LAST WORD 58
Sharon Singleton
Managing Editor, AGB
Asia losing out on online convergence MGM Resorts may have walked away from its $11 billion attempt to buy the U.K.’s Entain, but it’s unlikely to be the last attempt we see from landbased gaming giants seeking to secure a foothold in the online world.
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There are rumblings that cash-strapped governments he casino giant abandoned its attempt after Entain’s board rebuffed its offer for a second may be more eager than they have been in the past time. A merger would have provided MGM to consider legislating and taxing. But so far only the with sole control over their U.S. joint venture Philippines has taken a step to make that happen. The Philippine Amusement and Gaming Corp BetMGM, as well as other leading online brands, has begun issuing the first licenses that will allow the including Ladbrokes and Coral. As the land-based casino world continues to country’s nationals to gamble online and to allow landstruggle with Covid-19-mandated closures and social based casinos to accept online bets. It’s a bold experiment and very much in its infancy. distancing rules, the online world appears to be going Manila has been more willing to embrace the potential for from strength to strength. Entain this month reported net gaming revenue online gambling than its regional peers, but with mixed success. The early promise of the surged 41 percent in Q4 of last Philippine Offshore Gambling year, with momentum continuing Operator (POGO) segment has into 2021. The U.S. is seen as one given way to disillusionment, of the highlights, with BetMGM Manila has with firms leaving in droves now having an 18 percent share due to high operating costs of the market there and online been more willing and what many consider to be revenues surging 130 percent. to embrace the a greedy tax bid on the part of The figures are certainly the government. compelling and there is a strong potential for online Still, as the pandemic drags rationale for tie ups between gambling than its on and casino companies across U.S. operators and Europe’s regional peers, the region stare into the face of experienced online players keen months of further uncertainty, to get a slice of the newly liberated but with mixed it’s hard to imagine pressure American pie. success. isn’t building for online access MGM wasn’t the first. Caesars to players. Entertainment is buying William Macau, with its stringent Hill for $3.72 billion. Shareholders border controls, is looking at in the U.K. company voted to approve the deal in November. While Flutter declines in the high sixties, low seventies percent in Entertainment, owner of PaddyPower, merged with revenue for January compared with last year, according to Bernstein Research. Analysts now see the key Lunar The Stars Group last year. But where does this leave Asia? For all the multiple New Year holiday as being a wash out. The operators have shown they have deep pockets billions of dollars that undoubtedly change hands in the region’s online gambling markets each year there and through deep cost cuts are managing to remain in the black on the EBITDA level, but there are limits is still a dearth of regulation. And without it, we’re unlikely to see the kind of to the pain. As exciting new opportunities open up elsewhere, convergence that is happening between the European and U.S. operators and which will provide a diversified what was once the world’s most exciting region for gambling risks being left behind. revenue stream to support land-based assets.
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Asia Gaming Briefings | February 2021
