PHILIPPINES

PhilWeb launches charm offensive

Almost two years after losing its license in a spat with Philippine President Rodrigo Duterte, gaming technology company PhilWeb Corp is on a charm offensive to win back lost business with improved content and services.

"i hope you will support us,” PhilWeb President Dennis Valdes said as he recently shook the hand of Pastor Albano Jr, a businessman who operates internet-based casinos about 500 kilometres north of capital Manila. “If the price is right,” Albano replies.

Valdes gathered dozens of independent game operators from all over the country in May to reiterate a message: PhilWeb is back in business. He wants to win back Albano and others who felt they were the unwitting victims when PhilWeb ran into regulatory troubles.

PhilWeb lost its license in August 2016, prompting electronic casino game operators to shift to a unit of rival DFNN Inc. Albano, the businessman from Laoag City, drove for about 8 hours to attend PhilWeb’s luncheon meeting in Makati City to decide whether he should keep running DFNN’s gaming software in his machines or return to PhilWeb’s fold.

To make his case, Valdes ran some slides claiming 18 percent to 20 percent more revenue from each terminal running games provided by PhilWeb versus those by DFNN; more transparent and timely management of cash commissions, and better marketing services.

“It’s time you can expect more from us,” he says as he unveils the new company slogan.

The company has a two-pronged strategy. It aims to provide a new menu of online games, including non-casino games, to enrich the gaming experience and attract a younger audience.

It also plans to reactivate account-based play through its single wallet offering.

At the heart of this strategy is PhilWeb’s partnership with Habanero Systems BV.

Habanero’s Viva Las Vegas social gaming platform will be rolled out on PhilWeb’s system through Q3. It’s the second such social casino offering for PhilWeb after Magic Macau.

“Over the next years, we have plans to keep introducing new casino games into that mix, but always with the single wallet so the new players that are coming in can take advantage of that ecosystem.”

The single wallet will be interfaced with PhilWeb’s POS and membership system. With the player’s funds all in one virtual wallet, it’s easy to move funds in and out as the player shifts from one online game to another.

We’re not just going to stay with online casino software because, at some point, what you don’t want to see is just another slot machine game.

“We’re not just going to stay with online casino software because, at some point, what you don’t want to see is just another slot machine game. We’re going to put sports-betting games, virtual games, and a variety of other games into that same platform so that [the number of] our players will grow,” Valdes shares.

The single wallet will be what differentiates a player with a mouse and a screen from a player in a land-based casino, he adds. In a land-based casino, a player may have a single wallet, but when he wants to move from, say, a baccarat table to a slot machine, he has to physically walk to get over there. An online casino player with a single wallet doesn’t even have to stand from his chair.

PhilWeb used to be the anointed vendor of Philippine Amusement Gaming Corporation,or Pagcor, to service its network of accredited e-games cafes. PhilWeb operated under a coveted Intellectual Property License and Management Agreement (IPLMA), which gave it blanket approval to provide gaming software, as well as marketing, cash management and administrative services, to all Pagcorlicensed electronic casinos operated by independent businessmen.

Belatedly, rival DFNN was also granted an IPLMA in 2013. But by 2016, Philweb still had the upper hand with 286 electronic game outlets versus DFNN’s five. That year, President Rodrigo Duterte assumed office and started blasting PhilWeb’s former chairman and major stockholder Roberto V. Ongpin as an “oligarch he must destroy.”

Ongpin eventually bowed out of PhilWeb, but Pagcor still did not renew PhilWeb’s IPLMA when it expired in August 2016. This left casino operators out in the cold and about 220 electronic casino sites later shifted to DFNN’s electronic gaming system, ‘Instawin.’

“We met with Pagcor early on, and we tried to understand what they were trying to do,” says Valdes. A common ground for the discussions was how to eventually revive the P2 billion ($37.4 million) that Philweb had been remitting to Pagcor every year as part of its IPLMA. That amount is among the biggest non-tax revenues that directly fund some of the national government’s social programs.

A “mutually acceptable solution” was reached over a year later. It mirrored some existing regulatory structures. In the electronic bingo world, for example, Pagcor grants licenses to outlet operators who then choose the bingo machines from suppliers also accredited by Pagcor.

“In the electronic casino world, Pagcor said let’s just do the same,” Valdes says. As part of the accreditation process, Pagcor held a competitive public bidding for Electronic Gaming System (EGS) licenses. These are similar to the accreditation that Pagcor grants to bingo machine and slot machine suppliers. In October 2017, Philweb was granted the first EGS license.

By December 2017, Philweb plugged back its gaming software on 16 gaming sites operated by a fully owned subsidiary, BigGames Inc.

As of today, the company has 52 sites, with 28 of those actually owned by PhilWeb unit BigGames. Alongside the provision of services, the company has also been actively acquiring Pagcor-licensed cafe operators. It has previously said it was offering to buy the sites in return for the support it has received from the owners.

The company’s Q1 results show it is regaining ground, with a 236.7 percent spike in revenue and its cash loss narrowing from P45.4 million to P4.4 million.

Tiger Resort, Leisure and Entertainment

Tiger Resort Leisure and Entertainment’s Okada Manila, owned by Japan’s Universal Entertainment, is the largest resort in Entertainment City and the last to enter the market, with a soft opening in 2016. Universal said in its Q1 results that business had been ramping up well. In Q1, the casino business had net sales of 8.8 billion yen ($80.1 million) and an operating loss of 1.41 billion yen. Compared with Q4 of last year, sales increased by 1.73 billion yen and the loss decreased by 550 million yen. Universal has said it may seek a stock exchange listing for the local unit that controls the resort, Tiger Resort, Leisure and Entertainment, to improve name recognition. The IR has been gradually rolling out new amenities and in Q2 expected to open the Maharlika Club, a high-end area and spa targeted at local guests. It will also open more hotel rooms and retail amenities.

The property spans 44 hectares and at the completion of Phase One, Okada will have 994 hotel rooms and operate 500 tables and about 3,000 slots. Its centrepiece is the world’s largest coloured fountain, as well as a giant inner city beach complex, known as “Cove Manila”.

The casino floor will have about 500 table games and 3,000 electronic gaming machines, a 90,000 square-feet nightclub and beach club entertainment complex.

City of Dreams

The $1.3 billion City of Dreams Manila is owned by Belle Corp and Melco Crown Entertainment’s local unit. For Q2, revenue slipped due to accounting changes, though its adjusted EBITDA rose to $87.3 million from $62.8 million in the comparable period of 2017. The company said the improvement was the result of a better performance in all gaming sectors.

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-meters family entertainment center in collaboration with Dreamworks Animation, a live performance stage, two international nightclubs and a multi-level car park.

Bloomberry Resorts

Bloomberry Resorts’ Solaire was the first IR to open in Entertainment City and its most recent results have been strong, with record VIP volumes helping the company swing to a profit in Q1. It posted a profit of 2.15 billion pesos, compared with a loss of 1.15 billion pesos in the prior year quarter. Solaire reported VIP volume up 34.7 percent, mass table drop up 23.7 percent and slot coin in up 26.2 percent.

Solaire is a 16-hectare integrated resort. The Bay Tower of Solaire consists of a casino with an aggregate gaming floor area of approximately 18,500 square meters (including 6,000 square meters of exclusive VIP gaming areas), with about 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.

The company has a property on Jeju island South Korea and is planning a second IR in the Philippines in Quezon City. It expects to start construction next year, with completion slated for 2022. The resort aims to capture a share of the mass market north of Manila.

Resorts World Manila

Travellers International Hotel Group, a joint venture between Genting Hong Kong and Alliance Global, is the owner and operator of Resorts World Manila. The IR is not located in Entertainment City and caters primarily to a loyal mass market, local crowd. However, the pull to the newer resorts, coupled with a deadly attack by a lone gunman who set fire to gaming tables in June last year, have affected performance. For Q1, net profit fell 35.2 percent to P444 million (US$8.5 million). Revenue for the group fell 14.8 percent in the quarter to P4.5 billion, while EBITDA fell to P839.7 million, down from P1.4 billion in the same period last year.

Travellers said the decline in revenue was due mainly to lower revenue in its non-VIP segment at RWM.

Pagcor appoints new licensing head

The Philippine Amusement and Gaming Corp. has announced changes to the senior leadership of its Gaming Licensing and Development Department, appointing lawyer Angeline P. Papica-Entienza as its new head.

She will also be an assistant vice president and took up the position on July 3, replacing Ramon Villaflor. In addition, the regulator appointed Rowena Alcaide as senior manager of the Casino Licensing and Regulatory unit replacing Dave Fermin Sevilla.

Angelie Agustin will be a senior manager of the Responsible Gaming and Logistics unit, while Jeremy Luglug will be acting senior manager of the Remote Gaming Unit.

Government to ease arrivals for Chinese and Indians

The Philippines is looking for ways to hasten the processing of “visa upon arrivals” for Chinese and Indian tourists after recognizing the importance of the two markets.

“Right now, two major markets that we have to really look out in terms of facilitating entry are China and India,” Department of Tourism Undersecretary Benito Bengzon was cited as saying in local media.

Bengzon said the government is considering deploying Mandarin-speaking personnel to airports to better communicate with Chinese tourists. In terms of tourist arrivals, South Korea took the top spot at 1.6 million tourists in 2017, followed by China, and the United States.

India took the 12th position at 107,278 arrivals in 2017.