for the casino, it’s a lot of Midwest, and probably skews a little older, 45-plus, for the casino.

How about your gaming philosophy in terms of the rules of the tables, the paybacks of the slot machines?

I think there are facts to prove that we have the best video poker pay tables in all of Downtown. We have very favorable rules in the table games. All of our blackjacks pay 3-2, not 6-5 like the Strip properties. We have crapless craps and 10 times odds. We have a good variation of games. We’ve looked at single-zero roulette, but we haven’t quite migrated over to that yet. But coming from England, single-zero roulette’s all we know. So, I think we have very favorable gaming conditions, and our players club is extremely rewarding as well.

GGB: This is an interesting property, and it’s been in the works for quite some time. Tell us how it was brought from concept to reality.

David Jacoby: About 2012, I really started in earnest working on Lucky Dragon. The early days were a lot of site prep; the site here was initially five separate parcels, with a city road running through it, and each parcel had different easements. That was a whole process, getting the land prepped for vertical development. And we spent some time putting together an entity that helped raise funds overseas for the projects, so getting that all set up, licensed and ready to go took quite a bit of time early on.

Who are the owners of the property?

The owners are the Weidner and the Fonfa families—Bill Weidner is the patriarch of the Weidner family; he was the chief operating officer of Las Vegas Sands for several years, and now is also the CEO of Global Gaming Asset Management. His eldest son, James Weidner, is the lead on Lucky Dragon for the Weidner family. Andrew Fonfa has been a successful real estate developer of many different asset types throughout the Vegas area for more than 30 years. Notably and recently, he built the Allure condominium tower, which is immediately adjacent to Lucky Dragon.

This is the first completely Asian-themed property in Vegas. Give us an idea of what your target market is.

When we looked at the Vegas market, we saw a select few properties that do a very good job at catering to ultra-high-level Asian players. Alternatively, we saw a few properties that do an OK job at providing opportunities for the kind of grind local play. There was not much in the middle. So, that was the space we sought to fill, and are filling now.

We look at our core customers as the local Asian population and the regional Asian population. So, a lot of California, Vancouver, Seattle, Toronto, New York, Houston and other major metro areas within the U.S. We’re seeing a good amount of overseas Chinese play, and broader Asian play as well. The inaugural direct flight on Hainan Airlines from Beijing to Las Vegas just fortuitously happened to line up as one day prior to our grand opening.

Most people know that Asians are not homogeneous. There are all kinds of different cultures—Philippines, Japan, Vietnam, etc. And they’re all different. How do you approach different cultures while still trying to present the authentic experience?

That’s been something we’ve paid a lot of attention to from the early phases of this property. We fully recognize that there are many different types of Asian ethnicities, and then even within each ethnicity there are different types of tastes and preferences and personalities. So, there’s no right way to address everything. If we address everything, we sort of address nothing.

We’re careful to make sure, particularly through the cuisine, and through our staff, and through some of our service standards, that we are sensitive to many other Asian ethnicities. So, if you walk around our gaming floor, you’ll certainly find dealers and employees that will speak Mandarin. But you’ll also find Korean, Tagalog, Japanese, Vietnamese, many other languages. We try to be respectful to as many Asian ethnicities as possible.

Let’s talk about gaming. You’ve taken a risk by being strictly Asian, but you also opened without a sports book, no poker, no bingo, no craps, live keno. What was behind that decision?

We wanted to focus on our core customer, and what they really wanted. In our estimation, we think it’s a good hospitality experience, a clean environment, a friendly staff, very good authentic food, and games they tend to prefer—baccarat, heavily. We also thought we needed a spa. We have a beautiful spa on level two, a Sothys Spa. So, we’re not opposed to keno, we’re not opposed to a sports book. Those things may be things we add in the future. We just didn’t necessarily think they were essential to the success of our opening.

We all know customer service is a crucial part of any new casino. How did you prepare and motivate your employees to deliver the experience and the elements that you want the Lucky Dragon to be known for?

I think it started with each of our department heads, and we’ve got people that we’ve assembled here as a team, that all have tremendous experience throughout the gaming industry, internationally, domestically, here in Vegas, not in Vegas. So, we’ve got a great kind of broad representation of people from throughout the industry, and then it’s just really hiring the right types of personalities.

We had a tremendous response to the jobs we were posting for the property, and I was worried we might have to start recruiting heavily overseas, or in the other markets, but so many people were interested in coming here to work, that we were able to really be selective. We filled every position quickly, fairly easily, and with some very high-quality candidates.

GGB: Railroad Pass is in Henderson, just outside of Boulder City, Nevada, and it’s a very charming little casino. Please give us some of your background, and how it led you into the casino industry.

Joe DeSimone: My background is mostly in real estate and development. I was born and raised in New York. I moved to Nevada, and began doing mostly real estate sales for four or five years, and then made my way into the commercial development business. I did that from 1996, when I opened up First Federal Realty, and I continue to do that today.

We’re always looking to diversify—especially after the recession. First Federal did very well during that time. And this was offered to me as an exceptional business opportunity.

Were you actually looking for an opportunity in the casino industry?

Let’s say I’m aware of what’s going on in the community, and we’ve looked at a lot of different types of business over the years, and never really pulled the trigger. But I must admit that the character of the property, and the nature of the industry being in Nevada, led me to gaming and hospitality, and I thought this would be a good property to start with. I didn’t know how exciting it would be, but the people at MGM made it easy for me.

What shape was the property in when you got here? This was not a core property of MGM, by any means.

When I looked at their numbers, they had a $40,000-a-year capital improvement budget. The place was built in 1931. We replaced the roof, for a few hundred thousand dollars. We painted the place for a few hundred thousand dollars. We extended the bar; we changed the steak room layout and the menus. We renovated every room, for $1 million. Most recently, we bought an LED sign for the reader board on the highway, and spent $500,000 on that. So, we’re millions of dollars into the improvements. We made that commitment to the community, to our customers and to our employees.

Exceptional customer service is the key to success in the casino industry. What are you doing to really try to keep your employees motivated?

Well, MGM had some happy employees, despite the leaky roof (laughs).

We kept everybody on for six months, unless there was attrition. We found that they have happy employees, and the employees have a very unique relationship with the customers, since the majority of our customers are locals from Boulder City and Henderson. So, I understood that unique relationship.

We didn’t buy it to flip it. We didn’t buy it to sell it. We bought it to contribute to community, and make money as we do that.

You’ve got a relatively small market, as you mentioned mostly from Boulder City or Henderson. What’s the breakdown of your customers?

I think the standard rule of thumb for us is 80 percent of our business comes from locals, and 75 percent of that is from Boulder City. The customers that come back every day, or once a week, or twice a week, are really all like family. We love them.

You’ve got great payback on the video poker machines, and your table games are second to none, in terms of the low limits and the rules. You can have a good time and not go broke.

The first advice I got was to take out the table games, because it had been a loss leader. And I rejected that outright. And then I sought out advice on how to make it better, and the play has doubled; the people are having a better time. Anytime you come here, the tables are full. It brings excitement because it’s such a small place. And it also makes money now!

Across the street, you’ve got this massive construction project going on: the building of I-11 that will connect Las Vegas with Phoenix. What kind of access will the drivers have to your property here, when that’s completed?

Well, the drivers will have access from three directions. There will be a 24-acre truck stop and travel center on our site. We have 55 acres, just adjacent to the casino. So, the access will be, from Henderson, without a stoplight. From the bypass and Searchlight, without a stoplight. And from Boulder City, there will be the same experience. So, there will be three avenues onto

Railroad Pass Casino Road, which goes to the truck stop. We’re really excited about that.

So, you’re enjoying this new industry?

I’m having a lot of fun. I’ve met a lot of really neat people. I’m a people person, and I’ve built my career on that and relationships, and it’s helped me to expand my relationships into a different field, which has been exciting for me. But I like coming by. I enjoy the employees. Not just at the management level, but on a personal level, with the dealers or the cocktail waitresses, or the chefs. I also enjoy the discourse with the customers. It’s been a real fun experience for us.

Tell us a little about SpendSight and how you got where you are today.

SpendSight is software that gives casino operators a 360-degree view of their player. We do that by providing them with seamless access to the non-gaming spending behavior of each one of their players. We give them a profile so you can tell which one of your players is vegetarian based on their purchase patterns. Do they shop on weekends and pay with ApplePay? Do they have a social footprint and post reviews on Yelp? SpendSight helps casinos grow along with their customer base.

Do you rate the players and turn that information over to the casinos?

We don’t actually rate them. We just provide the casino with the methods to be able to segment that behavior. So, if a casino wants to know who their most valuable players are for a certain time of year for their coffee shops, or their spa, or their steakhouse, or even their showroom, we allow the casino to rate them based on their own criteria. We create a custom interface for each casino to view this information.

How did you build the SpendSight system?

I had the idea, and was looking for someone to build it for me but couldn’t find an exact fit, so I went to coding school and learned how to do it myself. So, being guided by people who were smarter than me, I built it myself. There’s no hardware at all. It’s all done in the cloud, so all casinos need to get the system is access to the internet.

Doing non-gaming ratings is much more difficult than simply rating the gambling of the player. Each different non-gaming offering has different profit margins. How do you balance that out?

We use measurements like lifetime value. How much has this person spent with you since they signed up for the player’s club? When you run a gaming promotion, for example, you can see side-by-side analysis of who spends the most at your restaurants or in your showroom. It’s never as clear and defined as the gambling rating, but when you compare them side-by-side you get a better idea of a player’s non-gaming value.

What we’ve found is that players want experiences, and the more we can tailor those experiences to their expectations, the more loyal the player becomes.

How do you make the data understandable to a casino executive who may not be very computer literate?

The SpendSight system is designed for people who don’t have a Ph.D in computers. Even before we introduced it, I spoke with casino operators who told me there was a lack of user-friendly, engaging options for them. The amount of training required to use some of this software is prohibitive. Our system is very intuitive and easy to use, and was built by listening to the operators tell us how they wanted the system to respond.

GGB: You’ve been executive director of the NCRG for less than one year. Explain what you understand about the early years of the organization.

Russell Sanna: The oral history tells us that people like Bill Boyd, Phil Satre, Frank Fahrenkopf and others witnessed the demise of the tobacco industry, with executives standing up before Congress and saying, “Cigarettes do not cause cancer.” Taking that message to heart, they all concluded we have to understand what is in fact going on scientifically with gambling activity. So there was a real commitment from the industry at that point to establish in the National Center For Responsible Gaming, establishing also a firewall between the industry and the science aspect. That was pretty important to do that, so that you don’t taint the outcome of the science, to be able to investigate the important questions: Is there gambling addiction?

So, over the last 20 years, one of the most successful research projects that we’ve established is that the prevalence of gambling disorder is 1 percent of the adult population—over and over again, that’s been established. So we were able to dispel the myths and the anecdotal evidence—my uncle, my cousin, that sort of thing. And so, we’ve been able to present what the peer-reviewed science says. In the last 20 years, the center has supported research, which has resulted in over 320 published articles in peer review journals, the gold standard of research.

What are some of the findings that stand out?

There continue to be a lot of new, interesting aspects that are coming out of the research. One of the major issues just now surfacing is that gambling addiction fits within a syndrome of other addictions, whether it’s other behavioral aspects, or substance addictions. That leads to a whole body of knowledge around psychopharmacology, for example. So, this summer, we gathered a group of scientists together for what we’re conceptualizing as a public health initiative, looking at the things that are associated with gambling disorder.

For example, a laboratory scientist has now trained laboratory rats to be addicted to gambling. And that’s important, because now we have a laboratory animal that psychopharmacology experiments can be conducted on. That puts them within the realm of other contemporary and leading scientific areas.

How about the comorbidity issue, where you can’t just treat one addiction and not the other, because they all go hand-in-hand?

That’s one of the big challenges that are out there. If you do the numbers, 1 percent of the adult population of the United States gives you 2.5 million people, approximately. The science that’s taking place through the centers, also, figured out that only 15 percent of that number is showing up in treatment modalities. So that leaves 85 percent, or roughly 2.2 million people, that we don’t know exactly where they are. And we think that upwards of 64 percent of that 85 percent have three or more comorbidities, with anxiety, trauma, depression.

And so, that’s what we’re trying to figure out. In conjunction with scientists, we need to get the policy apparatus in contact. The scientists that we deal with are not necessarily versed in the language of the state legislatures and policymakers. So, we’re making a considered effort to reach out, to get involved with organizations like the National Council of Legislators from Gaming States and various other associations where elected officials are members. We want to get on their agenda, so we can bring everyone together.

Give us a thumbnail of how the NCRG is funded.

We are funded by the commercial casino industry. The federal government does not spend a dime on gambling disorders. It would be a long conversation to figure out why that is; we don’t know that. We also know that the federal government’s probably not in a position to take up the cause. But it’s not unique to the gaming industry. In a previous job, I was involved in industry-funded housing research. We got architectural research from the industry. It goes on in the automobile industry and the construction industry, as well.

Is there an formula by which the industry funds NCRG?

Well, it’s fairly arbitrary, so it is voluntary. We have people funding us at the $300,000 level, and we have people funding us at the $5,000 level. So it’s a very typical 501(c)(3) nonprofit organization. We have a very active board of directors that’s made up of industry people and academic people who help us contact potential donors.

Do you also have contributions from tribal gaming?

We do not. Historically, Mohegan Sun and Foxwoods gave minor amounts of money close to 20 years ago. I would think historically there was a time when there was a bit of competition between Indian gaming and the operators within Nevada. Those days are over. So, in August, I was up at Seneca Casino in Niagara Falls, and I am back in touch with the chief operating officer there, who is very supportive and wants a proposal to go the board of directors. We’re hopeful this will be the first of many tribal contributions.

GGB: There’s been a lot of criticism that there is only one casino up and running after four years. How much control did you really have over that?

Stephen Crosby: Well, a lot of it was in the act—principally the issues having to do with local control and litigation. And then there were also a lot of lawsuits, and a lot of politics. So, I would say, maybe a third of it was sort of within our control.

We chose to be very methodical, and we were very new to the game. We didn’t know much of anything. And we did feel very strongly that we wanted to make sure we created a competitive environment. So we spent a fair amount of time making sure that the industry knew that we were really open for business. There were no inside deals; this was going to be an open, competitive, transparent process. So, we could have sped it up, but I think we always felt strongly that getting it right was better than getting it fast.

What were some of the hurdles you met early on?

One of them was the whole background check process. We got these documents, this multi-jurisdictional individual background checks, and a lot of us thought this is unbelievably invasive.

I’ve been a businessman more than I’ve been in the public sector, and I thought as a businessman that this was crazy.

But our consultants thought that this is the way it’s done, and that it was better to start out as a heavy regulator and retreat, rather than start light and go heavy.

The issue of competition was a major issue. There was kind of a subterranean belief here that Suffolk Downs and Caesars, who were partnered, had the inside track on the Eastern Massachusetts casino. And we didn’t want that to be the perception, because that was keeping other bidders from coming in. So we took our time and we created that perception that it was an open bidding process.

One of the things that you oversee that very few states with commercial casinos also oversee is the tribal gaming element. How do you handle that?

We don’t directly regulate the tribe, but we do have a compact, which has an agreement that says that we will give them certain kinds of financial benefits, and potentially exclusivity in exchange for which we get some money, but also we get this oversight role. But it’s a partnership; I want to be clear about that. We’re not regulating the tribe.

The commission decided that there would be only one tribal casino in the southeastern region, but a lawsuit is challenging the BIA’s decision to put land into trust. How are you handling that?

Massachusetts is broken up into three regions, and we have the authority to license one commercial casino in each of those three regions. We’ve done it in Western Mass, we’ve done it in Eastern Mass. Southeastern Mass is where the tribal casino is purported to be. We don’t really want two casinos down there, we thought, but we never have known for sure whether there ever would be a tribal casino. After three years, they got their land in trust, and for a variety of reasons, some of which have to do with the tribe, some of which have to do with the proposal itself, we decided not to award that commercial license. Then, the Federal District Court reversed the BIA’s decision, as you said, to award land in trust. So we are right back now to where we were four and a half years ago, which is wondering whether or not the tribe will ever get land in trust. So, at this point, we’re just sitting tight.

Tell us about your responsible gaming program, GameSense.

There was a lot of focus in our statute about promoting responsible gaming and trying to control problem gambling. We’ve taken that very seriously. We’ve put together a whole program that we call GameSense, which is a program that has its roots in Canada, although we’ve developed it quite a bit. And it has really three basic elements. First, we have a GameSense agent, a responsible gaming agent, on the casino floor, 16 hours a day. That person’s job is to inform people about how the games work.

Secondly, the GameSense agents are largely responsible for our voluntary self-exclusion program. Most voluntary self-exclusions are sort of a law-enforcement function, and you’re kind of treated like you’re a bad guy. We would like to make it sort of an entry point to treatment, and encourage people.

The third element is the PlayMyWay, which is a play management system, what the industry sometimes refers to as “pre-commitment.” And, it is a system in Massachusetts, where when you put your player card in, up comes a screen that says, “Would you like to set budget?” How much are you willing to lose? Today, this week, this month? You can say no and move on. If you say yes, the system will warn you when you’re getting close to your budget. But it will never shut you down. It’s just a tool to help you manage your budget.

What did you do at Foxwoods to right the ship?

First of all, I don’t want to take credit for “righting the ship.” It’s been a team effort. But I know that my predecessor, his team, the tribal council and tribal Chairman Rodney Butler spent thousands of hours working with our lenders to create a more stable financial environment.

What I’ve focused on since I’ve been here is to rebuild the executive committee, bring in a creative marketing team and work with our lenders to have not only a good story to tell in terms of better operations and better financial results, but also to have a viable five-year strategic plan for the future.

What areas needed more attention than others?

It’s kind of counterintuitive, but one of the reasons I was so optimistic was that there was room for improvement in virtually every area of our business. And I don’t say that to disparage anyone who came before me; it’s not my style. My style is to build on the foundation of what came before. And we’ve built a team that is one of the stronger if not the strongest of any that I’ve worked with in all my years in the business.

Tell us about the impact of the Tanger outlet mall that opened last year.

It’s the only fully enclosed, fully climatized Tanger outlet mall in the world. This is the only one that is part of a casino, and for those who think an outlet mall has to be tacky, it’s the complete opposite. It’s a beautifully designed, 80-store facility, and continues to gain traction. The visitations continue to grow, and it really gives Foxwoods a tremendous competitive advantage over any other casino in the region.

The Plainridge Casino just opened in Massachusetts. What kind of impact has that had on your property?

Penn National is a very good regional operator, and a large part of our market comes from Massachusetts, so you have to have a very compelling message to get your customers to travel further. If you just want to gamble and you have a place that’s five minutes away, that’s where you’ll go. But if you want the things we have to offer—38 restaurants, 300 shows a year, golf, spa, shopping and more—you’ll come to Foxwoods. So we haven’t felt that much of an impact.

With the upcoming integrated resorts in Massachusetts and New York, is gaming over-saturated in the region?

That’s not a word I like to use. The world is competitive and organizations that evolve stay competitive, survive and thrive. And organizations that do not evolve don’t have much success. So it’s my job, my team’s job, the tribal council’s job, to figure out what we want to be when we grow up. We’re about to celebrate our 25th anniversary next year in February, so we have an abundance of resources and facilities—we’re the largest casino resort complex in North America. If we stay static, we’ll be less successful. If we build on our natural foundational elements and add to that, in my opinion, we’ll continue to thrive. It will be much more of a balance between gaming and non-gaming that we have traditionally enjoyed.

Global Gaming Business: NetEnt started during the infancy of iGaming. How did the company grow and evolve with the industry?

Eriksson: The company was founded in 1996. The founder, Pontus Lindwall, was brought up in a casino family. His father owned a company called Cherry, and they had a big portion of the land-based markets in the Nordics. So, when the internet became available, he realized it was a fantastic tool. Just imagine, instead of having a physical casino, you can reach out to everyone, everywhere in the world. So, that vision has been part of our success from the very, very start.

In the beginning, the regulations surrounding iGaming were either very spare or even nonexistent. But NetEnt has always navigated those waters very skillfully. What did you have to do to make sure that you always stayed on the right side of the regulations in those days?

From the very beginning, we saw that this is such a great opportunity, it’s important to really try to do it right, instead of taking any chances. Even though there was a lot of money out there, the best thing is to do it right—as right as you can do it when there’s no clear regulation.

NetEnt games have the potential to cross over from online to land-based. How do you see that happening?

In the U.K., we have William Hill shops all around the country. You can get NetEnt games on slot machines or video terminals there. So, that’s the start for us. They’re getting more into land-based. But our main focus is still online.

NetEnt also has games in the New Jersey online casinos. Have they been successful?

Yes, very successful. And we’re really happy to see that, because we heard a lot of people tell us these games will not work in the U.S., because the U.S. players are different. But apparently, they’re not. They are more or less the same, and like the same types of games, as the Europeans. So, we’re really happy to see that. And also, we’ve put a lot of energy and innovation and quality into our games, especially in the U.S. We are off to a better start than we could have dreamt, so we’re really happy.

Why did you decide to come into the U.S. at this time, with just three states active in iGaming?

We see ourselves as pioneers. We were in the U.S. before it was banned in 2006. We pulled out immediately at that point, but at that time, it was the biggest iGaming market in the world. The potential is still there. So now, when it starts to open up again, we want to be part of it, and make sure that we do it the right way. And that’s also why we pulled out immediately when it was banned, so therefore, it was not hard for us to get into New Jersey. We think that we are very well-positioned for success in the U.S.

Why isn’t NetEnt involved in social gaming or online sports betting?

We have decided to be in casino only, just to make sure that we stay focused and that we are best in class in what we do. Even if it’s tempting, we resist, so far. There’s so much potential in the casino market, so, it’s better to be there only. There might come a day in the future, but not in the near future.

NetEnt has been very aggressive recently in signing some impressive branded games, like Jimi Hendrix, Guns N’ Roses and others. What’s behind that strategy?

We think a good way of getting recognition for our casino games is with popular brands. This year we have Guns N’ Roses and Jimi Hendrix, and we also will debut Motorhead shortly. Prior to these, we’ve had South Park, and film titles like Scarface, Alien, and so on.

So, we’re trying different types of branded games, to see what fits best and also for the players to enjoy. It’s great fun; we were so happy when we were able to sign these titles, because it’s very emotional. Most people like the bands, and new players are coming into the casinos that offer them to play.

Your second-quarter report was very impressive—more than 30 percent increases in the revenue, net profit and operating margin. How does that happen?

It starts with our corporate culture. We have people from 47 different countries working in NetEnt. We want people from all over the world to be part of NetEnt, so that we get influences from everywhere—because we believe very much in diversity, and because that diversity creates so much creativity.

We see ourselves as the leaders in the iGaming casino industry, and you need to push yourself all the time; otherwise, someone will come and be better than you in the future. We need to see ourselves in a different view, so that we can become better in what we do. And of course, we are launching new types of games, we are entering new markets. We are opening new offices, and we are expanding around the world.

Ainsworth North America has just opened a new state-of-the-art headquarters in Las Vegas. What does that mean for operations in North America?

Well, it obviously is an enormous step forward for us. We are very happy with how our building turned out. It’s a 290,000-square-foot facility. That means a couple of important things. No. 1, I think it shows a commitment to the market in both North and Latin America, in a way that is very profound, and very visible, of course.

Operationally, it enables us to service our customers better. We can reduce turnaround time, and reduce lead time, and get things to customers in a scale that we’ve not been able to do. And there’s plenty of room for us to grow.

Former Aruze Americas CEO Kelcey Allison just joined the company, and other people on your staff have long experience. Is it important to get all those knowledgeable, experienced players inside the company?

We firmly believe in our slogan: Experience Counts. And starting with the Australian team and CEO Danny Gladstone and the group around him, we all have many, many decades of gaming. They are focused on experience and the long game. It’s a marathon, not a sprint. So when the opportunity arose to bring Kelcey on board, I told him he really fit in quite well with our narrative. He has a great sense of experience, a great knowledge base. He’s very, very good with customers, with a lot of solid relationships, and our business is built on relationships. And generally speaking, we do look for people with experience at all levels.

Ainsworth hasn’t really emphasized branded and leased participation games in the past; is that an ongoing strategy, or is that something you’re reconsidering now?

We have dabbled, I’d say, in the branded stuff. We can do better at it, and we will do better at it. I think that you’re going to see a more conscious and directed effort towards improving our performance and library in that space. But that’s a super-competitive segment, and we’d better come with our A game. We will.

We’ve got some really interesting new premium titles coming out—things that I think will be seen as very compelling. We recognize that it’s not about all the glitz and glamour and the Hollywood sort of stuff. We have experiences where we get games out and they’re the workhorses. And in many cases, we see games staying on the floor for years and years.

Where does Ainsworth stand on the skill games issue?

We are moving forward. There are some pretty interesting titles that are going to come out that have skill features for us. I think there are still some regulatory items that need to be settled, in terms of the parameters of what you can and can’t do.

One of the challenges there is to make a skill game that is compelling but also can perform well on the floor. Any time you add a skill element, it takes time, and if you take time away, you’re reducing your spins per hour, so to speak. So, I think you have to kind of marry the skill experience with the gaming experience.

Novomatic recently purchased the majority of shares in Ainsworth. What does that bring to the table in terms of North America?

When the transaction closes within the next 12 months, we anticipate a lot of benefits of the two companies working together. There are many ways that we can help one another. If you look at the geographic map, obviously Novomatic is very, very strong in Europe, as well as Latin America. We of course have strength in Australia, and we’ve been getting stronger in North and Latin America. So it fits together pretty well, as two companies working together globally, and we anticipate a lot of benefits across games. But we are very excited that they’ve committed to keep Ainsworth as Ainsworth, moving forward.

GGB: Let’s start with the last year, in which Atlantic City has absorbed the loss of four casinos. Revenues have stabilized and most experts believe the market has “right-sized.” How is the DGE responding to this new reality?

Rebuck: We spent the past year responding to the closing of four casinos in 2014. It was something we saw coming, but it was worse than I had anticipated. So we reduced the number of staff that was necessary to oversee 12 casinos to one that was effective for eight.

And stabilization is the word I would use. We’re no longer seeing the revenue decline month after month; I think we’re at the point now where we see the casinos actually having a chance to compete against the surrounding states, so we have stabilization with the opportunity for growth.

Since Atlantic City is a free market in gaming, there is no limit on licenses. Do you believe that adding more licenses makes sense for businesses?

We’ve had several groups come to us over the past year to look at operating in Atlantic City. We’ve met with all of them, and up until now, none have decided to move forward. I think this demonstrates the reality of the market, and unless someone is reading it a different way, these groups have declined to become involved.

Let’s move to the North Jersey casino referendum. While we all agree that this would be a disaster for Atlantic City, the DGE has a statewide responsibility to ensure gaming is operated with integrity. Where does the DGE stand on this referendum?

We serve the governor’s office, and his view is that the people of New Jersey should be able to have a voice on whether there is gaming expansion outside of Atlantic City. So we’re pleased to be able to support that bill, and we’re ready, willing and able to do what is necessary under the law to implement the expansion of gaming if that is the choice of the people.

Does it bother you that there are few specifics contained in the bill?

Those who oppose the expansion of gaming, particularly here in the Atlantic City area, point to the lack of specifics in the bill. Their complaint is that people don’t know what they are voting for. They say, “How can you make that decision unless you know the details like the location, the tax rate and other things?” From the legislature’s point of view, they want to keep their options open. All these details would be filled in after the referendum is passed. So we’ll be ready to provide input and options if it ever comes to that point.

Let’s turn to the good news over the past year, the growth of iGaming in New Jersey. Why do you think it has finally taken off and found a foothold with the public?

I think a lot of it was growing pains. The assumption that U.S. online players would be the same as European players didn’t really hold up. So, it took a while for the online casinos to get to know their customers. Their marketing strategies have become more sophisticated.

I also think that the introduction of new games and products has made a big difference. And the improvement in technology has helped too. No longer is geolocation an issue. Payment processing has improved, although it’s still not perfect. And players now understand how to play, how the procedures work, and how they can have fun. It’s a combination of all these things.

Tell us about the liquidity agreement that you’ve reached with the UK Gambling Commission.

We sent letters to our licensees that also operate in the United Kingdom and asked them to suggest ways we could include players from both jurisdictions in the same pool. We first talked to the UK Gambling Commission about how this would work and we both agreed it could be done with cooperation from the licensees.

With 9 million people in New Jersey, and more than 63 million in the United Kingdom, this would mean a massive increase in liquidity for New Jersey operators. Even when you discount children and non-gamblers, it gives us access to a market that is very familiar with online gaming. That number is one-fifth of the total U.S. population.

Will this include all casino gaming?

Not initially. Our intent is to increase the liquidity of online poker, by exposing the games to many more players. Later, it could be expanded to include all casino games. We’ve given our licensees until August 1 to respond, and we’ll figure out where we go from there.

We’d still have to figure out lots of issues: specific regulations, how the tax rate from each jurisdiction would be applied, player ID and geolocation issues, and other things we probably haven’t even considered yet. But you have to start somewhere.

But we’re very serious about this, and we want to move it along as quickly as possible, so iGaming in New Jersey will continue the impressive growth we’ve shown over the last 15 months.

Tell us about Saipan. Most Americans don’t understand what it is and where it is, so give us the Cliffs Notes on the island.

Saipan is a beautiful island, and like most, I didn’t know much about it. There’s a lot of history, with lots of tourists: one-third Chinese, one-third Japanese and one-third Korean. It’s a great vacation resort, with 2,800 rooms on the island, 100 percent occupied. It’s the most beautiful place in the United States you never heard of, because it is an American territory.

You’ve been operating a temporary casino in Saipan for the past year or so. Tell us about that and how it has performed.

We didn’t have room at our permanent casino site, so we eventually wound up at DFS (duty-free shopping) Galleria mall. They were renovating it, so we took half of it to use as our temporary casino. We probably spent too much on a temporary facility, but because of the clientele we’re bringing in, it had to be beautiful. We opened in July with 32 mass-market tables, six premium-mass tables, 106 slot machines and seven tables that were in three junket rooms. In November, we introduced our rolling-chip program and shocked people by doing $1.6 billion, and about the same amount in December. Every month it has continued to grow, and now we’re doing roughly $2 billion a month, except for $3.2 billion in April. The VIPs love the island and what we do for them.

What is the plan for the permanent casino?

There has been some mis-reporting that we were going to build a $7 billion resort. That’s not the case, at least initially. Yes, we could invest $7 billion over time with some partners, but initially we’re building our casino pod, the main lobby and some of the restaurants. This is a Paul Steelman design, six-star, and will open by the end of this year, which includes junket rooms. We’ll open a beachfront exclusive area, which is modeled after the One-And-Only in Dubai—15 villas and suites, private lobby, French restaurant. The hotel with 374 suites will open in the first quarter of 2017. We’re spending $550 million on this phase. For the rest of the development we’ll take on partners, which is very much how Macau’s Cotai was developed.

What is your target market? How will you approach that market?

More than 95 percent of our VIP market right now comes from mainland China. But look at a map. Saipan is convenient to everywhere in Asia. It’s a four-hour flight from China, and there is no visa—you can walk right through customs. They’re spending an average of 3.5 days here. Before we even arrived, the mix of Chinese, Japanese and Korean visitors were coming and continue to come. Then we have the local market—businessmen most of whom are not native to Saipan.

Tell us about the role of the regulators in Saipan.

We are highly regulated. We come under all U.S. laws for anti-money laundering and know your customer, and we abide by them. Contrary to what people might think, our VIP partners like the fact that we’re highly regulated and watched. They feel like it’s a safe place for families and their customers. It’s being run by U.S. and Macau experts, so we are all very comfortable with the regulators.

GGB: What made you leave Bally to start your new company, OfferCraft?

Aron Ezra: We had a wonderful experience at Bally. It’s a great company; there’s a lot to like over there. Very, very innovative. But ultimately, there are certain ideas that just need to be built, and certain ideas that are a lot harder to build in any big company. OfferCraft happened to be one of those ideas that we were just so excited about, and needed to do. And we felt like the only way we could really do it right was to incubate it on our own.

Tell us about OfferCraft. What makes it so special that only you could do it?

There are a million companies out there trying to tell you what you need to give a player to get them to come back. What we wanted to do was really think about not what the offer should be, but how the offer should be presented. We spend so much time wondering whether we should give $12 or $15. But the way that something is given to somebody, the way that thing is presented, makes just as big a difference—often a bigger difference—in whether or not that individual is going to actually use the offer. So we wanted to really create something that would allow us to bring the concept of gamification to all different parts of the property.

You have so many casinos where they think about games all the time, but they only think about games on the casino floor. We thought that was crazy because casino patrons, more than maybe any other demographic in the world, love playing games.

What areas of the casinos do you really focus on?

We’re primarily focused in three areas. We gamify marketing, operations and certain HR elements, as well.

On the marketing side, one of the most frequently used parts of our platform would be sending out emails to a whole bunch of inactive customers who maybe haven’t shown up in a year or two, and they’re about to get rid of them in the system. By actually letting those folks go ahead and play a game to win things, we’ve been able to reactivate a pretty significant number of those folks.

But then on the operation side and on the HR side, we’ll do quite a bit to actually use games to incentivize certain behaviors. Maybe the server who serves the most drinks in the night gets to play a game and win something. Or the housekeeper who cleans her 5,000th hotel room gets a chance to play a game to win something.

And when we do all these things, we’re collecting data about these people’s preferences.

There must have been a lot of psychological research that went into this—how people respond, why they respond, and then quantifying that response.

We spent a long time looking at fields like behavioral economics, the study of how people behave and think, and what incentives get them to think about things. We looked into cognitive psychology, spent a lot of time on decision-making sciences. The goal of all of this was to discover how to present information in a more psychologically compelling fashion. Our clients spend X-million dollars a year on marketing, and typically have maybe 30 percent of the people respond. If we can increase that by even a few percentage points, then that is a massive return on investment.

Tell us about Smart Rewards.

This is the part of our platform that I’m most excited about. The games are a really amazing way to get people engaged, and get people to sit up and take notice. We actually do get participation rates up pretty significantly, but the redemption rates go up just a little bit. So, before, you had a 10 percent redemption rate, now maybe we have a 14 percent redemption rate. But I wanted to figure out a way to make that redemption rate really skyrocket by giving out rewards.

When we give out a reward, it looks like a normal coupon or voucher. But it’s not. It’s actually a tiny software program that can evolve and change itself, even after somebody has received it. Let’s say we give someone $20 of free play, but they decide not to use it. So if you don’t use that, in our system, we know that you’re ignoring it. We know you didn’t use it. So that reward is going to expire after a few days if you’re not using it. So then we send a message that we noticed you didn’t use this; do you want something else instead? So you can swap it out for something—maybe you don’t want more free play, maybe you’d rather get 2-for-1 on a hotel booking. So you can actually select something different, which not only dramatically increases the chances of you coming in and using the reward, but also gives us really, really powerful insights into your personal preferences, as well as the macro-level preferences of everybody.

That’s the kind of thing that gives us a lot of insights, and there’s a million different behaviors that we can actually pre-program in. The possibilities are endless.

Tell us about LVBA and how it got started.

Someone once asked me if this was a dream of mine. I told him it wasn’t a dream, it was an obligation on my part to improve the education in a city that has been very welcoming to my family and me. There are a lot of brilliant young people who are interested in earning their MHA, MBA or JD, who could not afford it or had to leave town to do it. My take was, I’d rather keep these brilliant people here than see them leave to go elsewhere.

How does it work?

We offer up to $75,000 for the candidates to advance their education in hospitality, law, business, and we’re adding engineering now, too. The great part about this program is the mentorship. The money is important, but we’re blessed with more than 30 board members who are leaders in big companies like Golden Gaming, MGM Resorts, Coca Cola, Ecolab, Las Vegas Sands, Southern Wine & Spirits and many other companies who spend their time educating students on how to become business professionals.

The students have to sign a five-year contract and work with a different company every month throughout their time in our program. Our recipients work to understand how these companies operate, so that by the end of the two years of the program, the depth of their knowledge will be attractive to any company looking for talent. And we also offer, to the employer, the opportunity to hire someone who is very well-rounded, very well-educated.

How do you identify the candidates?

Most of them are referrals from previous students. They also come from leaders in the industry who have identified people in their organizations they believe are worthy.

The students follow parallel curriculums, one with the University of Nevada, Las Vegas and one with LVBA, which includes working in the individual companies.

Do they work in all different departments?