Global Gaming Business, February 2020 by Global Gaming Business

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GGB Global Gaming Business Magazine

TRUCK-STOP VGTs PIT TECHNOLOGY MORE MERGERS ICE PREVIEW

February 2020 • Vol. 19 • No. 2 • $10

Socially Acceptable

Hold Your Own Why raising the slot hold can be a slippery slope

How the impact of gaming on communities is largely positive

Small Changes, Big Results The next evolution of casino marketing

VISIT GGB AT ICE IN STAND SD2-A Association of Gaming Equipment Manufacturers

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CONTENTS

Vol. 19 • No. 2

february

Global Gaming Business Magazine

COLUMNS

20 COVER STORY

The Slot Hold Debate Several academic studies show that slot machine players cannot tell the difference between a slot that is set at a high hold percentage (a low return to player) and an identical machine set at a lower hold. A veteran casino consultant, while not disagreeing with this point, stresses that casinos must weigh this immediate reaction to higher hold with the longer-term effect of players abandoning the slot floor because their budget does not last as long. By Brian Wyman, Ph.D.

FEATURES

30 Gauging Gaming’s Effects The industry has done a good job of battling outdated stereotypes related to casino gambling, but much work remains to be done.

10 AGA Look Back, Look Ahead Bill Miller

12 Fantini’s Finance Good for Gaming Frank Fantini

28 Making My Point Secret to Success Roger Snow

DEPARTMENTS 4

The Agenda

By the Numbers

5 Questions

13 AGEM

By Marjorie Preston

34 Emerging Leaders

36 Pit Tech

14 Trucking With VLTs Legislation expanding truck-stop gaming in Illinois and Pennsylvania are the latest events contributing to growth in a healthy video lottery and video gaming terminal market.

The resurgence of the table-game sector of the casino industry is aided by constantly evolving technological innovations. By Dave Bontempo

42 New Game Review 44 Frankly Speaking 46 Cutting Edge 50 Goods & Services

By Frank Legato

24 The Evolution of Demographics

With Excalibur’s Lukas Pesek, AGA’s Jessica Feil, and Jamul Casino’s Josh Ford

57 People

48 ICE Arrives

Marketing professionals can no longer lump younger players into a catch-all demographic of “millennials.” Here’s how casino player demographics are evolving, and how marketers should react.

One of the most important events on the gaming industry calendar happens this month, when ICE London fills the ExCeL Centre with the latest innovations in the business.

By Clay Peister and Steve Gallaway

By Patrick Roberts

58 Casino Communications With Michael Soll, President, The Innovation Group

FEBRUARY 2020 www.ggbmagazine.com

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THE AGENDA

Educating the Masses By Roger Gros, Publisher

ou’d think that gambling and the gaming industry are very mysterious things. Many people seem to be totally uneducated about the simplest things that make up gambling. For example, don’t casino customers know the odds are stacked against them? Don’t they realize that casinos worth millions or billions of dollars can’t be built on the backs of winners? There’s a built-in casino advantage—house edge—to gambling that makes it a very lucrative business. Do people win sometimes? Sure, they do. That’s what makes it so thrilling for those who enjoy gambling. But there seems to be a blind spot for many people who think casinos can’t survive unless the house wins a hefty percent of the money wagered. Even with that hefty percentage, casinos are way more player-friendly than lotteries or horse racing, which keep more than 50 percent of the money wagered by their players. So why can’t people learn? It’s really not that difficult. Table games are the best games to play in a casino because, in general, the house edge is lower than 10 percent. They’re much more volatile, meaning that there can be days where the casino actually loses money at tables. Information is widely available on the internet for anyone who cares to do a short Google search. Slots are more predictable, for casinos and players alike. Casinos set their “hold” percentage at a specific level depending on the regulations or market conditions. Regulatory agencies report in general what the hold percentages are in their jurisdictions, so it’s no mystery. Players just have to look it up to see they’re not getting the better of it when playing slots. When I was editor of Casino Player magazine in the late 1980s, we turned the “hold” percentage around and called it the “payback” percentage. After all, a 90 percent payback sounds much better to a player than a 10 percent hold. There were only two legal jurisdictions in those days—Nevada and Atlantic City. In New Jersey, the Casino Control Commission reported the hold percentage from every casino, as well as the hold percentage of each denomination of slot machine—this was before you had the “multi-demon” machines you see today. We thought this was a valuable piece of information, and even teamed up with CDC Gaming Reports to award “Certified Loose Slots” certificates 4

Global Gaming Business FEBRUARY 2020

to casinos that would give us access to their hold information to provide third-party verification of those facts. We believed that would guide players to the casinos and machines that paid back the most. And while there certainly were a handful of devoted players who appreciated this data, the vast majority of players just didn’t care. (Of course, it depended on how the casinos marketed that certificate to really take advantage of it.) In general today, there are many woefully uneducated players who only have the vaguest notion of how the games work. Ironically, they seem to be more knowledgeable about how the players clubs work, and how much they need to gamble to reach a certain level of comps. Casino folks call it “aspirational” play, and make it part of their marketing plan. I’m a member of many casino and gambling groups on Facebook, and the number of posts about players clubs far exceeds the posts about gambling and odds. Now there are some ongoing efforts to educate players on odds and playing conditions. One is the GameSense program, originally developed in British Columbia, which has been incorporated by MGM Resorts for all its properties. Hard Rock International just launched a similar program. Both these programs educate players about the rules of the games, the odds and the volatility of the games. They also offer assistance for players who have problems with gambling. This is just the start. The American Gaming Association is committed to educating players so they can make informed decisions when they play, and enjoy casino entertainment responsibly and without harm. The “Get to Know Gaming” (G2K) program is an excellent representation of the industry, filled with facts and figures. But will the players respond? In my 40 years in gaming, I haven’t seen a great thirst from the majority of players for the education that could make casino gambling more fun and profitable. I guess for many of them, gambling is an escape from their regular lives, where they’re generally educated and understand what they’re doing. Maybe it’s not that important to them to be informed. But that doesn’t mean the industry shouldn’t keep trying—if only to show that the information is out there. It’s up to the individual players to decide what to do with it.

Vol. 19 • No. 2 • FEBRUARY 2020 Roger Gros, Publisher | rgros@ggbmagazine.com twitter: @GlobalGamingBiz Frank Legato, Editor | flegato@ggbmagazine.com twitter: @FranklySpeakn Marjorie Preston, Managing Editor mpreston@ggbmagazine.com Monica Cooley, Art Director | mcooley@ggbmagazine.com Terri Brady, Sales & Marketing Director tbrady@ggbmagazine.com Floyd Sembler, Business Development Manager fsembler@ggbmagazine.com Becky Kingman-Gros, Chief Operating Officer bkingros@ggbmagazine.com Jessica Walker, Operations Manager jwalker@ggbmagazine.com Lisa Johnson, Communications Advisor lisa@lisajohnsoncommunications.com twitter: @LisaJohnsonPR Columnists Frank Fantini | Bill Miller | Roger Snow Contributing Editors Dave Bontempo twitter: @bontempomedia Steve Gallaway | Krista McPherson Clay Peister | Patrick Roberts | William Sokolic Brian Wyman, Ph.D. __________________

EDITORIAL ADVISORY BOARD Rino Armeni, President, Armeni Enterprises

•

Mark A. Birtha, Senior Vice President & General Manager, Hard Rock International

• Julie Brinkerhoff-Jacobs, President, Lifescapes International

• Nicholas Casiello Jr., Shareholder, Fox Rothschild

• Jeffrey Compton, Publisher, CDC E-Reports twitter: @CDCNewswire

• Dean Macomber, President, Macomber International, Inc.

• Stephen Martino, Vice President & Chief Compliance Officer, MGM Resorts International, twitter: @stephenmartino

• Jim Rafferty, President, Rafferty & Associates

• Thomas Reilly, Vice President Systems Sales, Scientific Games

• Michael Soll, President, The Innovation Group

• Katherine Spilde, Executive Director, Sycuan Gaming Institute, San Diego State University, twitter: @kspilde

• Ernie Stevens, Jr., Chairman, National Indian Gaming Association twitter: @NIGA1985

• Roy Student, President, Applied Management Strategies

• David D. Waddell, Partner Regulatory Management Counselors PC Casino Connection International LLC. 901 American Pacific Drive, Suite 180 • Henderson, Nevada 89014 702-248-1565 • 702-248-1567 (fax) www.ggbmagazine.com The views and opinions expressed by the writers and columnists of GLOBAL GAMING BUSINESS are not necessarily the views of the publisher or editor. Copyright 2020 Global Gaming Business LLC. Henderson, Nevada 89014 GLOBAL GAMING BUSINESS is published monthly by Casino Connection International, LLC. Printed in Nevada, USA. Postmaster: Send Change of Address forms to: 901 American Pacific Dr, Suite 180, Henderson, NV 89014 Official Publication

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BY THE

NUMBERS

Premium Challenges

ReMoTely InTeReSTIng A

study released in January by IDEA Growth, an association that seeks to grow jobs and expand the online interactive gaming business in the United States through advocacy and education, surveyed the concept of remote registration vs. in-person registration to open sports betting accounts. “In-Person Registration For Online Sports Betting, A Quantitative And Qualitative Analysis” revealed that in-person registration restricts the revenue potential of legal online sports betting, the competitiveness of legal markets, and the tax revenue that flows to state governments. Some of the findings included that some potential clients (15 percent) would not drive to open an account, while others consider an hour’s drive the outer limits of registration. New Jersey, which permits remote registration, is more than twice as successful as states that do not. And most interesting, in-person registration merely adds to the advantages enjoyed by illegal online sportsbooks when trying to convince bettors to transition to legal sports betting. To get a full copy of the report, visit ideagrowth.org.

n the December 2019 issue of the Eilers-Fantini Central Game Performance Database, IGT remained the leader in market share on the casino floor. With 34 percent of machines in North American casinos, IGT added to its lead by adding more wide-area progressives (WAP) over the last month, including the new Price is Right: Triple Showcase Showdowns. At 24 percent, Scientific Games added more premium leased and WAPs in November, with its new WAP, Dancing Drums Explosion. And third-place Aristocrat is actually the leader in premium slots and WAPs, topping the new titles with Mad Max Fury Road. The Eilers-Fantini Central Game Performance Database collects and tracks relative slot machine performance data provided by individual casinos on a monthly basis and then standardizes and aggregates the data. All data is held in a secure online database and no individual casino data is viewable. To obtain a copy of the report, contact Rick Eckert, managing director of Eilers & Krejcik Gaming, at reckert@ekgamingllc.com.

Supplier

The Illegal Sports Betting Market: The Consumer Perspective

Global Gaming Business FEBRUARY 2020

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© 2019 IGT. The trademarks and/or service marks used herein are either trademarks or registered trademarks of IGT, its affiliates or its licensors. Artwork, descriptions, game play, photographs, videos, and other product details depicted herein are subject to change. IGT is committed to socially responsible gaming. Our business solutions empower customers to choose parameters and practices that become the foundation of their Responsible Gaming programs.

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NUTSHELL

“They

5Questions

Anna Shahbazyan

USA and Latin America Regional Director, BetConstruct or many years, BetConstruct has been operating successfully in online gaming and sports betting in FShahbazyan Europe. The company is now aiming to become a force in the Americas in interactive gaming. Anna has been given the task of introducing the company to clients in these regions. She responded to questions from GGB Publisher Roger Gros in January. GGB: Give us some background on BetConstruct. Shahbazyan: BetConstruct started as a B2C operator in Europe, and today is a global award-winning tech-

1 2 3 4 5

nology and services provider for the online and land-based gaming industry. The B2B giant has 15-plus years of experience in iGaming under its belt, offering licensed products, services and industry expertise. What experience does BetConstruct have in sports betting in Europe and elsewhere?

BetConstruct continues to sweep accreditation from the most reputable jurisdictions across the world. This ongoing process guarantees the flexibility of our offering which, in its return, makes it possible for operators to launch their iGaming business in any corner of the world. Due to our network of 15 global offices, we successfully maintain close relationships with the relevant licensing bodies, as well as understand requirements in the native languages. What are the opportunities in the U.S. for BetConstruct?

The U.S. market is the next big thing. Given both the legislative developments and player preferences, entering this market amounts to being active in 50 states. So, first things first—certification is now a priority for any software developer. 2020 will bring new regulations to more new states. Some may provide even more freedom than the existing states like New Jersey. To understand the forthcoming legislative infrastructure, as well as perfecting our products and services, are the main goals for the year when it comes to the North American region. The operator’s profile is important too. To name a few, there are land casinos, lotteries and tribes. That goes to show that each business requires an individual approach, and our business models reflect this idea. BetConstruct has special package types covering the demands and interests of each profile, including the most important services: B2B and B2C support, risk, trading, marketing and land-based solutions. How do you think online gaming will proceed in the U.S., now that sports betting is legal in so many states?

We can surely say it will bring a positive impact on the economy by attracting foreign providers and operators. More investments and new jurisdictions come with the growth of legal iGaming operations, and any new provider from abroad is a new investment with the taxes they pay. U.S. regulation is a great example for other jurisdictions like Argentina. Having 20-plus states with legalized sports betting, the industry expects a dozen more to join this number in the upcoming year. Smaller states with many land-based casinos hold bigger iGaming opportunities, such as establishing an online brand of their physical venue. How do you help your clients obtain online players?

BetConstruct provides a number of B2C services and tools aimed at player acquisition and retention. All of them are conveniently available through our iGaming console, BME, where all marketing services are ready to be launched in a single click. To increase traffic and attract new players, our web marketing tools, such as the affiliate system and agent system, come in handy. When it comes to retention, Predictor and Sweepstakes free-to-play games guarantee engagement and convert sports lovers into sportsbook users. Alongside, we have B2B solutions, which help operators reach maximum revenue potential. One of them is BetCloud, which allows accepting over-limit bets without any risks of financial loss for operators, while helping them to retain VIP players.

Global Gaming Business FEBRUARY 2020

Said It”

“We will change the culture of women in leadership, and we will not stop until this industry becomes a beacon for others to study.” —Jan Jones Blackhurst, on her appointment as “chief executive in residence” of a new diversity initiative at the International Gaming Institute of the University of Nevada, Las Vegas

CALENDAR February 4-8: ICE London 2020, ExCeL Centre, London. Produced by Clarion Gaming. For more information, visit ICELondon.UK.com. February 5-8: iGB Affiliate London 2020, ExCeL Centre, London. Produced by Clarion Gaming. For more information, visit iGBAffiliates.com. February 10-13: 5th Annual Western Indian Gaming Conference & Tradeshow, produced by California Nations Indian Gaming Association. For more information, visit CNIGA.com. February 20: Gaming & Hospitality Education Series: 5 Ways the Gaming Industry Will Change in the Next Decade, Konami Headquarters, Las Vegas, and webcast. Produced by GGB and Clarion Gaming. For more information, visit GGBGHES.com. March 4-5: North American Regulators Roundtable, Tropicana Las Vegas. Produced by Gaming Laboratories International. For more information, visit GamingLabs.com. March 6: Prague Gaming Summit 2020, Vienna House Andel’s, Prague, Czech Republic. Produced by European Gaming Media and Events. For more information, visit praguegamingsummit.com. March 8-10: Casino Marketing Boot Camp, Hotel Mazarin New Orleans, Louisiana. Produced by Julia Carcamo Associates. For more information, visit CasinoMarketingBootcamp.com. March 11-12: Ukrainian Gaming Week 2020, International Exhibition Centre, Kyiv, Ukraine. Produced by Smile Expo. For more information, visit UGW.com.ua. March 23-26: World Game Protection Conference, Tropicana, Las Vegas. Produced by World Game Protection Inc. For more information, visit WorldGameProtection.com. March 24-26: CasinoBeats Malta, Intercontinental Malta, St. George’s Bay St. Julian’s, Malta. Produced by Sports Betting Community. For more information, visit SBCEvents.com. March 24-27: Indian Gaming Tradeshow 2020, San Diego Convention Center. Produced by the National Indian Gaming Association. For more information, visit IndianGamingTradeshow.com. April 2: Gaming & Hospitality Education Series: Lap of Luxury: The Modern Hotel With a Casino Konami Headquarters, Las Vegas, and webcast. Produced by GGB and Clarion Gaming. For more information, visit GGBGHES.com.

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AMERICAN GAMING ASSOCIATION

Look Back, Look Ahead One year and counting, and the future is bright

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Global Gaming Business FEBRUARY 2020

By Bill Miller

anuary marks my one-year anniversary as the American Gaming Association’s president and CEO. It’s been quite an amazing year. On my first day, the Department of Justice announced its reinterpretation of the Wire Act, and from there, the pace never slowed, and the industry never ceased to impress. I spent much of 2019 traveling, listening, and learning. Every conversation, from Macau to London, from Nevada to Pennsylvania, painted a clear picture: gaming is a modern industry, an economic powerhouse, and a committed community partner. One of my favorite parts of this job is visiting gaming communities across the country through our Get to Know Gaming campaign. I’ve met dozens of business owners, elected officials and community leaders who shared their unique stories of how gaming has positively impacted their lives. Translating this positive sentiment into greater political influence will be core to what AGA does in 2020, as we relaunch the Congressional Gaming Caucus for the 116th Congress with more than 30 representatives. Over the past year, the country has seen the benefits of legal, regulated sports betting firsthand. That’s motivated even more states to join the 20-plus jurisdictions that have legalized sports betting as legislatures come back into session. The AGA stands ready to serve as a resource for states considering establishing legal frameworks, and will continue advocating for policies that protect consumers and attract bettors away from the dangerous and

“

pervasive illegal market. Looking back, we pushed hard to overturn the Professional and Amateur Sports Protection Act in the first place because we believed legal, transparent, regulated wagering would disrupt the predatory, illegal, offshore market. The AGA brought together a broad coalition of law enforcement officials, political leaders, regulatory experts and other stakeholders to push for PASPA’s repeal. Now, we plan to reinvigorate that coalition to continue our work to stamp out illegal gambling and raise the bar on responsible gaming. While gaming’s popularity grows and our public support rises, we remain forced to operate in a financial environment that has not changed in decades. To help provide our customers with the same seamless experience on the casino floor that they enjoy throughout our properties, the industry is exploring ways to advance payment choices for customers, from debit cards to digital payments. The AGA will continue to support industry efforts to educate key stakeholders and equip members with research to pursue payments choice in states. I can honestly say that I’m more excited about this job today than when I started a year ago. I could not be more grateful to AGA’s members for giving us such incredible support, or prouder of the AGA team for the accomplishments we achieved. As the AGA celebrates its 25th anniversary in 2020, we will continue our work to advance these priorities, and accomplish for the industry what individual members cannot do alone.

Every conversation, from Macau to London, from Nevada to Pennsylvania, painted a clear picture: gaming is a modern industry, an economic powerhouse, and a committed community partner.

”

Bill Miller is president and CEO of the American Gaming Association.

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FANTINI’S FINANCE

Buying Spree Expect more mergers and acquisitions in the Year of the Rat

ooking ahead to what the Year of the Rat has to offer gaming, one thing is sure— more U.S. mergers and acquisitions. Sometime in the first half of the year, Eldorado Resorts will close on its acquisition of Caesars Entertainment. The deal has been examined six ways to Sunday, so we won’t take time or space to do that here. But we will ask this: How many more major acquisitions can we expect? The U.S. casino industry will soon be down to several major players: Las Vegas-Macau operators Las Vegas Sands, MGM Resorts and Wynn, and regionals Penn National, Boyd, Red Rock Resorts and, of course, Eldorado. So, what’s left? Boyd would seem a natural to buy Planet Hollywood or Paris-Bally’s from Eldorado. That would give the company a Las Vegas Strip presence that was lost more than a decade ago, when the Stardust was demolished to make way for the ill-fated Echelon project, which now is the Resorts World Las Vegas project. One large acquisition could be Red Rock Resorts, if the Fertitta brothers are interested in selling all or part of the company. There are some smaller operators that still could be targets: Golden Entertainment, Full House Resorts, Churchill Downs. Then there are the multi-property, privately owned Midwest casino owners, where founders or families might at some point want to cash out: Elite in Iowa, Jack Entertainment, Jacobs Entertainment, Rush Street and others. Of course, REITs can stay busy with sales and lease-backs, regardless. One of the biggest deals, MGM Growth Properties in some fashion acquiring MGM Grand in Las Vegas, has all but been publicly promised by MGM Resorts CEO Jim Murren. Big tribal operators are growing more ambitious, and have increasing financial strength to expand through acquisition. Certainly, we’ve seen the Seminole Tribe of Florida’s Hard Rock International, Mohegan Gaming and Foxwoods get

By Frank Fantini

into the commercial world. The Poarch Band of Alabama and Quapaw Indians of Oklahoma illustrate that other tribes can branch out, too. Who’s to say the Chickasaw, Seneca of New York, Morongo, San Manuel, Pechanga or some other tribal enterprises might not look to follow their examples? Nor can we dismiss the chance of international acquirers. There certainly are companies with the financial heft to afford a significant acquisition, though many might not want to endure the U.S. licensing process. If such a company did decide to enter the U.S. through acquisition, Wynn might make an attractive strategic target. We also can expect to see some small companies growing through acquisition. Former Red Rock CFO Marc Falcone now has two companies between Kentucky Downs and soon Gateway Casinos in Canada, which he is taking public. Former Aruze CEO Eric Persson co-founded Maverick Gaming, and has been non-stop buying small casinos. The Farahi family that controls Monarch Casino is sure to be on the lookout for their next opportunity after they open the transformative expansion of Monarch Black Hawk in Colorado. Some of the small companies mentioned above as possible targets could be acquirers. Certainly, Churchill Downs and Golden Entertainment have been in expansion mode for some time. Twin River, which bought Dover Downs, is now in the process of buying three Colorado casinos from Affinity Gaming, and having gone public, is in growth mode. Likewise, some of the private companies are growth-oriented, such as Jacobs and Peninsula Pacific. A little further out, the Drew and Resorts World Las Vegas projects represent big bets by Las Vegas outsiders that could, like Cosmopolitan and Aladdin before them, find their ways into the hands of different owners at some point. In brief, there’s plenty of opportunity for acquisition activity, though perhaps not on the scale of Eldorado-Caesars or Penn National-Pinnacle. One looking for growth opportunities in the U.S. gaming industry may let out a deep breath and

Global Gaming Business FEBRUARY 2020

exclaim, “Thank goodness for sports betting.” Sports betting has proliferated in a very short time from one to 20 states. The eager embrace of mobile wagering is generating betting beyond that historically experienced by sportsbooks inside brick-and-mortar casinos. Casino operators report more table game play thanks to sportsbooks. Even mature Las Vegas produced record betting revenues in November. Further, some states in the process of legalizing sports betting are legalizing online gaming, too, opening significant new revenues. These new revenues come as the question of growing the market vs. cannibalization is increasingly being answered—on the cannibalization side. Take Wynn’s Encore Boston Harbor as an example. Despite the excitement of opening an upscale destination resort and revenue projections of $1 billion when ramped up, the resort has been running at a rate of less than $600 million. And its first full quarter of EBITDA annualized to under $31 million—a long way to go to get to the $250 million goal, and a paltry return on a $2.6 billion investment. Further, Encore is biting into revenues elsewhere. In November, other Massachusetts casino revenues fell 9.3 percent, Connecticut slot revenues dropped 2.2 percent, Rhode Island’s casinos were off more than 8 percent. Nor is the story unique. The upstate New York casinos have been nearly infamous in falling short of projections. And the $1.2 billion Resorts World Catskills is generating revenues at just around $220 million a year, even with the closing of nearby sister property Monticello, which was devastated by Resorts World. More casinos are yet to open, in Pennsylvania, Illinois and elsewhere. Add to that the proliferation of slot routes, the emergence of instant-racing slot machines, and the coming of new jurisdictions like Arkansas, Virginia, and maybe Georgia and Alabama. A state of stasis for regional gaming could become the future. Frank Fantini is the editor and publisher of Fantini’s Gaming Report. For a free 30-day trial subscription email subscriptions@fantiniresearch.com.

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AGEMupdate AGEM MEMBER PROFILE

Norwalk, Connecticut-based Reed Exhibitions is one of the worldâ&#x20AC;&#x2122;s largest trade show companies, with more than 500 events around the world in 43 industry sectors. The busiest week for Reed can include more than 25 live events across the globe, all created and delivered by Reedâ&#x20AC;&#x2122;s innovative and creative teams. For the gaming industry, Reed Exhibitions organizes the Global Gaming Expo (G2E), where the gaming community comes togetherâ&#x20AC;&#x201D;the largest gathering of global, commercial and tribal gaming professionals in North America, all meeting at the Sands Expo in Las Vegas. Attendees can take advantage of new educational content thatâ&#x20AC;&#x2122;s fast-paced and actionable, and experience firsthand the new products and innovative technologies showcased on the expo floor. G2E has everything you need for a casino floor and across an entire gaming operationâ&#x20AC;&#x201D; from traditional casino fare to sports betting, non-gaming amenities and digital products. G2E is where business growth is accelerated. For more information, visit globalgamingexpo.com. The next Global Gaming Expo will take place at the Sands Expo Center in Las Vegas, October 5-8, 2020 (October 5-8: Education; October 6-8: Expo Hall). G2E Asia returns to the Venetian Macao May 19-21, 2020. For attendee and exhibitor information on G2E or G2E Asia, contact Event Director Korbi Carrison, at 203-840-5977 or email kcarrison@reedexpo.com.

AGEM is an international trade association representing manufacturers of electronic gaming devices, systems, lotteries and components for the gaming industry. The association works to further the interests of gaming equipment manufacturers throughout the world. Through political action, trade show partnerships, information dissemination and good corporate citizenship, the members of AGEM work together to create benefits for every company within the organization. Together, AGEM and its member organizations have assisted regulatory commissions and participated in the legislative process to solve problems and create a positive business environment.

AGEM Board of Directors Actions â&#x20AC;&#x201C; January 2020 â&#x20AC;˘ The 2020 election of AGEM officers took place at the January meeting. Luke Orchard, IGT, is president, and was not included in the election, as he holds the position for a two-year term. The following officers were approved for one-year terms: Vice President David Lucchese, Everi; Vice President Bob Parente, Scientific Games; Vice President Tom Jingoli, Konami; Secretary Eric Fisher, Crane Payment Innovations; Treasurer Hector Fernandez, Aristocrat; and General Counsel Daron Dorsey, Ainsworth. â&#x20AC;˘ Kate Chambers, managing director-gaming, Clarion Events, and Greg Saint, event director, ICE, gave a presentation at the AGEM January meeting to update members on progress with the forthcoming event. This yearâ&#x20AC;&#x2122;s show will have 629 exhibitors, up from 576 last year, taking up a total space of 47,680 square meters (513,223 square feet). Visitor pre-registration was 17,502 at the beginning of January, an increase of 40.5 percent from the same time last year. The conference event, ICE VOX, has also seen investment, with an expanded program and quality keynote speakers and thought leaders. â&#x20AC;˘ AGEM members approved a slate of annual sponsorship requests at the January meeting that included $5,000 for supporting the National Council of Legislators from Gaming States (NCLGS) winter and summer events; $5,000 to support the Western Indian Gaming Conference (CNIGA), held at Sycuan Casino Resort, San Diego February 10-13; and a first-time request of $5,000 to support the Responsible Gaming Council (RGC) Discovery 2020 Conference, to be held in Toronto, April 14-16. â&#x20AC;˘ In Mexico, the secretary of the economy recently announced a proposal for a new â&#x20AC;&#x153;NOM,â&#x20AC;? or federal rule, that might require an additional layer of certifications for machines coming into the country. The AGEM Mexico Committee is working together with both operator trade associations, AIEJA and APPJSAC, to put forward a proposal to argue against introducing the NOM. All three associations have agreed to contribute funds to support a combined legal effort. â&#x20AC;˘ AGEM Director of Responsible Gaming Connie Jones recently attended the NCLGS Winter Meeting in San Diego, joined by more than 40 legislators from 20 states and 200-plus attendees at the three-day event. The varied program included legislative-chaired committee sessions, general-session master classes focused on sports betting and tribal-state compacting, and a general session panel discussion. Keynote speakers included Bill Miller of the American Gaming Association and Robert Zahradnik of the Pew Charitable Trusts. AGEM was a sponsor of this event, which was one of the best attended so far. â&#x20AC;˘ As part of AGEMâ&#x20AC;&#x2122;s support of educational initiatives, the American Indian College Fund receives an an nual scholarship of $10,000. This year, four worthy college students received $2,500 each to undertake their studies. They include Tevin Phillips, a gaming major, of the Muscogee (Creek) Nation; Derrick Wandrie, a hospitality and casino management major, of the Muscogee (Creek) Nation; Anna One Star, a business management major, of the Rosebud Sioux Tribe; and Shane Schmitz, a business management major, of the Rosebud Sioux Tribe. â&#x20AC;˘ ICE 2020 takes place February 4-6 in London. AGEM will have a stand located at N1-138 in the North Halls. We look forward to welcoming friends and members, as well as meeting any companies interested in becoming new members. â&#x20AC;˘ AGEM will once again sponsor the International Casino Conference (ICC) to be held during ICE on Monday, February 3. This forms part of AGEMâ&#x20AC;&#x2122;s annual $15,000 support of the European Casino Association, which sees the contribution split between the ICC and European Dealer Championship taking place at Sun Casino Monte Carlo, Monaco, April 27-29.

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The AGEM Index increased by 5.39 points in December 2019 to 546.04 points, a 1 percent gain from November driven largely by Aristocrat Leisure Ltd. (ASX: ALL), which for 7.3 points of the 2019. The growth was accounted AGEM Indexâ&#x20AC;&#x2122;s monthly gain. A stronger Australian dollar accounted for Aristocratâ&#x20AC;&#x2122;s index gain, as the companyâ&#x20AC;&#x2122;s stock price declined Co. (CR) a 4 percent to which slightly. Crane experienced stock price gain from $83.07 $86.38, of 3.28 points. Overall, most led to an index contribution AGEM Index companies reported decreases in stock price during the month, with five trending positively and eight moving negatively. The major stock indices performed well, as the Dow Jones and the monthly growth of 1.7 percent and 2.9 percent, Industrial Average S&P 500 experienced respectively. The NASDAQ also experienced a strong gain of 3.5 percent.

FEBRUARY 2020 www.ggbmagazine.com

p. 14 truckstopVGT:Layout 1 1/15/20 2:36 PM Page 14

VLTs: Trucking On Truck-stop gaming and other expansion in Illinois and Pennsylvania mean growth for the original local-casino game | By Frank Legato

hey go by many names: VLTs, VGTs, distributed gaming, street machines—but they all perform the same function. They are games for the ultimate locals casino operations, in handfuls of placements in bars, restaurants, truck stops, convenience stores and other locations with one thing in common—that being that they are not casinos. The two most common acronyms for this type of gaming machine are VLTs, for video lottery terminals, and VGTs, for video gaming terminals— the latter popularized in those few jurisdictions where these types of games are not operated by a state or provincial lottery. There’s nothing new about this genre of gaming. The term “video lottery terminal” was coined in South Dakota in 1986, and evolved to mean 14

Global Gaming Business FEBRUARY 2020

gaming machines distributed in limited numbers to a large number of locations. The first VLTs in Canada appeared in 1990 in New Brunswick, followed by other Canadian Atlantic provinces the following year. Locations were limited to five machines each, and beginning in 1991, were limited to establishments holding liquor licenses. Eventually, eight Canadian provinces would offer VLTs through their lotteries, and U.S. states would continue to expand the genre. States like Oregon, Montana and South Dakota offer up the machines in limited doses in liquor-licensed establishments, where in states like Delaware, Maryland and West Virginia, the lotteries place the machines in fullblown casino environments. For the most part, VLTs are identical to slot machines, but are hooked to a central system monitored by the state,

p. 14 truckstopVGT:Layout 1 1/15/20 2:36 PM Page 15

which collects its share of the revenues. In Washington and New York, central determinant systems are used—instead of RNG-based results, a finite pool of results is tapped with each play of each game. It’s the equivalent of a scratch-ticket lottery conducted electronically, with each reel result effectively a “ticket” with a winning or losing result.

U.S. Growth For years, the biggest growth story in the worldwide VLT market was found in Europe, where there is a robust market of non-casino gaming parlors in Italy, Greece, Bulgaria and elsewhere. But the growth trend has definitely spread to the U.S. in recent years, with new VGT laws in Illinois and Pennsylvania multiplying the VLT footprint and bringing new operators into the market. The growth has been most dramatic in Illinois, one of the few markets not tied to a state lottery. Illinois first legalized VGTs in 2009, and placed the first machines in liquor-licensed locations in September 2012. At the end of that month, 61 VGTs were in operation. According to the 2019 “Wagering in Illinois” report of the state’s Commission on Government Forecasting and Accountability, there were 32,033 terminals operating throughout the state at the end of the most recent fiscal year last June. The Illinois VGT law has brought new players into the state as route operators, including prominent land-based operators like Boyd Gaming, Penn National and Delaware North, which have joined leading operator Accel Entertainment in providing machines to the young market. The Illinois VGT market is about to get even larger, thanks to a gaming expansion bill signed into law as the fiscal year ended in June. In addition to authorizing new land-based casinos, the law raises the maximum allowable machines for each of more than 7,300 licensed VGT locations from five to six. At the same time, VGTs at truck stops got a boost. Licensed truck stops were authorized to go from five to six terminals each, and the law created a new truck-stop category. “Large truck stops,” defined as those selling at least 50,000 gallons of diesel fuel per month, are each permitted up to 10 VGTs under the new law. The state forecasting commission estimates the changes in the law will bring the total number of VGTs in the state past 35,000 by the end of FY 2020 in June. According to Illinois Gaming Board Administrator Marcus Fruchter, the board is currently processing applications from truck stops to verify they qualify for the extra contingent of VGTs, but preparations were complete by the end of December for current licensees to add a sixth machine. “We had to engage in rulemaking to accommodate six machines,” Fruchter

explains. “That took some time, given the vagaries of Illinois law, but the rulemaking phase came to end in December. We now have 141 locations that have a live sixth machine, and there are about 1,700 requests that are being processed.” He adds that the board is now beginning to process new truck stop applications. The new Illinois law made other changes likely to further the expansion of VGTs—the maximum per-machine wager was increased from $2 to $4, and the maximum cash award was raised from $500 to $1,199—$1 under the federal trigger for issuance of a W-2G tax form. Pennsylvania is another state now adding VGTs to its gaming offerings, as the first terminals were added to truck stops last year under a 2017 gaming expansion law. That law permits up to five VGTs at qualifying truck stops around the state. While it was partly tailored on the Illinois VGT law, the qualification requirements in Pennsylvania are tougher—to qualify for five VGTs, a truck stop must sell at least 50,000 gallons of diesel fuel per month, as opposed to 10,000 gallons in Illinois, which now qualifies a location for six terminals. More significantly, the Pennsylvania legislature left bars and taverns out of the VGT law, to discourage competition to the 12 land-based casinos. According to Doug Harbach, communications director for the Pennsylvania Gaming Control Board, as of this writing, there have been 30 qualified truck stop establishments given final approval to operate up to five VGTs. Of those, 20 establishments are now operational, bumping the number of operational VGTs in Pennsylvania to 100. The board has 44 truck-stop applications pending. “These truck stop establishments have an associated operator that is responsible for the machines,” Harbach explains. “Of the 20 that are operational, there are two individual operators—Marquee by Penn National Gaming, which has 15 of the establishments; and Commonwealth Gaming, which has five.” The VGT and truck stop expansion measures in Illinois and Pennsylvania, while not massive in themselves, have energized the market, according to many of the suppliers that provide the machines to VGT and VLT markets. “We believe the legalization of truck stop gaming in these markets has provided a tremendous opportunity for SG, along with the truck stop owners and operators, as well as for the states,” comments Damien Greig, senior director of product management for Scientific Games. “As one of the first manufacturers to enter the Pennsylvania truck stop market, we have so far placed games into 11 of the truck stops that are currently eligible, giving us an estimated 85 percent market share. “In Illinois, the expansion from five to 10 games in their truck stop FEBRUARY 2020 www.ggbmagazine.com

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Century Gaming Technologies, by far the largest route operator in the state, operates more than 6,000 terminals in Montana. market has also been a great opportunity for us, and we have seen these locations generally perform better than other locations. This great performance, along with the continued demand for additional terminals, helps us to build a strong player base in both markets as those gaming markets continue to expand.” “In Illinois, this type of legislation has added approximately 30,000 machines to the market,” adds Jon Hanlin, senior vice president of commercial strategy for Aristocrat Technologies, “and that has created a large and vibrant VLT market, which has had a positive impact on the state. Reports have clearly shown that the VLT expansion did not diminish traditional-style gaming in casinos, so as other markets look at Illinois’ success with expanding VLT, we hope those types of reports help to alleviate concerns.” “New market openings and expansions are critically important to the VLT segment, for two reasons,” says Victor Duarte, chief product and strategy officer for Konami Gaming, which is just now adding the VLT sector to its product marketing plan. “First, they create incremental sales opportunities for suppliers that justify incremental investments in the VLT segment. Second, it further validates the distributed gaming market model. Illinois, for example, has been a tremendous success since its inception and now represents the single biggest distributed gaming jurisdiction in North America.”

Business is Booming Expansion of the VGT markets in Illinois and Pennsylvania is only the latest growth in what has been a robust VGT/VLT market in the U.S. South Dakota has made a comeback in the past year, with more than 9,109 terminals in 1,336 locations that have brought revenues back near their 2010 peak, finally recovering from the effects of a statewide smoking ban in VLT locations. In Oregon, where bars and taverns host up to six VLTs per loca-

In Montana, more than 1,400 licensed operators offer a total of more than 16,000 VLTs.

Global Gaming Business FEBRUARY 2020

tion, the lottery is second only to personal income tax as a source of revenue for the state. In Montana, more than 1,400 licensed operators offer a total of more than 16,000 VLTs. Century Gaming Technologies, by far the largest route operator in the state, operates more than 6,000 terminals in Montana. Century’s Montana business is nearing the scope of its business in Nevada, where it operates 7,000 games in routes of the former United Coin Machine Company, which it acquired in 2004. “The environment in Montana plays directly into our strengths,” says Tim Cogswell, vice president and general manager of Century. “We have been in the route business in Montana since the inception of statewide gaming over 30 years ago. We continuously work to be sure all of our route business partners have the most competitive equipment and highest level of service in every corner of the state.” Whether in mature markets like Montana or in growing markets like Illinois and Pennsylvania, VLT/VGT gaming remains one of the most healthy segments of the gaming industry, and suppliers and operators alike agree that business plans will always include the distributed gaming sector in addition to casinos, and all are keeping an eye on where the next growth is likely to come. “Illinois, Oregon and Pennsylvania are all interesting markets to watch, both for suppliers like Aristocrat, and for other states,” says Aristocrat’s Hanlin. “Other states are paying careful attention to Illinois, Oregon and Pennsylvania as they consider expanding into this type of gaming, and that makes us think that VLT is a potential growth engine for the gaming industry broadly.” “We believe we will see growth internationally in Canada, Greece and South America,” says Scientific Games’ Greig, “as well as domestically in Illinois, Pennsylvania and Oregon. The new gaming expansion laws in Illinois open up the number of machines each licensed location can have, and with SG’s already-strong performance in this market, we are confident we will see more opportunity as part of this expansion.” “IGT is firmly committed to the global VLT market, and it represents an important growth driver for many of our customers,” says Ryan Reddy, IGT’s vice president, product. “In North America, the Canadian and Oregon replacement cycles present growth opportunities for IGT, as does Illinois with its new ‘sixth machine’ and truck stop regulations. Pennsylvania is another market in North America that we closely monitor and identify as a potential VLT growth area.” “Many states have been watching the recent successes of Illinois,” says Century’s Cogswell, “and the long-term success in jurisdictions like Montana, South Dakota and West Virginia, and contemplating how to best take advantage of this revenue opportunity for themselves. Whether it be Missouri, Georgia, Indiana, Wyoming, or any of the dozens of states that are evaluating this business model, the strongest growth potential will definitely lie in one or more of these potential new VLT jurisdictions.”

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Q&A: Supplying the VLT Market

uppliers of slot machines to the traditional casino gaming market are increasingly turning to VLTs as a growth strategy. Here are some of the basics of the successes and strategies of some of the largest slot suppliers in this growing segment. GGB: What is your strongest VLT market, and why do you feel it is the strongest? Damien Greig, Senior Director of Product Management, Scientific Games: The Illinois

VGT market is currently our strongest market. Scientific Games has over 17,000 units live in the field, which equals a 52 percent market share. SG was one of the first manufacturers to enter this market when it opened up in 2013, and we have maintained the market leader position ever since. Because the majority of these games are developed out of our Chicago office, our game designers are able to take advantage of their close proximity to players and gain great insight into what these players like. As such, they have been able to design math models specifically for these regulations that resonate perfectly with players. Ryan Reddy, Vice President, Product, IGT:

IGT’s strongest VLT market is Canada, and it has been for many years. Canada is a gaming and lottery market, which plays well to IGT’s pedigree and strengths. We have longstanding relationships with our customers in the region that enable us to collaborate and identify new ways to modernize and propel the player experience. Mike Smith, Director of Product Management, Aristocrat Technologies: While we have a robust VLT market in Canada, in the do-

mestic U.S., we are entering the VLT markets in both Oregon and Illinois. Interestingly, players in both Oregon and Illinois have experienced our Class III games, so they are familiar with the type of game play and innovation we bring to games. Speaking first about Oregon, that is a VLT market that has matured, and players have established distinct preferences for the types of games and game play they enjoy, and as we enter that space, we are bringing the best that Aristocrat has to offer. We recently completed a 100-machine field trial, and we are looking at expanding in the near future. Turning to Illinois, that is a bit younger of a market than Oregon, and although it is still relatively new and relatively new to Aristocrat, we expect it to be one of our strongest markets in our VLT business. Illinois is the largest VLT market, and the players there like casino games; they like newer styles of games. Given that, and given our commitment to innovation, we believe we are very well positioned to enter Illinois.

Victor Duarte, Chief Product and Strategy Officer, Konami Gaming: Konami views VLT as

a strategic growth opportunity. Our initial focus has been on the government-operated distributed gaming markets, primarily in Canada. We believe these represent a logical strategic entry point, given the stability of the markets, our already existing relationships with the operators, and the near- to medium-term opportunity for machine purchases. Is there anything you do differently in game development or marketing with the VLT market as opposed to the casino market? Greig, SG: While one of our main strategies is to leverage our best

brands in the creation of new titles, we do have to comply with each market’s regulations. Our development teams do a lot of specialized work to optimize the math models to work in the VLT markets, while also catering to these types of players, who are typically “local” players and may be different than a standard casino player. We also leverage player testing and market research to ensure that we are selecting and making the best games for the VLT player, as well as working closely with our distributors and lottery partners to best market our products to these repeat players. Reddy, IGT: IGT has a VLT-focused center of excellence in Moncton, Canada that epitomizes our commitment to and leadership in the VLT space. This multi-disciplinary studio includes content managers, game producers, software developers, quality testers and project managers, all with the shared goal of creating the world’s best, growth-driving VLT products for our customers. We also strategically leverage player insights through multiple stages of the development process. In addition to drawing upon decades of experience in the space, IGT facilitates extensive focus group testing in North America and Europe to ensure high player appeal. John Hanlin, Senior Vice President of Commercial Strategy, Aristocrat: At Aristo-

crat, we are passionate about our core values of collective brilliance and innovation, which are designed to put a sharp focus on our customers and what we can do to help our customers grow. So as we look at our games and prepare them for different markets, we do extensive market research to ensure we are on point with the right types of games that players are interested in. This ensures we offer a right mix of product to meet player demand. That’s important because every market is very different. Most are multi-game; however, most have distinct player preferences, so we ingrain ourselves in each market, seek to truly understand the players, the customers, and then creating best product for those customers that fits within regulations.

Global Gaming Business FEBRUARY 2020

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Duarte, Konami: Game development needs to be targeted towards the jurisdictional requirements and player preferences of each market. Each jurisdiction needs to be analyzed for key requirements such as return to player, max bet and max award, as well as player preferences in terms of themes, denominations and game features. Not only do these requirements and preferences differ from casino markets, but they differ from one VLT jurisdiction to another. The casino market is more homogenized across jurisdictions in comparison to the VLT market. Is there any one VGT game that tends to dominate in your markets? Greig, SG: Different VLT markets have different games that perform well. In Illinois, the original Bier Haus is by far our best performing VLT title, and now we have released Heidi’s Bier Haus on the J43 cabinet. Bonus 7’s Wild is a standout in Canada, and our brand, American Original, is a top performer in the Oregon VLT market. In West Virginia VLT, one of the longstanding best video slot brands is our Life of Luxury theme. SG is currently the only manufacturer to leverage third-party brands, such as The Wizard of Oz, Betty Boop, Wonder Woman, Elvis and Mo-

nopoly. This year we will be launching new game sets featuring Willy Wonka and Rocky, to name a few. Reddy, IGT: IGT offers a multitude of standout VLT titles across our vast library. Our VLT content encompasses a range of slot-style, keno and video poker games. The Big Easy and Brilliant Wilds are among our top performers in European markets, while Sevens Wild and Wild Life are hits in Canada. In the U.S. we continue to see positive results from titles such as Big City 5’s, Wild Life Extreme, Bullfroggin’ Keno and Michelangelo Poker. Smith, Aristocrat: In the Canadian market, we have both casino and noncasino games that have been developed for markets to adapt to player preferences. Popular casino-type games include Wild Lepre’coins and Mighty Cash-style games, which have all been well received and well played. In noncasino style games, Fast Frankies and Sunset Tusk, which are more core VLTstyle games, have done very well. Duarte, Konami: Traditional themes and reel symbols tend to work well in VLT markets, but there is not a specific game or style that dominates across jurisdictions.

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Slot Hold vs. Slot Revenue Making sense of the slot hold debate By Brian Wyman, Ph.D.

here have been many articles published in recent months, and indeed over the last several years, about slot hold, with many at least partially attributing the industry’s woes to rising hold.

“Hold” is the expected amount of each wager that the slot machine “holds” over time. A slot machine with 5 percent hold is expected to produce $5 revenue for the casino for every $100 in wagers. The same machine may be described as having 95 percent “RTP” or return-to-player. Over the past two decades, we’ve seen average slot holds rise considerably, largely due to the proliferation of higher-hold penny video slots. See Nevada’s hold, for example, in the figure below.

Nevada Aggregate Slot Hold 1993-2018

Global Gaming Business FEBRUARY 2020

To contextualize this increase, betting $1 per spin at eight spins per minute, a $100 budget would last on average 249 minutes at the 5.02 percent hold we saw in 1993, but only 187 minutes at the 6.7 percent hold we saw in 2018. If we were instead to look at the effect of moving from 9 percent hold to 10.68 percent hold (the same 1.68-point increase, more indicative of penny slot hold), time on device for that $100 budget would decrease on average from 138.9 minutes to 117 minutes, a decline of more than 15 percent or nearly 22 minutes of play. Increased hold is decreasing the average time of slot sessions. This isn’t a controversial viewpoint; it’s just math—if the machine holds more per spin, players with a fixed budget necessarily spend less time on machines. The question, “Can players ‘feel’ the effect of hold changes?” has been studied by academics, and they’ve concluded that players cannot. Industry experts have countered this research by arguing that increased hold is nonetheless degrading the experience of the slot player, for example by decreasing time on device. These critics argue that a player-centric rather than a machine-centric review is necessary. These views may seem irreconcilable, and intuitively, how could players not feel a decrease of 20 minutes on device? This article is intended to bring together these views. I’ve spent a lot of time studying these questions with slot operators, finance teams, economists, and data scientists, and as such, have a unique perspective on the problem.

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Players Can’t Feel Hold Changes

By increasing theoretical hold, even if any individual player can’t tell that we’ve done so, we increase the number of players whose random sequence of slot outcomes lead them to have poor overall experiences at the casino, and this can have downstream effects in terms of visitation and spend.

Anthony Lucas, a professor at the University of Nevada, Las Vegas, has published several articles with various co-authors on how players can’t “feel” the effects of a hold change. The evidence has been several-fold, with the most compelling arguments being that: • A computer (let alone a human) can’t accurately distinguish between two different return-to-player (RTP) settings in a number of observations that mimic a human slot session on a reel machine; and, • Lucas and his co-authors have run a number of live experiments in casinos with side-by-side machines of the same theme, one with low hold and one with high hold, and observed empirically that the high-hold machines perform better financially. Both of these findings are sound. That is, in nearly all cases, a player cannot accurately tell the difference if a machine’s hold is changed, sometimes even dramatically. Though, I should note there are several ways of going from hold A to hold B, and some of these may be easier for players to “feel” than others. We’ll discuss why hold changes are not all created equal later on. In the cases studied, using variants of actual paytables from reel slot machines, Lucas and co-author A.K. Singh argue (correctly) that players can’t possibly tell the difference between hold settings, because even computers cannot tell the difference with any degree of certainty across 500 spins (representing approximately an hour of continuous slot play) or even across longer sessions. Certainly, players may guess, as can computers, but they are wrong nearly as often as they are right. Players can’t “feel” the time decrease because slot machine outcomes are volatile. As a wise man once said, “you never know what you’re gonna get.” This effect is born out on slot floors, as described in Lucas’ recent work with Kate Spilde, where they measure the performance of high-hold and lowhold versions of the same slot machines placed next to each other on the floor, finding that the high-hold machines outperform the low-hold machines empirically. My own experiences echo these results. In nearly every example I’ve ever seen—including the dozens of tests I’ve run with slot teams on real, live casino floors—the higher-hold machine of a pair of like machines generates higher win than the lower-hold machine. That is, slot patrons don’t shift their play to the lower-hold device. Players truly can’t feel hold changes.

How Can Player Behavior Be Impacted If a Player Can’t Feel Hold Changes? It would be easy to conclude, as Lucas does in several of his articles, that casinos can perhaps increase their revenues by increasing slot hold. But upon reflection this is far from clear. First, the side-by-side machine comparison fails to ask about the rest of the slot floor, about the rest of the player’s wallet. Is the increased financial

performance of the high-hold machine simply displaced win from the rest of the floor? Or, asked differently, do the players that lose less on the lower-hold machine exhibit increased play elsewhere on the floor? In other words, do players generally lose the same amount on the visit, but those experiencing lower hold just lose slower and on more machines, getting more time in the casino? Second, even if we were able to measure the overall wallet impact of experiencing lower or higher hold on a single visit, how does this experience impact likelihood to return, or frequency of visitation? Is it possible that a lower-hold experience today means that a player will return to the casino sooner, producing the same amount of revenue or more over more visits? As an extreme thought experiment, consider that a machine that holds 100 percent—never returning a dime to a player—will perform financially better in the short term, for some definition of “short term.” But as a player, if you walked into a casino with $100 and lost on every spin of your machine, would you consider yourself unlucky on that trip? Would you hesitate before returning? How would you feel if it happened again on your next trip? This thought experiment—even if 100 percent hold is extreme—provides a useful way of thinking about how players can be impacted by hold changes even if they don’t know that the hold is higher. Players don’t experience theoretical hold. Players experience the random sequence of outcomes that the machine produces in the short amount of time that they play on the machine. They experience “Did I have a good time while I was at the casino?” This question will have different criteria for different players: How long did my budget last me? Did I get to experience fun bonus games on the machine? Did I have positive staff interactions? Was my restaurant or valet experience good? And the answer to “Did I have a good time while I was at the casino?” influences player behavior related to return trips: Will the player return, and how soon? A player who has a bad session at low theoretical hold has the same negative experience as a player who has a bad session at high theoretical hold. Tying this all together, increased hold leads to a higher proportion of players experiencing losing sessions, short sessions, and therefore, overall negative experiences. We know that actual loss correlates to overall experience, and you can validate this with your own guest survey results. Players who have “winning experiences” as measured by the duration of play that their budget allows or as measured by the experience of low actual hold (including those who win on the trip) tend to report better satisfaction with staff interactions, beverage service, and several other areas of guest experience. And we all believe that experience matters in choosing whether entertainment budget should be spent at a casino, and furthermore when choosing which casino to visit. By increasing theoretical hold, even if any individual player can’t tell that we’ve done so, we increase the number of players whose random sequence of slot outcomes leads them to have poor overall experiences at the casino, and this can have downstream effects in terms of visitation and spend. FEBRUARY 2020 www.ggbmagazine.com

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So, What’s an Operator to Do? It’s important to stress that I don’t think there’s a one-size-fits-all solution to hold changes. For large commercial properties on the Las Vegas Strip, where revenue is shifting rapidly to non-gaming predominance, where casual visitors to Las Vegas have small gambling budgets relative to their overall vacation budgets, where the overall trip experience has many components beyond their experience on the casino floor, and where the time between trips is lengthy, it may make sense to push hold high and capture the tourist gambling dollar before the competitor down the street can capture it. Next year, when planning their annual Las Vegas trip, the thought of how quickly their $100 budget was captured by the slots will be dwarfed by their pool, dining, nightclub and hotel experiences, and by the “sin” in Sin City. In regional markets, by contrast, casinos may have large segments of patrons visiting upwards of 30 or 40 days per year. Gambling is the main concern at these properties, and markets are quite competitive, with many having four or more easily accessible casinos, not to mention the regional or national destination markets—Las Vegas, Atlantic City, Biloxi, and so on—that are also competing heavily for these guests. Here, hold is a more subtle concern. Casinos in these markets must carefully assess the impact that hold has on their businesses, but understanding the tradeoff between short-term financial gain (take the money quickly) and long-term business stability (Do we alienate our guests and cause them to reduce or cease visitation?) is not an easy task. In contrast to the Las Vegas market, the gambling experience at regional casinos by-and-large is the customer experience, so operators should approach the gambling experience with caution.

Macro Considerations For a Slot Hold Strategy In assessing the impact of a changing slot hold strategy, we must understand the balance between guests who are time-constrained, those who will leave the casino before they’ve exhausted their gambling budget, and guests who are wallet-constrained, those who will exhaust their monetary budget before they exhaust their allotment of time. If a guest is time-constrained, a reduction in slot hold will reduce the rate at which they lose (on average), and the casino will capture less of their gaming budget on their (fixedlength) trip. In order to make this decision profitable, the casino would need to increase the visitation of those guests to compensate for the reduced revenue. If a guest is wallet-constrained, however, a reduction in slot hold will simply increase the time that the guest’s budget lasts, providing more time in the casino and more positive experiences, i.e., more “bang for their buck.” Of course, if we increase the duration of the guest’s wallet too much, the guest may become time-constrained, and we run the risk of losing the guest’s available budget. It seems natural to argue that a perfect balance would be struck if we could have each guest expend their monetary 22

Global Gaming Business FEBRUARY 2020

An ideal hold strategy would be designed at the game level. Operators and manufacturers would work together on how to provide the best player experience while achieving operator financial goals.

and time budgets simultaneously. Quantifying time-constrained versus wallet-constrained guests is difficult to do scientifically. But as an example of this thinking, in a market like Biloxi—where many patrons are lodgers and as such are a relatively captive audience—guests are likely more wallet-constrained than time-constrained, and a lower slot hold environment may increase player satisfaction (and ultimately visitation, etc.) while effecting a very limited impact on gaming spend. And besides making the casino experience more fun, which we would hope leads to increased visitation, the limited revenue loss from the gaming floor on that visit may be recuperated by retail and dining outlets, albeit at a different margin. My own experience in the Louisiana and Mississippi markets suggests that Biloxi casinos tend to provide richer-than-typical free-play offers. Increased free play and reduced slot hold have a similar effect, increasing time on device, which is low cost to the casino so long as the patrons are walletconstrained and not time-constrained. Of course, many of these arguments can be applied to Las Vegas as well, but Las Vegas visitors are more time-constrained than one might imagine. The allure of other amenities, or even other casino properties, limits the amount of vacation time allocated to gambling in any one location. And with the proliferation of regional gaming, this makes sense. Most visitors come to Las Vegas for the party, for the pools, for the weather, for the food. The gambling is a nice-to-have, as opposed to Biloxi, where the gambling may be a primary focus of the visit. Additional considerations when developing an overall hold strategy for a property may include: • The floor’s utilization: Higher utilization suggests a higher hold strategy, as reduction of time on device can alleviate any periods of prohibitive utilization, which itself degrades the guest experience. • The quality and diversity of a property’s amenity set: The more opportunities a property has to provide great experiences to a guest suggests a higher hold strategy, as the slot experience may contribute less to the overall guest experience. • The frequency of visitation of the patron database: Higher-frequency properties might consider a lower-hold approach, since there is a high dependence on return visitation. • The competitiveness of the local market: Properties in highly competitive markets might consider a lower-hold approach as a way to improve guest experience.

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Micro Considerations For a Slot Hold Strategy I mentioned before that moving from one hold to another isn’t a universal concept. That is because there are many ways to change a pay table. As an example, consider the following simple mock game:

Simple Game - 7.5% hold

In this game, we wager $1, and we either lose our $1, or we win $1, $2, $10, or $10,000. The bonus game that produces a win of $10 is triggered on average every 40 spins, and the $10,000 jackpot is triggered on average every 100,000 spins. Now let’s say our aim is to increase the hold to 13 percent. One way to do this is to decrease the frequency of the bonus game to 1 in 50:

Simple Game - 13% hold (v1-fewer bonus games)

Given the option, we would certainly put the “fewer jackpots” version on the floor before the “fewer bonus games” version. In other words, there are ways to raise hold without impacting the player experience, and there are ways to raise hold while lowering the occurrence of relatively frequent events that the player celebrates. To the extent that we can accomplish the former, we should do so enthusiastically. With the latter, we should proceed cautiously. Only a careful review of PAR sheets, which detail pay tables and frequencies of game awards, can give a clear indication of how hold changes will affect player experience, and these can be cumbersome (I’ll say, politely) to read and interpret. A broad-based hold increase without regard to how hold is increased will certainly affect player experience. An ideal hold strategy would be designed at the game level. Operators and manufacturers would work together on how to provide the best player experience while achieving operator financial goals. Another consideration pointed out to me by savvy slot operators is the speed of the processors in newer games. They keenly note that players don’t necessarily experience hold as a percentage of slot handle, but rather as a loss-per-hour. We are seeing max bets and cost-to-cover on penny games increase, processor speeds producing more spins per hour, and holds rising, resulting in even more substantial increases in loss per hour.

Conclusion

Could a player “feel” this difference? How quickly? At eight spins per minute, this represents a loss of approximately 2.4 bonus games per hour. This is a question we can answer with science, but keeping this concept in mind, consider this alternative version of the simple game that also achieves 13 percent hold:

Simple Game - 13% hold (v2-fewer jackpots)

In this variation, we’ve returned the bonus game to a 1-in-40 proposition but reduced the frequency of the top award to 1-in-220,000. This pay table should provide identical game play as the 7.5 percent pay table, to nearly everyone who plays the game. No one will be able to detect with any certainty that the top award has become less frequent, as no one expects to hit the top award anyway.

I’ve worked with several properties on their slot hold strategy as an operator and as a consultant. While there is no one overarching method for measuring the impact of slot changes, I’ve been fortunate in my roles to work with talented teams of slot operators, economists, statisticians and data scientists to develop methodologies to evaluate the performance of slot hold changes. We’ve developed benchmarks and metrics to look at player behavior, machine performance, and overall property performance, each providing a different lens into the effects of these changes. With forward-thinking operations teams, we’ve run tests as aggressive as altering the hold on more than 30 percent (!) of the machines on a casino floor. As expected, higher hold approaches have produced more revenue on average in the short term, though at a mildly diminishing rate. Most of the studies were run for only six to 12 months, so I don’t know if in two, three, five or 10 years we’d conclude that a lower hold strategy would produce the loyalty and guest experience effects needed to outweigh the short-term effects of raising hold. Or whether we’d find in the end that cranking up the hold produces stronger financial outcomes across the board. Casinos continue to navigate the tradeoffs of immediate gains at the risk of degrading guest experience in many areas—resort fees in hotels, outlet fees in bars, ATM fees approaching $10, and even parking fees. Regardless of the enterprise’s overall strategy, taking a tactical, property-specific and game-specific approach can help achieve the desired short-term financial outcomes while managing the guest experience impacts and mitigating some of the potential long-term effects on the business. Brian Wyman is senior vice president, operations and data analytics for The Innovation Group.

FEBRUARY 2020 www.ggbmagazine.com

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The Evolving Casino Marketing Landscape The industry has changed, but not in the way we expected By Clay Peister and Steve Gallaway

wenty years ago, there was much talk in the gaming industry of how to engage GenXers, and the potential value of this segment. As GenX is only now becoming a meaningful contributor to the industry, this conversation has now evolved into the current hype around millennials. What allowed GenXers to become gamers is simple: they began to acquire the two key items that people need to gambleâ&#x20AC;&#x201D;time and money. As millennials age, we will see them gravitate toward casinos gaming as well. While the demographics of casino participation have been little changed for a generation, there have been material changes in products, channels and, importantly, methods of engaging with casino patrons. Technology is changing the industry in unexpected ways. A good example is marketing communication. Ten years ago, many people expected email to replace physical mail. Operators quickly found that response from email was lower than physical mail, and the switch to email never hap-

pened. A real-world example from Australia found that switching a bounce-back offer to email saved 9 cents in printing and postage, but cost the company $60 in foregone incremental win. Today, clever operators are figuring out ways to use digital channels to enhance a foundation of physical mail. We believe in the promise of big data, but big data, much like digital communication, will enhance our toolkit rather than replace it.

More Competitive, Diverseâ&#x20AC;&#x201D; and Complicated Over the past 20 years, the industry has evolved in meaningful ways. For instance, electronic table games two decades ago were a clever, but niche product, developed to address labor and table-cap constraints. Today, electronic table games and stadium-style electronic table games are a distinct business unto itself.

We believe in the promise of big data but, much like digital communication, it will enhance our toolkit rather than replace it. 24

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Getting the most from your data doesn’t require a significant capital investment, but clever analytics.

Slots have evolved, too, with a video-based product now becoming more dominant than traditional machine reels in most—if not all—jurisdictions. Whereas the dominating large-denomination machines in the past were typical $1 steppers, today they’re penny slots, where the average bet is north of $1.75, and playing full coin with full lines can often cost the customer more than $5 per spin. In terms of customer segments, Las Vegas has famously evolved into a broader destination where the volume of non-gaming visitors has risen, and where non-gaming dollars often outweigh gaming spend. Junkets, which once drove upwards of 80 percent of the gaming spend in Asian markets, are under increasing pressure. By extension, many of the billion-dollar integrated resort projects that initially relied more heavily on internationally mobile VIP players are diversifying into a business model that focuses more on mass-market and non-gaming patrons. Many high-frequency jurisdictions have become “buyer’s markets,” with patrons often receiving offers from five or more casinos per week. The implication of these dynamics is that the industry is becoming more complex, while concurrently becoming less concentrated. For casinos to be successful, their marketing departments and lines of communication with their players must be improved. Sending paper mailers only is no longer a sustainable direct mail strategy. While customers in the U.S. may, on the surface, be resistant to providing an email address or mobile number, this barrier is quickly broken down when the player recognizes the value of providing this information. In the world of big data, marketing departments have the opportunity to understand their patron’s needs and preference at an individual level. And by extension, the days of guessing at the success of promotions are over, or at least should be over at your casino.

The Challenge Casino Marketing Faces Today As the industry becomes more competitive, we’re seeing the average lift from marketing offers decline. As an operator, the question is how to ensure that marketing spend is increasing the amount of net winnings (gross win, less all player reinvestment) from our guests. Unpacking this objective illustrates the difficulties that operators face on a daily basis: • Sending richer offers often doesn’t help, as casino marketing reinvestment has sharp-diminishing returns. For instance, we recently worked with a casino where free-play to high-end patrons actually cannibalized daily spend. Likewise, events frequently led to patrons skipping a regular trip. • Sending more offers often doesn’t help either, as many casinos at times can be dependent on only a few responders. For instance, offers and pro-

motions typically make money from only a handful of players, but actually lose money on the remainder of the patrons. In our experience, 80 percent of an event’s incremental revenue comes from 5 percent to 10 percent of players. Fifty percent to 60 percent of invited patrons don’t change their behavior. And the balance of respondents come, but don’t (or barely) play. • The disparity of profitability by players at hosted events is even greater than direct mail promotions. Hosts often focus on their largest players, and neglect the balance of their list. We recently helped assess a highvalue event sold by the host team. We found a massive spread of response rates across the hosts, a range too wide to be explained by randomness.

Current Marketing Tools Aren’t Enough The cornerstone of casino marketing programs today is monthly direct marketing offers, where the player is simply gifted a free-play amount. These direct offers are, generally, not play-based, and are difficult for the casino to yield. For instance, if a player is accustomed to receiving a monthly direct offer with $100 in free play per week, yielding this offer to $50 will often spark a vocal dissent. Consequently, many properties are finding a low return on investment from their monthly direct marketing offers, but they still feel stuck because their patron base has grown accustomed to receiving this type of offer. That concern is justified. These offers have become entitlements rather than promotions; entitlements are always less profitable, and inevitably the casino has many players for whom they are upside-down. For instance, after a client overseas recently turned off their monthly direct marketing program, slot revenues declined by double-digit values, and the program was subsequently reinstated. In many markets in Asia and Australia, the majority of mass reinvestment is structured as generic promotions rather than direct marketing. Even when these generic promotions are tiered, they typically provide low return on investment. This is similar to many direct mail marketing programs in the United States. Players tend to sail through the offers, and their behaviors do not meaningfully change. In short, most casinos’ current marketing toolkit isn’t capable of delivering on the objective of profitable wallet share gains over the long term.

Thinking Small by Thinking Big Moving forward, the most successful properties will be those that excel in demonstrating the following seven capabilities: Mass personalization: Best-in-class direct marketing programs start FEBRUARY 2020 www.ggbmagazine.com

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Some offers have become entitlements rather than promotions; entitlements are always less profitable.

with an assessment of each player’s upside. It’s important to think about each player’s frequency of visits, average length of stay, daily spend, daily-spend/ADT and churn-risk. Understanding the patron’s upside with these metrics in mind is the basis for building an appropriately sized reinvestment program and customizing its terms and conditions. Understand promotional elasticity: Efficient marketing requires an understanding of how promotional spend changes the player’s behavior. For instance, a $50 free-play offer may lift a player’s frequency by 20 percent, while a $100 offer to the same player might only lift their frequency by 25 percent. Most casino marketing tools (free play, event invitations, promotions, room offers, etc.) deliver different benefits to players, and the scale of these benefits is not linear. In getting started with these first two capabilities, the most obvious pitfalls would be to analyze the player database too broadly or to rely too heavily on averages. By contrast, operators have found greater success with the newer analytical techniques—such as deep learning. Deep learning and other analytical techniques allow them to decipher the patterns of players we know a lot about and apply those patterns to players we know less about. This abstractive process is the basis of mass personalization. Master the yield equation: The unintended consequence of a large non-gaming business is the tension between the casino comping and nongaming cash spend. Getting this capability right requires an understanding of the expectations for gaming spend from non-gaming patrons, as well as non-gaming spend from casino guests. Most properties currently collect a wealth of data allowing them to estimate the indifference point between their gaming and non-gaming guests. The most obvious pitfall here is the assumption that an operator needs to know absolutely everything about each of its guests in order to solve the yield equation. While the prospect of big data and new data is exciting, and while these data absolutely enhance the context of casino marketing offers, most properties today are already collecting enough data to get moving in the right direction. Execute in real time: Often the best time to market to a guest is when he/she is active on the gaming floor. This is referred to as context relevance. For instance, if a patron has an “unusual win,” when it’s early in the day and the patron has been carded out for an “unusual” amount of time, it may seem appropriate to send that patron an offer. However, if the patron is already a hotel guest, the right move may be to suppress this offer. Zeroing in on this capability requires significant technical capabilities to apply forecasting models on the fly. Likewise, artificial intelligence would be needed to identify key intervention points and machine-learning capabilities to ensure that the offers adapt over time. When properly executed, real-time marketing can be 26

Global Gaming Business FEBRUARY 2020

transformative to a casino and will continue to have an overall impact on the industry. Player development: An operator’s success often depends on the service and player development team. Top-performing casinos help their hosts think beyond glad-handing to focus more on guided sales. Likewise, the best casino host managers will coach their staff on recognizing behaviors beyond the standard performance KPIs and use analytics to drive the host coding function. Artificial intelligence can help scale this capability across the industry. The major pitfall here is shoehorning non-casino specific AI capabilities to the casino business. The proper expertise from the gaming industry must be utilized when coding AI applications. Manage leakage: Particularly in Asia, but also in the U.S., there’s a significant amount of fraud in most marketing programs. Risky areas are rooms programs, drawings, point-picking and employee collusion. Fraud leaves indelible tracks that analytics can uncover, and AI can silently monitor this activity. Big data: Most properties on a big data journey are getting it wrong. These projects are fantastically expensive, and are generally sold by big tech companies who are shoehorning their client’s vision for a hospitality or retail big data solution. While we’re believers in the promise of big data, we believe these projects require three capabilities to be successful: • Clear purpose and vision: How does bigger data help? • Guided ambition: If it’s not obvious how the data lifts response rates/spend, or lowers expenses, then likely the added complexity is not worth the effort. A solution with focused and attainable goals is key to the success of a big data program. • Knowledge and experience: At the end of the day, having the right person to oversee the program, who understands the need to execute on the two above points, will be crucial to the success of your program.

While it’s now an old adage that “data is the new oil,” the concept is still true. Getting the most from your data doesn’t require a significant capital investment, but clever analytics. Most properties can yield actionable insights from the data collected today. But gathering and distilling those insights requires a blend of practical casino experience and technical analytical acumen. Clay Peister is managing director of Differential Labs, a strategic partner of Global Market Advisors, and is known across the industry for his expertise in modern-day marketing. Steve Gallaway is managing partner of Global Market Advisors, the industry’s leading provider of consulting services to the gaming and hospitality industries.

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MAKING MY POINT

Secret to Success How to make yourself likeable By Roger Snow

ob Crane had it all. Good looks. Hot wife. Beautiful family. Hit radio show. Hit TV show. Mad stacks of cash. Big house in the Valley. Millions of fans around the world. Oh, and a pathological sex addiction that included orgies, swingers’ clubs, BDSM, MFF, MMF, homemade pornography, drug use and penile augmentation surgery. Which, in aggregate, cost him his looks, his wife, his family, his radio and TV shows, his money, his house, his fans, and ultimately, his life. It’s been 41 years since police stood over Crane’s dead body—strangled by an electrical cord and bludgeoned by a camera tripod—at an apartment in Scottsdale, Arizona. His murder remains unsolved. At the time, he was performing something called dinner theater (Google it if you’re under 50) at various venues around the country. This paid the bills, sure, but it was a far cry from his glory days as Colonel Robert Hogan of the eponymously titled Hogan’s Heroes, one of the highest-rated television series of the 1960s. In the opening minutes of Auto Focus, the movie about Crane’s life—or lives, as it turns out—the secret of his showbiz success is revealed. “Eddie Cantor once told me that likeability is 90 percent of the battle,” says actor Greg Kinnear, playing the part of Crane. “And he was right. “Well that’s me. I’m a likeable guy.” Yes, millennials, you can Google Eddie Cantor, too. We’ll wait. Crane was right. Had his personality traits been listed in descending order of concentration, like ingredients in a soufflé, likeability would have been at the top. Immediately followed by perversion and philandering, of course, but likeability would still be No. 1. So how do you, in your career, make yourself more likeable? Easy to work with? Fun to be around? Better at getting what you want? Let us count the ways.

Global Gaming Business FEBRUARY 2020

Say My Name In the book How to Win Friends and Influence People, author Dale Carnegie posits that everyone loves hearing the sound of his or her own name. “It’s the sweetest and most important sound in any language,” he writes. “Respect and acceptance stem from simple acts such as remembering a person’s name and using it whenever appropriate.” Think Carnegie is full of baloney? Call someone by the wrong name and see what happens. You’ll light the Olympic torch of grudges: that bad boy ain’t ever going to burn out. The misnamed never forget such a slight. You see Kinnear observe Carnegie’s advice in the film. When he’s introduced to a studio lot gadfly—the man who probably killed him, by the way—he asks for his name, then repeats it back to him. “John Carpenter,” he says, with emphasis, so he won’t forget it. Use your imagination. Try a mnemonic device. Repeat until it’s rote. But whatever you do, to improve your likeability, you need to master the name game.

No Thanks, But Thanks “Hey, we’re having a meeting next Friday at 4:30 p.m. to go over cost allocation methodology options for the upcoming budget cycle, and we hope you can join us.” The correct response is: A. “I wish I could, but I can’t make it.” B. “I can’t make it, but I wish I could.” If you guessed B, you are a student of human nature (either that, or just a lucky guesser). Whatever. Because whenever we hear the word “but,” our mind ignores what came before and fixates on what comes after. In this case, the “I can’t make it” gets your point across, but the “I wish I could” massages the message and makes the person you’re rejecting feel better. So, next time you tell a good-news-bad-news joke, give them the bad news first.

It’s Not Me, It’s You Talk less, listen more. Ask instead of answer. Be courteous with your curiosity. In other words, ignore a powerful instinct that actually makes you seem weak: shooting off your mouth. Bragging. Gossiping. Trafficking in speculation and rumor. And follow this simple rule: If you say you’re going to do something, do it. Nothing dismantles a reputation more quickly and more irreparably than letting people down. Don’t do it. To boost your likeability rating among others around the communal coffee pot, keep your interactions and conversations onesided—for the most part—away from you. Show genuine interest and you’ll get genuine appreciation in return. In another scene in Auto Focus, Bob Crane is shown meeting with entertainment journalists at a kickoff meeting for Hogan’s Heroes. Amid the short skirts of the waitresses and the long lines at the buffet, Crane meets a fledgling radio host from Nowheresville, USA. With these two men—one star, one upstart—it’s the star that turns fanboy. When they sit down to discuss Crane’s show, Crane instead asks the interviewer about his. When the man responds, Crane flashes his smile and says, “I’ve actually heard good things about that.” Which, of course, he hasn’t. But that’s not the point. This is: When you subvert your need to shine and instead train the spotlight on the other person, you immediately ingratiate yourself to others. Think about them more than yourself, and likeability—the trait both Cantor and Crane claimed was 90 percent of the battle—is an inevitability. Roger Snow is a senior vice president with Scientific Games. The views and opinions expressed in this article are those of the author and do not necessarily reflect the views and opinions of Scientific Games Corporation or its affiliates.

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Social Impacts of Casinos: Facts and Fallacies By Marjorie Preston

ny time a casino comes up for debate in a community, two camps face off: supporters, who talk up potential jobs, investment and fresh tax dollars; and critics, who believe casinos mean increased crime, decreased quality of life, compulsive gambling and general moral decline. Sometimes, the argument goes from merely contentious to frankly absurd. Take Kentucky’s 2019 gubernatorial race, in which then-Governor Matt Bevin said, “Every night somewhere in America, somebody takes their life in a casino because they’ve wasted the last semblance of dignity and hope that they had. Families are ruined. Lives are ruined.” Bevin later disavowed the statement, and claimed he’d never said it. Alas for him, it was part of a taped radio broadcast. He lost the election to former Attorney General Kevin Beshear, who is pushing not just casinos but sports betting and online poker to top up Kentucky’s underfunded pension system.

The ‘Sin Card’ These days, with gaming ubiquitous across the United States, the moral argument against it—let’s call it the “sin card”—has been played out, as Matt Bevin almost certainly now knows. “The industry is in 40 states,” says Bill Miller, president of the American Gaming Association. “The people in those communities have actually seen, touched, experienced, been employed by and benefited from the casino industry. All the bogeymen are trotted out at the start, but when the reality happens, the bogeymen are gone. People recognize we are economic engines in those communities.” Before casinos were widespread, he says, most Americans’ perceptions of the industry were drawn from TV and movies, most of which focused on the mobbed-up origins of casinos in Las Vegas. “Today, as people experience the casino that came to their town—the place their neighbors work, or where they work—they know these are good community partners,” Miller says. Unlike some big corporations that demand big incentives to move into a market—think Amazon, which sought $3 billion in tax breaks to open a second headquarters in Queens, New York—casinos are both economic drivers and taxpayers. “We pay the highest taxes of any business in any state we come into,” says Miller. “Our record as it relates to diversity and opportunity among disadvantaged populations is exemplary. When you talk about tribal operations, the story is even more incredible—gaming has quite simply changed their fortunes.”

Global Gaming Business FEBRUARY 2020

“Today, as people experience the casino that came to their town—the place their neighbors work, or where they work— they know these are good community partners.” —Bill Miller, President and CEO, American Gaming Association

Adding It Up The revenue figures back him up. According to the AGA’s 2019 State of the States report, released last June: • Commercial casinos in the United States generated $41.7 billion in gaming revenue in 2018, up 3.46 percent from the previous year, for the highest-ever annual total. • Those gaming halls paid $9.7 billion in taxes to state and local governments. • According to the most recent statistics from Oxford Economics, in 2017 commercial casinos employed more than 361,000 people, who earned more than $17 billion in wages, benefits and tips. • Tribal casinos generated more than $31 billion in gaming revenues for the same year; the state of Oklahoma, for one, collected nearly $139 million from exclusivity fees, breaking the previous record for the fourth year in a row. Those figures don’t include the revenues gaming halls spend with local and regional businesses. In 2017, for example, Iowa’s 19 casinos bought $239 million in goods from vendors in the Hawkeye State. In 2019, Harrah’s Cherokee Casinos in North Carolina paid more than $50 million to area vendors. Last October, when Rush Street Gaming CEO Neil Bluhm visited Waukegan, Illinois, to talk about a proposed Rivers Casino there, he promised a “Waukegan First policy” for vendors and suppliers, and made a commitment to provide opportunities to businesses owned by minorities and women. “One of the most exciting parts of this job is to visit communities all over the country and see the actual impact this industry has,” says Miller. “Unlike others, we don’t go to state capitals and say, ‘Hey, we might be willing to locate in your state if you give us a tax abatement.’ We’re the exact opposite.”

18+,Pl ayRes pons i bl y www. about . gambl eawar e. or g

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“As an economist, I look at the costs and benefits—I don’t start out with some bias against gambling as an activity.” —Douglas Walker, author, Casinonomics: The Socioeconomic Impacts of the Casino Industry

Douglas Walker, professor of economics at the College of Charleston, South Carolina, and the author of Casinonomics: The Socioeconomic Impacts of the Casino Industry, points to a 2008 study that contended casinos lead to higher employment (by around 8 percent) in counties where they exist, and create slightly higher wages in those counties. The study, published in the Journal of Gambling Business and Economics, isn’t the last word on the subject, and hasn’t been updated since, but according to Walker, those conclusions generally have held up over time. “It’s no different from any other growing industry, which would have a positive impact on the economy as measured by per-capita income,” he says. Walker agrees that the industry has become acceptable in the mainstream. “For most people, it’s becoming less of a moral issue. As an economist, I look at the costs and benefits—I don’t start out with some bias against gambling as an activity.”

Better Business

“Those companies have pushed it forward,” says Whyte, “but others are going to follow the regulations in their jurisdiction, check the box, and that’s all. In many jurisdictions, the regulations are minimal, with none of the tax money from gambling going to help people with gambling problems. They require employees to be trained, and that’s about it. “The good news for the industry is that, with advocates like us and associations like the AGA, there’s a pretty big movement towards defining the standards for good responsible gambling, and helping the industry meet those standards.” Whyte says consistent, rigorously enforced standards are simply good business. “Then you’re able to attract and retain high-quality employees, people who are looking for a company that willingly, honestly addresses the downside, and you’ll build stronger relationships with customers. Between employees and customers, that’s the lifeblood of any business.

“Let’s not forget that good, aspirational responsible gambling programs are going to keep you in the good graces of regulators, legislators and advocates like us. It’s pretty much a bottom-line, dollars-and-cents argument.”

Despite Bevin’s contention that problem gambling often or even regularly leads to suicide—a statement the AGA slammed as “patently false and irresponsible”—most estimates put the number of problem gamblers in the U.S. at 1.4 percent of the population. Research shows that the vast majority of —Keith Whyte, Executive Director, National Council on Problem Gambling American adults gamble recreationally, or not at all. Of course, the comparatively low incidence of problem gambling “And let’s not forget that good, aspirational responsible gambling programs doesn’t mean it shouldn’t be strenuously addressed, by both public health exare going to keep you in the good graces of regulators, legislators and advocates perts and by the gaming sector. Keith Whyte, executive director of the Nalike us. It’s pretty much a bottom-line, dollars-and-cents argument.” tional Council on Problem Gambling (NCPG), says the industry has made The NCPG is fighting on Capitol Hill to get federal funds to study prob“tremendous progress” on that front. lem gambling, which often occurs alongside other problems such as depression, “Back in the 1970s, no one had best practices in responsible gambling anxiety and substance abuse. for the land-based industry,” he notes, “but by the late 2000s, there was a naMiller agrees that gaming firms have an implicit “social license, a moral litional council to establish responsible gambling principles and encourage cense” to identify and protect problem gamblers, “because we have the most folks to harmonize their programs.” vested interest.” The AGA’s Responsible Gambling Collaborative, founded in 2018, Look for the debate to continue whenever a casino is proposed for a town brought together commercial and tribal gaming associations, including lotor city that doesn’t have one. Gaming is not a golden ticket to fiscal security, teries and racing interests, with gaming equipment manufacturers and public and it’s not a neon-lit road to perdition; like other flourishing major industries health organizations including the Yale School of Medicine and Harvard in the U.S. that are tied to consumer confidence and discretionary income, it University’s T.H. Chan Public School of Health. has its ups and downs, pluses and minuses. Miller would argue that the scale is Whyte says the next step—and it’s an important one—is to standardize firmly tipped in the plus column. responsible gambling requirements and get everyone on board. “I want the politicians in Washington who sit in Congress and the Senate, “This is a tale of leaders and followers,” he says. The leaders—mammoth state and local politicians, and communities and people to have a strong sense firms like MGM Resorts, Caesars Entertainment and Las Vegas Sands of what we bring in terms of jobs and tax revenue,” he says. “The AGA will alCorp.—are “way out in front” in terms of social responsibility, and recognizways be on the offensive to make sure the portrayal of our industry is accurate.” ing and working to prevent problem gambling. 32

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EMERGING LEADERS Czech Mate Lukas Pesek Vice President of Food & Beverage, Excalibur hile attending a wine tasting at the Four Seasons Hotel in Prague in 2007, Lukas Pesek met a faculty member from the University of Nevada, Las Vegas. A few bottles of wine later, Pesek embraced Las Vegas, sight unseen. “I called my mother and said, ‘I think I want to move to Las Vegas.’” Some six months later, he applied for admission to UNLV, and in 2008 matriculated as an international student. He had already studied hospitality and food and beverage management at a school in his native Czech Republic. It shouldn’t come as a surprise that Pesek fell in love with the gastronomic side of Las Vegas. His father indoctrinated him in the finer side of culinary life in Prague and the rest of Europe, teaching him to read a wine list as a youngster. “I grew up in a very culinary and cultural-oriented family,” Pesek says. Opera was another aspect of his upbringing. By 15, Pesek had seen Aida, La Traviata, Tosca, La Bohème and dozens of other operas. He traveled to the culinary capitals of Europe: Vienna, Salzburg, Luxembourg. And in 2003, he moved to Zurich, where he worked in a boutique hotel. As a student at UNLV, Pesek landed a position with Wolfgang Puck, working in various Las Vegas restaurants, including Spago, Lupo, CUT, Postrio and Bar & Grill. A year after he graduated with a B.S. in hotel administration, he went to Dubai to open CUT. In 2017, Pesek moved to MGM as director of restaurants at Aria, and a year later was promoted to director of food and beverage. Last May, he advanced again to vice president of food & beverage at Excalibur. “At Excalibur, I’m overseeing the whole food and beverage program, multiple restaurants, bars, lounges, banquets and catering operations, two showrooms and in-room dining.” Pesek’s climb up the ladder took him to seven different countries—the Czech Republic, Germany, Switzerland, Mexico, U.S., Dubai and Singapore—on three continents. Though he encountered roadblocks along the way, he says, “I don’t look at obstacles as obstacles, but rather opportunities to get stronger and better. I enjoy dealing with challenging situations. A dear friend once told me, ‘Lukas, you are not performing an open-heart surgery, so don’t act like your job is stressful.’ Sometimes, we create obstacles in our mind, and that limits us. I truly believe in living life without limits.” He’s had numerous mentors along the way, too numerous to mention. But he looks up to folks like Bob Iger, Ray Dalio and Danny Meyer. “I have been studying their leadership styles,” says Pesek, who still enjoys music, and plays the saxophone to relax. His two favorite musicians? John Coltrane and Tchaikovsky. Pesek’s world view has given him some pearls of wisdom to offer those that follow his footsteps. “Never let anybody tell you that you can’t do something!” he says. “Also, don’t be afraid to make a mistake.” —William Sokolic

“I don’t look at obstacles as obstacles, but rather opportunities to get stronger and better. I enjoy dealing with challenging situations.”

Global Gaming Business FEBRUARY 2020

Not Horsing Around Jessica Feil Senior Director of Government Relations, American Gaming Association rowing up outside Philadelphia, Jessica Feil practiced the art of riding and showing horses. Her career has taken twists and turns, but she still rides and shows horses when time permits. “It’s a great sport that you can participate in at any level throughout your life,” she says. Horses are a constant in a life that brought her on a circuitous route to the American Gaming Association, where she works as the senior director of government relations. Armed with a degree in government from Skidmore College, Feil joined a boutique communications and public policy firm, performing tasks like tracking media coverage, working on advocacy campaigns, and even ordering office supplies. “Tracking coverage was a great way to learn about different topics and policy matters that impacted the clients’ business,” she says. After graduating from law school at Case Western University, Feil worked as a prosecutor dealing with child abuse and neglect. “You see families during their toughest times, including emergencies that impact the safety of children. On the other hand, it was really powerful to help families when they needed it most,” she says. Feil’s first brush with gaming occurred at Ifrah Law in Washington. While much of her time involved criminal defense, gaming offered an interesting sidebar, she says. “My practice grew in the gaming space because I enjoyed being part of such an innovative and fast-paced industry.” Prior to the AGA hire, Feil earned a certifi-

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cate in sports betting regulation at the University of Nevada, Las Vegas. “With all the changing laws as legalized sports betting spreads across the country, it’s been fascinating to follow the different regulatory models put in place,” she says. “And the certificate provides a great foundation of knowledge.” With the AGA, Feil oversees state policy discussions. This includes monitoring legislative activity that may affect the casino industry, identifying areas where the association can support policies, and leveraging research. “I provide regular legislative and regulatory updates,” she says. The AGA tracks a number of gaming issues, and sports betting is among the more significant. “We monitor updates in states that are working to legalize sports betting, and once a state passes legislation, we keep an eye on implementing regulations,” Feil says. “With each state taking a slightly different strategy, it’s essential to stay up to date on the different models in place and how that is impacting the gaming industry in each state.” When she joined AGA, Feil jumped into roles outside her comfort zone. She learned the importance of taking the time to ask the right questions of the right people to understand how to be effective in each role she faces. She gives kudos to government affairs attorney Barbara DeMarco and GGB COO Becky Kingman-Gros for their support along the way. “Having friends who are willing to share their knowledge of the industry and be a sounding board has been invaluable. It’s been meaningful to me to have people I can go to with questions and speak candidly with about working in gaming,” Feil says. The most important piece of advice Feil can give is to learn something new outside your daily work experience. “This is a complex business, and people are open to sharing their experiences and knowledge if you ask. You can learn something new every day, even if it’s not immediately relevant to your work at that moment.” She still considers herself a newbie at the AGA. “I’m learning so much,” Feil says. “When I started on my career, I did not expect to end up working in gaming. But now that I am, I really enjoy it. I hope to keep working in this industry, advocating for companies and sensible public policies that will help the industry grow while ensuring a safe and fun environment for customers.” —William Sokolic

The Power of ‘Why’ Josh Ford Chief Information Officer, Jamul Casino osh Ford has always had a passion for figuring out how things work. From a young age, he loved to tinker with objects, disassembling and reassembling them. Naturally, even as a child, he took up computer programming. Growing up with such aspirations enabled Ford to assess situations and challenges through a process-based approach. This method has allowed him to “focus on how to get from point A to point B effectively,” he says, “without spending time worrying about the actual challenge itself.” With a propensity for constant inquiry, Ford’s success in gaming is no surprise. He graduated from Elizabethtown College in Pennsylvania with a bachelor’s degree in business management and a minor in computer information systems. After graduation, he started in the casino industry as an overnight bus greeter for Caesars Entertainment in Atlantic City. While working at night, he dove into learning about the casino’s processes. He learned how repetitive some tasks were, and found ways to do them more efficiently. His curiosity and innovative thinking caught the eye of the regional database marketing team. Impressed by Ford’s desire to understand and implement efficiencies within the casino, they moved him into the database marketing role that jump-started his career. Within his new role as database administrator, Ford realized there were many efficiencies to be gained through technology. This inspired him to improve processes and generate tools to help fellow employees perform their jobs more efficiently. He describes “the glow you see in your co-worker’s face when you take the time to walk in their shoes and provide them with solutions that save them even as little as 20 to 30 minutes of work in their day.” Ford calls it “energizing.” He continued to ask questions and implement time-saving innovations, and utilized data

to build internal software that assisted casinos promotionally. His efficiencies caught the eye of Rush Street Gaming, which hired Ford as one of its property database marketing managers, and later promoted him to director of IT and business intelligence at the corporate level. Today, Ford is chief information officer of Jamul Casino, San Diego’s newest casino, where he’s responsible for the strategic and tactical decisions of the IT and analytics departments, ensuring the casino’s success through datasupported decisions and recommendations. Ford believes his curiosity and ability to gain a wide range of knowledge simply by asking “why” led to his success in the gaming industry. He says he always strives to “understand the inner workings of processes, programs, and companies—even if it falls outside of my line of discipline.” From a data and analytical standpoint, Ford says there is always a need to “play devil’s advocate and understand the ‘why’ behind why something wasn’t done a certain way, or why an opposing decision was made.” Ford embraces differing viewpoints and seeks to understand the opposition, a tactic that strengthens his knowledge of how people and departments work together within an organization. As for the future of the gaming industry, he believes it is at the beginning of a technological renaissance. Ford says he is thrilled by the growing interest in data analytics machine learning, which is attracting young professionals and startup companies, and iGaming, which is bringing innovative companies into the industry that never would have entered otherwise. Ford’s No. 1 piece of advice to young professionals? “Always stay curious, and never accept ‘because this is how we’ve always done it’ as an answer.” —Krista McPherson, Analyst, The Innovation Group

FEBRUARY 2020 www.ggbmagazine.com

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Powering the

Pit

By Dave Bontempo

he evolving pit. Those three magic words reflect the revitalized home of the industry’s classic games: craps, blackjack, roulette, baccarat, and, in the new age, poker. The beauty of the evolving pit is its varied interpretations. Some vendors enhance its function with exciting games. Others offer operational flexibility and the penchant for on-site marketing. Maximized funds access also plays a role. From varied angles, it’s a new age for the pit, which has swung like a pendulum, from dominating casino operations to being overtaken by slots and then finding a path back to a happy medium, anchored by younger players. The pit not only holds its own in the revenue realm, but embraces some of the community-based elements of slot operations.

Bring the Games The pit retains a flair for magic. “People want live entertainment and the ability to socialize, and the table-game experience is unmatched in that area,” says John Hemberger, senior vice president of table products for AGS. “Over the last few years, the biggest change we’ve seen in the pit is that, regardless of the game, there are so many more betting options. “Blackjack is a great example. The many new side bets and progressives add new twists, significantly more excitement and more ways to win.” Industry table games enjoyed a strong 2019, and AGS reported record table-game revenue in the third quarter, the last financials available, Hemberger says. Progressives, side bets and exciting new games trigger his 2020 optimism. “We’re laser-focused on driving an engag36

Global Gaming Business FEBRUARY

AGS STAX Progressive

For many players, the pit is the heart and soul of a property. With these game innovation and technological enhancements, it’s performing even better. ing player experience and partnering with operators to grow the table-game player base, encouraging loyal players to invest more,” he says. “We’re addressing this primarily through our focus on table progressives, and adding more interactivity to the player experience.” Hemberger calls Bonus Spin Xtreme, an innovative new progressive side bet system, an example of AGS’ passion in this sector. The cutting-edge design, which features three concentric wheels, lets Bonus Spin Xtreme reward all participating players with a community prize. One player gets an enhanced prize, which could even be a progressive jackpot. “Bonus Spin Xtreme is also the only product in our industry to link all table games within a casino, including community-style table games like roulette, baccarat and craps, and offer a single shared progressive jackpot,” Hemberger adds. “Every progressive on the floor is fueling that jackpot, making it much more lucrative. It’s also a community experience, where everyone is winning together, creating more energy and certainly more camaraderie. People like to win together, and they like to see other people winning. That’s really the foundation of our industry and what drives people into casinos.” Hemberger also touts the STAX Progressive platform, a table-game progressive platform offering a multi-level progressive, a must-hit-by jackpot, and even a Golden Seat feature that randomly selects a player who’s wagered the progressive side bet and delivers a customizable, casino-configurable reward. “The must-hit-by feature that we added to STAX stemmed from a desire to get higher participation on these progressive wagers,” he indicates. “Operators have, in some instances, seen a 30 percent to 40 percent increase in participation after turning on the STAX must-hitby progressive, because it offers exciting new energy at the table as the meter increments to-

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“We’re laser-focused on driving an engaging player experience and partnering with operators to grow the table-game player base, encouraging loyal players to invest more.” —John Hemberger, Senior Vice President of Table Products, AGS

wards the must-hit-by amount.” In the latest version of STAX, AGS has added features that “make the casino pit more energetic,” such as seasonal-themed backgrounds that can be easily changed to celebrate holidays like St. Patrick’s Day, Halloween and Christmas. “While we still want to differentiate the casino pit from the slot floor, we recognize that there are elements we can pull into the pit, like attractive animated signs and themed celebratory progressive displays,” says Hemberger. “They draw players to the games and offer better ways to merchandise the game and the progressive jackpot.”

The role of automatic card shufflers is increasingly important in the casino pit, and AGS is penetrating the industry with its Dex S single-deck poker shuffler (it launched in late 2018, and now has 175 units installed across 13 markets). The company just introduced a second variety, the Pax S single-deck packet shuffler. “There’s another product we’re looking forward to launching in 2020,” Hemberger says, “the ACOT Chip Tray and no-peek device. It’s a new, elegantly engineered version of a casino pit must-have, designed to efficiently store and arrange chips for easy accessibility, while securely protecting chip inventory. “The no-peek component, which is available with ACOT or separately, provides greater levels of security for blackjack tables.”

Our IT guy is our “It Guy.” The Jamul Casino team congratulates Josh Ford, our Chief Information Officer, for being recognized as one of the emerging leaders of gaming under 40. The always positive executive, Josh provides indispensable leadership, innovation, and data-driven decisions. This is a well-deserved honor for someone who makes our technology work for us, rather than the other way around.

619.315.2250 • 14 619.315.2250 14145 1 C 145 Campo ampo R Road, oad, JJamul, amul,, CA 91935 20 minutes from from downtown downtown San San Diego Diego • jamulcasinosd.com jamuulcasinosd.com FEBRUARY 2020 www.ggbmagazine.com

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Blaze baccarat, Blaze sicbo and A Plus Shuffler by TCSJohnHuxley

Adding the Energy Combining security-friendly utility products with presentations designed to add some pizzazz to the pit is by no means confined to U.S.-based suppliers. London-based TCSJohnHuxley, a longtime leader in the international table-game supply business, offers plenty of both types of product. One of the most prominent examples is the Blaze Surface Technology range, now offered on TCSJohnHuxley tables for roulette, sicbo, baccarat, craps and roulette. This suite of games brings a new twist to these traditional games, incorporating eye-catching patented game attract animations as well as highlighting winning bets with lively displays, while providing additional security to dealers and operations staff alike. “Our Blaze range of products have been extremely successful in the Americas,” says Steph Nel, the company’s general manager for the Americas, “with many casinos capitalizing on the added excitement and spectacle these eye-catching tables bring to the gaming floor. With the addition of Blaze Baccarat, operators can now take advantage of offering one of the world’s most popular card games while improving the playing experience for the customer.” Adding to the company’s lineup of new table products—to be displayed at this month’s ICE London show—is the TCSJohnHuxley Jackpot System, which provides operators with the flexibility to configure multiple bespoke progressive jackpots and patented mystery prizes, to enhance any base game. The system focuses on preferred hit frequencies as well as specific jackpots, their seed values and contributions. “Never before has there been a successful progressive system that provides high levels of excitement as well as multiple customizable independent progressive jackpots and fixed payouts, incorporating both event based and mystery wins,” says Nel. On the utility side, TCSJohnHuxley offes the A Plus Shuffler, which the company calls the most versatile and reliable single-to-eight-deck shuffler on the market. It is available with interchangeable blackjack and poker shoe configurations, and can be easily set up for all kinds of card game shuffling needs, although it comes pre-programmed with many popular casino card game settings. The A Plus Shuffler is capable of delivering a continuous supply of cards from one to eight decks, or can deliver composite hands of one or more cards in turn. “A Plus Shuffler can easily increase game speed, hand rate, utilization and ultimately revenue from almost any casino card game,” Nel says. “It is simple and easy to use, and requires limited training time, as the machine prompts the user throughout the dealing process. Introducing new staff to the unit only takes minutes.”

Innovative View There’s a new way to manage pit traffic. TableView brings a 2020 dimension to the pit for Scientific Games, 38

Global Gaming Business FEBRUARY 2020

which enhances the product via mobile capability. The updated product is strongly entrenched in the Asian market, and will enter the United States this year, according to Bobby Liscio, senior product manager at Scientific Games. TableView, attached to 11,000 tables in 302 casinos worldwide, has been upgraded consistently over the past 15 years. It already provides an innovative table management solution designed to replace any existing manual rating process. With the ease, speed and simplicity of a fixed tablet or a mobile device, floor operations staff enter real-time player ratings and issue customer comps and markers right at the table. Information and transactions recorded at the table integrate seamlessly with the CMS, providing casino personnel with secure and instant access to table ratings and detailed financial information. The product is known for its touch-screen entry, integrated CMS database access, table ratings and a graphical dashboard for detailed analytics, among other features. And it’s about to enter a new age. The emerging hand-held version, TableView Web, turns supervisors into walking command centers, who can move among tables to implement important data, everything from player ratings, fills and credits to open and close of tables, rollover of the gaming day and head-count limits. All aid decision-making in raising or dropping table limits or deploying personnel. Operators may decide to replace older hardware, like the hydraulic arm containing the tablet at many tables, or a mechanism by which a tablet is fixed and mounted on a table, over time. “One of the benefits it produces at the pit is freeing up space around the table,” Liscio says. “Think about it now, with all the displays, shufflers, signs about table limits, etc. There’s a lot of hardware attached to the tables. Now we can take some of that away and free up space for any other technology.” The new version also frees up budgets, he says. The iPad is more than 50 percent cheaper than the tablets at the table, a savings that multiplies over the span of multiple units. While the new TableView packs smart enhancements, Liscio is thrilled about its imminent integration with SG Vision, which, through small cameras and chip and facial recognition, will enable players to be instantly identified and marketed to, on the spot. TableView is just one of the products enhanced with SG Vision, a company-tailored version of Computer Vision, the video-surveillance and people-counting tool used in many fields, including security at airports. It’s in development. “An alert can go out, telling the host that a VIP has arrived at a table,” Liscio indicates. “We can alert surveillance when players are wagering a large amount. Players won’t even need loyalty cards. They walk up to a table, the rating is opened. When they walk away, it’s closed.” Liscio believes SG Vision and TableView will help supervisors regain the

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“Holistic systems like our ‘Digital Neighborhood’ will be critical in addressing operational, compliance and customer experience needs.” — Darren Simmons, Executive Vice President and Fintech Business Leader, Everi ability to interact with players, an important public-relations role. “SG Vision is going to be a real gamechanger,” he says. “You try to take as much responsibility from a supervisor as possible, and you take inaccuracies out of the system. If someone has to watch six to eight games at one time, how accurate are their guesstimates? “The tasks added onto a supervisor’s job over the years have kind of taken over what’s really important in the pits, and that’s getting to know your customers and delivering a high level of customer service. I opened Caesars in Atlantic City in 1979. I was in craps, and we had time to shake hands with the customers. We knew the players, what they drank, what they like. ‘Hey, can we get Joe a beer?’ ‘Hey, Joe wants $1,000 in chips.’ The customers loved that. People love to be recognized. “That phase of gaming just kind of went away. You see supervisors buried in paperwork, their heads down. They’re unable to shake hands with the people. I think we’ll be able to bring those good things back.”

The Digital Neighborhood Darren Simmons, executive vice president and fintech business leader for Everi, believes the pit is entering a unique age. Funds access, the gas in the player’s tank, gets higher “octane” with new products. “Self-service options, convenience and consumer adoption in the retail space—for example, Apple Wallet—are all driving demand for digital transformation across the casino floor, which we’ve witnessed over the past 24 months,” he says. “This digital transformation is impacting technologies that are being evaluated and deployed in casino pits. We believe holistic systems like our ‘Digital Neighborhood’ will be critical in addressing operational, compliance and customer experience needs.” The concept of Everi’s “Digital Neighborhood” is centered around its core platform products and suite of services, Simmons says. These products and services interact with each other, whether it’s on the loyalty kiosk, in payments processing, at the ATM or in the back of the house through jackpot processing or compliance solutions. The company’s mobile platform enables these products to communicate with each other and provide the seamless convenience of a single vendor, he says. The mobile application leverages all the core functionality and capabilities to complete the customer journey and create a convenient user experience. While Everi sees success in the mobile funding capabilities, it views even greater opportunity by bringing all of its services into one mobile solution, according to Simmons. Everi touts CashClub Concierge and CashClub Wallet as major players in this sector. 40

Global Gaming Business FEBRUARY 2020

“They’re two of several touch points for casino guests that are tied together through Everi’s Digital Neighborhood,” he says. “This experience is unique, in that it’s free from the disruptive mechanisms of conventional payments, compliance and loyalty. Both parts of our payments solutions suite, CashClub Concierge and CashClub Wallet, are designed to maximize funds to the floor, optimize how players access their funds, and enable operators to monitor and control player activity with an eye toward compliance and responsible gaming.” What are the dynamics behind the products? “The wow factor comes down to providing more freedom and convenience in how guests access and manage cash on the casino floor,” he says. “This freedom and convenience are commonplace in the retail space, but has been a long time coming to casinos. “CashClub Wallet consolidates payment options for guests, enabling them to store multiple payment methods, easily move funds in and out of the casino and manage their spend limits, all aimed at supporting responsible gaming and compliance. We’re involved in test programs of our CashClub Wallet at two large casino properties, and both operator and player feedback has been positive. Operators have been impressed with the fact they are able to offer another self-service option to their guests besides ATMs and kiosks, as well as the potential to reduce cash handling costs and to extend promotions to guests while not on property.” CashClub Concierge delivers personalized cash access cage service right at the guest’s table position, via mobile tablets and mobile point-of-sale devices through the CashClub payments software platform. Based on operator feedback to date, the solution has reduced disruption of play, as guests don’t have to step away from gaming to access additional funds, and has shortened lines and wait times at the cage. As players demand more excitement and options, the evolving pit appears ready.

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NEW GAME REVIEW by Frank Legato

Game of Thrones— Winter is Here Aristocrat Technologies

ristocrat has built on the widely successful Game of Thrones slot franchise within its gaming operations portfolio with Game of Thrones—Winter is Here. Based on the seventh season of the hit HBO TV show, Winter is Here is featured on the ultra-large, cinematic Edge X cabinet. The base game plays out on a five-by-four array (four rows of symbols per reel), plus a sixth Bonus Reel that applies in the game’s main feature. The game includes a “Beyond the Wall” feature that allows players to take on the White Walker army with a cascading Cash on Reels progression. Landing a character in this feature awards credit prizes with multipliers up to 12X for consecutive wins. Winter is Here also offers the Night King feature, where Bonus Reels 2-6 contain only credit prizes, multipliers and high-paying royal symbols. Game of Thrones—Winter is Here is a medium-to-high volatility game available in both MSP and SSP in non-MSP jurisdictions. There are four symbol-based progressives, awarded for lining up five scattered symbols corresponding to each jackpot, resetting at $100, $200, $750 and the Grand Jackpot, resetting at $250,000.

On the Edge X, players will have a sense of personalized gaming space packaged with a 27-inch super-high-definition topper and vibrant themed wedges. The ergonomically designed LED display puts out a vibrant, high-contrast picture which, according to the manufacturer, replicates the experience of being in the “Seven Kingdoms” alongside the main characters. Manufacturer: Aristocrat Technologies Platform: Edge X Format: Five-reel, ways-to-win video slot Denomination: .01 Max Bet: 500 Top Award: Progressive; $250,000 reset Hit Frequency: Approximately 60% Theoretical Hold: 10% (est.)

Ultra Rush

Incredible Technologies

his new game series on IT’s Infinity Skybox cabinet utilizes the two main monitors for simultaneous play on two stacked three-by-five reel sets. The top monitor features a jackpot wheel that awards one or more of five progressive prizes. The inaugural release features two base themes, Sky Fire and Golden Steed. On each, the two reel sets work together for a 60-line base game. Three golden medallion scatter symbols trigger 10 free spins with the chance to re-trigger for more free games, as well as win the “Ultra Rush” feature within any spin. The Ultra Rush hold-and-respin feature is triggered when six scatters land on the same spin, regardless of upper or lower reel set. The six scatter symbols remain locked while all the rest of the regular symbols are cleared to reveal new reel sets holding only blanks, credit scatters and wheel scatters. Players begin the event with three free spins, but each time a scatter symbol lands, the free-spin countdown resets to three. Filling the entire reel with scatters results in a large credit bonus, in addition to the accumulated credit amounts from the pearl scatter symbols. Any wheel scatter symbols grant players the chance to spin the jackpot and progressive wheel. According to the company, there are more wheel scatters available the higher the bet.

Global Gaming Business FEBRUARY 2020

The wheel displays all four progressives—the Mini, resetting at $10; the Minor, at $50; the Major, at $500; and the Grand, at $10,000. Players spin the wheel once for each wheel scatter accumulated in the free-spin bonus, which means players can win multiple progressives within any Ultra Rush bonus round. Manufacturer: Incredible Technologies Platform: Infinity Skybox Format: Five-reel, dual-reel set, 60-line video slot Denomination: .01, .02, .05, .10, .25, .50, 1.00 Max Bet: 75, 150, 225, 300, 375 Top Award: Progressive; resets at $10,000 Hit Frequency: 5.91%-14.16%

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Willy Wonka Everlasting Gobstopper Scientific Games

his latest entry into Scientific Games’ Willy Wonka series presents a load of mystery features and bonuses on the immersive Gamefield 2.0 cabinet. The base game is a six-reel game, with four rows of symbols per reel and 25 paylines. The game employs a three-level symbol-driven progressive, with a Minor jackpot resetting at $250 and a Major resetting at $2,000. The top progressive jackpot is a wide-area prize either on the Reel Adventures link, resetting at $200,000; or the Cash Connection link, resetting at $400,000. (There also is a near-area progressive version.) The top jackpot is won with six scattered Willy Wonka symbols at max bet. There are several mystery events in the base game. The “Oompa Loompa Feature,” randomly triggered on any spin, stretches the reels to five, six or eight active rows, and three reels are replaced by an alternate reel that contains more high-paying symbols. Each Everlasting Gobstopper symbol that lands on the reels awards the following credit prize: Regular Gobstopper symbol: 10–250, Mystery Gobstopper symbol: 25–500, and Golden Gobstopper symbol: 100–1,000. If at least one Golden Gobstopper symbol lands on the reels, then a multiplier of 2X–10X may be awarded. Also randomly on any spin, a wild symbol will be placed on up to six reels—a minimum of two reels, or three reels if the Enhanced Bet is active. Also random is a Reel Replacement Feature, in which a number of

positions on each reel are replaced with one of nine highpaying symbols. Five Golden Egg symbols trigger a bonus feature. Each egg is randomly placed in either the Free Spins egg collector or the Chocolate River Bonus egg collector. The first egg in the Free Spins collector awards five fee spins, and each additional egg adds one free spin. The Chocolate River Bonus awards a pick feature, with each Everlasting Gobstopper symbol awarding a prize of 1075 credits with the standard bet or 25-100 credits with the Upgrade bet. At the end of the pick feature, a Slingshot Game and a candy pick field of 10 candies are awarded. During the Slingshot Game, players will launch the Everlasting Gobstopper to select one candy from the pick field. Each candy reveals the following prizes: Regular Gobstopper: 150–2,000 credits, Mystery Gobstopper: 150–2,500 credits, Major, Minor jackpots, or 2X, Golden Gobstopper: 150–3,000 Credits, Major, Minor Jackpots, or 2X multiplier. Each bonus feature ends with a chance to land the “Golden Ticket.” Players are presented with Chocolate Wonka Bars equal to the active bet multiplier. Each Wonka Bar may reveal the Golden Ticket for 500,000 credits, 50–200 credits if Standard bet is active, or 75–200 credits if More Upgrade Everlasting Gobstoppers bet is active. Manufacturer: Scientific Games Platform: Gamefield 2.0 Format: Six-reel, 25-line video slot Denomination: .01, .02, .05, .10 Max Bet: 450 Top Award: Progressive; $200,000 or $400,000 reset Hit Frequency: 10.98%-13.13%

Lion Dance IGT

his new title on IGT’s CrystalCurve cabinet utilizes intricate artwork in a colorful Asian theme that takes full advantage of the cabinet’s 42-inch curved portrait monitor. The base game is a 40-line video slot on a five-by-four reel array (five reels, four rows of symbols each). The game features a 75-credit cost-to-cover. During the base game, coins may spill from the treasure chest located in the top screen in a mystery event. The coins are collected in the “Wilds Bonus” area located below the reels.

If five coins are collected under the reels, the Wilds Bonus is triggered for an initial five free spins, with retriggers. Any additional coins collected turn into wilds on the reels. The Chest Bonus is triggered when a treasure chest lands anywhere on the middle reel, increasing any existing wilds on the reels by 1X. Manufacturer: IGT Platform: Ascent, CrystalCurve Format: Five-reel, 40-line video slot Denomination: .01 Max Bet: 225, 375, 750, 1,500 Top Award: 2,095,700 credits Hit Frequency: 24% Theoretical Hold: 4%-15%

FEBRUARY 2020 www.ggbmagazine.com

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FRANKLY SPEAKING by Frank Legato

s I write this, it is early January, and in Las Vegas, that means one thing: a two-week hangover, followed by a brutal two weeks of winter. OK, two things. But wait: January in Vegas means one more important thing. If you can stand the winter deep-freeze—when daytime temperatures barely make it out of the 50s—you can go to CES. CES is the popular trade show that was originally called the Consumer Electronics Show, and it’s one of those events to which slot manufacturers and even casinos send their resident innovators, for technology that can be adapted for use in the casino industry. These consumer shows have provided slot manufacturers a lot of ideas over the years. Programmable button decks, cashless technology and interactive slot displays are among the consumer ideas that have been successfully commercialized on slot machines. Others, like a slot machine built into a treadmill or other exercise device, were suggested but never took off. They should have included an ashtray on the thing like I suggested. In any event, whenever CES comes around in January, I pay close attention to stuff that may end up in a slot machine, or even in a casino hotel room or bar. This year’s CES, held the second week of January, didn’t disappoint, although from my perspective, there was much more innovation that can be used on the non-gaming side than in a slot machine. For the hotel room, there was a “multitasking bed for sex.” It was one of the “sex tech” exhibits, which also included “internet-connected vibrators.” I can’t wait to see these in my suite at Caesars Palace or MGM, if only to find out just how many multiple “tasks” there are to be had in bed. As far as I can see, there’s only one. (OK, maybe two on a good night.) And I don’t know about you, but I sure don’t want my vibrator connected to the internet. For that matter, what the heck does connecting something like that to the internet do? Never mind. I don’t even want to know. This is a family column. I read that these “sex tech” products are now allowed at CES in the “health and wellness group” of exhibitors. (Well, well.) It’s an updated policy, implemented to prevent the kind of brouhaha that happened last year when sex-toy company Lora DiCarlo’s CES Innovation Award was taken away because of a policy prohibiting “immoral, obscene, indecent or profane” products. CES is much more liberal now, although they still don’t allow cannabis products. Because, you know, that would be much more immoral than an internet vibrator. Other stuff for the casino hotel room featured at this year’s CES 44

Global Gaming Business FEBRUARY 2020

included a lot of something called “toilet tech.” There were sensors to determine how much water each flush requires, “voice assistants” to flush your toilet, a “roll bot” to save on toilet paper, and even a wearable stomach monitor to notify you when it’s time to use the bathroom. Wow. Just, wow. What do the voice assistants say? “Flush! In the name of all that is holy, FLUSH!” And for the record, I’m 63. There are a lot of things I need: Heartburn pills. Physical therapy after my dog yanks my shoulder out of its socket on a walk. Someone to remind me why I went into the kitchen just now. If there’s anything I don’t need, it’s something to tell me when I need to go to the bathroom. Then again, maybe I should get with the times. Think of it. Technology hooked to my gastrointestinal tract can assure me that I’ll never miss a bathroom trip. Here, I’ve been relying on intestinal cramps, like some loser. Moving on, there are two men in Mississippi who could have used some of that high-tech karma. Authorities say two men attempted to scam the state lottery by submitting a losing ticket that had the winning numbers glued on. The men, both from Columbus, Ohio, submitted the glued-up ticket and tried to claim a $100,000 prize. From what I understand, the ticket was made of construction paper, with pictures of cows and horsies pasted on with Elmer’s Glue-All. It worked about as well as their former attempt to use a Magic Marker to fill in the third “7” on a slotmachine near-miss. These guys should have gone to CES before planning their caper. They could have implemented at least some rudimentary technology to create their bogus lottery tickets. And as a bonus, they could have gotten something to tell them when to go to the bathroom. And to complete the picture: internet vibrators! VICT OR RIN ALDO

High Tech, High Times

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CUTTING EDGE by Frank Legato

Personal Sportsbook Product: Bring Your Own Device (BYOD) Manufacturer: Kambi Group

ambi’s Bring Your Own Device (BYOD) technology can be rapidly deployed to greatly augment the sportsbook experience in any landbased environment, giving operators the ability to provide a slick, sophisticated product that can be highly tailored to suit their brand through Kambi’s open APIs. By way of example, the launch of Parx Casino’s on-property sportsbook in Pennsylvania in January 2019 saw the operator leverage Kambi’s BYOD solutions to launch Betslip Builder, a mobile app which enables players to fill out their bet slip when on the move and create a QR code to be scanned prior to reaching a cashier. Kambi’s portfolio of on-property solutions is a huge aspect of what the supplier offers. With a number of states in the U.S. regulating on a “retail first” basis, Kambi’s ability to offer a comprehensive solution that incorporates a tailored blend of cutting edge over-the-counter and kiosk services has been a crucial driver of the progress the company has made. The market-leading BYOD technology has been one of the key aspects of Kambi’s successful retail delivery to clients in the U.S., including Penn National Gaming, Rush Street and Seneca Gaming Corporation.

The technology markedly enhances the player experience, enabling them to view lines and build bets on mobile for quick and easy placement at the property. It elevates the entire casino ecosystem by putting the entire sportsbook at players’ fingertips regardless of whether they are at the casino or at home. The technology also allows for a far greater level of interaction and movement for players within the casino, giving customers the opportunity to start putting together their bets when they’re at the bar, or walking the gaming floor in search of a slot or table. Furthermore, the BYOD technology has delivered clear success through streamlining the sportsbook experience during peak times. For more information, visit kambi.com.

Graphics Power Product: EGL7100 Manufacturer: EFCO Technology Corporation

he slot machine remains the most popular and iconic game for casinos today, having greatly evolved from the “one-armed bandit” to employing interactive elements and varied video graphics. Modern slot machines employ highly reliable embedded technology, or gaming logic boxes, that offer rich user-experience features in a game developerfriendly platform. EFCO will be demonstrating its most advanced gaming logic computer solution, EGL7100, at ICE 2020. With support for up to six displays, and up to 8K of output, developers can unleash their imaginations in designing new games and experiences. And, because EFCO’s gaming logic computers are easily upgradable, it allows designers to begin implementing the latest technology immediately. Based on the Intel 8/9th generation of the Intel Core-i, Pentium and Celeron processor families, the EGL7100 supports complete gaming features including SecuBoot, RootSecu, GPIO, NVM and intrusion detection to fulfill a variety of security needs. In addition, LED lighting comes standard with all EFCO gaming logic computers. The extremely flexible use pattern can be operated independently of the game, allowing designers to reimagine this feature.

Global Gaming Business FEBRUARY 2019

EGL7100 offers standard support for up to 4x 4K displays when paired with an external, industrial-grade Nvidia graphics card, or 6x 4K with AMD graphics card. It easily connects with other peripherals via the 6x serial ports, 8x USB ports and two Ethernet ports. Other features include support for PCIe high-speed NVRAM with virtual boost technology to accelerate access rate. Add-on PCIe Gen III 16x graphics card, modular I/O design with plenty of GPIO, and over 25k hours MTBF at 50 degrees centigrade at 65W CPU plus 100W GPU. Lifetime support until 2031 is included. For more information, contact info@efcotec.om or visit efcotec.com.

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PREVIEW IGT’s European Focus at ICE

t ICE London 2020, IGT will demonstrate how its portfolio of proven gaming solutions can elevate the player experience and drive growth for its customers around the world. Under the theme “Player-Driven PerIGT’s Bubble Blast Bank formance,” IGT will highlight a diverse range of innovative solutions within stand N3-160. The company will present the latest additions to its linked multi-level progressive content library at ICE. IGT’s Bubble Blast game with the Spells N Whistles and Treasures of Atlantis base games on the PeakSlant 49 gaming machine will make its ICE debut. IGT will present an expanded library of core titles that excelled in the company’s internal and external testing processes and graduated as “Proven Performers.” Exceptional titles for the CrystalDual 27 cabinet will include Star Goddess, Lucky Buddha and Twin Strike. The company will showcase its multi-game content bundles with new, market-attuned USwitch content for the Cobalt 27 cabinet and diversity HD game suites for the AXXIS 23 gaming machine. IGT’s new poker bar-top cabinet, PeakBarTop, will make its ICE debut. The new cabinet elevates the player experience with its 23-inch curved display, USB charging ports, enhanced lighting and audio and more. IGT will shine a spotlight on its TRUE 4D technology with new Wheel of Fortune titles such as Wheel of Fortune 4D More Money and Wheel of Fortune 4D WheelMobile. Both titles combine the most successful slot theme of all time with the innovation of TRUE 4D technology for a gaming experience unlike any other. IGT’s PlayDigital organization will showcase its interactive content delivery solution, PlayRGS, with new content such as Bill & Ted’s Excellent Adventure, and an omni-channel version of a classic IGT title, Cleopatra Gold. The company’s systems area will showcase IGT Advantage and its Player Experience Product Suite of mobile solutions including Cardless Connect, Resort Wallet and Intelligent Offers. When its elements are leveraged together, this product ecosystem enables casino patrons to effortlessly interact with gaming devices via their mobile phones, which helps drive operational efficiencies for the casino.

Konami Ready for ICE with New Specialty Slots

onami Gaming announced a significant lineup of compelling new cabinets and popular progressive series at ICE 2020. More than 35,000 guests are expected at the exhibition February 4-6, where Konami is filling stand S7-110 with its latest proven gaming entertainment. Titles on display include Dragon’s Law SeleXion, Ba Fang Jin Bao and Treasure Ball, which have demonstrated success across Konami’s specialty 4K Ultra 48

Global Gaming Business FEBRUARY 2020

Feb. 4-6 London

High-Definition machines, KX 43 and Concerto Opus. As part of its continuing support for core dual-screen cabinets, the company is showcasing over two dozen original themes on Concerto Upright and Slant—from jackpot progressives to the SeleXion multi-game-compatible content. Gaming executives and professionals at this year’s event will also encounter the official ICE premiere of Konami’s new 49J machine, offering high-end 4K entertainment across a 49-inch, “J-curve” display. ICE 2020 includes two specialty Konami cabinets, each with relaxed slant top, dual spin buttons, dual cup holders, and an exceptional 4K game library. Konami’s 43-inch screen KX 43 and 65-inch screen Concerto Opus cabinets will showcase several of the industry’s highest performing slot series. Treasure Ball is a top new linked progressive, with the ability to offer a mix of base game options to players through SeleXion multigame. ICE 2020 also includes the special release of Dragon’s Law SeleXion, which combines the popularity of Dragon’s Law Rapid Fever and Dragon’s Law Boosted in one machine. Inspired by the success of Konami’s classic Cai Lai Si Ji, an entirely new 4K-linked progressive called Ba Fang Jin Bao has demonstrated success with flexible betting options and Konami’s Chili original base games. Chili Fire Boosted These ICE show highlights are available Wins & Wilds now across international markets.

Scientific Games Pumped for ICE

t ICE 2020, Scientific Games will be showcasing great games, best-inclass iGaming and sports platforms and its complete entertainment ecosystem powered by cutting-edge technology. When it comes to land-based gaming, no other gaming company creates exciting player experiences supported by efficient systems and seamless technology like Scientific Games. At ICE, Scientific Games will introduce new games that will build on its long history of introducing great games that take proven, player-favorite game mechanics to the next level of excitement for the European market. This includes great games such as Hot Hot Jackpot, Penny Pier Link, and Ultra Hot Mega Link, an evolution of beloved Ultimate Fire Link. Each of these games is complemented by SG’s cutting-edge hardware, which is designed to bring players right into the game, creating a richer experience. Scientific Games is bringing back the classic five-reel mechanical game with the TwinStar 5RM. The company is launching its first new 5RM games

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in seven years with Dancing Drums 5RM and Lock it Link 5RM. Scientific Games also will showcase the latest features and updates from its dynamic iGaming and sports platforms and experiences, OpenGaming and OpenSports. Through OpenGaming, Scientific Games offers immersive casino content and dynamic Dancing Drums 5RM player experience features in one integration. New iGaming features such as Mega Drop, Mega Drop Quest and Jackpot Wars create innovative, new ways of engaging players and growing the player base. The modular platform, OpenSports, is trusted by the world’s leading operators, and lets operators choose exactly the services their business requires.

TCSJohnHuxley Set to Dazzle

CE 2020 provides the perfect showcase for leading global innovator of live table gaming solutions TCSJohnHuxley to debut some new and exciting additions to the range. Qorex Gaming Solutions provide all the thrills of live gaming while delivering all the benefits of electronic gaming such as multi-game selection and improved security while optimizing resources and hardware to increase revenue. Designed to complement the striking Qorex cabinet that incorporates system-controlled LEDs, a range of new accessories featuring podiums, divider shelves and game signage will display just how flexible and eye-catching Qorex layout configurations can be, transforming the gaming floor and creating an exciting gaming experience for players. Also on show will be the TCSJohnHuxley Jackpot system, which provides operators with the flexibility to configure multiple bespoke progressive jackpots and patented mystery prizes, to enhance any base game. The system focuses on preferred hit frequencies as well as specific jackpots, their seed values and contributions. Never before has there been a successful progressive system that provides high levels of excitement as well as multiple customizable independent progressive jackpots and fixed Single Qorex payouts, incorporating both event-based and Terminal mystery wins.

Merkur Gaming Going Big at ICE 2020

he event that Merkur Gaming and the entire Gauselmann Group regard annually as its most significant is the 2020 ICE London gaming exhibition. The Merkur Gaming team is ready to put on a significantly big show. Thanks to the restructuring of the individual stand areas, the Gauselmann subsidiary has gained significantly more space for its product show. This is actually also necessary as, for example, the new Avantgarde Max promises to be really huge. The Avantgarde Max is where maximum performance meets maximum entertainment. The cabinet’s two or even three 31.5-inch full HD monitors

Merkur Stand at ICE 2019

set new technical standards that allow players to immerse themselves deeper than ever before into the game. The loudspeakers, which are mounted at console height, ensure an even more intensive gaming experience due to their improved transmission angle. The linked progressive jackpot Treasure Link provides a real gaming adventure. This product highlight combines five brand-new games—African Glory, Dragon Marbles, Golden Silk, Joker Buffalo and Temple of the Nile—with an exciting entertainment concept. Each of the basic games has an individual bonus feature called Cash Games that gives the player the chance to win the Treasure Link’s Mini, Midi, Maxi and Mega jackpots. The bonus feature innovation Rapid Thunder will also find its way into the hearts and minds of ICE visitors in a flash. The non-progressive jackpot allows big prizes to be won on five levels and brings the already-familiar games Taco Tuesday, Land of Charms, Immortal Emperor, Immortal Princess, Baozang and Amulet of the Pharaoh to an entirely new level.

Gary Platt Manufacturing Presents Art at ICE 2020

ary Platt Manufacturing doesn’t have employees—they have a team of artisans who design, create, and construct every chair by hand. Now on stand S5-200 at ICE 2020, Gary Platt will showcase its very latest designs, each a masterwork of hand-crafted perfection. Gary Platt has more than 20 years of experience, hand-crafting chairs using only the best materials, right down to the proprietary blend of foam that each chair is made from so that it perfectly pairs fashion with unsurpassed comfort. Visitors to Gary Platt’s ICE stand will relax in the unsurpassed comfort of the Savannah, Monaco and Lugano models. While Gary Platt is perhaps best known for bringing unsurpassed comfort to the casino floor, the company has a deep portfolio of seating solutions for the entire enterprise—gaming and hospitality. At ICE, Gary Platt will be showcasing seating solutions from its Sierra Nevada Hospitality line for the bar, restaurant, convention, guest room, and other hospitality areas. Gary Platt’s Monaco Series

FEBRUARY 2020 www.ggbmagazine.com

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GOODS&SERVICES further $5 million to be paid April 1, 2020 and $5 million on December 24, 2021. Everi expects to fund the acquisition from existing cash on hand and future cash flow.

STAR ENTERTAINMENT, KONAMI RENEW PARTNERSHIP

ustralian casino operator Star Entertainment Group and Las Vegas-based Konami Gaming have jointly announced the continuation of a longstanding partnership to bring Konami systems technologies to Star’s integrated resorts in Sydney, Brisbane and the Australian Gold Coast. For more than a decade, Star has leveraged Konami’s award-winning Synkros casino management system to deliver dependable performance and fresh engagement opportunities throughout its portfolio. With the agreement, Star will introduce a

Everi’s Triple X Threat now online

EVERI GOES ONLINE WITH VERSIONS OF CLASSIC SLOTS; ACQUIRES ASSETS

aming supplier Everi Holdings last month announced milestones that will strengthen the company in two areas. New Jersey’s winningest online casino now offers a whole new library of classic slots—three-reel steppers featuring rows of BARs, 7s and cherries. By bringing traditional games to GoldenNuggetCasino.com, game manufacturer Everi is giving traditional slot lovers the kind of games they want, but in an all-new, instantly accessible format, said Marshall Adair, vice president and executive director, digital and interactive for Nevadabased Everi. Everi’s remote game server uses advanced system architecture to develop and distribute playerpreferred content directly to operators—including award-winning three-reel mechanical games and video slots, all built to deliver the exact same look, game features and math as their land-based counterparts. All can be played in either landscape or portrait mode, so they’re just as much fun on a smartphone as they are on a laptop or tablet. The RGS currently supports 30 titles and is expected to exceed 50 by the end of the year, with new games rolling out over time. Also last month, Everi announced that its wholly owned subsidiary Everi Payments Inc. has acquired certain strategic assets of Micro Gaming Technologies Inc. (MGT), a privately owned provider of self-service casino loyalty and marketing products and promotional tools and apps. MGT’s products, software and technologies for casino operators represent a complementary addition to Everi’s portfolio of fintech products and services. The acquisition also provides Everi with a portfolio of customer locations where MGT’s solutions are currently installed, including at properties of many key Everi customers. Under the terms of the transaction, Everi acquired certain assets of MGT for an initial payment at the time of closing of $15 million, with a

Star Casino Sydney

number of technologies, from optimized rewards to cashless wagering. The Star has launched Money Klip cashless wagering for faster, more secure transactions. It allows players to load secure funds to their account electronically, rather than feeding bills or TITO tickets into each machine. Additionally, destinations across Star’s portfolio will drive greater player loyalty rewards with optimal convenience, accessibility, and personalization through Synkros Offers Management.

JCM GLOBAL, PENN NATIONAL SIGN SUPPLIER AGREEMENT

Global Gaming Business FEBRUARY 2020

xpanding on a long-term partnership and laying the groundwork for the future, JCM Global and Penn National Gaming have entered into a multi-year master supplier agreement under which Penn National will utilize JCM bill validators and printers at all of its 41 casinos. Under the agreement covering over 36,000

electronic gaming machines, JCM will supply equipment and systems to Penn National Gaming for many of its existing properties and all new properties for the next five years. Among the products JCM will supply are the iVIZION bill validator, GEN5 Thermal Printer, the patented Fuzion peripheral management system, the ICB Intelligent Cash Box system, and the Promonet floor-wide promotional couponing system.

SCIENTIFIC GAMES WINS VLT CONTRACT FOR NORWAY

cientific Games Corp., through its subsidiary Global Draw Ltd., announced last month that it has secured a landmark agreement with Norwegian lottery agency Norsk Tipping to supply video lottery terminals across multiple locations throughout Norway. Norsk Tipping, owned by the Norwegian Ministry of Culture, is the only VLT operator in Norway. Starting in late 2020, SG will supply 3,000 to 4,500 VLTs in approximately 1,000 venues, including convenience stores, bingo venues and other arenas across the country. The design provides a one-stop gaming solution to meet the unique needs of the Norwegian market. Modular in design, each VLT model ensures a consistent player experience that is customizable to suit the needs of each individual venue. This deal also makes Norsk Tipping the first European customer of Scientific Games to secure partnerships with the company for lottery, gaming and digital services. Scientific Games also provides iGaming, instant games, instant lottery games, lottery gaming systems and retail technology to its longtime partner.

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OREGON TAPS ARISTOCRAT, IGT FOR VLTS

uppliers Aristocrat Leisure Ltd. and IGT have both scored big orders for video lottery terminals by the Oregon Lottery. According to a report from Todd Eilers of Eilers & Krejcik, the lottery will purchase a total of 2,720 VLTs—1,550 in IGT’s CrystalDual cabinets and 1,170 in Aristocrat’s Helix+—after field trials showed the machines from the two suppliers outperformed existing machines in the market. According to the report, the lottery will spend $25 million on VLT purchases this year, with Eilers assuming average selling prices of $15,300 to $23,000 per machine. The purchases should run through June 2021.

RYMAX ANNOUNCES NEW BRAND PARTNERSHIPS

t was a productive 2019 for incentives-industry giant Rymax, which added more than 30 new brand partnerships to its portfolio of gift items. The total now exceeds 450 brands, and ranges from licensed sports gear to children’s entertainment, from luxurious luggage to connected home devices. Many gaming properties rely on Rymax to provide premium gift items for their preferred customers. The following products and brands are among the newest additions to Rymax’s rewards collection: • Gaming devices from Logitech G • Gaming accessories from Astro • Ultra-portable Bluetooth speakers from Ultimate Ear • Licensed sports gear from Northwest Co. • Innovative and luxurious luggage from Delsey • Home security products from Ring • Bluetooth trackers from Tile • Travel accessories from Calpak • Iconic sunglasses from LeSpecs • Women’s eyewear from Seafolly With the addition of 36 brand partnerships, the company continues to maintain an unsurpassed rewards collection, representing the largest selection 52

and widest variety of motivational rewards of any incentive provider. Rymax will offer these brands from their network of distribution centers across the country for a variety of programs, including corporate gifting, sales incentives, employee engagement and recognition, loyalty programs and more.

GLOBAL PAYMENTS MARKS GROWTH

named to board positions with the iDevelopment and Economic Association (iDEA) and the American Gaming Association (AGA), where he sits on task forces focusing on payments modernization and sports betting.

ZITRO’S LINK SHOCK INSTALLED IN FRANCE

s both iGaming and sports betting become more widely accessible, Global Payments Gaming Solutions has reported 2019 growth exceeding 50 percent within the U.S. iGaming market, the company announced in January. Serving more than Global Payments President 3 million registered Christopher Justice players and adding more than 30,000 monthly, Global Payments provision of credential-free enrollment reduces friction and enables expanded online play. Global Payments’ VIP Mobility solution enables frictionless responsible gaming and an enhanced user experience for players, and is currently being piloted in a host of casinos across the United States. For land-based casinos, Global Payments supports a significant number of operations, having signed key deals to deploy self-service options that enhance operator profitability and make the cage more efficient. Additionally, the company continues to invest in and deliver new functionality like dynamic currency conversion, and new payment forms, such as cash advance with American Express. This year, Global Payments added new benefits to its compliance-management solution, VIP Shield, an open API solution that is compatible with any gaming system. The solution now provides users with enhanced Title 31 and IRS reporting, and better visibility between the cage, surveillance and finance departments. To support its momentum, Global Payments added key personnel to its executive team in 2019, including Michael Minor as head of sales, and Gregory Boardman as head of product. Both executives bring unique industry experience to the organization: Minor previously served as head of North American system sales for IGT, and Boardman is a veteran leader in payments and commerce. Company President Christopher Justice was

Global Gaming Business FEBRUARY 2020

he Fouras Casino has become the first gaming hall in metropolitan France to add Link Shock, a multi-game progressive link from Zitro. Link Shock is featured on Zitro’s new Fusion Slant cabinet, a state-of-the-art form factor with an ultra-slim design, which, together with the widescreen sign, creates a visual spectacle that stands out on a casino floor. “We look for unique experiences for our players to offer the best entertainment on the market,” said Claire Karcher, general manager of Fouras Casino. “In our group, we trust Zitro products, and therefore we wanted to incorporate the new progressive Link Shock multi-game as an extremely innovative proposal for our customers.” Philippe Boulay, CEO of distributor SFM Mascot, added, “This new milestone leads us to confirm that Zitro video slot games triumph throughout France with such successful and reputable products in the global gaming industry, as this new installation and all the others that already captivate the whole country.”

FIREKEEPERS CHOOSES SCIENTIFIC GAMES

cientific Games has been chosen by FireKeepers Casino Hotel in Battle Creek, Michigan to provide sports betting and iGaming to players in Michigan, following the recent passage of a Firekeepers’ CEO bill legalizing sports Kathy George and online casino betting in the state. Scientific Games will launch retail sports betting at FireKeepers as well as online sports betting and iGaming across the entire state of Michigan once regulations allow.

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FireKeepers Casino will utilize OpenSports, a modular sportsbook solution that empowers operators to choose the technologies and services that best benefit their business. The launch in Michigan will include end-to-end retail sports betting solutions and a comprehensive data feed from Don Best Sports, Scientific Games’ leading managed trading service. In addition, FireKeepers will receive iGaming content via Scientific Games’ OpenGaming content aggregation platform. Once approved by state and tribal regulators, the company’s portfolio of U.S.-available slot games will launch online for players across the state. Kathy George, chief executive officer at FireKeepers, said, “Our goal is to create a 360-degree entertainment experience. We are proud of our existing partnerships to put FireKeepers at the forefront of Michigan’s betting landscape. We’re the title corporate sponsor of the NASCAR FireKeepers Casino 400 held annually at the Michigan Speedway, a testament to our dedication to creating that full-service entertainment ecosystem. In partnership with Scientific Games, we’re thrilled to offer sports betting and iGaming both online and in our upscale property.”

BETMGM ANNOUNCES LACROSSE PARTNERSHIP

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he National Lacrosse League (NLL) last month announced a landmark partnership with Roar Digital—a joint venture between global gaming industry leaders MGM Resorts International and GVC Holdings—making Roar’s sports betting brand, BetMGM, the official and exclusive gaming partner of the NLL. It is the first-ever gaming partnership for the sport of lacrosse in the United States. “We are so proud to welcome BetMGM as yet another world-class brand to our family of national partners,” said NLL Commissioner Nick Sakiewicz. “The growth of our league as a sports and entertainment property and the amount of engagement we will be able to generate through this innovative partnership with MGM Resorts and Roar Digital will be very exciting and add tremendous value to avid, casual and new fans.” “Lacrosse is a fast-paced, high-scoring, growing sport that presents exciting sports betting opportunities. We are greatly impressed by the management and operations of the NLL as evidenced by its strong roster of team owners,” said Scott Butera, president of interactive gaming for MGM Resorts. “The NLL is an ideal partner for BetMGM in accessing a fast-growing Lacrosse fan base.” BetMGM will have commercial visibility and other promotional opportunities throughout the NLL regular season and playoffs. In addition, it will create weekly betting lines distributed across all NLL platforms and channels.

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PEOPLE DECORAH NAMED GM AT PECHANGA

rian Decorah has been named general manager at California’s Pechanga Brian Decorah Casino Resort. Pechanga recently completed a $285 million expansion and renovation. An enrolled member of the Ho-Chunk Nation, Decorah started his gaming career in his tribe’s casinos, and later went on to become a general manager at two of its mid-sized casinos. He later became general manager at FireKeepers Casino Hotel in Michigan, where he led an expansion that added a hotel. He joined Snoqualmie Casino in Washington state at the beginning of 2018, before moving to Pechanga in late 2019.

DESALVIO TAKES HELM AT RESORTS WORLDS NEW YORK

ust a month after leaving Encore Boston Harbor, Robert DeSalvio was named president of Resorts World New York City and Resorts World Catskills. Genting, owner of RWNYC, recently bought the controlling inRobert DeSalvio terest in RW Catskills, which has been struggling. DeSalvio shepherded Encore Boston Harbor through its construction process and early operations before being replaced last fall by Brian Guilbrants. DeSalvio previously operated Sands Bethlehem, and prior to that, worked for many years at Foxwoods and Sands Atlantic City.

BLUBERI NAMES ANDREW BURKE CEO

orth American gaming company Bluberi Gaming Canada Inc. has announced the appointment Andrew Burke of Andrew Burke as its chief executive officer. Burke was with gaming supplier AGS for 14 years, starting before that supplier was acquired by equity group Alpine Investors in 2008, and oversaw its slot division as it evolved into a major force in the industry. He most recently was senior vice pres-

ident of slot products for AGS, overseeing all aspects of the division’s commercial operations in the United States and Canada. Burke’s appointment as CEO of Bluberi comes as the supplier prepares for a new phase of strategic growth. He succeeds Mike Starzynski, who guided the company to its current strong market position and oversaw its 2019 acquisition by funds managed by the Catalyst Capital Group Inc.

HARRIS JOINS GLOBAL MARKET ADVISORS

ecky Harris, former chairwoman of the Nevada Gaming Control Board, has joined Global Market Advisors (GMA), a leader in the gaming, entertainment, sports, integrated resort and hospitality industries. Becky Harris Harris has a diverse background as a lawyer, legislator, regulator and academic. She is currently a Distinguished Fellow in Gaming and Leadership of the University of Nevada, Las Vegas’ International Gaming Institute, and will serve as a regulatory, policy and legal consultant at GMA. Harris recently finished her term as chairwoman of the Nevada Gaming Control Board, and was the first woman to hold the position. As chief regulator for the NGCB—which is viewed as the gold standard in gaming regulation—she helped guide the board through a number of important and controversial matters including sports betting, the Wire Act, sexual harassment issues, cannabis and other key regulatory issues. Harris also serves as a non-executive director for PointsBet Holdings Ltd.

ISAACS JOINS TECH COMPANY BOARD

ndia-based PureSoftware, in pursuit of a larger presence in gaming, has brought on respected industry veteran Gavin Isaacs Gavin Isaacs to help show the way. PureSoftware boasts various “next-generation disruptive technologies,” primarily in the field of financial platforms, including digital banking and digital wallets. But founder Anil Baid said the company’s focus is increasingly shifting toward enhancing its services portfolio for gaming operators and suppliers. Isaacs currently is chairman of SBTech, a sports betting technology company. SBTech is slated to be acquired by DraftKings, and Isaacs said he expects to serve on DraftKings’ expanded board when the sports betting giant goes public. He is also a director for table-games provider Galaxy Gaming, and previously served as CEO of Scientific Games, Aristocrat and Shuffle Master.

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COTA MONTAÑO NAMED MEXICAN GAMING CHIEF

HBG Design . . . . . . . . . . . . . . . . . . . . . . . .33

n December, Leonel Cota Montaño was appointed director-general of Juegos y Sorteos, Mexico’s gaming authority, a position he will start in March. “Juegos y Sorteos issues the necessary permits for the Leonel Cota Montaño development of gambling and betting events authorized by law and oversees that the relevant terms and conditions are rightfully met,” said Olga Sánchez Cordero, head of the Mexican Secretariat for Home Affairs. “I am sure that Mr. Leonel Cota Montaño is the right person to take over this role due to his wide experience in the field.”

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FEBRUARY 2020 www.ggbmagazine.com

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CASINO COMMUNICATIONS

Michael Soll

uring the early days of gaming expansion, The Innovation Group was one of the major consulting companies that casinos turned to for feasibility studies and marketing analysis. Michael Soll spent several years with the company in those days, and returned five years ago after stints with Caesars Entertainment and Hard Rock. Now, as president of the company, Soll is navigating a new world of market saturation and limited expansion to provide tribal, commercial and international casino companies with a path forward to organic growth. Soll spoke with GGB Publisher Roger Gros. For a full podcast of this interview, visit GGBMagazine.com. GGB: The Innovation Group has had an exciting year, with lots of success and accomplishments. What stands out for you? Michael Soll: We really solidified our fourth part-

ner and our Las Vegas presence through Brian Wyman. His joining us as a partner is symbolic of the major shifts we’ve had under way for the last four or five years, moving into data analytics and marketing analytics, which has become our window into most new technologies and gaming platforms, whether it’s online, sports betting or traditional operations. We also were honored to be selected by Virginia’s Joint Legislative Audit and Review Commission to provide, with our partners at RMC Legal, much of the background research they relied on for their “Gaming in the Commonwealth” report. Market analysis and feasibility has long been the bread and butter of this company, and it was fulfilling to bring that expertise to a new category of client. And, of course, through our relationship with GGB, we’ve had a stellar response to this year’s Emerging Leaders program. These young leaders are really starting to interact with one another through get-togethers and meetups at different conferences all over the world. It’s very organic. The class this year was really special. The fact 58

Global Gaming Business FEBRUARY 2020

President, The Innovation Group

that we had to choose from 200 nominees was pretty amazing, and the level of people who were nominated, or even nominated themselves, was really high. I’m really happy with the way it turned out this year. You mentioned Brian Wyman. Who are your other partners?

Interestingly, we have a partner per office. Brian is in Las Vegas. Tom Zitt, a longtime partner with the company, still works out of our original office in New Orleans. He drives the majority of our domestic business. He’s in tune with about half of the tribes we work with, particularly in the Eastern U.S. In Denver, the office is led by Michael Zhu, our partner who handles most of our business in Asia. I’m still based in Orlando, handling both Latin America and Europe from there. So, we have a geographic approach to handling the industry’s global needs. What major challenges will operators, manufacturers and governments face in the near future?

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

I don’t find the characterization of the new group

of players as millennials useful anymore. It’s almost become a term that’s too vague to explain the challenges the industry faces. We’ve done some survey work on this recently, about what amenities are valued now, outside of gaming. How popular are they among guests? Who are the drivers? Also, we included all kinds of questions about skill games and esports. Our view is: Be flexible, have enough floor space to try things that are hitting the market, and don’t assume that every potential future player is the same as every other potential future player. How can a company like The Innovation Group help established casino companies and manufacturers understand these challenges and develop solutions, particularly if they don’t have those kinds of experts in-house?

There are several routes. The tools we use are relatively similar, although they’ve evolved in terms of how we deal with data, database analysis and loyalty programs. But as far as answering these questions, it’s about research, in the sense of survey research and taking temperatures and benchmarking. It’s also about qualitative research—sitting in rooms with people from different demographics and player groups in different countries, and seeing what they believe a gaming property should offer. What do they believe the online experience is like, compared to the bricks-and-mortar experience? And where do they draw lines around a social experience versus a personal experience? The research we do builds a database of research around these areas. So, as we did with our early feasibility work and tracking penetration, we’re building a history and benchmarks around these attitudes and trends. When we start to segment them by age group, by nationality, by jurisdiction, by ethnicity within the market, we start to have trends that we can watch.

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