Jurisdiction Updates October 2017 Edition
In focus pg.42
New skills for millennials
Macau
Hato highlights infrastructure woes pg.6
Korea
Jeju advances pg.20
Philippines Exploring entertainment options pg.12
JAPAN
Leadership for locals? pg.22
G2E 2017 SUPPLIER SPECIALS pg.44
CURVE YOUR
THINKING This year at G2E we invite you to “curve your thinking” around the possibilities of games, cabinets, services, technology solutions, and the future of the gaming industry. You can expect to see new hardware and technology, insight led venue management solutions and the industry’s most entertaining new content all on the one stand. Immerse yourself in our diverse portfolio that illustrates platforms and a range of commercial options that are accommodating to your strategy. We look forward to further strengthening our relationships with you and gaining your valuable feedback on our portfolio.
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MESSAGE 3
Bringing skill to the deal
N
o industry can thrive without pushing for
Manila steal Macau’s Las Vegas dream? Filipinos’ well known
innovation and nowhere more so than in gaming,
love for entertainment means the country’s casinos may see
which is seeking to appeal to multiple consumer
significant upside from their non-gaming attractions if they
segments, including the key millennials. How
get the mix right, giving Macau a run for its money when it
can the industry appeal to the next generation of gambler?
comes to creating a diversified entertainment hub in Asia.
Is it through eSports and/ or skill-based gaming? How do
Towards Indochina, Vietnam’s casinos and slot parlors
disruptive technologies come into play? In this edition of Asia
are likely generating close to $1.2 billion in annual gross
Gaming Briefings we look at how the industry is embracing
gambling revenue, this without the long-awaited framework
new technology to reinvent itself, or at the very least adapt,
that will allow locals to play at two remote locations in
to an emerging techno-savvy generation of punters. We take
opposite sides of the country.
a deep dive into the state of play of skill-based gaming, and
Down-under, Australian operators are concerned that a
how big industry names are making waves in the new social,
point of consumption tax introduced in South Australia may
digital sphere. We also take a look at the industry’s appetite
go national and potentially render the wagering industry
for the ultimate disruptor, cryptocurrencies.
unprofitable. While in New Zealand, an increase in spending
Courtesy of Dr. Sally Gainsbury, we also examine how
on pokies in clubs and bars - and in spite of a shrinking
gambling operators and regulators can monitor and respond
number of venues - has baffled industry regulators.
to the same technologies that are changing the way punters
This edition of the Supplier Special report is dedicated to
interact with their gaming experience and the consequences
Global Gaming Expo in Las Vegas, where we preview the
of not approaching the issues from broader perspectives.
products on show at the exhibition floor from a wide range of
In this edition of Asia Gaming Briefings we bring you the
equipment manufacturers, suppliers and service providers.
most relevant industry updates across 22 jurisdictions.
The 2017 edition of the G2E is gearing up to bring in leaders
Beginning with Macau, we report on how operators have
from outside industries, such as neuroscience, marketing and
rallied to the aid of the community after the worst tropical
generational studies to share their knowledge on how the
storm in half a century, causing loss of life and widespread
gaming industry can sharpen its skills in an ever-changing
devastation. At least ten people died as Typhoon Hato
environment. Stephen King, CEO of Dave and Buster’s is
swept through Macau in August, leaving more than half
delivering the keynote address.
of the population without power and many without water
If you’d like to book a meeting with AGB while in Las Vegas,
for days, and highlighting the degraded state of Macau’s
drop us a line at g2e@agbrief.com.
infrastructure, despite its position in the top five globally in
See you in Fabulous Las Vegas!
Rosalind Wade
Luis Pereira
terms of gross domestic product per capita. In North Asia we look at how at how Japanese leadership is
Connect with us:
seen as the politically correct way forward to develop the @agbrief
‘IR consortiums’ supported by local Japanese investors and developers and potential international gaming operators.
Asia Gaming Brief
Onto Korea, the IR development plans in Jeju are continuing apace, though the outlook remains bleak in the short term
Asia Gaming Brief
On behalf of Asia Gaming Brief
given tourism restrictions and tensions to the North.
Rosalind Wade & Luis Pereira
Moving to South East Asia we prompt the question: can
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OCTOBER 2017 EDITION Series II • Issue XIX
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Asia Gaming Briefings | October 2017
CONTENTS 4
GREATER CHINA
NORTH ASIA
SOUTH EAST ASIA
06
MACAU
THAILAND
10
KOREA
20
PHILIPPINES
12
JAPAN
22
MALAYSIA
16
RUSSIA
24
SINGAPORE
18
INDOCHINA
AUSTRALASIA NEW ZEALAND
26
CAMBODIA
32
AUSTRALIA
28
VIETNAM
34
CNMI
31
36
special focus
SUPPLIER SPECIAL REPORT
44
LAST WORD
62
GO 2 ENGAGE
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Asia Gaming Briefings | October 2017
03-05 OCTOBER 2017, LAS VEGAS, USA
STAND 4823
6
GREATER CHINA
6
MACAU
Operators step up after Typhoon Hato Macau’s operators rallied to the aid of the community after the worst typhoon in half a century caused loss of life and widespread devastation.
Asia Gaming Briefings | October 2017
GREATER CHINA
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t least ten people died as Typhoon Hato swept through Macau in August, leaving more than half of the population without power and many without water for days as the main water supply facility was flooded. The category 10 storm, the highest possible, highlighted the degraded state of Macau’s infrastructure, despite its position in the top five globally in terms of gross domestic product per capita. Some casinos were forced to close as a result of flooding, though most were able to remain open, operating on backup generators. As expected, the storm took the shine off August gross gambling revenue, which gained 20.4 percent from the prior year, lower than pretyphoon expectations for a gain of 24 percent. All six of the operators allocated funds and mobilized resources to help the cleanup effort. Melco Resorts & Entertainment, Wynn Macau and MGM China all donated MOP 30 million, while Galaxy Entertainment put up MOP 60 million and Sands China and the Adelson Family Foundation pledged MOP 65 million. SJM Holdings provided food and medical expense help. “This is the worst typhoon Macau has seen in over half a century. Melco and I personally are 100 percent committed to sharing our collective
resources to help the city and its people arrive at a swift and total restoration of order, including our own employees,” said Melco chairman and CEO Lawrence Ho.
“
Through our survey, we understand that over 60 percent of our SME vendors have suffered losses in this typhoon.
”
Wynn Resorts was forced to split its aid efforts between the U.S. and Macau after Hurricane Harvey devastated large portions of Texas and Louisiana. It donated an equal amount in the U.S. to help victims of Harvey in Houston. “It is a very sad and tragic coincidence that in two major cities where we have our employees and customers – Macau, in the People’s Republic
of China, and Houston, Texas -- tragedy struck within a few days of each other,” said Steve Wynn, Wynn Resorts chairman and CEO. Employees from all the operators were mobilized to help to distribute water and supplies and to help clean debris from the streets, which were made impassable by fallen trees and garbage. Sands China also offered engineering and technical services to help authorities check and make repairs to buildings, given the limited supply of expert labor, strained to the maximum by the storms. Both Sands and MGM China have also set up support programs for small and medium-sized enterprises. Sands offered expedited payments to young entrepreneurs, or “Made in Macau” companies, for any goods or services delivered in August. It will also offer a 50 percent advance payment for orders for the remainder of the year. MGM will also expedite payment processing and upfront payment to alleviate cash flow needs, logistics support and assistance with minor to major damages. “Through our survey, we understand that over 60 percent of our SME vendors have suffered losses in this typhoon,” CEO Grant Bowie said. The government’s failure to adequately predict the intensity of the storm and its
GROSS GAMING REVENUE GGR 2016 MOP 223b
-3.3%
Q2 GGR MOP 62.9b
+21.9%
Q2 VIP revenue
+34.8%
Mass revenue
+8.1%
Slot revenue
+17.2%
GGR 2017E Bernstein
+10%
Morgan Stanley
+15% +10%
Fitch
+12%
GGR 2018E Morgan Stanley GGR August. MOP 22.7b
+9%
Casino employee wages gain in 17H1 The average earnings of employees in the gaming sector rose 4.6 percent year-on-year in June 2017 to MOP 23,080 (per month), according to statistics from the Statistics and Census Service (DSEC). Average earnings of dealers also increased, rising 5.1 percent to MOP 19,930. In regards to the number of full-time employees in the sector, the total was similar to the prior year period, standing at 55,726. Of this, the number of dealers dropped by 1.3 percent to 23,980. Job vacancies however were significantly higher than the prior year period, with a total of 923 at the end of 17Q2, compared to 587 in 16Q2. Most of the vacancies were for clerks (51.1 percent) while 29 percent were for dealers.
Asia Gaming Briefings | October 2017
GREATER CHINA 8
unpreparedness triggered an outcry in Macau. The weather bureau is now under investigation by the territory’s anti-corruption investigators seeking to answer why it took so long to raise its typhoon alert signal, thus leaving residents little time to prepare. The storm also highlighted the woeful state of Macau’s creaking infrastructure, with many promised improvements long delayed and far over budget. “It’s a long-time story of incompetence and a lack of caring to find a solution,” Jose Coutinho, a lawmaker in the Macau legislature, told Reuters, referring to lack of progress in tackling infrastructure problems. He added that with casino revenues booming, there was little pressure to do anything different. Meanwhile, analysts expect any impact from the typhoon in terms of GGR to be short lived. The VIP sector quickly found its feet, though the mass market suffered more due to the cancellation of some group tours in the wake of the storm. Morgan Stanley notes that the repair bills, coupled with the higher VIP contribution to the revenue mix, may result in thinner margins. “We expect VIP to recover faster than mass. This, along with additional operating expenses or maintenance, is likely to mean lower earnings before interest, taxation, depreciation and amortisation (EBITDA) margins in the third quarter of 2017,” it said in a note. Melco temporarily suspended construction at its Morpheus hotel site to free up labor to help
Asia Gaming Briefings | October 2017
with reconstruction, while MGM China said it still expects to be able to open its new Cotai resort in Q4 this year, as originally planned.
Galaxy Entertainment Group Galaxy Entertainment Group (27:HK) has three main properties and runs three City Club casinos inside hotels. The company’s Galaxy Macau Phase 2 and Broadway at Galaxy Macau opened on May 27, 2015, almost doubling the capacity of the resort. The operator said it continues to move forward with Cotai Phase 3, with the potential to start construction in late Q1, or early Q2. It also said it is moving ahead with plans for a low-density IR on the neighboring island of Hengqin. The company has been shifting its focus to expand its mass market business and non-gaming activities and as a result is now seen as one of the best positioned in the market. MorningStar analysts recently raised their fair value estimates for Galaxy to HK$41 from HK$37 per share after solid Q2 results. “In the next decade, we expect an 8 percent revenue CAGR, as new infrastructure will improve Macau’s accessibility, and the opening of Galaxy Phase 3 and 4 in 2021 will drive gaming and non-gaming revenue,” analyst Chelsey Tam wrote.
Sands China Sands China (1928:HK) has five properties in Macau. The new $3 billion The Parisian opened
in September 2016 and received a highly positive reaction from analysts. It features a scale replica of the Eiffel Tower, nearly 13,000 hotel rooms, two million square feet of retail-mall offerings and two million square feet of MICE capacity. The operator recently announced it would be upgrading some of its VIP gaming facilities at the Venetian and the Plaza Macau. The work is expected to begin early next year and be completed in June. In Q2, total net revenues for Sands China increased 23 percent year-on-year to US$1.8 billion driven by strong mass gaming revenue growth. Net income for Sands China increased 37.6 percent year-on-year to US$326 million in 17Q2, compared to US$237 million in 16Q2. Mass revenue was up 23 percent, with premium mass up 40 percent. The results were largely in line with expectations.
Melco resorts & entertainment Melco Crown Resorts & Entertainment (6883:HK) has three casinos and the Mocha Clubs. The company operates the City of Dreams and Studio City in Macau and the City of Dreams Manila. Studio City International Holdings, the holding company for the resort of the same name, recently filed for an initial public offering in New York. The move surprised analysts who had expected Melco to buy out its minority partner in the development to fully benefit from the revenue stream.
GREATER CHINA 9
Competition hits Success Universe results Success Universe recorded a loss for the six months ended June 30, 2017, following a decrease in the group’s earnings at Ponte 16, and a dip in revenue from its travel business. The loss attributable to owners of the company amounted to HK$21.1 million in the first half of 2017, while revenue of the group decreased 18 percent to HK$284.4 million. The group’s shared profit relating to Ponte 16, the company’s flagship investment project declined to HK$7.2 million, down 32 percent year-on-year. Success Universe said it faced the challenges and intense competition caused by new supply of hotel rooms and gaming tables. It has been combating this by “actively enhancing its entertainment portfolio and marketing strategy.”
For Q2, the company posted net income of US$36.5 million, driven by improved group-wide rolling chip revenues. The company posted net revenue of US$1.3 billion in 17Q2, representing an increase of approximately 21 percent from US$1.1 billion in the prior year period. Adjusted property EBITDA was US$329.5 million, representing an increase of 34 percent. Melco temporarily put work on its iconic Morpheus hotel on hold after Typhoon Hato to free up labor to help with reconstruction efforts.
SJM Holdings SJM Holdings (880:HK) has 20 casinos on the Macau Peninsula. In the first half, gaming revenue, adjusted EBITDA and profit fell by 2.0 percent, 7.7 percent and 12.9 percent, respectively. Mass market table gaming revenue decreased by 0.5 percent and VIP gaming revenue showed a decrease of 3.4 percent, slot machine operations revenue decreased by 3.2 percent. The company has been losing market share while it completes construction of its Cotai IR, which SJM has said will open the second half of next year. However, analysts say the timetable is likely to slip. “We have concluded that the opening will likely be delayed until 2019 and we have strong concerns about how quickly it will be able to ramp up. In our view, investors are overly bullish on the opening time and its ramp-up potential,” Bernstein said in a recent note. Construction on the resort was forced to halt for about seven weeks after
the death of a worker. The Grand Lisboa Palace’s original plans were for 700 gaming tables and over 1,200 slot machines across a gaming floor area of approximately 27,000 square metres. So far none of the new casinos have received the table allocation they had initially sought.
Wynn macau Wynn Macau (1128:HK) opened its $4 billion Wynn Palace in Cotai on August 22 after facing construction delays. The company’s original property is on the Macau Peninsula. The Wynn Palace has 1,700 hotel rooms and 90 percent of the resort will be non-gaming. Wynn Macau posted a 57.5 percent increase in net profit for the second quarter of 2017, reaching US$102.6 million, boosted by strong revenue growth. Morgan Stanley analysts noted its original peninsula property outperformed its Cotai IR, Wynn Palace. Casino revenue reached $1 billion in the quarter, compared to US$608.4 million in 16Q2. Net revenues from Wynn Macau reached $682.7 million in the quarter, a 6.8 percent increase from the same period in 2016. VIP roll was up 21 percent quarter-on-quarter, while slot revenue was up 4 percent quarteron-quarter. Wynn Palace, which opened on August 22, 2016, reported net revenues of $414.7 million and casino revenues of $372.2 million. VIP roll grew only 5 percent quarteron-quarter, while VIP revenue fell 25 percent
quarter-on-quarter. Mass and slot revenue grew by only 1 percent quarter-on-quarter, said the brokerage.
MGM china MGM China (2282:HK) is operating a single casino on the peninsula. The opening for its new $2.9 billion development, MGM Cotai, has been pushed back from late 2016 to Q4 of this year. The company has said the typhoon is unlikely to affect the opening plans, though no date has yet been set. The resort will not feature any VIP rooms at the opening and will focus on mass gaming, while its original property will continue to offer VIP services. MGM Cotai will have approximately 1,500 hotel rooms and suites, meeting spaces, a high-end spa, retail offerings and food and beverage outlets. The HK$24 billion ($3.1 billion) project has a jewellry-box design and 85 percent of its gross floor area will be dedicated to non-gaming facilities. It will also feature a permanent collection of more than 300 Asian and Chinese artworks. The opening of the resort will mark the largest incremental expansion for any of the Macau operators. In Q2, the company posted a one percent decline in 17Q2 revenue to $448.7 million as mass floor table games income fell two percent, while VIP gained just one percent. Despite the decline, revenue from Macau operations was slightly ahead of Deutsche Bank forecasts for $445 million.
Asia Gaming Briefings | October 2017
SOUTH EAST ASIA
10
THAILAND
Casino legalization ball rolling? The push to legalize casinos in Thailand appears to be gathering momentum, though experts say any reforms are unlikely to have much of an impact on the thriving illegal market, which is estimated at more than $5 billion a year.
SOUTH EAST ASIA
A
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cademics in the country, who focus former Prime Minister Thaksin Shinawatra, on gaming, say there is increasing before he was ousted in a coup in 2006. At confidence that the issue of casinos that time the focus for a casino was a hotel will be raised again after the next complex in Jomtien Beach, 150 kilometres general election, expected in late 2018. It from Bangkok on the eastern coast. Analysts said Adelson also held talks during would be the most significant step in gaming industry reforms since Thailand became a the administration of Prime Minister Yingluck Shinawatra - the younger sister of Thaksin constitutional monarchy in 1932. Visanu Vongsinsirikul, a lecturer in economics before her government was overthrown in at Dhurakij Pundit University, says after the the May 2014 coup. Rattaphong said in the most recent election the government will have a mandate from the people that will help it push through negotiations Las Vegas Sands was in talks reforms. “I’m quite sure that Thailand will have a over a vacant property in central Bangkok legal casino, they will have it in the near future.” currently owned by the debt-ridden State Rattaphong Sonsuphap, an associate Railway Authority of Thailand (SRT). The SRT-owned land located at Makasan professor at the College of Social Innovation at Rangsit University, agrees there is an increasing is well placed to draw the foreign tourism push for legalizing casinos. “So you ask, one market through easy access from Bangkok’s international airports year, two years? It - Suvhanabhumi could be one year, International and it could be two,” he Don Muaeng Airport. told AGB. I’m quite sure However analysts, Apart from the that Thailand will who are also acting state lottery and as advisers to the wagering through have a legal casino, Thai government, the Royal Turf Club, they will have it in said the company gambling is banned is facing some push in Thailand. Prior the near future. back in government governments have circles as it is seeking flirted with the idea of a monopoly license. legalizing casinos, but A spokesperson for Marina Bay Sands in have not succeeded, in part because they have been ousted in coup attempts or have not had a Singapore told AGB the casino operator was strong enough majority to implement reforms. “continuing to monitor the situation in Thailand”. Other plans may include up to three casinos Since 2014, the country has been run by a military junta which has taken an increasingly in Thailand; on the outskirts of Bangkok, in pro-casino stance as it seeks to stamp out the Pattaya Beach Resort area and in Phuket. Rattaphong says the new casino, hotel illegal gambling. Under Thailand’s new constitution the and entertainment complexes would largely military is set to remain a major influence, be tailored to the tourist market, which will with control over the Senate. A joint sitting of not help shrink Thailand’s thriving traditional both the Senate and House of Representatives underground market. The final model to be will have the power to select the next Prime adopted and whether it will restrict local access Minister. Analysts are currently tipping present is still to be determined, however traditional incumbent, former Army chief Prayut Chan-o- underground gambling is largely focused on cha, to be selected as the next government leader. board and card games. Sungsidh Piriyarangsan, dean of the College In terms of casinos, Visanu says early planning has placed at least one casino in of Social Innovation at Rangsit University, says the greater Bangkok area and another in the legalizing casinos in Thailand could generate up to $11.8 billion per year. He says there are resort island of Phuket. Las Vegas Sands has been studying the as many as 170 underground casinos operating market for several years, with CEO Sheldon in Bangkok. These range from 10 “permanent” Adelson and senior executives from Marina operating locations, to more than 100 mobile Bay Sands Singapore visiting in 2015 with an casinos that open for a few days before relocating. Sungsidh estimates turnover from the offer to develop a US$5.0/6.0 billion casino and hotel and entertainment complex in Bangkok. underground casinos at between $5.0 billion The company has engaged in talks with and $5.56 billion, earning profits of more than several Thai governments dating back to the $1.05 billion and paying bribes of between 5.0
“
”
percent and 20 percent of turnover. Rattaphong says the underground casino operations, largely targeting Thai customers, would be expected to continue. The late monarch King Bhumipol Adulyadej, who passed away last year, opposed an expansion in the gaming sector. But analysts say the new monarch, 64-year-old Maha Vajiralongkorn, may be more supportive of reform. The three casino models under review include looking at a monopoly such as Genting’s integrated resort in Malaysia, or that of Singapore, which has two IRs. There is also study of a Macau-style model offering an entertainment complex and several casinos.
GROSS GAMING REVENUE GGRE Underground casinos $5b - $5.56b GGRE Potential $11.8b (Source: Rangsit University)
Police bust Pattaya betting den Police in the province of Chon Buri recently busted an online gambling den in the beach resort of Pattaya, arresting seven Chinese nationals. Authorities said the three men and four women had entered the country on student visas and have been operating a sports betting den for eight months. The gang received bets from clients in Thailand totaling tens of millions of baht and transferred money to their boss abroad. He said the leader of the team was paid about THB1.5 million a month ($45,248) for the job.
Government mulls lottery reform The government is seeking to overhaul the state lottery system with the introduction of a super jackpot aimed at undercutting illegal underground lotteries. It is now considering a payout of up to THB600 million, about ten times the current winnings of $166,600 for a pair of 80 baht tickets, according to media reports. The reform plan was scheduled to be put to the board of the Government Lottery Office in September, but even if approved it will need an amendment to the 1974 Lottery Act.
Asia Gaming Briefings | October 2017
SOUTH EAST ASIA 12
PHILIPPINES
Can Manila steal Macau’s Las Vegas dream? Filipinos’ well-known love for entertainment means the country’s casinos may see significant upside from their non-gaming attractions if they get the mix right, giving Macau a run for its money when it comes to creating a diversified entertainment hub in Asia.
A
ccording to Fitch estimates, nongaming revenue in the Philippines was just 7 percent of total revenue in 2016 and a fraction of the 66 percent generated by attractions in Las Vegas. Morgan Stanley estimates non-gaming at 8 percent of the total and 16 percent when it comes to the mass market, compared with 12 percent in Macau. However, it expects the Philippine figure to rise significantly. The firm sees non-gaming revenue as being 20 percent of what it projects will be a $5 billion
Asia Gaming Briefings | October 2017
market by 2020. “We estimate that non-gaming can contribute revenue of US$1.25 billion, significantly higher than 17Q1 annualized of US$200 million,” it says. So why the optimism? John Raczka, former Vice President of Entertainment Development and Operations for Melco Resorts & Entertainment in Macau, points out that Filipinos spend a disproportionate amount of their discretionary dollars on entertainment. “There is a greater predisposition to enjoy non-gaming entertainment and gaming
during the same visit by the average resort guest in Manila than Macau,” says Raczka, who developed the entertainment ecosystem plans for Studio City Macau and City of Dreams Manila. However, he says to date Filipinos have been underserved when it comes to international touring shows and world class theme parks. Part of this has been because of a lack of suitable venues. For example, one such gap in the market is the 3,000-seat multi-purpose venue, which can
SOUTH EAST ASIA 13
better support niche genre programming or even family ice shows for an extended period without the rental cost and less intimate feel of larger venues in the market. It’s “a definite opportunity for a gaming operator to address in Manila Bay,” he says. “From an available touring show volume perspective appropriate for the market, there is currently room for only one of these on that side of the city, so first one to own one there wins, bringing entertainment programming to the district currently absent that an IR can well leverage.” Traditionally, stage productions in the Philippines have been locally produced using local talent. Live entertainment and especially music has a universal appeal in the country for which IRs can draw from an enormous and inexpensive local talent pool. However, international productions
are starting to grow in presence. Resorts World Manila has just staged its seventh musical, Annie, which it says was its most successful production to date. Its parent company, Travellers International, says the resort’s stage productions feature all local performers. However, Bloomberry Resorts’ Solaire will be hosting the London West End production of The Sound of Music from September, and also hosted the West End production of Wicked in February. Also, the gambling revenue mix in the Philippines is changing and this is likely to lead to adjustments in non-gaming programming. According to Morgan Stanley’s research, foreign tourists made up 45 percent of total gross gambling revenue last year and that figure is expected to rise. The government has set an ambitious target to double tourism numbers from the current level of six million by 2020. Raczka says this dynamic creates an opportunity for Manila IR’s to host shows during specific holidays that speak more directly to foreign VIP segments, such as Korean, Japanese or Chinese. The Philippines enjoys a few other key advantages over Macau when it comes to devising non-gaming programs and making them pay. There are more than 12 million people living in the Metro Manila area. Macau’s fixed population is just over 600,000. Neighboring Hong Kong has an additional 7.3 million who are able to freely visit, however, potential visitors still need to grapple with ferry travel, when high level non-gaming entertainment is readily available at home. “You do not have to “sell” Filipinos on consuming entertainment—they love it, the more the better. Also, a significant sponsorship sector exists to help defray costs. The country’s economic growth curve continues to increase discretionary income among the masses, and if amenities support it, whole families will make the visit.” Raczka says there is a common misconception that due to the lower average income level in the Philippines all shows need to work on volume rather than individual ticket price margins to pencil out. However, will the Philippines ultimately top Macau when it comes to non-gaming offerings? Raczka isn’t betting on it. “In all likelihood, Macau should hold the lead, due to the density and scale of its resorts and entertainment vehicles that exist and those soon coming, its IR’s geographic marketing reach and greater average spend of Macau’s visitor base.”
GROSS GAMING REVENUE 2016 2017E 2018E
US$2.8b US$3.5b
US$4.3b
2019E
US$4.8b
2020E
US$5b (Source: Morgan Stanley)
Pagcor GGR 2016 2017E
P149b P150b
PhilWeb gets Pagcor nod to resume ops PhilWeb Corp. will be able to operate again after receiving the green light from the Philippine Amusement and Gaming Corp. (Pagcor) to become a service provider. The company was forced to shut down last year after its license expired on August 10, 2016. However, after months of appeal, PhilWeb has been given the Provisional Certificate of Accreditation as an Electronic Gaming System (EGS) service provider. As an EGS service provider, PhilWeb will be able to start offering its software and other services to operators of Pagcor-licensed gaming sites for electronic games.
Asia Gaming Briefings | October 2017
SOUTH EAST ASIA 14
Bloomberry Resorts
City of Dreams
Resorts World Manila
Bloomberry Resorts’ Solaire is a 16-hectare gaming and integrated resort complex along Asean Avenue in Parañaque City. The Bay Tower of Solaire consists of a casino with an aggregate gaming floor area of approximately 18,500 square meters (including approximately 6,000 square meters of exclusive VIP gaming areas), with approximately 1,400 slot machines, 295 gaming tables and 88 electronic table games. Bay Tower has 488 hotel rooms and 15 specialty restaurants. Contiguous to the existing Solaire Resort and Casino, the Sky tower consists of a 312 all-suite hotel, additional ten VIP gaming salons with 66 gaming tables and 223 slot machines. It also includes a certified 1,760-seat lyric theatre. For Q2, Bloomberry’s net profit grew 47.4 percent year-on-year to P1.96 billion, attributed to robust growth in its Philippines gaming operation. Net revenue increased 17.8 percent to P9.9 billion in the quarter. Revenue from Solaire was P9.7 billion. Solaire reported record highs in mass table drop, VIP volume and slot coin-in during the quarter, growing 20.1 percent, 14.5 percent, 29.4 percent, respectively. The company also owns a resort on Jeju island, South Korea.
The $1.3 billion City of Dreams Manila is owned by Belle Corp and Melco Crown Entertainment’s local unit. City of Dreams Manila has six hotel towers with approximately 950 rooms in aggregate, including VIP and five-star luxury rooms and high-end boutique hotel rooms, a wide selection of restaurants and food & beverage outlets, a 4,612.44 square-meter family entertainment center in collaboration with Dreamworks Animation, a live performance stage, two international nightclubs and a multi-level car park. It includes an approximately 260-room Crown Towers hotel, Hyatt City of Dreams Manila, a 365-room hotel managed by Hyatt International Corporation and Asia’s first Nobu Hotel with 321 rooms. In Q2, net revenue rose to US$176.2 million from $120.2 million a year earlier. The resort generated adjusted EBITDA of $62.8 million compared to $36.5 million in the comparable period of 2016. Rolling chip volume totaled $3.2 billion, up from $1.7 billion in the second quarter of 2016, while the mass market table games drop increased to $169.8 million from $134.3 million.
Travellers International Hotel Group, a joint venture between Genting Hong Kong and Alliance Global, is the owner and operator of Resorts World Manila. The company reported a lower-than-expected profit for the first half of 2017 after a June 2 attack on the resort shut down gaming operations for 27 days. It had net profit of P373 million, down 79.2 percent from a year earlier. Net revenues declined to P10.4 billion, compared to P12.5 billion in 16H1. After the deadly attack, the company said it would not reopen its gaming operations on the second floor, but would dedicate the space for non-gaming. The hotel room count for the group’s three hotels (Maxims Hotel, Remington Hotel, and Marriott Hotel Manila) remains at 1,226. Phase 2 at RWM is nearing completion with the addition of 228 rooms in the Marriott West Wing in Q4. Phase 3, which will consist of three hotels, Hilton Manila, Sheraton Manila Hotel, and Maxims II, will be completed by 2018. It will also include an additional gaming area, new retail spaces and six basement parking decks. PAGCOR has approved new gaming capacity of 420 gaming tables and 4,148 gaming machines at the resort.
Tiger Resort, Leisure and Entertainment
Galaxy eyes the Philippines Macau’s Galaxy Entertainment Group is looking to expand its gaming business to the Philippines, and reportedly plans to team with Negros Occidental Rep. Alfredo “Albee” Benitez as its partner, local media reports. Benitez is the founder of Leisure and Resorts World Corp. (LRWC). It is understood that the joint venture is looking to build an integrated casino resort in the Philippines with around $300 to $500 million in investment. The site for the IR however, is yet to be determined.
Asia Gaming Briefings | October 2017
Philippine’s largest integrated resort, the 44-hectare Okada Manila, will be the biggest in the country once fully up and running. It opened its giant water fountain feature and 116 deluxe accommodations at the end of March. The $2.4 billion casino resort held a soft opening on Dec. 21, and officially commenced casino operations on Dec. 30. The resort will feature two Y-shaped hotel towers with a total of 993 rooms, a casino floor with about 500 table games and 3,000 electronic gaming machines, a 90,000 square-feet nightclub and beach club entertainment complex. It will also have an 8,409 square-meter retail promenade, a world-class spa and 40 restaurants ranging from casual, buffet, and international dining. Morgan Stanley estimates that the property could add GGR of $1.2 billion to the market by 2019 without hurting existing casinos. The bank projects it will have a 33 percent market share by 2020.
SOUTH EAST ASIA 15
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Asia Gaming Briefings | October 2017
SOUTH EAST ASIA 16
MALAYSIA
GITP bears topline fruit Genting Malaysia’s revamp of its Resorts World Genting facilities has begun to bear fruit, though analysts have expressed disappointment that the opening of a key theme park attraction has been further delayed to the second half of next year.
N
ew attractions at the resort helped to drive an 8 percent gain in visitation in the three months to end June, helping to boost domestic revenue by 7 percent. However, adjusted EBITDA declined 8 percent in Malaysia in the period to MYR434.3 million ($101.6 million) due to higher costs linked to the expansion plan and expenses linked to premium players. The company generates about 80 percent of its EBITDA from its Malaysian operations, where it holds the country’s only casino license. So far this year, the company has opened the first two floors of its new forest-themed mass market floor in March and in June launched the Genting Highlands Premium Outlet. The third and fourth floors of the Sky Casino, dedicated to VIP and gold card members, are expected to come online in the third quarter. According to a report by Alliance DBS Research analyst King Yoong Cheah the new floors will add a further 250 tables, increasing capacity by about 40 percent from the current 550 tables in operation. Its Sky Avenue and Sky Plaza Shopping Malls were rolled out at the end of last year. However, a theme park with Twentieth Century Fox, also initially slated for 2016, has now slipped back to the second half of 2018. The park will span 25-acres and will feature more than 25 rides and attractions based on Fox films such as “Ice Age,” “Rio,” “Alien vs. Predator,” “Planet of the Apes” and “Night at the Museum.” It was originally scheduled to open in 2016 and is seen as the centerpiece of the ambitious MYR10 billion Genting Integrated Tourism Plan, which aims to boost visitation from 19 million in 2015 to 30 million by 2020. The park was touted as a first for the U.S. studio, though it may now be neck and neck in the race to open with another park
Asia Gaming Briefings | October 2017
announced by the U.S. company in Dubai. TA Securities notes that Genting saw an increased number of international visitors in Q2 from Indonesia, Thailand and Singapore, though Chinese tourist numbers dropped by 23 percent. “According to management, the company has directed its marketing efforts towards its members first, who are largely Malaysians, to experience the new mall, hotels and premium outlet,” it said. “When the group ramps up other facilities this year and next, it will then tailor the market strategy to international customers, including the Chinese market.” Overall, the group’s Q2 profit lagged expectations. Group revenue rose 2 percent to MYR2.24 billion, while net profit slumped 63 percent to MYR173.6 million. In the U.S. and the Bahamas the group saw a 9 percent gain in revenue to MYR765.9 million, helped mainly by a favorable foreign exchange rate, but also by an improved revenue contribution from its Resorts World New York property. In the UK, overall revenue and adjusted EBITDA was affected by the fall of the pound against the ringgit, coupled with a lower hold percentage and volume of business from its premium gaming business.
GROSS GAMING REVENUE (Source: Genting Malaysia Berhad)
RM million
8,328
8,229
8,396
8,932
7,893
2012
2013
2014
2015
2016
SOUTH EAST ASIA 17
Badminton Association warns against gambling The Badminton Association of Malaysia has warned it will not tolerate its players gambling. The warning followed a case involving a sports school in which the player revealed to his coach he had run into difficulty as a result of online gambling. He was slapped with a three-month suspension from all competitions. “As I have mentioned earlier, we have got zero tolerance when it comes to gambling or even match fixing,� BAM president Datuk Seri Norza Zakaria told local media.
Illegal operators flee to jungle A massive police crackdown on illegal gambling in Penang has pushed illegal operators into the outskirts of town, and online, according to Penang police chief Commissioner Datuk Chuah Ghee Lye. More than 215 raids have been carried out since January this year, leading to the arrest of at least 268 traders and 384 gamblers. About 448 simulator machines, 633 slot machines, 119 computers, 19 tablet computers, four mobile phones and RM81,000 (US$18,900) have been seized during the raids. Chuah said the operators were even gambling in the jungles.
Asia Gaming Briefings | October 2017
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SINGAPORE
Results improve as cost cutting, debt control kick in Singapore’s two gaming operators reported an improvement in Q2 results, helped by cost controls, lower bad debts and higher premium play, though analysts see few catalysts for significant expansion of the market.
I
n 2007, Singapore granted Las Vegas Sands and Genting Singapore a license for one resort each until 2017. Those licenses have been renewed for a further three years, but the government is not expected to allow any new entrants, therefore keeping a lid on the size of the island-state’s gaming market. Visitation to Singapore has been steady, but the figures have shown less propensity for tourists to spend on gaming activities. In the year to June, arrivals were up 4.5 percent overall, with China arrivals up 5.4 percent. A more detailed
Asia Gaming Briefings | October 2017
report of Q1 statistics released in July highlighted that most of the spending from the 4.3 million visitors was on shopping. Retail spending gained 38 percent, while gaming was flat. In addition, the Singapore dollar has been strong relative to currencies in its neighbo ring source markets, such as Malaysia and Indonesia, creating headwinds for the mass market. Despite the limitations, the two resorts still generated a healthy US$4.2 billion in gross gambling revenue in 2016 and the most recent figures show an upward trend on most metrics.
Genting’s Resorts World Sentosa was the standout performer, beating most analysts’ expectations. It has been lagging Marina Bay Sands as it struggled with bad debts from its VIP players, mostly from China. However, efforts to tighten its policies on the provision of credit and a marketing push towards the premium mass sector appear to be paying off. The group has achieved revenue growth for three sequential quarters. Overall revenue rose 24 percent to $596.1 million, helped by a higher rolling win percentage in the premium
SOUTH EAST ASIA 19
GROSS GAMING REVENUE Genting historical revenue
singapore GGR total US$4.2b
(SGD in millions)
3,500 3,000 2,500 2,000 1,500 1,000 500 2011
player business. Adjusted EBITDA soared 152 percent to $292.7 million. “All major businesses registered stronger EBITDA at the back of improved operating margin as we continue to drive strategy to focus on better margin business and maintain lower impairment of receivables,” it said. Management now has a target to maintain impairments at the S$15 million level or lower per quarter, although some analysts say this may be ambitious, especially given the fact the company plans to begin extending more credit. “We think a high-40s margin will be difficult to maintain in the long run,” MorningStar analyst Chelsey Tam wrote in a note. “We think benefits to margins from cost savings have been largely reflected, as quarter-on-quarter margin expansion decelerated to 83 basis points this quarter from 638 basis points in the first quarter. With increased credit extension, we forecast the absolute level of provisions to increase starting second-half 2018, which will
2012
2013
2014
2015
2016
Six arrested for online gambling
Government to clip back fruit machines
Authorities arrested six people in August for violations of Singapore’s Online Gaming Act. The five men and a woman were arrested in a raid at an entertainment outlet in the main shopping area of Orchard Road, local media reports. They had used an app called Niu Niu, which operates on social media platform WeChat, to facilitate the remote gambling services. Under the Remote Gambling Act 2014, those convicted of gambling using remote communication and using a remote gambling service not provided by an exempt operator could be fined up to S$5,000, jailed up to six months, or both.
The Ministry of Home Affairs is tightening regulation of clubs with jackpot machines to protect against harmful gambling. In a July statement, it said more stringent criteria for fruit machine permits will be introduced. There will be a reduction in the availability and accessibility of fruit machines and stronger social safeguards. “Over time, a number of clubs have relied on fruit machines as a major activity,” it said. “This is not in line with the intention of allowing clubs to operate fruit machines only as an ancillary part of a broader suite of social and recreational offerings to club members.”
pressure margins. We expect margins to decline to 44.3 percent by 2021.” Genting outperformed Marina Bay Sands in the higher margin mass sector in Q2, but underperformed in VIP. Mass-market share increased from 38 percent in the first quarter to 40 percent in the second. Premium focus The company has been increasing its focus on premium players, boosting attractions targeted at this market, such as a focus on gourmet foods. It held a Street Eats festival in August and in September planned The Great Food Festival that was to feature the largest collection of 16 Michelin-starred and celebrity restaurants. To squeeze further growth out of its non-gaming segment, the company said it’s preparing a five-year strategic road map “that will significantly enhance our destination appeal in the targeted market segments as
well as adopting innovative technology to drive productivity, efficiency and customer experience,” it says. Morgan Stanley also noted the results had exceeded its expectations. “EBITDA grew 4 percent QoQ and beat our estimate by 10 percent.. Positive earnings estimate revision on mass market share gain, lower commissions, redemption of perps and Japan optionality could drive the stock higher,” it said. At Marina Bay Sands revenue rose 17.7 percent to $836 million and adjusted property EBITDA was up 37.8 percent to $492 million. Morgan Stanley notes that the reported property EBITDA was the second-best since opening in 2010, though was mostly driven by luck as the mass market did not grow. “In SGD terms, VIP volumes, mass and slot revenue all declined slightly QoQ by 3 percent, 11 percent and 1 percent, respectively,” it said, adding the company has taken cost control measures including cutting back of VIP commissions.
Asia Gaming Briefings | October 2017
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SOUTH KOREA
Jeju projects forge ahead despite tourism slump IR development plans on the southern island of Jeju are continuing apace, though the outlook for international tourism to South Korea remains bleak in the short term due to a tour travel ban by China and escalating tensions with its northern neighbor.
NORTH ASIA
T
ourism numbers in the seven months through to end July fell almost 21 percent, with a 46.5 percent drop in arrivals from China, according to figures from the Korea Tourism Organization. In the month of July alone, overall arrivals were down 40.8 percent. The number of Chinese tourists who visited Jeju from June 30 to July 6 was tallied at 9,386, about one-eighth of the 77,824 recorded in the same period last year. China in March banned all tour group travel to South Korea following Seoul’s decision to deploy a U.S. anti-missile system, while more recently the accelerated pace of nuclear tests and bellicose rhetoric from the north has had a further impact. Honeymoon spot Jeju itself is a popular tourism destination for locals, especially honeymooners, though they are not allowed to enter into the island’s casinos. Still, China-backed projects are continuing apace. Hong Kong-listed Landing International Development recently announced an accord with Lionsgate Entertainment to develop a theme park at its Jeju Shinhwa World IR, which had its initial opening in April. It has also inked an accord with the Four Seasons for a hotel at the complex. The company said it will require more funding to complete the resort, with the current estimate being for a further $1 billion. The theme park, named Lionsgate Movie World, will be Lionsgate’s first branded outdoor theme park, which will be built exclusively around world famous movies. The theme park will span 122,000 sqm, and will center around seven movie zones with multiple Lionsgate’s film properties, including Hunger Games, The Twilight Saga and Now You See Me.
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Visitors will be able to experience movie scenes through state-of-the-art rides, attractions and 4D Intellectual Property (IP) reproduced streets and towns. Each zone will also feature themed restaurants, cafes, souvenir shops and entertainment performances. The theme park is expected to commence construction in 2018 and is scheduled to open in 2019. The Jeju Shinhwa resort opened its initial phase in April. “With the addition of Lionsgate Movie World as the centerpiece of Jeju Shinhwa World, the group believes that Jeju Shinhwa World will offer comprehensive premium guest experiences in world class resort facilities including Four Seasons Resort, Marriott Resort and Spa, Somerset serviced resort condominium and upscale villas,” Landing chairman and executive director Yang Zhihui wrote in a release. The Four Seasons Resort, which is scheduled to be opened in 2019, will include approximately 240 guest rooms, suites and exclusive villas, with a variety of tailor-made restaurants and bars. It will also feature a spa, designed in the style of a traditional Korean tea house. Meanwhile, Lotte Tour Development Co has selected Grand Hyatt as the hotel brand for its Jeju Dream Tower integrated resort. The hotel services agreement was signed on August 28 for Hyatt to operate 1,600 rooms, 11 restaurants and bars, and all other hotel amenities. It will be the world’s second-largest Hyatt hotel in terms of room capacity. The company said that it chose Grand Hyatt due to its resonance with the Chinese market which, it says, is a major target market for Jeju Dream Tower. Ki-byung Kim, chairman of Lotte Tour Development said: “With the solid partnership that has been formed between the Greenland Group, China’s largest property developer and co-developer of this project, China State Construction Engineering Corporation (CSCEC),
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Jeju Dream Tower Integrated Resort is expected to become a major tourist destination on Jeju Island. It will also create 3,000 jobs including hoteliers and casino dealers, and contribute tens of billions of Korea won to Jeju Tourism Promotion Fund every year.
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world’s largest construction company and main contractor who provided an unconditional complete guarantee, and Grand Hyatt as hotel operator, Jeju Dream Tower Integrated Resort is expected to become a major tourist destination on Jeju Island. It will also create 3,000 jobs including hoteliers and casino dealers, and contribute tens of billions of Korean won to Jeju Tourism Promotion Fund every year.” The company recently raised just over $34 million through a third-party placement of convertible bonds to help finance the development. The integrated resort is 169 meters tall with 38 stories, covering a total floor area of 303,737 sqm. Each room in Grand Hyatt Jeju will be over 65 sqm.
FOREIGNER-ONLY REVENUE 2016 GGR KRW 1.28trn ($1.14b)
+2.6%
Kangwon Land KRW 1.63trn
+4.3% (Source: STB)
TGG inks accord with Jeju’s Majestar casino TGG Takara Gaming Group, a provider of gaming platform technology, has secured Korea Testing Certification approval, and has signed a gaming machine operation agreement with Majestar Casino, the biggest Korean casino in Jeju Island. Co-founder and CEO of TGG Raymond Chan said, “Korea is a fundamental marketplace for Asia gaming. He said the company’s product would be deployed from the second half of 2017.
Kangwon stops card cash services Kangwon Land, the only casino in South Korea that allows local gamblers, says it is discontinuing credit card cash services at the property starting September 1, 2017. The operator said the move is part of a bold policy shift to create a healthy gaming environment for casinos. While short-term lending services, such as credit cards and cash loan services will be discontinued, deposit and withdrawal services within the scope of customers’ deposits will remain unchanged, said the operator. There are currently 22 cash depositors in and out of the Kangwon Land Casino.
Asia Gaming Briefings | October 2017
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JAPAN
Japanese ‘leadership’ for IR consortiums
Michael Penn
In early September, MGM Resorts International CEO James Murren emphasized in a public presentation that his company was looking for a “Japanese-led” IR consortium in a major urban market. He wasn’t specific about what he meant in practical terms, but clearly MGM envisages its Japanese partners playing a major, perhaps a predominant role in a future IR.
M
GM isn’t alone. When AGB interviewed Steve Tight, president of international development for Caesars Entertainment, in late July, he described his company’s competitive advantage as being that, “it is sort of in our DNA to partner in all of our various ventures, and we know in Japan the government is going to want a consortium represented by both Japanese investors and international operators to be successful.”
Asia Gaming Briefings | October 2017
International gaming industry analysts have speculated that the Japanese government would set legal caps on the percentage of IR ownership that could be held by an international operator. Perhaps it would even be legally required that the majority stake go to Japanese enterprises. In reality, there has yet to be any hint that the central government is planning any such limitations. There were no limits on foreign ownership suggested by the Experts’ Committee report, which is expected to form the basis
AGB NIPPON Special Correspondent
of the IR Implementation Bill. Moreover, politicians on both sides of the debate have not—so far—raised the ownership issue as a pending matter. IR advocates proactively welcome large-scale foreign investment, and opponents largely don’t care if it’s a Japanese company or a foreign company—they are against casinos whoever owns them. These facts are likely what provoked Seth Sulkin, the head of the American Chamber of Commerce in Japan’s task force on IRs, to tell
NORTH ASIA 23
AGB in late August, “I would say there will not be any informal or formal guidelines on that. I think it is really going to be a matter of the power balance between the international operators and the local companies. And so I think that the balance will be different in each location.” If some of the IR consortiums are indeed to become “Japanese-led,” there obviously need to be major Japanese enterprises willing to take the lead. But in contrast to the many international casino operators who have been vocally and repeatedly expressing their strong interest in participating in an IR, major Japanese companies have so far been comparatively silent. The one exception that is routinely cited is the Keikyu Corporation, which has openly positioned itself as taking strong interest in a prospective Yokohama IR, should the local government decide to brave public opposition and move forward with a bid. Indeed, Keikyu seems a very strong candidate for leadership of an IR consortium. Known mainly for its transportation services—especially the Keikyu train lines connecting Tokyo and Yokohama, including a branch to Tokyo Haneda Airport—it is also deeply invested in real estate, leisure services, and other businesses that are
a good fit with the IR concept. It was over three years ago in August 2014 that Keikyu announced that it was setting up a new section within its corporate strategy office to investigate the possibility of entering the IR business. Last year, the Japanese-language publication Business Journal reported that Keikyu was planning to set up an IR consortium for the Yamashita Pier location at an investment level of about US$5 billion. Cards close to chest In response to AGB’s inquiry about this figure, Keikyu’s media relations department offered a sort of “non-denial denial” by responding: “We have not officially launched a consortium nor published any details about investment figures.” They did, however, admit that the president of the Keikyu Corporation, Kazuyuki Harada, has served since last May as the chairman of the “IR Research Association” within the Yokohama Chamber of Commerce & Industry. Beyond Keikyu, however, no other major player on the Japanese side has made overt moves toward leading an IR consortium. Osaka, for example, has a political and business
community that has been keenly supportive of establishing an IR at Yumeshima, but that doesn’t mean that any particular local corporation has been signaling leadership ambitions. The chairman at the head of the IR promotion group within the Kansai Association of Corporate Executives is Shinichi Fukushima, president of the Osaka International Convention Center Corporation—an interested party to be sure, but not an enterprise engaged in a wide breadth of related businesses such as Yokohama’s Keikyu. This does not mean to suggest that plenty of Japanese companies are not willing to take smaller, supporting roles in IR consortiums. There is likely a wide variety of companies willing to consider, for example, 5 percent stakes in a consortium. Dozens of Japanese companies have joined IR promotion organizations and are clearly looking for opportunities to either directly invest in a development project or, more often, to offer their services and products to whatever consortiums are eventually formed by other parties. At this point in the consortium-building process, the present evidence suggests that far more Japanese companies are interested in following an IR development than in leading one.
Racing and pachinko curbs planned
IR LOCATION CANDIDATES
The Japanese government is looking at ways to curb problem gambling by limiting online race betting, removing ATMs from some racing venues, and reducing the jackpot rewards for pachinko. Cabinet Ministers have also reportedly agreed to develop a system to restrict casino access to individuals suffering from problem gambling following requests from their families. There are also measures to discourage people from indulging in pachinko gaming, by reducing the rewards for hitting a jackpot. Pachinko slot machines are said to be affected by these new measures as well.
Rusutsu Tomakomai
Kushiro
Iwanuma
Sasebo (Huis Ten Bosch)
Japan
Wakayama (Marina City)
Narita Yokohama (Yamashita Pier) Tokoname (Airport Island) Oosaka (Yumeshima)
Adelson says bill won’t allow “best” IRs Las Vegas Sands CEO Sheldon Adelson has criticized Japan’s planned IR legislation and warned that the bill in its current form will mean a lower level of investment from his company should it win a license. Adelson criticized the Experts’ Committee draft for regulation of IRs which has been proposed at the central government level, declaring that it wouldn’t allow construction of “the best kind of IR.” According to Adelson, under the current regulation proposals, Sands’ investment would be capped at about US$4-5 billion, but if the regulations were revised in a favorable direction, a $10 billion investment would be possible.
Asia Gaming Briefings | October 2017
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RUSSIA
Primorye revs up development efforts The Russian gambling zone of Primorye, which has not been developing as fast as anticipated, is stepping up its efforts to attract more investors as part of an ambitious plan to almost treble visitor numbers by 2025.
T
he Primorsky Krai Development of 619 acres not a gambling zone, but an Corp. (PKDC) is seeking expressions integrated entertainment resort, a City of of interest for three plots of vacant entertainment,” PKDC director general land and says it will hold an auction Andrey Folomeev said in an email. “It will once it receives pre-orders from at least three become a place for both family members companies. It has been in talks with groups and lovers to take a drop of whiskey while from Russia and Europe and potential Chinese playing poker. For old ones and young ones investors. The company says the situation has - for everybody.” been complicated as most of the investors The zone is just over two hours by plane so far have been interested in a plot of land from Beijing, Tokyo and Seoul, giving it leased to the Royal Time Group. access to a population of about 400 million The development company terminated its in the northern Asia region. According to contract with Royal Time in June after repeated Daiwa Securities, Northern China accounted construction delays for 21 percent of of its Phoenix IR. China’s high net Only 2 percent of worth individual It will become the first Phase A population in 2014 of the project had but only 6 percent a place for both been completed of Chinese visited family members by a December 16 Macau in 2014. deadline. “We believe and lovers to take Before President there remains a a drop of whiskey Vladimir Putin shut large amount of down all casinos in untapped gaming while playing Russia in 2009, the demand in cities poker. For old ones country generated within a threeabout $3.6 billion hour flight time and young ones in annual gross of the Primorye for everybody. gambling revenue. Integrated Resort,” Gambling is now Daiwa said. only p ermitted PKDC and in five relatively remote zones, which were other investors have committed to invest deemed in need of foreign investment. up to $2.17 billion in improving supporting Most are struggling to get off the ground, infrastructure, such as transport links and though Primorye, thanks to its proximity to other engineering projects. northern Asia, has attracted more interest. The development company points out According to a study by Ernst & Young, that Primorye offers attractive incentives for commissioned by the PKDC, the zone has investors, such as one of the world’s lowest the potential to generate $2.2 billion in GGR taxation regimes. There are also proposals by 2025. Global Market Advisors has set a to allow the resorts to operate Duty Free range between $2 billion and $7 billion. Stores, while air links are rapidly improving, “Our plans (are) to make the territory especially to China.
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Asia Gaming Briefings | October 2017
By 2022, when the eight facilities in the first phase are supposed to be fully operational, the company projects that about 20,000 people will be employed in the resorts, with total employment creation of 30,000 once related industries are factored in. It sees an increase in the annual volume of tax deductions to the federal budget by 950 million rubles, and of 7.8 billion roubles to the regional budget of the Primorsky Territory. The three plots of land currently on the block all set out minimum investment limits and table and slot allowances. So far, Hong Kong-listed Summit Ascent has the only operational IR in the zone, having opened its Tigre de Cristal in November 2015. However, the ramp up was slow, with fewer tourists than expected and a limited appetite from locals for the gaming offerings. The company also said illegal gambling had hurt its operations, forcing it to scale back the number of slots and tables it was offering. To address the problem,
NORTH ASIA 25
the Primorye development company said a hotline has been set up to report cases of illegal gambling. Summit Ascent says it now sees improving business conditions, helped by better transport and the new visa scheme. It is now reviewing designs for the $500 million second phase, which it will carry out with South Korea’s Kangwon Land. This phase is expected to open in the second half of 2019. Hong Kong listed NagaCorp is constructing the biggest resort in the zone. In April of this year builders started the second stage of excavation and are planning to approach the completion of the facility in the beginning of 2019. Russian investor Diamond Fortune Prim is also scheduled to open its Selena facility by 2019. Diamond Fortune is the largest investor in Primorye, with planned investments of $914 million in four separate complexes, one of which will include a ski slope. Selena is scheduled to open with 500 slot machines and 100 tables.
GROSS GAMING REVENUE Primorye GGR 2025E US$2.2b (Source: Ernst & Young)
Summit Ascent gaming and hotel rev. 171H 161H
Hk$204.6m
HK$79.1m
Online gambling complaints spike Russia’s telecom watchdog says it has received more than 38,700 complaints related to illegal online gambling in the first half of this year, a more than 235 percent increase from the same period a year earlier. Roskomnadzor has been clamping down on illegal gambling and has a large and expanding database of blacklisted sites. It has also reached an accord with the country’s search engines to block residents’ access to such sites.
VIPs boost Summit Ascent’s revenue Summit Ascent Holdings saw revenues increase 20 percent in the first half of 2017, attributed mainly to an influx of VIP revenue in the period. Total revenues reached HK$204.6 million ($26.1 million). The company recorded a net loss of HK$5.3 million in 17H1, attributed mainly to a number of non-cash items including depreciation and amortization. The main contributor to revenue came from its rolling chip business, which saw a 140 percent increase in 17H1 to HK$8.4 billion.
Asia Gaming Briefings | October 2017
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AUSTRALASIA
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NEW ZEALAND
Are SAPPs responsible for new pokie gains? An increase in spending on pokies in New Zealand’s clubs and bars, despite a shrinking number of venues, has baffled industry regulators. Asia Gaming Briefings | October 2017
AUSTRALASIA 27
GROSS GAMING REVENUE GGR 2015/16 NZ$2.21b
+5.6%
TAB NZ$342m
+5.3%
Lotteries NZ$437m
+4.0%
Casinos GGR NZ$586m
+11.1%
Non-casino pokies NZ$843m
T
+3.1%
he government commissioned independent research to look into various factors that might be influencing the trend and though the results were far from clear cut, one takeout appears to be the introduction of Stand Alone Progressive Prize (SAPP) machines. These were introduced into New Zealand from 2010 and now make up 40 percent of the gaming machines in the non-casino sector. An SAPP gaming machine has games that contribute to incrementally increasing prizes, similar to a jackpot, which can only be won on that gaming machine. Official data shows spending on non casino pokie machines in New Zealand pubs and clubs has been increasing slowly since 2013, and has now stabilized, after nearly a decade of decline. Gaming machine proceeds (GMP) for the year ended 30 June 2017 rose 3.1 percent over the previous year from NZ$843.4 million (US$624.12 million) to NZ$869.9 million, (US$643.7 million) according to figures from the Department of Internal Affairs. This was the same rate of increase as the preceding year. The recent increases occurred despite a continued decline in the number of gaming machines and venues. In the year to June 2017, the number of venues fell by 3 percent from 1,220 to 1,180, and the number of gaming machines also fell by 2.3 percent from 16,238 to 15,858. Following the introduction in 2003 of stricter controls on venues and the number of machines allowed, GMP had been declining until 2013 when it started increasing again. The Department of Internal Affairs, which monitors and regulates the gaming industry commissioned Business and Economic Research Ltd. (BERL) to analyze possible influences on expenditure between 2007 and 2016. Some of BERL’s findings were surprising and
Foreign bookie levy moves forward
SkyCity results hit by lower international business
Plans to levy foreign bookies taking bets on local sports and racing events in New Zealand are moving forward, with legislation introduced into Parliament which will require foreign bookies taking bets from New Zealanders to pay two levies: an information charge, and a consumption levy. The legislation follows a report from a government and racing industry working party which estimated up to NZ$45 million (US$33.4 million) in revenue was being lost by New Zealanders betting offshore.
SkyCity Ltd reported lacklustre results in the fiscal year 2017, marked by a 30 percent drop in turnover in its mainstay international business, and an even sharper drop of 42 percent in EBITDA. The company posted “modest growth’ in the New Zealand business, and lower net interest expense being offset by reduced turnover in international business and weak trading conditions in Australia. Normalized revenue for the year ending June 30 2017 was NZ$1.02 billion (US$750 million) – down 7.2 percent with NPAT down 1.3 percent to NZ$154.6 million.
perhaps counter-intuitive. For instance, it found that there was no evidence that macro-economic factors had any effect on GMP. “A number of variables that might be expected to have a positive relationship with expenditure actually have a negative relationship,” the report says.
Likewise, with population: GMP has decreased as population has increased. The same is true with employment, weekly earnings, and consumer confidence. As jobs, wages and consumer confidence have increased, GMP has fallen. One positive correlation of the factors examined was between the number of venues and GMP. “This might imply that, for many people, playing (pokies) is a casual activity that is engaged in on an unplanned basis when the opportunity presents itself.” While SAPPs were thought to be a driver for growth, the results from the analysis were not clear cut. BERL’s analysis suggests “SAPPs appear to have lifted expenditure per machine in the majority of regions (of New Zealand).” “When we looked at expenditure per machine and the SAPP machine, there was a strong relationship, but taking into account other factors, the relationship became “cloudy,” said Mark Cox, senior economist with BERL. Cox said that there was no empirical evidence from gamers themselves that they found the SAPP machines more attractive or interesting to play, but this belief was “received wisdom” from the regulator and the gaming industry representatives on the working party, which supervised the research report. Despite recent increases in GMP the report finds “there is a positive relationship between expenditure and the number of venues. This means that, overall, the reduction in venues has contributed to reduced GMP. In 2007/08 there were 1552 venues which produced NZ$938.3 million in GMP, while in 2016/17 1180 venues produced NZ$869.9 million. This results in an increase in the average GMP per venue from NZ$604 574 per year to NZ$737 203 per year.
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Expenditure might be expected to increase as GDP, population, employment, earnings, consumer confidence and the number of international visitors increase, but the opposite appears to be true.
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“Expenditure might be expected to increase as GDP, population, employment, earnings, consumer confidence and the number of international visitors increase, but the opposite appears to be true.” However, BERL concluded, “taking mid2007 to the end of 2016 as a whole, GMP has decreased as GDP has increased. This is contrary to the expectation that, other things being equal, GMP would increase as GDP increased.”
Asia Gaming Briefings | October 2017
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AUSTRALIA
PoC tax threatens profits Australian operators are concerned that a point of consumption tax introduced in South Australia may go national, which they say could potentially render the wagering industry unprofitable.
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he tax came into effect in South Australia on July 1. All betting operators taking bets from anyone in South Australia will have to pay 15 percent of net state wagering revenue in excess of A$150,000 ($119,196), even if they are not physically based there. The measure includes sports betting, horse racing, harness racing and other wagers such as the outcome of a general election or the Academy Awards. Although South Australia has been the first to impose the tax, it may not be the last. According to Sydney-based law firm Addisons, Victoria, New South Wales and Western Australia have expressed their support for South Australia’s POC Tax. It says each of these governments is now expressly contemplating the implementation of a similar measure. Operators have criticized the new tax, saying it unfairly punishes customers in South Australia. According to Addisons, some are ceasing business in the state, while others are reducing services. CrownBet and SportsBet for example are cutting back on their promotion of South Australia horse racing to decrease the amount of revenue generated there. “If this POC tax were to go national, every single betting agency is in a loss-making position,” said Ladbrokes Australia CEO Jason Scott. “As an industry we now need to find a way to pass [the cost of tax] onto the consumer.” “There are a couple of methods we can do that: one is a differential pricing, less competitive pricing, or less enticing promotions. Another way is a push for offshore staff... meaning fewer jobs for Australians.” Scott told a panel at GRWA in Sydney that Ladbrokes is in the process of building a differential pricing system, which will make bets more expensive for South Australia customers. He also added that the group is preparing for a national POC tax, which he expects will be in place by July of next year. “As an industry, politically, we don’t have
Asia Gaming Briefings | October 2017
many friends, we’re an easy target. To me, it’s a money grab,” he said. “The perception is that bookmakers make a lot of money.” Total gambling expenditure in Australia for the 2014/2015 year, the latest data available, was A$22.7 billion, up 7.7 percent. For South Australia, total expenditure was A$1.02 billion, with the bulk of that figure bet on pokies. That puts it in sixth position out of the country’s eight jurisdictions, with New South Wales and Victoria in the lead with A$8.91 billion and A$5.75 billion respectively. Ladbrokes launched a digital operation in Australia in 2013 and posted net revenue for the year to April up 59 percent. Paddy Power
Betfair’s Australian unit SportsBet reported net revenue of GBP312 million last year, with profit of GBP84 million, up 38 percent. SportsBet lobbied hard against the POC tax in South Australia, emailing clients to contact their local politicians to protest. It argues the new tax will make “wagering in South Australia more expensive than anywhere in the world” and means shorter odds on betting markets. The South Australian government has defended the tax, saying it is an initiative to tax money where it is actually earned. Dini Soulio, Liquor and Gambling Commissioner, Consumer and Business
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Services at the Attorney General’s Department, South Australia - told the panel that the tax was to create a level playing field for those operating in South Australia. He argued that taxes paid by citizens in South Australia need to be allocated to programs to alleviate the harm from problem gambling. “This is a government initiative to tax in relation to where money is earned,” he said. “What the government saw was that a number of operators who were making money from people in South Australia through betting operations, and the government was dealing with harms that arose from that industry.” The tax is part of a broader issue that has been simmering over taxation of online gambling companies, which have been accused of regulatory arbitrage. Many of the country’s online betting operations are based in the Northern Territory, where they benefit from a lower tax regime and market their services elsewhere in the country. As of May this year, there were 21 internet bookies registered in the NT, including William Hill, CrownBet, bet365 and Ladbrokes.
GROSS GAMING REVENUE All gambling Y14/15 A$22.73b
+7.7%
Sports betting $814,6m
+30.1%
Racing $2.81b Total gaming (including poking and lottery) $19.1b Casinos $5.17b
+2.7% +7.7%
+17.8%
Ainsworth sees H2 turnaround Ainsworth Game Technology reported profit after tax of A$37.9 million ($30.4 million) for the year ended June 30, 2017, ahead of guidance, as a result of a strong second half. CEO Danny Gladstone said the FY17 results were ahead of the company’s initial guidance, with the second half of FY17 recording profit before tax of A$42.2 million, an increase of 178 percent compared to first half of the year. “Our impressive second half performance begins to reflect the competitiveness of our broader product offering, our investments in technology, sales and marketing, and the strength of our international footprint,” said the chief executive.
Doubts over IRs after China policy shift There is a question mark over major planned investments in IRs in Queensland as a result of China’s decision to restrict overseas investments in some industries, including gaming. According to the Gold Coast Bulletin, a key funding partner of ASF Group state-owned China State Construction Engineering Company, is just one of the potential investors in the Gold Coast which may be affected. Knight Frank agent Mark Witheriff said he was aware of at least two major deals, totalling around A$40 million, which have fallen after Chinese interests withdrew. “I suspect there will be a slowdown until people see the lie of the land in terms of property,” he said.
Asia Gaming Briefings | October 2017
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CNMI
IPI agrees amended timetable Hong Kong-listed Imperial Pacific International says construction work at its delayed casino resort on the Pacific island of Saipan is now on track and it expects the labor issues that have dogged the project to be resolved soon.
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he company opened the casino portion of its resort in July, transferring operations from a temporary facility in a downtown mall. After the transfer, the company’s gaming capacity was increased from 48 tables and 141 slot machines to 76 tables and 184 slot machines, with a maximum capacity
Asia Gaming Briefings | October 2017
of up to 193 tables and 365 slot machines once the resort is finished in 2018. The temporary facility, with its handful of tables, has been generating rolling chip volume that has averaged more than $2 billion a month since it opened in Nov. 2015, despite a lack of hotel and other tourism infrastructure to
accommodate VIP guests. At present the company has three villas and five yachts to host visitors as well as hotel rooms secured from local high quality hotels. However, the company acknowledges that a lack of hotel space is a serious bottleneck for the tourism industry on the island.
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According to the Hotel Association of the Mariana Islands, for the first half of the calendar year of 2017, average hotel rates reached a new high of $145.5 per night with average hotel occupancy rates of 92.1 percent, representing growth of 5.3 and 5.8 percent compared to the same period of 2016. The company now has an amended timetable in place for the opening of its resort, with the initial gaming facility to be completed by August 2018. The original plans involved a five-stage rollout, beginning with a town hotel in 2016, but the company ran into issues with its main contractor, which is under investigation by U.S. authorities for using illegal Chinese labor. It has also faced delays linked to weather due to the disruption caused by Typhoon Soudelor. Under the amended accord, the initial gaming facility needs to include at minimum, a
329 room four or five-star luxury hotel; 14,140 sqm of gaming area; 3,870 sqm of food and beverage outlets; 186 sqm of retail space; 930 sqm of meeting space; 15 villas; 1,500 sqm of spa/fitness area; and associated parking, site improvements, landscaping, furnishings, fixtures, utilities and infrastructure. Phase one is to be completed no later than August 13, 2023, and is designed to “result in the establishment of a fully functional integrated resort.” It will need to include an 800-room four or five-star hotel, a $100 million themed entertainment facility, 5,372 sqm of food and beverage outlets; 2,500 sqm of meeting space (including indoor seating space for 600 persons); 5,000 sqm of retail shops; wedding chapel; 500 sqm spa/fitness area; 10,000 sqm of gaming area (which includes back-of-house areas); and associated parking, site improvements, landscaping, furnishings, fixtures, utilities and infrastructure. Phase two, which includes similar elements, is required to be completed no later than August 13, 2028.
GROSS GAMING REVENUE 17H1 16H1 15H1
HK$7.1b HK$3.9b HK$138.2m
Koreans fuel visitor arrivals The Marianas Visitors Authority says, for the first half 2017, total visitor arrivals to CNMI grew by 37.4 percent to 333,960. This was mostly driven by an increase from South Korea of 78.1 percent as a result of increased flights. Visitor arrivals from Mainland China grew by 8.6 percent, while arrivals from Hong Kong and Taiwan boomed by 216.5 percent and 66.6 percent, respectively.
Capital needs As of end June, the company said $506 million had been invested in the construction and design of the resort. Shortly after winning the license to develop the island’s only casino in 2014, Imperial Pacific said the full roll out of the resort would cost $7.1 billion. In its filing to the Hong Kong Stock Exchange announcing its first half results, the company outlined capital raising steps it has taken to date to secure funding for the development and said it doesn’t rule out further financing efforts should the opportunity arise. In 17H1, the company reported an 8.9 percent rise in profit to HK$912 million, helped by a surge in revenue to HK$7.3 billion, up from HK$3.98 billion in the prior year period. Best Sunshine Live saw VIP table games rolling revenue rise to HK$196.3 billion in the half year, compared to HK$104.7 billion in 16H1. Revenue from mass gaming operations amounted to HK$147 million up from HK$121 million. “We are also planning to open more VIP gaming rooms by the end of 2017,” the company noted in the statement. “With the gaming capacity to be further enhanced, we expect to commence collaboration with gaming promoters after they are granted junket operator licenses to operate on the Island of Saipan. Due to CNMI’s low tax regime, we believe we will be able to offer very competitive commission rates to our gaming promoters.”
Casino tax revenue to close pension gap Lawmakers in the Commonwealth of Northern Mariana islands have agreed to allocate a portion of casino tax revenue to make up a pensions shortfall. The House has accepted that $22 million in casino taxes will be proportioned to retirees, rather than a separate account of $15 million generated from the annual casino fee. Instead, $1.5 million of the license fee for Saipan will now go to the Saipan Higher Education Financial Assistance program, while Rota and Tinian will get $2 million each. The rest can be appropriated by Saipan lawmakers.
Asia Gaming Briefings | October 2017
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Juggling junkets Australia-listed Donaco International has been revamping its marketing strategy and changing the junket mix again at its Star Vegas property after assuming full management control in July.
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he property saw a 6.8 percent dip GROSS GAMING REVENUE in revenue in fiscal 2017 to THB 2.89 billion ($87.5 million) due to Mass Market: Mass Market: Electronic VIP Market Non-gaming subdued consumer sentiment and Public floor tables Gaming Machines a weak economy in Thailand, which has been marking an official 12-month mourning period 1H2016 1H2017 for King Bhumibol Adulyadej who died in 36% 39% 25% 52% October last year. US$103.5m US$111.6m US$101.8m US$210.5m Thais are the biggest source market for Star Vegas, which sits on the border at Poipet. The company says it expects the performance of the resort to improve once the mourning period for the King ends and as new initiatives 19% begin to bear fruit. US$74.5m Donaco bought Star Vegas in January 2015 21% 4% 4% for $360 million, although the Thai vendor agreed US$62.0m US$11.4m US$14.8m to stay on for a further two years to manage the (Source: Nagacorp) property, offering a guaranteed minimum of $60 million in EBITDA during the period. Koreans busted for illegal The company entered a three-year contract AirAsia to offer gambling ring with Macau-based junket, the Heng Sheng Sihanoukville flights Group, in August of the same year, though Operators in the town of Sihanoukville, Five South Korean nationals were arrested that was terminated in early 2016. It said the home to some 14 casinos, are likely to in August for illegal football gambling, local exclusivity Heng Sheng had for certain countries get a boost from improved transport links media reports. Provincial police deputy chief Chea Kimsan said the five men were and territories had prevented it from working with Malaysia. AirAsia has said it will fly a arrested during a raid on an online gambling four-times a week service between Kuala with other junkets. shop in Krous Village in Siem Reap. Kimsan Now the company has taken on full Lumpur and the coastal town. The town’s said the men, aged between 29 and 49, airport is located 7 km to the north of the management control of the property from operated and managed the shop. The men port and has up until now been served by the vendor, it is once again rejigging its face up to five years of jail each if convicted. domestic airlines and a flight from Vietnam. junket operations. “During this transition period, Donaco anticipates that earnings from the VIP portion of the Star Vegas business in the first quarter the transition period, and the VIP business is was operating tables at the country’s biggest operator Nagacorp in Phnom Penh, though of FY18 will be lower than the corresponding rebuilding well.” “Some of our new junket customers will that accord lapsed early this year as a result months last year,” the company says, though commence offering online gaming in September of the non-renewal of relevant contractual the mass business will be unaffected. documents, it said in an annual results filing. All key management appointments at Star 2017, as new facilities are built out.” Naga, which began aggressively courting The company, which saw a 32 percent Vegas have now been made, and the company is implementing new marketing initiatives gain in non-gaming revenue last year, has China’s high rollers in 2013, has since scaled back to attract new junkets and additional players brought on third-party providers to build new on the incentives it offers to improve margins. Meanwhile, junket to the venue. Amax International It has announced Holdings in September deals with Vivo Tower, During this transition period, Donaco said it had entered into a Poker King Club and the anticipates that earnings from the VIP Letter of Intent to obtain Asian Poker Tour, and has the operating rights to a engaged a number of new portion of the Star Vegas business in the VIP room in Cambodia. Thai junket operators. A first quarter of FY18 will be lower than The company did not further 100 tables are also specify which casino, but expected to be added to the corresponding months last year, noted that the VIP room fill underutilized space, operates 13 baccarat tables which may boost revenue. and is owned by a PRC “We have also made good progress in signing up additional junket entertainment facilities for VIPs, including a citizen. Amax said the move was made in order to diversify its income stream and expand its operators, with new customers joining us during nightclub and karaoke rooms. Cambodia’s casinos saw a spike in interest gaming business. Under the agreement, Amax August 2017, and further deals signed for more junkets to commence in September 2017,” from junket operators after the collapse of will be required to pay a fixed monthly fee for CEO Joey Lim said. “The main hall and slot the Macau VIP market from 2014, though a period of two years for the exclusive rights machine business has remained robust during turnover has been high. Jimei International to operate the VIP room.
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Asia Gaming Briefings | October 2017
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VIETNAM
GROSS GAMING REVENUE Annual GGRE $800m - $1.2b Operator statistics Nearly 30 venues 1,900 slots 1,100 ETG seats 391 tables (Source: Union Gaming)
Robust revenue without local help Vietnam’s casinos and slot parlors are likely generating between $800 million to $1.2 billion in annual gross gambling revenue, although a long-awaited locals program may be too timid to provide much of a further boost.
U
nion Gaming provided the market estimates in an August report based on figures provided by the three listed firms with assets in the country. Australia-listed Donaco International and Silver Heritage Group and Royal International Corp. generated about $68,000 per gaming position in 2016, according to the August report. Its figures don’t include illegal gambling. Applying a similar level to all positions would result in $415 million in GGR. “However, we believe this significantly understates the true GGR story as win/day in many of the Hanoi and Ho Chi Minh City slot parlors is many multiples of the $185 average noted above, while the junket-centric Crown International Club also well outearns the country average by many multiples.” Vietnam has about 30 gaming facilities with 1,900 slots and almost 400 tables, the report found. The government passed long-awaited gaming legislation earlier this year that will allow locals to gamble for the first time. However, it only handed out two licenses on a three-year trial basis to two locally owned developers building resorts in the far north and far south of the country. Other operators are still waiting to hear if there is any chance they could be added into the program, which is viewed as the missing link when it comes to pushing the country’s gaming industry to the next level. Many foreign investors are believed to be interested in the market, but only if locals are also permitted to gamble. In the meantime, projects are slowly moving ahead. Macau’s largest junket operator, Suncity
Asia Gaming Briefings | October 2017
Group Holdings, recently said it was buying a 34 percent stake in an integrated resort project in Hoi An South for an aggregate consideration of HK$600 million ($76.8 million). SunCity partnered with Hong Kong’s Chow Tai Fook Holdings and VinaCapital Investment in the $4 billion resort, which consists of a casino, hotels, residential areas, and a golf course. According to the company filing, phase 1 development of the project is expected to be completed on or before mid 2019. SunCity said the acquisition of the casino could help the company tap into the potentially expanding gaming market in Vietnam, which is in line with the group’s objective to develop tourism-related business in the country. Also in the centre of the country, the provincial committee of Thua Thien-Hue has reportedly asked the government for permission to increase the investment capital of the Laguna Lang Co project to US$2 billion, as well as to open a casino in the complex. If approved, the project is estimated to contribute $245 million annually to the local budget from 2021. It is understood that the Ministry of Defence and the Ministry of Culture, Sports and Tourism have already approved the plan, local media said. The casino is expected to be implemented in the second, third and fourth phases of the project, with capital of nearly $250 million on a 2.6 hectare area. The Laguna Lang Co project received an investment certificate from the management board of the Chan May-Lang Co Economic Zone in 2007, which was modified in June 2014.
Commercial banks get green light for casino-related forex Commercial banks will be allowed to trade and provide foreign exchange services related to casinos from October, local media reports. The information was contained in Circular No10/2017/TT-NHNN on the management of foreign exchange for the casino business, which will come into effect from October 15 this year, Vietnam News reported. Foreigners and Vietnamese holding foreign passports are able to gamble freely in the country’s casinos, while a decision was taken earlier this year for locals to enter some of the country’s casinos for the first time on a three-year trial basis.
Ho Tram launches condotel project The Ho Tram Project Company Ltd, operator of Vietnam’s only IR, has announced the launch of the KAHUNA Ho Tram Strip condotel and villa project. KAHUNA Ho Tram Strip is a 244-key resort development made up of 164 condotel units situated in a 12-storey tower, 36 double key villas and 8 beach front villas all for long-term lease. Investment costs range from VND 2 billion ($88,800) for a one-bedroom standard unit to VND 9.1 billion ($400,000) for a penthouse and from VND 7.97 billion ($350,000) to VND 20.5 million ($900,000) for a villa. In a press release, HTP said it guarantees a return of 8 percent per annum for 2 years of net lease cost for investors. KAHUNA is the fifth phase of the Ho Tram Strip development, adjoining the existing 541-room, five-star Grand Hotel, and the 559-room five-star Beach Club. To the west is the award-winning Greg Norman designed Bluffs Golf Course and the prestigious Gallery Villas residential development.
The project has registered capital of $875 million and is spread over 280 hectares. It is designed to serve 400,000 visitors each year, and includes resorts, spas, hotels and restaurants, retail shops, golf courses and villas.
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Asia Gaming Briefings | October 2017
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New Social circles Aristocrat Leisure recently snapped up social games developer Plarium for $500 million, but what exactly is the appeal of acquiring a studio that creates strategy/ role-playing game (RPG) titles for a very different player demographic to social casino gamers?
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ergers and acquisitions in the social casino space have been rife since the turn of the decade, with blockbuster deals worth hundreds of millions – even billions – of dollars becoming commonplace. But not many industry observers foresaw Sydneylisted Aristocrat Leisure’s recent takeover of Israeliheadquartered strategy and role-playing games developer Plarium. The deal includes a US$500 million upfront payment plus an earn-out arrangement, which implies a multiple of 10x the last 12 months’ EBITDA at year end. Aristocrat said the purchase boosts its digital revenue contribution from 14 percent to 22 percent of its overall business and will expand its addressable market from the $3.2 billion social casino sector to the $25.4 billion strategy, RPG and casual segments. Privately owned Plarium, which recorded revenues of $201 million and an adjusted EBITDA of US$44 million for the 12-month period ending March 31, 2017, boasts a headcount of 1,200 spread throughout Israel, Europe and the US, though most of the workforce
Asia Gaming Briefings | October 2017
is based in Ukraine. Focused on free-to-play mobile games, Plarium’s portfolio includes hit games such as Throne: Kingdom of War, Stormfall: Age of War, Soldiers Inc and Vikings: War of Clans. Boutique analyst firm Eilers & Krejcik Gaming estimates that Vikings: War of Clans accounts for more than 50 percent of the mobile, social and web-based game developer’s revenues. This is the first social gaming acquisition Aristocrat has executed since buying social slots studio Product Madness in 2012 for $27 million, including earn-outs. Eilers & Krejcik Gaming’s Adam Krejcik says Aristocrat has enjoyed “overwhelming success” with Product Madness and that it was an “incredibly timely and lucrative acquisition”. Indeed, $27 million looks an absolute snip in hindsight. “Now that Aristocrat has several years’ exposure to the digital games market, it clearly is getting more comfortable with the space and sees this as a long-term growth opportunity,” Carter Rogers, senior analyst at SuperData Research tells AGB. “It’s no secret that
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millennials are currently less interested in realmoney gambling than their older peers, and their interest in video games is a contributing factor. Whether or not this will be a successful acquisition depends on future titles in Plarium’s pipeline. Revenue for their flagship title, Vikings: War of Clans, peaked in June, 2016.” Strategic sense For a slots manufacturing giant like Aristocrat, purchasing Product Madness made business sense. Similarly, IGT buying DoubleDown Interactive (DoubleDown Casino) for $500 million in 2012 and Bally Technologies acquiring Israeli social casino studio Dragonplay for $100 million in 2014 were logical plays. Bally’s parent company, Scientific Games posted a 31.8 percent gain in Q2 revenue from its social casino division, the strongest growth across its business sectors. That M&A activity has continued apace, particularly in Asia. In April, IGT announced the sale of DoubleDown Interactive to one of the leading social casino gaming publishers, South Korea’s DoubleU Games, in a deal
worth $825 million. And last year, Caesars Entertainment Corp. sold its social casino heavyweight, Playtika, to a Chinese consortium for an eye-popping $4.4 billion. Aristocrat’s latest acquisition is unusual in that it’s a real-money gambling company buying a business with no connection to the gambling space. “Plarium may be a gateway to more social slots,” says Guy Hasson, a social slots consultant who has worked for social casino giant Playtika and online gaming supplier Playtech. There are not the same obvious synergies with the Plarium deal as there were with Product Madness. And there doesn’t appear to be much crossover in terms of player demographics between Plarium’s games and Product Madness’ flagship slots title Heart of Vegas. The typical social casino player is over 45 and female and Vikings: War of Clans may not appeal. Meanwhile, strategy/ RPG gamers are usually male and under the age of 45. Social casino probably isn’t going to appeal to these players. Aristocrat says it recognizes player demographics are diverse and that Plarium will operate as a largely standalone division
once the deal is finalised. An Aristocrat spokesperson says Plarium and Aristocrat have a high degree of cultural alignment. “This transaction is about growth. Plarium provides Aristocrat with an ideal entry point into the high value, fast-growing social gaming sector, consistent with our strategy to maintain our growth trajectory and in particular to continue to scale profitably in the dynamic digital gaming market. Loyal gamers While mobile social gamers can be notoriously fickle, social casino players do tend to be more loyal, which is partly why social casino apps are steady, reliable earners for the industry’s biggest publishers. The average lifetime value (LTV) of a mobile social slots player has been estimated at $324. Zynga struggled for years to replicate the success of point-and-click PC hits like FarmVille and Mafia Wars with the transition to mobile, but play-money title Zynga Poker is still going strong and its slots titles, Wizard of Oz and Hit it Rich!, continue to perform well.
Asia Gaming Briefings | October 2017
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Cryptocurrencies gain favor in Asia gaming Bitcoin has regularly made the headlines in recent months, its price surging towards the $5,000 mark - four to five times its value at the start of 2017 - predominantly driven by interest in Asia.
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t has also emerged as a viable gaming currency, with online operators discovering that users, particularly in Asia’s grey markets, are keen to embrace a currency that is secure and easily deposited and withdrawn. Several Bitcoin-led operators, including Bitcasino.io and Cloudbet, have enjoyed rapid growth by simplifying and accelerating the deposit and withdrawal process, particularly in markets where banking restrictions make depositing fiat currency on gaming sites a challenge. But this might be just the beginning of a wider
Asia Gaming Briefings | August 2017
revolution in blockchain gaming that could seriously threaten the established order, and even has Asia’s biggest lotteries in its sights. In recent months several initial coin offerings (ICOs) focused on the gaming industry have raised significant funds. ICOs, or token sales, are a means of crowdfunding that tend to use the Ethereum blockchain - a variant of the technology that backs Bitcoin - and its associated cryptocurrency, Ether.
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The most notable of the gaming ICOs so far is FunFair Technologies, led by tech entrepreneur Jez San, which raised around $26 million in both Bitcoin and Ether in just four hours during its ICO in June. FunFair aims to build a decentralized gaming platform powered by Ethereum smart contracts. The Ethereum blockchain can allow casino games to be conducted in a manner which is fully verifiable and open to both player and operator by eschewing servers and running the casino’s functionality directly through the blockchain - essentially a public ledger accessible to all and secured by cryptography. These smart contracts, for instance, pledge to pay out winnings dependent on the result of a game, and are automatically executed on the blockchain itself. This holds a number of advantages, particularly in markets where players are concerned that online games are not safe and fair.
Another similar project, Wild Crypto, held an ICO at the start of September to raise funds to bring its blockchain-based online lottery platform to market. “The Wild Crypto platform will harness the full disruptive power of the blockchain, and is designed to shake up the global lottery industry,” Andrew Jarrett, Wild Crypto’s technology business and gaming advisor, told AGB. Those who subscribed to the Wild Crypto ICO exchanged Ether for WILD tokens at a discounted rate of 2000 WILD to one Ether. The tokens can be used to play games on the platform upon launch. “We will offer a completely open, verifiable and fair platform for customers to play lotto games on. It is an offer that should worry any lottery which is failing to engage players, particularly younger demographics, via the innovative use of technology,” Jarrett said. According to the World Lottery Association, Jarrett added, only 4 percent of the $260 billion lottery and associated games market is currently online, offering projects such as Wild Crypto “a huge opportunity”. The Wild Crypto ICO pre-sale raised 2000 Ether (around $600,000) in just 96 seconds. “Our platform will democratize lottery by creating a stronger product that is available to a wider pool of players,” he added. Whether these Ethereum-powered ICOs prove to be the future of blockchain gaming, however is another question. Both Ethereum and Bitcoin have their advantages. Ethereum’s technology offers greater flexibility and the opportunity to build a platform upon the blockchain; Bitcoin, meanwhile, is far more established as a gaming token and appeals as a simple way to deposit and withdraw swiftly and securely. Jarrett at Wild Crypto said that while Bitcoin has an important role to play, Ether will be the cryptocurrency to revolutionize the sector in Asia and beyond. The future of blockchain gaming? “From an innovation standpoint, Bitcoin can only serve as a currency with which to gamble. We are thinking bigger than that, and the future of gaming will be built on the Ethereum blockchain,” Jarrett said. However, Tim Heath, CEO of the Coingaming Group, which operates bitcoin-led casino Bitcasino.io, told AGB that Bitcoin, particularly in Asia, will remain the cryptocurrency of choice when it comes to gaming. “Bitcoin is far more established than
other cryptocurrencies, both in the minds of the public and as a gaming currency. While there are some interesting gaming projects emerging on the blockchain, Bitcoin already has a significantly lead,” he said. Bitcasino recently launched dedicated Japanese and Chinese-language websites as part of a broader rebrand in response to significant demand from Asia. “Asia’s unique regulatory challenges have seen many in the region embrace Bitcoin as a gaming currency,” he said. Bitcoin alternatives Bitcasino has no current plans to begin accepting other non-Bitcoin cryptocurrencies, known as altcoins, unless there is major demand from players. He also pointed to Bitcasino’s heritage and content as a reason why players would likely favour more established Bitcoin operators over newly-emerging altcoin operators. “Bitcasino is well-established, trusted and offers content from many of the industry’s leading suppliers. Currently no altcoin casino can say the same,” Heath said. Oron Barber, CEO of Australia-based Bitcoin media and marketing agency CoinPoint. net, agreed that, for the time being at least, Bitcoin casinos would maintain their lead. “In the near future the market will follow the existing and new Bitcoin casinos which are providing great content and service,” he told AGB. However, he said the growing number of ICOs, which span platforms, operators, affiliates and slot providers, will likely begin to impact the industry by mid-2018. As well as transparent and verifiable gaming, the blockchain could theoretically facilitate everything from live payments for affiliates to the pooling of jackpots across multiple operators or suppliers. This will concern Asia’s major lotteries, and China’s introduction of a ban on companies raising money via ICOs at the start of September may have in part been accelerated by the number of gaming-focused ICOs on the horizon. But this is unlikely to halt the growth of cryptocurrency as a gaming medium in Asia. “Many customers in Asia have suffered at the hands of underground online operators over the years,” said Heath at the Coingaming Group. “So there is huge appeal for a trusted operator that can guarantee security, fair games and fast withdrawals.”
Asia Gaming Briefings | October 2017
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Dr. Sally Gainsbury
Time for disruptive responsible gambling Technology is changing the way that people gamble, in terms of their gambling experience, how they interact with operators in venues and online, and how gambling operators and regulators monitor and respond to customers. From a regulatory and corporate social responsibility perspective, it is important to clarify the risks associated with new technology, and how this can be used to minimize and prevent the experience of gambling-related harms.
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he technological changes to gambling are too numerous to mention. Notable examples include virtual reality, augmented reality, betting on professional video games (esports), gambling with virtual items (skins), gambling using blockchain and cryptocurrencies, skilled video gambling machines, and of course social media as a marketing and communication platform. There are many issues emerging, including whether new products are classified as gambling activities and should be regulated as such. An important concern is the potential target market for new products – are vulnerable populations, including young adults, children, and those with gambling problems, likely to increase gambling as
Asia Gaming Briefings | October 2017
a result of a new product? Will people who would not otherwise gamble now enter the market and potentially migrate to other gambling activities? Do features of new gambling products pose specific risks of harm? This is one of the most difficult to answer as gambling products are being developed so rapidly that there is generally little research on the potential impact of these. However, conceptual models and existing research suggests that some concerns may be warranted. Virtual reality is a highly immersive experience that is likely to cause dissociation including losing track of time, suspension of reality, and spending more money than intended. Already gamblers report that digital currency leads to excessive expenditure due to a lack of salience of the
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money being spent. Augmented reality and apps involving smartphones and often track location and access personal information to offer a customized experience. This may allow gambling operators to have unprecedented information about customers, which could be used to encourage ongoing gambling. Skills challenge Video gambling machines incorporate a skill element into a chance-based gaming machine; however, the extent to which consumers understand the varying role of skill and the impact it may have on outcomes is unclear. It is possible that VGMs may encourage illusions of control and excessive gambling in the hopes of ‘beating’ a machine that is still largely chance determined. Disruptive innovation is an often misused buzzword. The Harvard Business Review describes disruptive innovation as a process in which a new company/product meets needs of a neglected market segment and introduces a completely different business model to this population. Responsible gambling is another jargon term that is poorly defined with varying agreed-upon meaning within the gambling field, including among academics, industry, regulators, and consumers. Although semantically it should mean gambling within appropriate limits of time and money, it has become synonymous
with avoiding or addressing problem gambling. Gambling is one of the most heavily regulated industries in the world. However, there is very little empirical evidence to support the effectiveness of most policies and practices designed to minimize harms. Efforts have typically focused on the small proportion of gamblers who experience significant harms, and largely ignore, or are ignored, by the vast majority of consumers, including those at risk of experiencing lower levels of gambling-related problems. There is growing recognition of the need to disrupt harm-minimization efforts and focus on preventing gambling problems. Providing tools and resources for all gamblers can assist in setting appropriate limits and staying within these so that gambling remains an enjoyable and affordable entertainment activity. Risk controls Technological developments have the potential to transform the gambling experience in terms of reducing the risk of harm. Increased access to customer data allows operators to customize warning and notification messages to be more relevant for consumers and enhance their impact. Facial recognition technology, Bluetooth, and other geolocation technology could be used to enhance the provision of selfexclusion programs, send nudges to those who
have been gambling for a lengthy period, and encourage the use of non-gambling amenities. Virtual reality casinos may include personal avatars to check in with customers and ensure that they are gambling within their means, in a private and totally customized manner. Educational materials teaching consumers how outcomes are determined and to counter common irrational beliefs may be gamified to encourage their use and enhance effectiveness. Treatment and interventions can be delivered online and incorporate augmented and virtual reality technology resolving issues related to location, appointment times, and needing a counsellor when self-directed options can be very useful. The massive changes that are occurring in the gambling industry are exciting and potentially revolutionary. However, consumers are increasingly more savvy and aware of the importance of corporate social responsibility. Regulators are also more demanding of the gambling industry to demonstrate an active effort to address gambling-related harms. The gambling industry, researchers, and policy makers need to move away from focusing only on the small minority of those with severe gambling harms, and provide resources for the rest of gambling consumers so that they can enjoy these new technologies, with the appropriate levels of risk and reward.
Asia Gaming Briefings | October 2017
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The right skills for the job Casinos appear to be struggling to appeal to the next generation of gambler, with slots in particular looking tired to the younger audience. So could skill-based games be the answer, or will the savvy millennial gamer quickly see the odds are still stacked in favor of the house?
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lthough far from mainstream, some big names have recently announced they are taking a bet on skill-based products to draw in the younger demographic. Australia’s Crown Resorts and Chill Gaming – a 50/50 joint venture between Crown and New Gaming Pty Ltd, owned by Wymac Gaming Solutions – plans to deploy a suite of skill-based electronic games after showcasing prototypes at gaming shows. While GameCo, a self-styled video games casino, recently displayed its proprietary video gaming gambling machines (VGMs) at the Australasian Gaming Expo
Asia Gaming Briefings | October 2017
(AGE) in Sydney. The New York-based company is also hopeful that Macau will approve its machines before the end of the year. CEO Blaine Graboyes says: “We’re seeing a very similar underlying business focus from casinos worldwide; the search for new, innovative products that attract new audiences and generate incremental revenue. We have strong demand from operators in Macau and other regulated gambling jurisdictions across Asia, while our participation at AGE was our first chance to expose Australian operators to our products and I am pleased to say that the response was very encouraging.”
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GameCo, which has VGMs installed at the Tropicana and Borgata casinos in Atlantic City, describes itself as a “data-driven startup”. It regularly gathers and analyses user feedback and performance metrics from casinos to assess how its games are performing. For example, its games typically allow bets of between US$2 and $20 per play, though average bet size is around $4. Meanwhile, the games are generally 45-60 seconds in length per play, while users tend to play each machine for an average of 15 minutes. Users also often flit between games, which is why a carousel of gaming options, such as a ‘pod’ of three or four VGMs, helps keep them interested, according to the firm’s research. GameCo has been granted a patent on its proprietary system for controlling return to player using similar math to traditional skill-based games like poker. The company’s games portfolio includes the likes of Danger Arena, a first-person shooter in which participants have to eliminate advancing enemies, basketball game Nothin’ but Net, and Pharaoh’s Secret Temple whereby players match gems to collect rare treasures within a time limit. “We are seeing a strong correlation between players who enjoy traditional casino games as
well as new video game gambling offerings,” says Graboyes. “Gamers come in all ages, from Millennials to Generation X [baby boomers].” Different genres appeal to different players, however. For instance, around 60 percent of Danger Arena players are male and under 40. Meanwhile, the majority of those that play Pharaoh’s Secret Temple and Poseidon’s Deep Sea Saga (a bubble shooter game) are females over 40. Social experience Established in 2010, Gamblit Gaming has developed a number of multiplayer tabletop games that replicate an online social gaming experience on the casino floor. Its first games – Gamblit Poker and Cannonbeard’s Treasure – have been installed at casinos across the US and cruise ships operating in the Atlantic and Pacific. With these games, there is a joint combined wager against the house, anywhere from a total of $8 (four players each with a $2 bet) up to $20 (four players each with a $5 bet). The outcome of the wager is the pot that the players then compete for. “We think that the allure of these specific games is that people get to play together,” says Marcus Yoder, VP of business development for
regulated markets at Gamblit Gaming. “One person – the winner – comes away from each hand with an outcome greater than what they wagered in that hand. Furthermore, the male-female divide is pretty close. “We’ve seen that along the gender line, both games come up fairly equally in terms of male and female players, with Gamblit Poker skewing only slightly more male, and Cannonbeard’s Treasure skewing only slightly more female,” says Yoder. However, there is a major challenge for game designers. They need to ensure that titles aren’t too intimidating for non-gamers who may feel they lack the gaming aptitude to succeed and stand a chance of actually winning money. On the flipside, there has to be enough difficulty so that more accomplished gamers don’t win too much too easily. It’s a fine balancing act. “Yes, we have taken into account the potential for some players to feel like they could never be skilled enough to win at skill-based games,” says Yoder. “First off, most games that you will see in the near future from Gamblit and other suppliers will continue to have an element of chance in the wagering outcome. Some jurisdictions will still mandate that.
Asia Gaming Briefings | October 2017
SUPPLIER SPECIAL REPORT 44
G2E 2017
Tapping into technology Global Gaming Expo 2017 (G2E), the world’s premier international gaming trade show and conference presented by the American Gaming Association (AGA), will open its doors on October 2, 2017 at the Sands Expo and Convention Center in Las Vegas.
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amed as one of the top 25 fastest growing tradeshows by attendance, one of the biggest focuses of the show this year will be on the next generation of casino innovations, with the inclusion of skill-based gaming displays. Also featured this year will be the latest advancements in security, the future of esports and sports betting, as well as the debuts of new games and technology from innovators around the globe. “Innovation in the gaming industry is at an all-time high,” said Todd Sheahan, event director for G2E. “Key to G2E’s recent growth is the continued development and enhancement of a business marketplace that showcases innovation and highlights the latest products in casino gaming to the biggest influencers in the industry. G2E has established itself as the ultimate convergence of the brightest minds showcasing state-of-the-art technology.” G2E’s famous educational programs cover some of the industry’s hottest topics, and will be presented by the industry’s foremost thought leaders.
Asia Gaming Briefings | October 2017
Attendees will gain an inside perspective on technology innovation, developments in cyber security, sports betting and more over the four day event. “As the legalization of sports betting continues to grab national headlines, G2E 2017 will bring in the nation’s top experts to address what a legal, regulated sports betting market will look like for our industry,” said Geoff Freeman, AGA president and CEO. G2E educational programs are available from 9am to 5pm on Monday, October 2 to Thursday, October 5, while the exhibition will open on Tuesday, October 3. “One of the main reasons for the incredible growth of G2E is the exponentially expanding variety of industries that are now involved in the gaming industry,” added Andrew Ortale, AGA’s vice president of industry services. “Whether you’re a restaurateur, spa director, video animator or one of the other hundreds of professions that have found a home in gaming, G2E has become the epicenter for them to grow their businesses at destination casinos around the world.”
SUPPLIER SPECIAL REPORT 45
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SUPPLIER SPECIAL REPORT 46 ABBIATI
Famous design and style
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bbiati is set to showcase their “Abbiati by Americas” line of tables and live gaming equipment dedicated mainly for Americas’ markets. The new line still keeps Abbiati’s famous design, style and high quality materials and is mainly dedicated for the main rooms/ mass market. The new line of tables and furniture, manufactured in Las Vegas, can be integrated with the most advantaged hardware devices, not only limited to RFID and antennas, but also with sensors and cameras, to name but a few. As usually, Abbiati will expose their line of innovative security casino currency products, such as chips, plaques and jetons, which will incorporate a number of security features such as 13.56 MHz PJM RFID, 8-color UV pigments, 3-in-1 UV security feature, Laser Tracer technology, Optical Variable Ink and high security holograms. The Italian company will exhibit their latest range of plaques, which will include an impressive collection of new patterns, designs and materials, as well as their line of patented “Tie” chips and the newest line of chips called “il Gettone”. The show visitors will also have an opportunity to see Abbiati’s high precision GLI-25 certified
American Roulette Laser Wheel, which incorporates an upgraded patented invisible laser technology (Class 1A). Abbiati wheel can be connected and run to online gaming terminals and winning number displays. Thanks to an open protocol Abbiati’s American roulette wheel is installed and working in many casinos connected to the leading online gaming companies. The wheel will be accomplished with a selection of high quality multimedia displays, run directly from
Abbiati Laser Wheel or auto-setting overhead reader or camera. As the exclusive distributor of Modiano playing cards, Abbiati will present at the show a complete range of their playing cards, both 100 percent plastic and paper plastic coated. During G2E Abbiati will also present the Lucky Ball side bet, one of the alternatives offered for American Roulette game. Find Abbiati at stand 3423 at the show.
Advantech
Elevating gaming intelligence
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dvantech’s theme of “Elevating Gaming Intelligence” will highlight AdvantechInnocore, which stands poised to introduce its gamer-changing solutions, including LCD monitors, advanced storage systems, highperformance graphics cards and a revolutionary new gaming platform. “This year’s G2E theme aptly encompasses our products, our knowledge of the industry, and our added value hardware and software solutions,” commented Craig Stapleton, Advantech’s product director. “Armed with the latest technology for the intelligent heart of today’s sophisticated slot machines, our range of software solutions are set to boost performance, efficiency and security for the highly competitive world of commercial gaming. We could not be more excited to attend!” On display is the DPX-S445, AdvantechInnocore’s groundbreaking motherboard for the gaming industry. It features the very latest Intel top-end embedded platform, giving customers
Asia Gaming Briefings | October 2017
field-proven reliability with the peace of mind of massive scalability and future upgradeability. With screen sizes available from 7” to 55” and beyond, new monitors from Advantech-Innocore offer high-visibility, touch screen, sunlight view ability and ruggedization. Curved screen models will also be on display, featuring concave and convex curved LCDs, and even S-shaped curve screens. For customers needing more screens or high performance discrete graphics card performance, Advantech-Innocore graphics cards only use the latest AMD and Nvidia GPUs. Featuring 4GB or 8GB of onboard memory, and the latest Polaris GPU architecture from AMD, customers can experience a 3D performance with extended availability needed for gaming. Also set to be on display in multiple formats, is Advantech’s powerful, secure storage solution includes power fail detection and protection, as well as flush manager and voltage stabilization.
It has been approved by the most demanding ODMs in gaming and lottery. With 15 years of experience, AdvantechInnocore’s team of engineers not only builds top-of-the-line computing hardware, they are dedicated to helping customers with the design and install process. For customers requiring specialized hardware, Advantech-Innocore can add intelligence in the form of custom FPGA and additional micro-controllers with custom firmware for sophisticated security, control. Find them at stand 3841 at G2E 2017.
SUPPLIER SPECIAL REPORT 47 AGS
Apex
Obsessed with the game
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ttendees at G2E this year will get a closer look at the new gaming experiences AGS has been fixated on over the last year. AGS has upped its hardware game with the debut of Orion last year, and since then, AGS has deepened its game library to include new titles that continue to drive performance well above the house average. With stunning graphics and bonus features that take advantage of its impressive 42” display and 498 game-controlled LED lights, Fu Bao Bei, Lucky Lil’ Devils, and Olympus Strikes are full of surprises driven by solid math to keep performance sky high. Attendees will see the newest addition to the Orion family of cabinets, which officially launches in 2018. The core library on ICON has also grown with new original titles like Capital Gains, Grand Royale and Jade Dragon. Luck and Prosperity, Koi Riches and Wild Surpize add to the ICON game library as well, with links to Hot $ Jackpots, another new progressive family featuring core-gambler style math and gripping bonuses. Xtreme Jackpots is a first-of-its-kind multilinked progressive ecosystem and connects across both Orion and ICON for more frequent awards and more explosive jackpots. Buffalo Jackpots XJP and Longhorn Jackpots XJP drive the experience as established, player-
Household name
favorite games with four jackpot levels and two exciting bonus rounds. Customized sign options and configurations extend the thrills and draw players in. Last year AGS also introduced its awardwinning Bonus Spin table game progressive solution, a product that gives players more winning experiences and heightens interaction. This year, AGS is bringing Bonus Spin Roulette for an even more engaging experience at the wheel. Several new specialty games, like Premium Hold’em will also be on display. Chase the Flush with Bonus Spin – powered by Dex S, a singledeck, commercial-grade shuffler. AGS will also feature retail-inspired innovations to table game signage as well. With its new Roulette and Baccarat signs, attendees will see how embracing the value of dynamic, interactive displays that feature animations, crisp graphics, and engaging content can transform your games, attract more play, and captivate players for increased profit potential. When it comes to social, AGS has been intently focused on offering its customers a turn-key, customized social casino solution that’s based on proven, player-favorite, landbased content, including the newest additions Jade Wins, Shadow Fox Dreamcatcher, and Rumble in the Jungle.
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PEX gaming has what it takes to become just as much a household name in gaming in America as it is in Europe. APEX gaming has made a significant impact with its iDROPe cash management solution for live gaming tables, winning two awards at last year’s Casino Marketing & Technology Conference and has recently reported on its success at one of the largest casinos in the USA. The iDROPs will receive its world premiere at G2E. Speed is the essence and the iDROPs is the answer to high-speed acceptance at an amazing rate of 6 notes/tickets per second. As game designer and slot machine manufacturer all in one, APEX gaming took ICE earlier in the year by storm with the introduction of the DRAGON EGG jackpot island. Operators can choose between three versions – with eight integrated slot machines (all with 3 large screens) – as a bank of slots on both sides, or four slots that each have a 43” screen as a rounded solution or another rounded solution with 4 Pinnacle SL slots that each have 3 screens. The overhead display becomes part of the game. The four core jackpot levels actually provide an amazing number of jackpot levels – 16 in total. “We are very busy installing the DRAGON EGG jackpot island in casinos around world. This single game solution has had amazing feedback. Now it is available to casinos in America”, stated Mr. Kubilay Özer, global sales director of APEX gaming. Naturally customers can choose from the entire APEX slots machine range – including the VIP Premium Lounge, Pinnacle 24” and Pinnacle SL. All the APEX slots are fitted with the EVO3 gaming platform that truly brings the APEX games to life. APEX gaming also offers automated roulette in the form of the APEX PLAYER STATION that can work in conjunction with four separate roulette wheels – both live and electronic. Operators can source an increasing number of solutions from APEX gaming – individual slots, jackpot islands, automated roulette and table gaming products like iDROP/e/s and Shuffle King. Visitors to the G2E Las Vegas are invited to come to stand 3359 and see the difference APEX gaming is making to the industry.
Asia Gaming Briefings | October 2017
SUPPLIER SPECIAL REPORT 48 AINSworth
Pac-Man chomps on casino floors
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insworth Game Technology will showcase an array of new content for its sleek and innovative A640 and A600 cabinets at G2E 2017. In total, Ainsworth will display more than 130 games -- including titles for both Class III and Class II jurisdictions -- as well as new sign package options, linked progressive brands and premium branded slot games sure to attract attention. Highlighting the booth will be PAC-MAN DYNAMIC EDITION. The iconic PAC-MAN character is one of the most recognizable figures in arcade game history and was the basis for the most successful arcade game of all time. Now, PAC-MAN has chomped on to casino floors on the A640 cabinet. In total, Ainsworth’s Class III game library now tops 250 unique titles, giving casino operators a wide selection of compelling game content for the company’s full line of innovative cabinets, including the A600, A640 and A600 Slant Top. In addition to PAC-MAN, among the titles on display for the A640 will be the exciting new games Desert Dawn, Desert Dusk, Rumble Rumble Eagle and Nostradamus. Additionally, entirely new brands like QuickSpin and Power Shot will debut at the show. The games take full advantage of the stunning A640, which features optimal viewing
on a 40-inch high-definition LCD game screen and an attractive design creating powerful game experiences with eye-catching game art. The cabinet comes standard with a touchscreen LCD button deck and a mechanical “bash button” to combine the ease of new technology with the excitement of traditional slot play. An optional 27-inch LCD topper will attract players across busy casino floors. On the A600, visitors to Ainsworth’s booth will experience Hao Yun Dao, a new Asianthemed linked progressive series that stands out on casino floors with customizable sign packages, two unique game experiences and world-class graphics. Several new brands will make their debut on the dual-screen A600, including FirePower and Big Hit Bonanza. Ainsworth launched its entrance into the Class II market last year and has seen success across the country. This year at G2E the Company will showcase its eye-catching A600 cabinet for Class II, including several new titles that have had strong performance in Class III markets. Titles shown on the A600 will include Twice the Diamonds, Cash Cave, Mustang Fortune, Light ‘Em Up and other games proven to perform on U.S. casino floors. Undoubtedly the Class II highlight will be
the unveiling of AnyBet, a linked progressive system that can connect to any Ainsworth game and offers players the chance to win progressive jackpots on any game, at any bet, anytime. Ainsworth can be found at stand 1529 at the show.
Aruze
Entertainment and innovation
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ruze will have over 40 never-before-seen titles at G2E 2017, with entertainment and innovation remaining at the core of the company’s philosophy. Debuting at G2E 2017 will be the Thor cabinet. This striking new video cabinet sits on a curved 55-inch high definition monitor with an 21.5-inch LCD touchscreen panel. Multiple titles will be available including skillbased games as well as electronic table games. Recently launched is the Cube-X Innovator Deluxe, a premium Radiant Reel stepper cabinet on the already high performing Cube-X platform. This eye-catching cabinet features a larger than life video wheel display on a 42-inch HD monitor, with a 23-inch LCD topper option, and a lightning speed processor board and operating system. The Cube-X Innovator Deluxe will be hard to ignore on any casino floor with its dynamic graphics and robust sound.
Asia Gaming Briefings | October 2017
The casino operator’s favorite, the 999.9 Gold Wheel on the Cube-X Ultimate, is now available in a video cabinet. The first two titles on this cabinet are Ultra Stack Lion Gold and Ultra Stack Dragon Gold. As the player increases their bet per line, the Gold Wheel feature is available on additional reels and the mechanical wheel topper showcases multiple jackpots and award credits. Aruze continues a strong line-up for their video products with more content available on the Cube-X Vertical and Cube-X Vertical 80 cabinets. Available on both cabinets is the Thunderstorm series. Diamond Noir and Gilded Treasures are two electrifying themes that consist of credit awards, free games and a Jackpot Wheel with a four-level progressive. Aruze Gaming plans to expand it product line into additional segments. A lot of additional content will be on full display at stand 2659 at the show.
SUPPLIER SPECIAL REPORT 49 BETGENIUS
aristocrat
Madonna slot game
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ristocrat has licensed the Madonna brand for a new multi-game slot deal, and the company will be causing a commotion when it unveils the first Madonna Slot Game at G2E Las Vegas. Since arriving on the Hot 100 with “Holiday” in the week of Oct. 29, 1983, Grammy Awardwinning, Rock and Roll Hall of Fame inductee Madonna has earned a total of 57 chart hits, including a record 38 Top 10 singles. Madonna also holds the title of the highest-grossing solo touring female artist in Billboard Boxscore history. “Aristocrat aggressively pursues the absolute best and most iconic brands to inspire us to create games that help our operator partners give their players the most engaging and entertaining experience possible. There is no bigger name in the history of pop music than Madonna, and we are thrilled to welcome the brand into Aristocrat’s enviable family of licensed products,” said Matt Wilson, Aristocrat’s managing director of the Americas. Each Madonna Slot Game will be themed with its own unique game play, inspired by and
including Madonna’s popular hit songs from her most memorable eras. “We have been diligently working for months to create a slot game that perfectly encapsulates the essence of the Madonna brand, while also bringing an entertaining experience to players fueled by her landmark and groundbreaking music, coupled with video and exciting game play. We are excited to premiere the new Madonna Slot Game at G2E,” said Rich Schneider, Aristocrat’s chief product officer. Aristocrat’s Madonna Slot Game can be found at stand 1141.
Betconstruct
Global product line-up
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etConstruct, a provider and supplier of gaming and betting solutions, joins this year’s G2E Vegas to showcase the updates and additions to its gaming and betting products. “G2E is a very international show. It maybe tilted towards the Western Hemisphere a little but nevertheless is a truly global gathering of gaming industry. That’s why here we present not only what’s relevant to the US market but our entire lineup, from sportsbook to virtual reality, from data services to our live dealer studios,” says BetConstruct CEO Vahe Baloulian. New types of American sports, live update of points, auto calculation of contests, licensed headshots for players - all these are among the updates of BetConstruct Fantasy Sports Software. Including three separate games in one software which are Backgammon, Poker Classic and Open Face Chinese Poker BetConstruct will also showcase its Skill Games offering. An access to the widest range of products – Social Sportsbook, Poker, Casino and Skill Games you can get from BetConstruct’s Social Gaming suite. Social Gaming suites, Fantasy Sports, Sportsbook and Skill Games - all can
contribute to the business growth of any operator. One of the innovations of BetConstruct introduced this year at the iGaming Super Show is Spring Business Management Environment (BME). With a single click one can enable multiple gaming products and use many services all provided by BetConstruct and merged in one platform. Everything the operators will need – including marketing, legal, accounting, risk management and bookmaking services – can be found on user-friendly dashboard of Spring BME. “By introducing Spring BME, we are extending the concept of an online gaming platform with built-in business services, multi-tenancy support and B2B marketplace,” said BetConstruct CTO David Gasparyan. “Our primary goal is to bring all vendors, technology providers and operators into a friendly and comfortable environment. All we have developed so far is incorporated into Spring BME: products, tools, knowledge, and expertise.” BetConstruct will attend G2E Vegas and can be found at stand 4823.
Proven and innovative products
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etgenius, a Genius Sports Group company and the leading supplier of sophisticated, data-driven products to regulated wagering operators, will showcase its portfolio of proven products at G2E Las Vegas. Founded in 2000, Betgenius is a onestop-shop for tailored wagering solutions for sportsbooks operating in regulated markets worldwide. Its range of products includes the market-leading outsourced trading product and cutting-edge digital marketing services, both proven to drive down operational costs and boost sportsbook turnover. Visitors to the stand can find out more its game-changing sportsbook platform which brings together best-in-class products and services to create the most powerful, flexible and innovative solution on the market. From trading and risk management to player account management and personalization, it gives operators everything they need to run an efficient and highly profitable wagering business. Betgenius also provides over 150 regulated sportsbook operators with the sector’s leading automated odds compilation and sportsbook management services. It offers an unrivalled range of pre-match and in-play content, offering hundreds of thousands of events a year across every major sport, including end-to-end products for esports and horseracing betting. Betgenius runs a sector-specific agency helping brands acquire and retain customers. Deep knowledge of the industry and the ability to leverage the wider betting ecosystem gives us a unique position to acquire the right players at the right price, and ensure maximum lifetime value through effective engagement. Its technology allows operators to target customers based on their abandoned betslips, trending or popular bets, and make bet suggestions based on their personal interests. Mark Locke, CEO of Genius Sports Group, said: “We are hugely excited to be exhibiting at G2E Las Vegas. Betgenius has long been the goto supplier of outsourced trading to the largest European sportsbooks and we are excited to welcome operators from North America, Latin America and beyond onto our stand. “For anyone wanting to check out the latest in innovative sportsbook management technologies, they should look no further than Betgenius at stand 5234.”
Asia Gaming Briefings | October 2017
SUPPLIER SPECIAL REPORT 50 BMM Testlabs
Staff from around the world
B
MM’s experts will be taking part in a variety of events and conference sessions at this year’s G2E. Professional staff from BMM’s North American, Australian and European test labs will be on hand to discuss compliance and testing services for both land-based and online clients during the three-day exhibition. BMM’s president and CEO, Martin Storm commented, “Today, BMM is the best gaming lab in the world, not the biggest. But the progress
we have made in the US and Europe in the last three years has surprised the industry. Our performance makes me completely confident that in the near future BMM will not only be the best, but also the biggest gaming lab in the world. The numbers speak for themselves.” Storm concluded, “BMM looks forward to sharing our expertise and industry knowledge at G2E 2017. We encourage all regulators, manufacturers and operators to visit the BMM booth to discuss how BMM can support their objectives.”
CPI
DLV
Future of payments
C
rane Payment Innovations (CPI), continues to empower the gaming industry with its proven range of currency validation technologies and real cash management solutions. This year at G2E, the company is unveiling a breakthrough set of capabilities and portfolio enhancements that will revolutionize the way operators connect with their players, their business processes and, ultimately, their revenue. CPI is dedicating an entire section of its booth to innovation and connectivity. Visitors will have the opportunity to evaluate an array of cashless and emerging payment technologies, including potential solutions for table games and real-time data delivery. From its traditional product portfolio, CPI is also highlighting its SC Advance note acceptor. SC Advance sets the gold standard for performance, reliability and total cost of ownership. It features the industry’s highest first-pass acceptance rate for valid street-grade notes – including those that are damp, dirty, crinkled or torn.
Asia Gaming Briefings | October 2017
BMM will also be moderating three panels at G2E including “Technology Meets Tradition: Regulation and Compliance’s Role in Tribal Innovation” on Tuesday, October 3, “Riding the ETG Wave: A New Generation of Games for a Changing Floor” on Wednesday, October 4, and “Trending Tech: AI, VR, and New Developments in Casino Games Design” on Thursday, October 5. Visit BMM Testlabs at G2E, stand 2230 at G2E Las Vegas.
Silk Flowers jackpot SC Advance is also accompanied by a growing suite of modular extensions – including EASITRAX, the industry’s smartest cashbox system that is now installed in more than 200,000 games worldwide. EASITRAX provides the critical insight needed to drive faster, smarter and more profitable efficiencies from the gaming floor to the back room. Automated asset tracking through EASITRAX eliminates the need for dedicated cashboxes, helping operators reduce drop time by up to 40 percent. Now, a new Maintenance Alerts feature for EASITRAX allows operators to set their ideal note acceptor performance thresholds and receive automated email notifications based upon these critical metrics. CPI continues to expand the EASITRAX smart cashbox system with new features and functionality not just for casinos but also for a wider range of gaming markets – including VLT networks and route operations. To learn more, please visit CPI on stand 1850 at G2E.
A
fter a rather busy first half of the year, DLV is set to take part in G2E Las Vegas to continue showcasing this year’s releases. Hardware products will be represented by the compact and ergonomic Diamond Z machine featuring 24” LCD screens, iVizion bill acceptor and other peripherals, as well as management systems support. This and another company cabinet – Diamond Excel – will be exhibited with a series of new multigames. On offer will be the “debutant” Silk Flowers jackpot with 25 games and four mystery progressive levels. It is already successfully deployed in several countries, while being certified for a number of other European, Asian and Latin American markets. Another product to be showcased 12-games Jewel Jackpot Lux – is intended allow customers to renew their gaming offer with minimum investment. Finally, there will also be the breathtaking Diamond Games Ultra 4 with 25 games, which was first released during last year’s G2E Las Vegas and over this time has made substantial gains on international markets. DLV looks forward to welcoming its guests at stand 3219 at the show.
SUPPLIER SPECIAL REPORT 51 everi
Showcasing CageXchange
E
veri Payments’ G2E display will feature innovative cash access solutions that provide players with new options for managing their funds on the gaming floor, critical cash handling solutions that increase cage and enterprise efficiency, and data-driven solutions that promote insights into customer behavior. At G2E 2017, Everi Payments will feature CXC 5.0 and CXC 5.0 L, Everi’s newest full service kiosks. The CXC 5.0 offers enhanced security features including self-frosting glass and a real-time rear view camera to give the
casino patrons a more private and secure cash access experience. Built with the casino brand in mind, the new kiosks provide ample marketing space on the larger screens and through custom fit LCD panels between each kiosk for the wall or pod configurations. All Everi kiosks include the same traditional functionality such as ATM, bill break, and ticket redemption, with a more sophisticated, secure and appealing look. In today’s environment, casino operators are continually looking for ways to improve the
Gamblit Gaming
golden race
King of Virtual Sports
Soon to be announced
G
amblit Gaming, an innovator in real money skill-based gaming, will be unveiling brand new titles at G2E 2017. Gamblit’s TriStation hardware (launching in land based casinos in August 2017), will offer an engaging single-player experience with some exciting new game titles, including Cut
efficiency of their operations, reduce overhead and manage rising labor costs. Everi’s industryleading cash handling solutions are ideally positioned to automate and even eliminate certain tedious cash handling functions, allowing operators to focus their attention where it is needed most, on the player. Everi will showcase CageXchange, which improves cash accuracy and provides for secure cash storage, allowing operators to protect their funds and reduce counting and balancing times. Meet the Everi team at stand 1116.
the Rope, Jetpack Joyride and Doodle Jump. Gamblit Gaming is working with ZeptoLab, the developer behind the wildly popular hit, Cut the Rope 2, to gamblify the adventure game and transform it into a modernized casino experience. In partnership with Halfbrick Studios, Gamblit is bringing award-winning mobile phenomenon Jetpack Joyride to land-based casinos and will make its world debut at G2E. The high flying adventure game, Jetpack Joyride with 350 million downloads and 14 million monthly active users will get gamblified and hit casino floors with real-money gaming elements in late 2017 on Gamblit’s TriStation game machine. Gamblit has also joined forces with Lima Sky, the developer behind Doodle Jump, to gamblify the classic game and turn it into an innovative casino experience. With more than 250 million downloads, Doodle Jump has been released across multiple platforms and continues to ride high with its real money version hitting casino floors in early 2018 on Gamblit’s TriStation game machine and revolutionary G-Sports (eSports for everyone) platform. Gamblit’s Model G interactive game tables are live in Las Vegas and are the first multiplayer skill games on the casino floor. The TriStation single player platform also launched in August with six unique skill games. Gamblit’s platform has shown to lower the average consumer age down by 20 years in most jurisdictions. Gamblit Gaming will be at G2E 2017, found at stand 4423.
G
olden Race, creators of the award-winning HD Real Fighting, the “King of Virtual Sports” 3D Football and the all-new online platform and direct-to-mobile experience will showcase their newest solutions this year. Golden Race will once more add excitement for both players and operators with an aweinspiring American Football stadium-themed stand, a clue into their newest release. With outstanding virtual video, which is both manageable and customizable for each operator and market, all Golden Race products are fast, secure, reliable, and completely manageable across all platforms. With TVs on display, the stand will exhibit the latest selection of products of Golden Race and members of the team will take the chance to explain how the company maintains a flexible and cost-effective solution for operators ensuring unparalleled gaming experience for players. It’s the only company able to run such high-tech virtual games on Android devices. Be sure to find out more about the company at stand 4418.
Asia Gaming Briefings | October 2017
SUPPLIER SPECIAL REPORT 52 GameCo
Bar-ready form factor
T
he VGM, when introduced to the marketplace in 2016, was an entirely new patented “Video Game Casino” platform, which resembles an arcade-style video game cabinet, allowing gamers to gamble, utilizing their skill, playing popular video games while delivering the same return to players as traditional slot machines. This year at G2E 2017, GameCo will be showing a wide range of new VGM game themes along with entirely new products that extend the VGM product offering. “Steve Aoki’s Neon Dream” is inspired by the legendary artist’s 2014 “Neon Future” album and its underlying soundscapes. The first-person game blends the nearly effortless controls of an infinite runner with the sensorial, transcendental experience of Aoki’s music. The Terminator 2 VGM game takes place in the year 2027. You are the newest weapon for the Resistance in the fight against Skynet. Play as a T1000 captured and reprogrammed by the Resistance to fight for the survival of the human race.
Other new VGM games to be debuted at G2E include Poseidon’s Deep Sea Saga, an Undersea Bubble Shooter, Cosmic Candy Heist: an Intergalactic Matching Puzzle Game, and Twisted Worlds, A Surreal Hidden Object Game. GameCo Inc. will also introduce the Bartop Video Game Gambling Machine or
VGM - the first gaming device that brings skill-based video games to the casino in a bar-ready form factor. GameCo’s Bartop VGM bridges the gap between the casual games players have come to enjoy with a gambling experience in a relaxed, social environment. Come visit GameCo at stand 5034 at G2E 2017.
in the chip’s design and counterfeit deterrence. Customers will be able to see firsthand demonstrations of the exclusive high-frequency SMART RFID products and solutions. SMART offers the latest advancement in casino currency RFID technology and when used with the Chip Inventory System (CIS) software, SMART delivers a complete currency tracking and authentication solution. GPI has developed new and advanced solutions using SMART to provide its customers some of the highest level currency security options available. Since doubling the size of GPI’s playing card manufacturing facilities in Blue Springs, MO, GPI has worked hard to enhance the features of existing playing card offerings. Customers who visit the booth will see these new enhancements firsthand. GPI is also excited to introduce a new line of premium paper playing cards under the Paulson brand, Paulson Aces. Paulson Aces are manufactured using a heavier, highgrade European paper stock and offer superior handling. Also on hand, will be the full line of
Gemaco brand playing cards, which includes both paper and plastic card types. With a variety of stocks and finishes, the line of cards provide ideal handling and dealing for all types of table game play. For more information, visit stand 4433 at the show.
GPI
Full suite available
B
eing a leading global supplier with an extensive suite of table game products including chips, plaques, jetons, playing cards, RFID solutions, layouts and dice, GPI will be showcasing its full suite of table game products at G2E 2017. GPI customers’ options include multiple currency lines under the well recognized brand names of Paulson, BG, Bud Jones, Gemaco and Dolphin. Each line offers its own set of innovative design and security features giving customers the ability to design a one-of-a-kind piece of currency with multiple layers of security. The BG V-Series, produced with a new, innovative and highly durable injection material formula, was developed to provide customers a gaming currency option with advanced chip design flexibility. BG chip customers can now include GPI’s new Focus security feature into their chips. Focus is a new and advanced covert security feature that will be demonstrated to some of the company’s select customers. In addition, V-Series customers can also include Hollow Shot in their chips. The Hollow Shot serves a dual purpose
Asia Gaming Briefings | October 2017
SUPPLIER SPECIAL REPORT 53 GLI
Trusted business partner
G
aming Laboratories International (GLI) provides world-class testing, certification and assessment services to the global gaming industry with the highest levels of independence and integrity. GLI has become a trusted business partner to over 475 jurisdictions worldwide. With 20 labs strategically located on six continents around the world, GLI’s 1,000+ professionals are dedicated to bringing a truly global perspective to each and every client, 24/7. The company is proud to say it has pioneered many of the trends in the gaming industry. Since 1989, GLI has paved the way with its widely accepted gaming technical standards and work in the iGaming realm. The company holds U.S. and international accreditations for compliance with ISO/IEC 17025, 17020, and 17065 standards for technical competence in the gaming, wagering and lottery industries. GLI’s experts have years of experience testing and certifying every type of electronic gaming equipment and technology. Beyond testing, GLI’s consulting staff is also prepared to help with complex issues, such as rule writing; annual rule and regulation review; and test standards development. With regulators in mind, the company created world-renowned GLI University to help keep its clients as up to date as possible on new technologies; GLI can even develop customized training to fit your specific jurisdictional needs. With GLI’s training, testing and certification services, its clients have been able to surpass the competition and enter virtually any jurisdiction where gaming is legal. Please visit GLI at stand 4430 at the show.
JCM
Next level of connection
A
t G2E 2017, JCM is showing its bill validators, printers, promotional solutions, and digital media that operators need to take customer connections to the next level. Leading the way to the future is JCM’s revolutionary FUZION technology, ready to adapt onto casino management systems and address any regulatory challenges. When paired with JCM’s iVIZION bill validator and GEN5 printer, FUZION unleashes the possibility for each slot machine to become a multi-line profit center with the potential to vend and redeem lottery tickets, vend and redeem race & sports betting, facilitate Daily Fantasy Sports (DFS) wagering, the casino’s own or a 3rd party’s, conduct cross-enterprise promotional couponing for carded and uncarded players, enable real-time currency exchange with exchange rates and streamline tax forms processes. iVIZION powers FUZION. Its CIS technology scans the entire note or ticket, reading more than 9.5 million data points on every note, more than twice that of the nearest competitor, plus it has a unique capability to read 2D barcodes, and its intelligent bezel enables mobile connection for additional FUZION functionality. FUZION’s capabilities come to life when paired with GEN5. GEN5 has a faster CPU and
faster print speed, resulting in faster customer connections. It has the flexibility to print TITO and promotional tickets, plus various wager tickets and templated promo coupons. FUZION integrates with JCM’s ICB 3.0 drop management system, providing real-time health monitoring data and predictive drop and maintenance scheduling to dramatically increase operational efficiency. Next, PromoNet 2.0, a floor-wide couponing solution allows operators to identify high-value players and maximize results using business analytics. PromoNet increases amount of play, decreases un-earned awards, and lets each operator control compensation levels. Last, PixelPro Max displays have HD and UHD frameless LED screens with industryleading color contrasts allowing spectacular images and video on a curved or flat wall, indoors and outdoors, giving the ultimate in flexibility to unleash creativity, anywhere across the property. Find JCM’s team at stand 4039 at the show.
Konami
Creative new releases
K
onami Gaming, Inc. is showcasing a strong lineup of multi-station developments, skill-based games, premium slots, and advanced casino systems technology at G2E 2017. Konami’s popular Concerto Collection of video slots continues to expand with an extensive library of proven game themes, novel progressive bonus options, and premium releases such as Castlevania. These core product innovations will be showcased alongside a high-demand mix of multi-station and skill-based games, including Crystal Cyclone, Beat Square, Frogger: Get Hoppin’, and more. An estimated 27,000 gaming professionals and executives from markets across the globe will have the chance to see and experience Konami’s latest gaming developments and advanced SYNKROS casino systems solutions live at the stand.
“Over the years Konami has become known for games and systems that stand the test of time, and now as our creative technology expands, that legacy supports even greater possibilities for properties and excitement for players,” said Steve Walther, senior director, marketing & product management. “Whether it’s a new progressive game, an emerging skill-based concept, or specially targeted player loyalty incentives, players and operators are looking for new entertainment that is not only unique, but also has the substance to sustain excitement beyond an initial attraction. Which is why at G2E 2017 Konami is showcasing a suite of captivating gaming options that welcome players to play on and enjoy the full experience each casino has to offer.” Attendees are encouraged to visit stand 1154 to explore these and more important new Konami releases.
Asia Gaming Briefings | October 2017
SUPPLIER SPECIAL REPORT 54 novomatic
Extensive US showcase
F
or the first time at the Global Gaming Expo in Las Vegas, NOVOMATIC and Ainsworth Game Technology will team up to showcase a combined booth, brimming with market-first innovation. Taking centre stage for NOVOMATIC will be the international premiere of From Dusk Till Dawn, following the recent partnership with Miramax. This enthralling theme resurrects the Quentin Tarantino and Robert Rodriguez classic on the casino floor as the cult film celebrates its 20-year anniversary. Presented on the NOVOSTAR V.I.P. III and V.I.P. Lounge cabinets, the game has all the elements to inspire players with its fiery gameplay, Dusk and Dawn jackpots, and exciting features and bonuses. A major highlight for Ainsworth will be Pac-Man Dynamic Edition that sees one of the most recognizable figures in arcade game history on the A640 cabinet. This title follows the success of Pac-Man Wild Edition, which has seen significant uptake in the US, and adds even more fun with thrilling bonus features and massive jackpots. The A640 will also feature exciting new titles such as Desert Dawn, Desert Dusk, Rumble Rumble Eagle and Nostradamus, and new brands QuickSpin and Power Shot will debut at the show. The full range of Ainsworth cabinets, including the A640, A600 and A600 Slant Top, will display more than 130 games, for both Class III and Class II markets. Highlights on the A600 include Hao Yun Dao, a new Asian-themed linked progressive series, as well as new brands FirePower and Big Hit Bonanza, which make their international debuts at the show. Undoubtedly the Class II highlight will be the unveiling of AnyBet, a linked progressive system that offers players the chance to win progressive jackpots on any Ainsworth game. Visitors are encouraged to see the combined booth, at stand 1259.
scientific games
Bond, James Bond
F
rom Dr. No to Spectre, from Blazing 7s to Cash Spin Deluxe, Scientific Games is raising the bar this year at G2E, showcasing beloved classics, cutting-edge innovations, and visionary concepts that will elevate every casino floor. This year it is all about Bond, James Bond. Experience James Bond like never before in Scientific Games’ immersive James Bond G2E Environment, showcasing three inaugural game titles based on the hit movies: Casino Royale, Goldfinger, and Diamonds Are Forever on some of the latest Premium platforms. Scientific Games will debut the bold TwinStar V75 cabinet featuring a 75-inch, curved, ultra-HD, 4K-resolution display. The V75 offers players the ultimate, large-format gaming experience while its innovative, patent-pending design addresses many issues operators have with large-display cabinets. At G2E, the TwinStar V75 will showcase Monopoly Hot Shot, combining the popular Monopoly brand with player-favorite Hot Sho® Game-in- Game bonuses. Also debuting is the TwinStar J43 with iReels, pairing the dynamic features of the TwinStar J43 with an engaging reel mechanism. The TwinStar J43 with iReels will showcase the new James Bond theme, Goldfinger, as well as Cash Spin Deluxe,
Asia Gaming Briefings | October 2017
and Lord of the Rings – Rule Them All, based on the epic cinematic trilogy. Scientific Games will feature some of the most iconic Bally classic stepper games on the innovative TwinStar 3RM, including Blazing 7s, Bonus Times, Black & White 5x Pay, and Double Jackpot Triple Blazing 7s. Internationally successful games from Scientific Games’ Australian studio will also be featured, including Very Cherry; Fortunes 3, a multi-game platform featuring three Duo Fu Duo Cai games; and two new titles in the successful Lock It Link series - Cat, Hats, and More Bats and Eureka Reel Blast. The company will showcase EZ Baccarat, and the electronic table Fusion Hybrid SM which connects players with up to four live table games in one terminal. In addition to offering roulette, baccarat, and sic bo, Fusion Hybrid now also features Stadium Blackjack SM, Three Card Poker, and Casino War. On the Systems side, Scientific Games will demonstrate solutions that allow casinos to operate and communicate more effectively, including Praxis Analytics the big data solution, SG Cloud and mobile solutions, and iVIEW 4, the next generation of ondevice messaging technology. Scientific Games can be found at stand 1126.
SUPPLIER SPECIAL REPORT 55 spintec
New generation gaming solutions
S
pintec will show its latest innovations for the gaming industry at G2E Las Vegas this year. Visitors will have the opportunity to experience a wide selection of quality wood and leather finishes Spintec offers on their electronic table games and get the possibility to play a wide range of machines showcased at the expo. Besides automated and virtual Roulette, also SicBo, Craps and Baccarat will be present at this year’s G2E. Spintec products are well-known for design, player comfort, performance, and outstanding stability. Spintec will invite casino operators to experience the new generation of multi game solutions. Aura is the latest addition to their machine range. With a revolutionary new approach in design, Aura aims to be the most comfortable and ergonomic gaming terminal on the market, resulting in proven longer playing sessions and popularity among players. Spintec will showcase Aura gaming terminals with a stand-alone display offering live, automated and virtual games in one multi game experience. While Aura has been designed for amphitheatre
setups, Karma is the ultimate compact solution with a proven track record that guarantees longer gaming sessions on any casino floor. The Karma gaming solution is modular and customizable offering casino operators virtually endless options to add or extract modules and choose from a wide range of premium quality wood and leather finishes. Karma has been rolled out worldwide for years and has proven its reliability and performance. During G2E
this top selling automated Roulette and SicBo will be on display. Meet the team at stand 2046 at the show.
Suzohapp
Tomorrow’s ideas
A
t G2E, SUZOHAPP will proudly display its advanced solutions created and designed for OEMs and will show how tomorrow’s ideas can be turned into today’s reality. Coin hoppers, toppers and push buttons are three examples where SUZOHAPP has applied its expertise to create industry-leading solutions. “This is what has made SUZOHAPP the company it is today,” explains Ron Partridge, president of SUZOHAPP Americas. “We offer OEMs complete vertical integration from product design to production, and after-sales service and support. Our team has the development and manufacturing capabilities to produce innovative, OEM-specific solutions.” In the SUZOHAPP booth, significant focus will be placed on monitors and LCD’s, featuring ELO touchscreens as well as SUZOHAPP’s own Vision PRO monitors, including new LED edge-lit monitors and innovative dual-sided monitors. Visitors will have the opportunity to see a variety of buttons which suit any customer’s needs. Mechanical Halo buttons, chrome buttons, TFT buttons, touch deck and Aura buttons will
be showcased and the innovative Picture Key Technology (PKT) push button solution will be in the spotlight. SUZOHAPP will also offer a rich selection of components and at G2E will be showing joysticks, locks, speakers, video cards, LED Tube lights and new LED lighted USB Chargers. The top selling SH1950 Video Topper, now available in a backlit version, will be highlighted, as will TransAct printer solutions. Furthermore, SUZOHAPP is an exclusive distributor of Optec Displays and G2E will be an excellent opportunity to learn more about the features of Optec’s impressive new type of casino signage made from LED arrays that can be seen up to 300 feet away. Cash management equipment is a prominent offering in the SUZOHAPP portfolio and, at G2E, SUZOHAPP’s strong reputation for cash handling expertise will be on display. Featured will be the new CashComplete SDS-35, an innovative Smart Deposit Solution which represents a cost-effective method to secure notes and reduce labor time associated with counting notes. SUZOHAPP
will also be showing the RCS-500 and RCS-600, Recycling Cash Solutions which transform cash handling into smart cash management. At the SUZOHAPP stand there will also be a wide array of cash handling components on display, including the reliable MFL banknote reader, the Bill-to-Bill banknote recycler, the Comestero coin validators and the coin payout devices (Evolution, Cube and Flow hoppers). “The G2E promises to be a great event again, giving us the chance to show our professional and dedicated approach to the industry,” concludes Ron Partridge. “Our goal is to support gaming OEMs and help casino and route operators in their day-to-day business.” The SUZOHAPP team will be found at stand 4233 at the show.
Asia Gaming Briefings | October 2017
SUPPLIER SPECIAL REPORT 56 sensen
Unity
S
U
Refining your offerings
SenGame 3.0 enGame 3.0 is the latest release from Sensen Networks that will be launched at G2E Las Vegas. This is following on from the phenomenal response received at G2E Macau for the SenGame 2.0 edition, which captures table game performance metrics accurately and cost effectively. The 3- Dimensional colour, infrared and depth-sensing technology determines the number of players at the table and hands per hour, as well as the number, type and value of all bets placed. This information is then used for numerous business intelligence applications for table game yield optimisation and player satisfaction. SenGame 3.0 includes the addition of the tiny new 68mm x 17mm x 7.25mm camera allowing for the additional features of float count, mixed chip stack valuation and player grading capabilities. The compact size also makes it much more flexible to attach to varying existing table signage whilst remaining inconspicuous. SenGame 3.0 also comes complete with its own dashboard for operators to take a simple snapshot of any area of the gaming floor over any period in real time. As with SenGame 2.0 the option also remains to provide data for existing yield management systems already installed. SenGame’s smart design utilizes the latest cutting-edge technology and off the shelf hardware combined with its own proprietary computer vision and artificial intelligence algorithms. The setup was designed to be both quick and simple so that casinos experience zero downtime and disruption to the gaming floor. Each table is fitted with a camera and a mini PC that all communicate to a server which can then interface with any existing system. Gathering accurate table game insights was both difficult and prohibitively expensive to achieve in the past, however advances in technology and software solutions have now made it a reality and Sensen Networks is leading the way. See it first at G2E Las Vegas at stand 5338.
nity has been used in numerous forms of entertainment, and the gaming scene is no exception. Gaming equipment companies such as slot and gaming equipment manufacturers have already been tapping into the engine to develop their products. Unity challenges traditional in-house developer engines by opening gaming development to both 2D and 3D rendering, and giving developers the option to use more common coding languages such as C#. This allows companies to use the engine to tap into a greater talent pool for development and more. Unity has also been working side by side with developers and the gaming industry to ensure that resulting products comply with the stringent regulations to gaming. Developers can instead focus on bringing out their creativity and building new experiences. With a team that has many years of industry experience, Unity Technologies has been supporting companies to implement Unity in gaming on all the various platforms, from casino to web and mobile. “Working side by side with developers and the gaming industry to give them an edge, Unity has always valued our partnerships with the gambling community to get feedback and ideas on how we can help refine their offerings,” said Quentin Staes-Polet, regional director, South Asia Pacific, Unity Technologies. Unity Technologies will display their capabilities at stand 1331 at G2E 2017.
TCSJohnHuxley
Gameball to cause stir
F
ollowing on from the worldwide launch of Qorex Electronic Gaming Solutions at last year’s show, TCSJOHNHUXLEY will be debuting a host of new additions to the range. Powered by the GFL Gaming module, the
Asia Gaming Briefings | October 2017
ergonomically designed Qorex Terminal is now available in a 23” cabinet as well as the existing 27” version. The new 23” cabinet incorporates all the features of the original larger terminal, but has been designed to provide a more spacesaving footprint. A variety of terminal configurations will be showcased at G2E, clearly displaying the flexibility of Qorex. Center stage will be an 8-player Qorex carousel featuring Gameball, the exciting custom-developed new Baccarat style game. With the added benefit of 3 types of jackpots, Gameball is set to create as much of a stir in the US as it did when it was unveiled in Macau at G2E Asia recently, winning a ‘Hot Product’ award. Alongside the developments of the Qorex terminal is the completely redesigned Qorex Tablet Table. Now designed as a flexible modular system that can be built into custom designed furniture or bars, Qorex Tablet Table features an integrated bill validator system, eye-catching LED’s and a consistent user interface which
allows players to easily transition from Qorex terminal to tablet and vice versa. Also, being presented is the next generation Blaze LED Surface Technology and Saturn Glo Roulette Wheel. Visitors will be able see the eye-catching patented animations of Blaze that can be customized to display a variety of themes or promotions, as well as clearly indicating game status and winning numbers with the synchronized color changes of Blaze and Saturn Glo. A new games showcase will feature a range of proprietary and side bet innovations which includes some Crown Resorts games, such as Dice Duel, Nutz and S7REAK that form part of an exclusive table games distribution agreement. Alongside these will be AxMan, the fun and easy to play side-bet which adds an exciting Poker twist to the classic game of Blackjack and the progressive, 3 Card Draw Poker which will allow visitors to experience the power of the GFL Bonusing platform. Meet the team at stand 4439.
SUPPLIER SPECIAL REPORT 57 win systems
Driving Americas growth
Zitro
Bingo innovation
Z
W
in Systems, a leading technology supplier for the gaming and entertainment industry, will display its full suite of innovative products at G2E 2017. Visitors will be introduced to its premium S3 and S2 32” GameStar slot machines, state-of-the-art Lumina, Lumina Knock Out and Quadra Gold Club electronic roulette machines. The stand will showcase Win Systems’ full range of casino management products, including WIGOS, an innovative solution capable of processing vast casino floor data, currently adopted by more than 260 casinos within 17 countries. Its complementary marketing tools Intellia and WinUp will also be on show. Senior personnel will be present throughout, demonstrating how operators can utilize its expansive product range, as well as explaining the ease of Win System’s product integration into all casino operations. With new product developments to be announced and business partnerships to be established, Win Systems looks to build on recent trade show momentum and consolidate its position as one of the leading providers of technology and systems for casinos. Eric Benchimol, CEO of Win Systems, said: “G2E is another excellent opportunity for us to showcase our products and develop further business opportunities. “We enjoyed great success at Juegos Miami earlier this year, and Las Vegas presents a key event for a further push into the Americas, as well as other regions. “Our multi-channel casino solutions range will be on display, and as always, Win Systems personnel will be on hand to detail the integration and running of the products to all delegates.” Win Systems has also announced it is hosting The Great Pack Party, in partnership with FBM and Zitro, on the opening night of this year’s G2E in Las Vegas. The invite-only event, held at the Moon Nightclub, Palms Fantasy Tower, will provide a fantastic opportunity for networking after the first day of the major gaming trade show. Win Systems can be found at stand 3849.
itro will showcase its capacity for innovation and differentiation at G2E Las Vegas by presenting unseen products, including a new way of playing bingo. While at Zitro Experience 2017, Zitro unveiled its new range of Show Time video bingo games, mainly conceived for being compatible with the Blackwave platform and with the amazing Fusion Slant 23/27 platform, now Zitro will be introducing its new Show Prize concept, a new way of playing bingo that combines a frequency of prizes that has never been seen in a bingo game, with vast simplicity for the player to understand the prizes that have been won. The company will also launch Western Express as well as present Kingo, Gran Tesoro, Wonderful Lamp, Spin Win & Fire I, II and III, which have been specifically designed for the Fusion Slant 23/27 platform. Zitro will also present its new promotional systems Bobby Hour, Big Hour, Crazy Jerrypot, Super Botín and Mega Air Cash, and the new functionality Wild Crush, available for clients subscribing to the Zitro Partnership Program. With regards to its Bryke video slots range, Zitro continues to expand its multigame packs within its already extensive collection of Pick & Win games, as well as its new multi-game family Spin Hit with four progressive jackpots, all of which are available in the superb new Fusion Up Right 23/23 and Fusion Slant 27/27 cabinets. At G2E, Zitro will be presenting its LAP Blazing Pearls, which comes with three oriental-themed titles that include elements of great symbolic richness and excellent graphic representation. The games Dragon Princess, Dragon Warrior and Fu Charms share four progressive and shared jackpots, and a differentiated and unique gaming mechanics inspired by the legendary dragons found in the Chinese culture that struggle to reach the blazing pearl, symbol of well-being, prosperity and richness. Zitro continues celebrating its tenth anniversary, with what will be a spectacular G2E. Find the Zitro team at stand 2440 at the show.
Asia Gaming Briefings | October 2017
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OCTOBER
DECEMBER
MARCH
Global Gaming Expo (G2E) 3-5 October 2017 Sands Expo Center, Las Vegas, USA www.globalgamingexpo.com
SBC AWARDS 5 December 2017 London, U.K www.sbcevents.co.uk
iGaming Asia Congress 13-15 March 2018 Macau https://igamingasiacongress.com/
IAGR annual conference 16-19 October 2017 Johannesburg, S. Africa https://www.iagr.org/conference
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International Casino Exhibition (ICE) 6-8 February 2018 ExCel Centre, London, U.K http://www.icetotallygaming.com/
MGS Entertainments Show 14-16 November 2017 Venetian, Macau http://www.macaogamingshow.com/
Sports betting and gaming India conference 27-28 February 2018 Goa, India www.sportsbettingevents.com/background-india.html
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APRIL Asia Amusement & Attractions Expo (AAA) 3-5 April 2018 Guangzhou, China http://www.aaaexpos.com
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Asia Gaming Briefings | October 2017
LAST WORD 62
Hato lifts lid on infrastructure woes Sharon Singleton
Managing Editor, AGB
In the 15 years since Macau was handed back to Chinese sovereignty, real gross domestic product growth has averaged more than 10 percent a year, fuelled by its booming casino sector.
A
ccording to a February International with border crossings. Work began in late 2011 and the first phase of Monetary Fund report, Macao has zero gross public debt and fiscal reserves equal to 95 the line is now expected to be operational by 2019, percent of gross domestic product. After some three years behind schedule. The timetable for 15 years of double-digit current account surpluses, completion for the remainder of the system, linking foreign exchange reserves are roughly US$19 billion up the Macau Peninsula and the island of Coloane remains murky, as does the estimated final cost. or around 100 percent of pataca M2. Another major infrastructure project, the 35.6km The territory overtook Switzerland in 2013 to become the world’s fourth-richest nation in terms of bridge linking Hong Kong, Macau and Zhuhai, has GDP per capita, with less than 2 percent unemployment. also been plagued by construction problems, fatalities However, all it took was one storm to highlight the and a corruption probe. Earlier this year, Hong Kong graft busters arrested woeful state of Macau’s infrastructure. The category 10 Typhoon Hato hit in August, killing at least 10 people 21 contractors after they were found to have switched concrete samples for the mega and leaving more than half project. Hong Kong officials the population without power were forced to conduct stress or water for days. tests on the structure and Hydro trucks were sent The completion have concluded it is sound, from the neighbouring Chinese of projects, such as despite the scam. province of Guangdong to The bridge is seen as a help restore running water a light rail transit game changer for Macau’s to homes, while People’s system, have been tourism aspirations, providing Liberation Army soldiers touted as key drivers a direct link to Hong Kong’s left their barracks, taking to international airport and the streets for the first time of future gross cutting out the need for the ever to help clear the debris. gambling revenue hour-long ferry crossing. One casino executive Officials admitted earlier told Reuters on condition growth, especially this year, that it will cost of anonymity that it was like for the mass market more than initially planned, the city had returned to the although didn’t say by how “stone age.” sector. much. Some projections have “People have to queue said it will come in at more on the street for water? than double the initial price It is unbelievable to have no power and water more than 48 hours after,” the tag of almost $11 billion. Most of the construction work is now scheduled executive said. “How can the government claim we for completion by the end of this year, though some are a first world city?” Analysts, legislators and tourism experts have link roads may still take time to finish. Macau also has a shortage of affordable housing, been arguing for years that Macau needs to improve infrastructure to meet its full potential. In fact, the triggering protests from residents who have been completion of projects, such as a light rail transit priced out of the market. A 2014 tender for public system, have been touted as key drivers of future housing saw some 40,000 candidates vye for about gross gambling revenue growth, especially for the 1,000 houses. Legislators José Pereira Coutinho and Leong Veng Chai in their campaign for September’s mass market sector. Yet most are long-delayed and over budget. The legislative elections called on the government to set first phase of the LRT system will link the island of aside land to build about 80,000 housing units. After Hato, it has become abundantly clear that Taipa, home to the Cotai strip resorts, to the new Pac On ferry terminal and the international airport. further delays in improving basic infrastructure and It will be Macau’s first rail system and is designed providing for residents in one of the richest places to solve traffic bottlenecks and eventually connect on the globe is unlikely to be accepted.
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Asia Gaming Briefings | October 2017