Global Gaming Business, June 2020 by Global Gaming Business

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GGB Global Gaming Business Magazine

COVID-19 SOLUTIONS TRADE SHOW SHOWDOWN iGAMING GAINS THE END OF SMOKING?

June 2020 • Vol. 19 • No. 6 • $10

THE

PATH FORWARD How operators and suppliers are working together to return to prosperity

Marketing Health Wellness Is gaming compatible with a robust lifestyle?

Balancing Finances

Taking a proactive approach to finance on reopening

Association of Gaming Equipment Manufacturers

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ÂŠ 2020 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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CONTENTS

Vol. 19 • No. 6

june

Global Gaming Business Magazine

COLUMNS

18 COVER STORY

Coming Back

10 AGA Baby Steps

As casino operators prepare to reopen their properties to the public in phases, the gaming industry begins to prepare to serve customers in what will be the “new normal” for gaming floors, at least for the near term.

Jess Feil

12 Fantini’s Finance Alphabet Soup Frank Fantini

22 Health The End of Smoking? James M. Galloway

By Roger Gros

32 Making My Point Winners, Losers & ‘Crisitunity’ Roger Snow

Cover photo by Erin O’Boyle Photographics

DEPARTMENTS

FEATURES 14 Wellness and the Gaming Resort

34 The iGaming Bump

Holistic wellness concepts could prove valuable in easing the health concerns of patrons as they cautiously return to casino hotels.

The industrywide Covid-19 shutdown has given a boost to the online casinos in New Jersey, Pennsylvania and Delaware. Here’s why the boost may outlast the shutdown.

By Michael Vanaskie

By Bill Sokolic

4 The Agenda 6 By the Numbers 8 5 Questions 13 AGEM 44 Emerging Leaders

24 Toward Financial Strength

With Caesars Interactive’s Kevin Fulmer and Urban Systems’ Nicole Stewart

Covid-19 has caused a seismic shift in the entire economy, which means gaming operators must take proactive steps to return to financial health.

46 New Game Review 48 Cutting Edge

By Sean McGuinness and David Waddell

50 Frankly Speaking

28 Trade Show Futures

52 Goods & Services

The Covid-19 shutdown has severely altered the year’s calendar of trade events, and is putting new challenges on show producers to demonstrate the economic viability of the events.

As casino hotels prepare to return to operations, they will be assisted by a host of products designed to make that return safe and healthy.

By Frank Legato

38 Reopening Tech

57 People 58 Casino

Communications

With Sandra Douglass Morgan, Chairwoman, Nevada Gaming Control Board

JUNE 2020 www.ggbmagazine.com

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THE AGENDA

Slippery Sovereignty By Roger Gros, Publisher

Vol. 19 • No. 6 • JUNE 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

ne of the civics lessons we’ve learned during the Covid-19 pandemic is about how fleeting sovereignty can be. As we try to survive this desperate period, at times sovereignty has been used and abused in the battle against the coronavirus. On an international scale, we’ve seen countries close their borders to either keep in or keep out sick people. And those that are allowed in are often required to quarantine for 14 days to ensure that they’re healthy and vital. Specific regions of individual countries have been quarantined, such as Wuhan, where the virus originated. But this was nothing new for China, where travel restrictions on its citizens are a daily aspect of that sovereignty. Can you imagine that happening in the U.S.— say, in New York, which turned out to be the hotbed of viral infection in this country? Of course not. But that didn’t stop individual U.S. governors from instituting stay-at-home orders. States’ sovereignty was often cited as an excuse for this suspension of the inalienable rights guaranteed by the U.S. Constitution. To be sure, the Constitution limits the power of the federal government over states’ rights, so there supposedly is legal justification for governors to institute these restrictions. While the jury is still out on whether they’re actually working, the legal wrangling will probably take years to untangle. Of course, there have been many suspensions of constitutional rights during wartime. The internment of Japanese-American citizens during World War II was one of the most egregious, but even the sainted Abraham Lincoln ran roughshod over constitutional rights during the Civil War. Was the response to Covid-19 similar to those occurrences? Only time will tell. Needless to add, sovereignty is the cornerstone of tribal gaming. Government-to-government relationships among tribal, state and federal governments are the bedrock principle when tribes decide what activities to offer on their reservation land. Tribes were under no obligation to close down their operations when the governors of their states ordered a lockdown. Yet they were often the first to voluntarily close their casinos, understanding that their role in the overall community is foremost. Their responsibilities to their members, employees and other stakeholders made it an easy decision. Realistically, however, there was no choice. The states control access to tribal reservations, so any

Global Gaming Business JUNE 2020

other decision would surely have forced a showdown between tribal and state authorities, which no one would have won. So the best course was to close down, with tribal sovereignty and community responsibility intact. At the same time, during this period there were important developments related to tribal sovereignty that really had nothing to do with Covid-19. In Massachusetts, the Mashpee Wampanoag tribe was stripped of its tribal sovereignty when the Department of the Interior decided to withdraw its approval of land into trust for a tribal reservation. The Mashpees are once again a landless tribe, as they have been for many years. In last month’s issue of GGB, attorney Judy Shapiro laid out the Mashpee struggle, and outlined why this is a dangerous precedent, not only for the Mashpees but for all of Indian Country. For a quagmire of tribal sovereignty, you only need to look to Oklahoma. When the 20-year gaming compacts with the states’ tribes expired at the end of 2019, Governor Kevin Stitt declared that the compacts ended on December 31 and must be renegotiated. Tribes disagreed, saying the agreements automatically renewed. The result has been a continuing standoff. In April, Stitt reached separate compact agreements with two tribes, giving them sports betting and the right to expand into territories that were not part of their reservations—a smart move by Stitt, because it broke the solid wall he had been facing against a unified tribal gaming industry. (Now the Oklahoma attorney general has ruled those new compacts null and void, because only the legislature can add new gaming options to a compact. But that doesn’t negate the governor’s purpose of dividing the tribes.) The Oklahoma Indian Gaming Association quickly suspended the tribes in question, saying the industry must speak with a united voice. But where does this leave tribal sovereignty? If each tribe is indeed a separate nation, how can OIGA object when one government reaches an agreement with another? As the leader of one of the rogue tribes, Otoe Missouria Chairman John R. Shotton, said, “Regardless of the opinion of the OIGA, there are not hierarchies of sovereign nations in Indian Country. I certainly hope as negotiations continue, other tribes won’t be singled out for exercising their tribal sovereignty.” As we’ve commented many times during this ongoing crisis, we do live in interesting times.

Terri Brady, Sales & Marketing Director tbrady@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 | Jess Feil James M. Galloway| Roger Snow Contributing Editors Sean McGuinness | Bill Sokolic | Michael Soll Michael Vanaskie | David Waddell __________________

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

READY TO ROLL A

s casinos reopen across the U.S., the question remains: Are the players ready to come back? That won’t be answered, of course, until all casinos reopen and we can see actual numbers, but a recent study conducted by three firms, ROKK Solutions, Engagious and Sports & Leisure Research Group, gives us some hints. The study, “What it will take to get Americans to re-enter casinos: Public opinion insights from late April 2020 Back-toNormal Barometer,” asked 518 American adults who participate in sports, leisure, travel and consumer activities about their willingness and reasons to return to those activities. The survey focused on four questions: —“When will things be back to normal?” —“How do we restore confidence so clients return?” —“What will the new normal look like?” —“What external assurances will lure customers back?” For context, the survey asked the respondents which activities they had participated in within the last year:

Strategies to get customers to return are going to have to be multidimensional, and not always in control of casino management. The development of a vaccine and the government OK to return are important to customers, but totally out of the casinos’ control.

And should there be enough assurance that customers could return in any appreciable numbers, it may be as much as a year before they are comfortable enough to do so.

As April progressed, there was a slight increase in willingness to return to their favorite activities.

The next chart shows bad news for the meetings and convention business as fewer people are ready to turn to trade shows or conferences. 6

Global Gaming Business

JUNE 2020

Sports and Leisure Research Group is a market research firm specializing in the sports, travel and leisure sectors, based in White Plains, New York. Engagious is a bicoastal research firm specializing in corporate and public policy message testing and message refinement. ROKK Solutions is a Washington, D.C.-based bipartisan public affairs firm specializing in strategic communications, media engagement, digital and social strategy, message amplification and crisis management.

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NUTSHELL

“They

5QuEstions

Earle Hall

CEO & Founder, AxesAI, and Vice Chairman, International Gaming Standards Association has a long history in the gaming business, mostly as the inventor of several innovative table EgencearlegamesinHallgaming. and table bonuses. His new company, AxesAI, is dedicated to blockchain and artificial intelliAs the vice chairman of the International Gaming Standards Association, Hall is keenly aware of the technological challenges facing the industry today. He spoke with GGB Publisher Roger Gros at his offices in Las Vegas in March. GGB: You’ve just been appointed vice chairman of the International Gaming Standards Association. What does that mean to you? Hall: I’m really scared right now. We’re heading into a quantum world. Quantum computers are not so

1 2 3 4 5

rare anymore; you can buy one for $35,000, which means I can pop in and out of networks, I can put a spider or crawler on top of a server, and I can get out without anyone ever seeing me. We’re going into a phase of technology that, in my opinion, is the scariest we’ve ever seen, because we’re the most decentralized, and the ways of being intrusive inside of a network now are infinite. I’m very scared about what operators are going to go through over the next three to five years unless we can implement blockchain technology that will create the highest level of security and bring in a standard for ethical behaviors.

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

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

Blockchain is a new technology. It’s only been around for three to five years. And no technology ever really takes hold unless it’s been around 10 years or more. Right now, we’re in the phase where everyone lost their initial investments and they’re scratching their heads (laughs). But the core technology is still moving along. Blockchain is confusing because 80 percent of the people who try to explain it don’t know what they’re doing, but that’s normal, because it’s new. Remember in 1997, when everyone was an internet consultant but didn’t know how to log on? Do regulators understand blockchain?

Surprisingly, many of them do. At last year’s international regulators conference in Jamaica, I was blown away by the level of knowledge of some of the regulators from Australia, Africa and especially three or four in Europe. The wave of regulators with blockchain knowledge is growing quickly, because they see that blockchain is more risk-aversive than the way they’re doing things right now. How would blockchain aid the industry to encourage responsible gaming?

Blockchain is capable of looking at literally billions of pieces of data. My company collects data from more than 50 countries now, and it gets very deep. If you’re in a casino and having a great time, you’re getting that adrenaline rush that makes you feel great. But once you go into a cortisol response—a “fight or flight” response—it means that what’s happening in the real world is not meeting your expectations. Like an animal, you’re going to fight to survive or you’re going to run to survive. Inside of our database, we’ve found a pattern in every single country—speed of click, change of betting pattern, and then change of machine. We’ve got seven parameters that identify this. I don’t care who the player is, when I see the pattern, I know something is wrong, and we can do something about it.

Global Gaming Business JUNE 2020

Said It”

“For the first time in 40 years running this company I’m having a drink at work, because this is the hardest, most painful thing I’ve had to do.” —Tilman Fertitta, owner of the Golden Nugget casinos and Landry’s restaurant chain, announcing the layoffs of thousands of employees; Fertitta called Covid-19 “a meteor that hit the United States and the world”

CALENDAR EDITOR’S NOTE: Every conference and trade show set for June has either been canceled, rescheduled or modified. Below are their new dates and/or status. VIRTUAL: June 8-10: ICE Asia and SiGMA Manila, Produced by Clarion Gaming and SIGMA. For more information, visit ICE-Asia.com. CANCELED: July 27-29: OIGA 2020 Conference, Tulsa Convention Center, Tulsa, Oklahoma. Produced by the Oklahoma Indian Gaming Association. For more information, visit OIGA.org. August 11-13: Australasian Gaming Expo, ICC Sydney. Produced by the Gaming Technologies Association (GTA). For more information, visit AustGamingExpo.com. September 11-12: NCLGS Summer Meeting 2020, Intercontinental Magnificent Mile, Chicago. Produced by the National Council of Legislators from Gaming States. For more information, visit NCLGS.org. RESCHEDULED: September 22-23: ASEAN Gaming Summit 2020, Shangri La BGC, Manila. Produced by Asia Gaming Brief. For more information, visit aseangaming.com. October 5-8: Global Gaming Expo, Sands Expo Center, Las Vegas. Produced by American Gaming Association and Reed Exhibitions. For more information, visit GlobalGamingExpo.com. RESCHEDULED: October 26-27: East Coast Gaming Congress, Harrah’s Resort, Atlantic City. Produced by Spectrum Gaming, Cooper Levenson, the Friedmutter Group and Sysco. For more information, visit EastCoastGamingCongress.com. November 9-11: Sports Betting USA & Investment Summit, New York City. Produced by Clarion Gaming. For more information, visit SportsBettingUSAConference.com. RESCHEDULED: December 1-3: Betting on Sports America, Meadowlands Exposition Center, East Rutherford, New Jersey. Produced by Sports Betting Community. For more information, visit SBCEvents.com. RESCHEDULED: December 1-3: G2E Asia 2020, Venetian, Macau. Produced by Reed Exhibitions and the American Gaming Association. For more information, visit G2EAsiaMacau.com.

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AMERICAN GAMING ASSOCIATION

Baby Steps Taking a thoughtful approach to safely reopening our industry By Jess Feil

Editor’s note: This column was written in the first week of May. For updates on the American Gaming Association’s most recent efforts, visit AmericanGaming.org.

o matter what challenges our industry faces, the health and safety of our customers and employees will always come first. We look forward to welcoming back the entire gaming community as we move toward reopening the industry. Reopening our doors will require the collaboration of stakeholders across all levels of government and all facets of our industry. This includes following guidance from federal, state and local officials to understand the timetable for reopening and the measures that will ensure the safety of every customer and employee. As industry leaders take steps to reopen, they’re taking every necessary precaution to prioritize safety. These will differ by jurisdiction and property, but include things like implementing social distancing measures, heightening sanitization protocols and using personal protective equipment. Some operators are looking to new technology, like thermal imaging cameras or new reservation systems that can improve the guest experience. Reopening efforts are being tailored to the specific needs and regulations of each state and property. Individual casinos best understand how to manage and support their floors, back of house, staff and patrons, as well as how to ensure that social distancing and other safeguards are in place while still providing superior customer service. The AGA is committed to being a resource throughout this reopening process, as we all continue to learn to operate in a new normal. This includes working closely with casino operators, regulators and other experts to implement stringent health and safety requirements while

Global Gaming Business JUNE 2020

providing a positive experience for our patrons. The AGA is also focused on providing research and resources to inform our members’ reopening plans and the public. Notably, we collaborated with travel industry groups on the development of health and safety guidance to help the hospitality industry navigate this new normal. The guidance, reviewed by public health experts, focuses on six main areas for travel businesses: 1. Adapt operations, modify employee practices, and/or redesign public spaces to help protect employees and customers. 2. Implement touchless solutions where practical to limit the opportunity for virus transmission while also enabling a positive travel experience. 3. Adopt and implement enhanced sanitation procedures specifically designed to combat the transmission of Covid-19. 4. Promote health screening measures for employees, isolate workers with possible Covid-19 symptoms and provide health resources to customers. 5. Establish a set of procedures aligned with CDC guidance should an employee test positive for Covid-19. 6. Follow best practices in food and beverage service to promote the health of employees and customers.

Additionally, we’re tracking the reopening of casinos across the country so all those involved can stay informed. There’s no doubt that the past few months have been some of the most challenging times our industry has seen. Getting the industry back on its feet will be a long and involved process, but our industry is committed to working together to make sure it’s done responsibly. Jess Feil is senior director, government relations for the American Gaming Association.

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FANTINI’S FINANCE

Alphabet Soup What will the recovery look like—if there is a recovery— after the lockdown is over? By Frank Fantini

ther than a manic-depressive stock market that seems to overreact to every shred of news on the outlook for Covid-19, there is surprising consensus about how to reopen the American economy and, pertinent to this column, the gaming industry. It seems as though policy makers turned on a dime. Even the most ardent advocates of lockdown, such as New Jersey Governor Phil Murphy on the Atlantic coast and California Governor Gavin Newsom on the Pacific coast have begun to allow a loosening of shelter-in-place, albeit more slowly and couched in the phraseology of science and data caveats. For casinos, the outline is clear, specific and now familiar: maintain social distancing, check for fever among employees and customers, keep crowded venues such as nightclubs closed, and sanitize, sanitize, sanitize. Maintaining social distance will require dramatically reduced capacity. At best, every other slot machine will be closed, half or more seats will be removed from gaming tables, and there will be limited seating in amenities such as restaurants— 50 percent, maybe 25 percent, and so on. That reduced capacity raises the question of how financially viable casino operations can be. But before deciding that, we’ll have to see what kind of recovery the economy experiences. So far, the possible outcomes are an alphabet soup. Some favor a V, meaning bouncing back as quickly as we fell. Others expect a U meaning a longer time at the bottom before recovery. Bears choose an L, meaning flat after hitting bottom. Perhaps most feared of all is the W: bouncing back quickly from the bottom, then falling very quickly again. Anyone expecting an autumn resurgence of Covid-19 could fall into this camp, though it may be more likely a lopsided W, tilted toward a lower second dip and something eco-

Global Gaming Business JUNE 2020

nomically like the Great Depression. We’d like to be advocates of the V, but that seems an unlikely scenario. Even when casinos are allowed to throw open their doors, it seems unrealistic to expect a rush of pent-up demand. Public opinion surveys show that somewhere between 40 percent and 60 percent of Americans will not travel or patronize crowded venues. So, while there may be a lot of restless casino customers eager to return, and while casino executives report that conventions and events can-

Public opinion “ surveys show that somewhere between 40 percent and 60 percent of Americans will not travel or patronize crowded venues.

”

celed this year are rescheduling, it seems safe to say customer counts will be down for a while. That may be especially true in Las Vegas, which gets so many customers arriving by air, because air travel is expected to take longer to recover. To us, the U seems the most likely scenario, and that assumes no dramatic resurgence of the virus. And it’s likely to be a modified U, with the right leg of recovery being shorter than the left leg of decline. Interestingly, a 40 percent to 60 percent decline in customers would about match the expected cut in casino capacity. And casinos appear to be planning for that. Boyd Gaming CFO Josh Hirsberg said on his company’s quarterly investor call that, given the lower cost structure, it won’t take much to become cash-flow positive, and that Boyd is committed to achieving that. Casinos not only will reduce costs, they’ll focus

on inviting back their best players, so they get more revenue per patron. Covid-19 should finally kill off the $5 blackjack table; $25 might be the new universal minimum bet. But just getting cash-flow positive, while it’s welcome and reassures that bankruptcy court will be left to restaurants and retailers, not casino companies, doesn’t mean getting to a level of prosperity that will support stock prices, no less lift them. If there are two U.S. companies that seem positioned to recover more quickly than most, they’re Las Vegas Sands and Wynn Resorts. The reason is Macau. As of this writing, Macau has not had a new case of Covid-19 in nearly a month. Its two big feeder markets, Hong Kong and the nearby mainland China province of Guangdong, appear to have the virus under control. It seems reasonable that travel restrictions between those jurisdictions will be loosened. And the lessons of lower cost structures and focusing on the most profitable customers will apply in Macau every bit as much as in the U.S. In addition, the LVS business model, which emphasizes conventions, may bounce back in Las Vegas sooner and stronger than the leisure segment, though that may not be until 2021 and maybe deep into the year. Wynn, likewise, has a niche: the high roller, who can be brought back in both Macau and Las Vegas more easily than other customer segments. It’s also worth noting that LVS benefits from its Singapore duopoly and, just as Macau can rebound strongly, Singapore can, too. Current analyst consensus puts LVS stock at 15 times 2022 earnings per share and Wynn at 14 times. That’s not cheap, given the long wait to get there. But if Asia gaming recovers as it should, today’s stock prices will be bargains. 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 Board of Directors Actions for May 2020

AGEM MEMBER PROFILE

NRT is a global technology leader in the design and

development of next-generation enterprise payment systems, specialized self-serve financial/marketing kiosks, digital table game platforms, big data analytics utilizing artificial intelligence and gamification, credit marker information services, and digital and mobile experiences to casinos, lotteries, banks, retailers and ATM operators around the globe. NRTâ&#x20AC;&#x2122;s global family of companies facilitates more than 2 billion physical and digital commerce experiences at more than 750 casino properties worldwide, including the Top 25 largest casino corporations. NRT is based in Toronto and Las Vegas. NRT solutions include secure payment systems, specialized financial and marketing kiosks, AML compliance tracking and reporting tools, digital gamification and mobile experiences, intelligent table game platforms, credit/marker information services and electronic marker solutions. New products offered by the company include the QuickTouch3 Multi-function kiosk platform, OfferCraftâ&#x20AC;&#x2122;s reopening module and AI-driven camera-based bet recognition technology. VisuaLimits, the industryâ&#x20AC;&#x2122;s leading multifunction table games platform, will be further enhanced with the AI camera-based bet-recognition and autocalibration features. The past few months have been extremely hard for operators and suppliers around the world. NRTâ&#x20AC;&#x2122;s ability to adapt and innovate and its belief in thoughtful solutions and working together with the industry will enable it to persevere through these difficult times. NRT is looking forward to the day that everyone can return to â&#x20AC;&#x153;Connecting the Guest Experience.â&#x20AC;? 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.

â&#x20AC;˘ AGEM Executive Director Marcus Prater continues to hold twice-weekly calls regarding the Covid-19 situation with Nevada Gaming Control Board Chairwoman Sandra Douglass Morgan, the Nevada Resort Association and representatives of restricted gaming licensees. Recently, these meetings have been dominated by a timetable for Nevada casino reopenings as other states such as California start to open. Many operators are currently working on â&#x20AC;&#x153;How to Prepareâ&#x20AC;? plans that have to be submitted to the Gaming Control Board seven days prior to opening. Chairwoman Morgan has been very helpful and supportive of AGEM throughout this period by sharing information, and she will continue to work with the association as the reopenings occur. â&#x20AC;˘ AGEM is coordinating with Nevada Industry Excellence (NevadaIE.com) on the new NevadaWorksTogether.com website designed to introduce furloughed gaming employees to job openings in other Nevada businesses and industries. Former Nevada Gaming Control Board Chairman and state Senator Mark Lipparelli helped connect AGEM to this effort, and the membership will receive notice when the website is fully functional. Meanwhile, gaming company human resources departments can review the site and share pertinent information with those who have been furloughed or laid off. â&#x20AC;˘ AGEM and the AGAâ&#x20AC;&#x2122;s campaign against unregulated gaming machines continues, despite a recent setback in Virginia in which Governor Ralph Northam approved a one-year extension, allowing skill games to be taxed in an attempt to boost Covid-19 relief revenues. It is hoped that this approach will not be adopted by other states. Discussions related to unregulated gaming continue in Pennsylvania and Missouri, but itâ&#x20AC;&#x2122;s unknown how the virus crisis will impact legislative priorities in the coming months. AGEM is also active in helping shape the discussion in Wyoming, as the gaming commission and legislature there await recommendations from committees reviewing gamingâ&#x20AC;&#x2122;s role in the Cowboy State going forward. â&#x20AC;˘ Will Wise, vice president of Reed Exhibitions, along with Korbi Carrison, event director for G2E, and Allie Barth, senior vice president of industry relations for the American Gaming Association, addressed AGEM members at the May meeting to give an update regarding G2E Las Vegas. They reiterated that their visitors on what prime interest is ensuring the health and safety of exhibitors and alike, with any decisions the show will look like based foremost on these priorities. Over the past six weeks, they have had discus sions with more than 200 exhibitors, and the feedback has been varied, due to the continually evolving situation. As a result, they have decided to conduct a research project using a third-party company to gauge true credible insights from buyers and operators, and will publish the initial results to exhibitors by midJune so firm decisions can be made about the next show. â&#x20AC;˘ AGEM welcomed a new Associate member in May. Sparks Marketing Corporation, based in Las Vegas, is an award-winning experiential marketing agency that creates brand moments for activations, events, trade show exhibits, digital and retail. This takes AGEMâ&#x20AC;&#x2122;s global membership to 180 companiesâ&#x20AC;&#x201D;an all-time high.

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The AGEM Index increased 63.52 points in April 2020 to 376.04 points, a 20.3 percent gain from March 2020. Eleven of the 13 AGEM Index companies reported significant stock price increases as global markets began to rebound from the initial shock of the Covid-19 pandemic. The stock price for Aristocrat accounting for a 40.13-point improvement the AGEM Leisure Ltd. (ASX: ALL) increased 19.4 percent, in Index, while International Game Technology Plc. (IGT) experienced a 26.7 percent stock price jump that led to an index contribution of 5.82 points. All three major U.S. stock indices increased as the Dow Jones and the experienced gains of 11.1 percent and 12.7 respec Industrial Average S&P 500 monthly percent, tively. The NASDAQ also experienced a gain of 15.5 percent.

JUNE 2020 www.ggbmagazine.com

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Slots Chakras Can gaming and holistic wellness concepts coexist in a single resort? by Michael Vanaskie

efore the Covid-19 pandemic wreaked havoc on global economies and forced the closure of all non-essential businesses, including casinos, the domestic U.S. gaming industry could best be described as in a state of maturity. Commercial gross gaming revenues increased 3.5 percent in 2018 to $41.7 billion, while tribal revenues grew 4 percent to $33.7 billion during the National Indian Gaming Commission’s 2018 fiscal year. While the domestic gaming industry will likely be at the start of a recovery phase as this article is published, the longer-term trend for U.S. brick-and-mortar gaming is one of healthy, yet minimal growth. Sure, specific states may legalize land-based gaming in an effort to stimulate economies, creating pockets of regional growth. And as the rollout of sports betting continues, incremental revenue will be created. However, once the recovery period is over and the incremental opportunities from sports betting are captured, operators will once again be faced with the seemingly perpetual question of how to induce new guests and gamers to their existing resorts, diversifying their customer base and generating increases in revenue in the process. Often, operators turn to expansions including additional amenities to keep current patrons loyal and entice new customers. Spas are a common amenity for gaming resorts with hotels, but virtually all spa concepts within gaming resorts stick to conventional spa treatments and services such as massages, facials and pedicures. Despite minimal conceptual evolution for spas within gaming resorts, distinctive spa-resort concepts have emerged as sought-after destinations for travelers, both domestically and abroad. The concepts are centered around holistic wellness—promoting health and well-being through physical, psychological and spiritual activities. These holistic wellness resort concepts go beyond conventional spa amenities and corresponding services, offering treatments and activities including dietary cleanses, yoga and meditation retreats or even shaman sessions, among others. Before dismissing these concepts as too “new age” for a gaming resort, consider the size and growth of this type of travel. From 2015 to 2017, wellness tourism increased by 6.6 percent annually to nearly $640 billion, as reported by the Global Wellness Institute (GWI). This growth is twice that of overall global tourism revenues, which increased 14

Global Gaming Business JUNE 2020

just 3.2 percent annually over the same time period. On top of this, there’s a precedent for holistic wellness-leaning concepts operating alongside casinos in single resorts. Canyon Ranch Las Vegas has operated in the Venetian since 1999, while Nemacolin Woodlands Resort offers a “Holistic Healing Center” as well as its Lady Luck Casino. The limited existence of these concepts within current gaming operations, paired with the strong growth of wellness tourism, begs the question: do holistic wellness concepts fit more broadly into gaming resorts?

The Numbers Behind the Industry As highlighted above, wellness tourism revenues have experienced strong increases in recent years. This growth is forecasted to accelerate in coming years, with GWI forecasting annual growth averaging 7.5 percent from 2017 to 2022, reaching $919.4 billion. The table below details the historical growth and forecast by region. North America represents the largest share of wellness expenditures, accounting for 37.8 percent of total 2017 expenditures. Notable fast-growing regions of origin include the Asia Pacific and Middle East-North Africa. Wellness Tourism Expenditures by Region of Origin ($US billions) Origin

2015

North America

$215.7 $241.7 5.9%

$311.3 5.2%

Europe

$193.4 $210.8 4.4%

$275

Asia Pacific

$111.2 $136.7 10.9%

$251.6 13%

Latin America Caribbean

$304

$348

$54.7

9.5%

Middle East North Africa

$8.3

$107

13.5%

$18.7

11.8%

Sub-Saharan Africa $4.2

$4.8

6.9%

$8.1

11%

Total

2017

CAGR 2015-2017 2022

$563.2 $639.5 6.6%

Source: Global Wellness Institute

CAGR 2017-2022 5.5%

$919.4 7.5%

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Holistic Wellness Travel Motivators and Resort Types Traveler Types/Seeks

Unsurprisingly, wellness travelers spend more per trip versus typical or conventional travelers. As summarized in the table below, spend per international trip averaged 41.8 percent more for U.S. wellness travelers versus conventional travelers. The premium for domestic trips is even greater, at 59.1 percent higher for wellness travelers compared to conventional travelers.

North American Markets Average Spending 2017 Per International Trip United States Canada

Type of Location

Physical

Health, Spa & Beauty, Healthy Eating, Fitness

Fitness centers, organic & natural restaurants, health food stores, integrative health centers, contemporary alternative medicine wellness centers, spas, salons, baths & hot springs

Mental

Mind-body

Yoga studios, martial arts studios, meditation studios, shaman sessions

Spiritual

Spiritual & Connection

Yoga retreats, spiritual retreats, ashrams, shaman sessions

Emotional

Personal Growth

Lifestyle retreats, wellness retreats

Per Domestic Trip

Wellness Trip

Average Trip Wellness Trip

Average Trip

$3,812 $1,052

$2,689 $731

$716 $291

$1,139 $527

Source: Global Wellness Institute

As GWI notes, thereâ&#x20AC;&#x2122;s a misconception that wellness travelers are a small, elite and wealthy group who visit holistic wellness resorts. The organization identifies two types of wellness travelers: primary travelers whose trip/destination choice is primarily motivated by wellness; and secondary travelers, who participate in wellness experiences on trips with other primary purposes such as leisure or business. The latter form of travelers accounts for 89 percent of all wellness trips and 86 percent of expenditures.

Sampling of Amenities

Environmental Eco & Adventure

Social

Can encompass all locations

Wildlife sanctuaries, nature preserves, parks, farm to table restaurants Includes all group amenities

Source: The Innovation Group

Primary & Secondary Arrivals/Trips Type

Trips (million)

Percent

Secondary Domestic

611

74%

Secondary International

129

15%

Primary Domestic

Primary International

Source: Global Wellness Institute

Types of Holistic Wellness Resorts in Gaming Motivation behind wellness travel can be categorized into physical, mental, spiritual, emotional, environmental and social drivers. Holistic wellness resorts typically cater to one, some or all of these motivators. Travelers motived by physical aspirations tend to seek locations specializing in health, spa and beauty, healthy eating and fitness. These travelers seek amenities and locations such as fitness centers, natural and organic restaurants, health food stores, wellness centers, wellness cruises, health resorts and sanatoria, spas, salons and bath and springs. Wellness travelers looking for mental and spiritual experiences are driven by mind-body and spiritual connections, and are drawn to yoga, spiritual

and martial art retreats. Emotional wellness travelers seeking personal growth often look for lifestyle and wellness retreats. Wellness travelers driven by the environment seek eco- and adventure travel within wildlife sanctuaries and preserves. Social wellness travelers can fall into all these categories and are primarily driven by group activities. As pointed out previously, there are at least two holistic wellness concepts currently operating alongside domestic casinosâ&#x20AC;&#x201D;Canyon Ranch Las Vegas at the Venetian and the Holistic Healing Center at Nemacolin Woodlands Resort in Farmington, Pennsylvania. While the coexistence of these concepts with casinos is noteworthy, there are a few key caveats to note. To be fair, Canyon Ranch Las Vegas is somewhat of a watered-down version of its other holistic wellness locations. Even on the companyâ&#x20AC;&#x2122;s website, its Las Vegas location is described as a Spa and Fitness location while its other land-based locations are described as either Wellness Resorts or Wellness Retreats. The Holistic Healing Center at Nemacolin certainly qualifies as a true holistic wellness concept; however, the Lady Luck Casino at the property is positioned as more of an amenity versus the primary visitation driver for the resort. In fiscal year 2019, the casino generated just over $30 million in GGR. Still, these examples provide precedence for the intersection of the gaming industry and holistic wellness.

JUNE 2020 www.ggbmagazine.com

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Broader Gaming Industry Opportunity? To dig deeper into whether holistic wellness concepts provide a broader opportunity for the gaming industry, I went to an expert, Peaches McCahill, president of the McCahill Group (www.mccahillgroup.com), a health, fitness and beauty consulting practice. She has more than 30 years of experience working with various casino and hospitality developments throughout the country on the design, branding and management of spa and fitness concepts. McCahill believes there’s an opportunity for holistic wellness within resorts where gaming has a presence. In some ways, she sees this as a natural evolution. “In the early days of spa concepts, body work like massage was almost thought of as taboo,” McCahill says. “Now, they’re commonplace.” Spa services will continue to evolve just as operators’ thinking around spas has evolved. “Spas within casino resorts were previously considered as a ‘comp amenity’ for players,” McCahill explains. “Now, the expectation is that the spa is a profit center.” Despite the evolution of spas in general, McCahill doesn’t recommend that every gaming resort introduce holistic wellness concepts as amenities. She notes that property location, quality rating and current brand positioning are all important factors affecting the success of a holistic wellness amenity at a gaming resort. The most important factor, however, is the current customer base. “You need to have a thorough understanding of who your customer is,” says McCahill. “Is this (holistic wellness) something they’re interested in?” Generally, McCahill believes four-diamond properties, or those of commensurate quality with a more sophisticated customer base, are best suited for holistic wellness amenities. That doesn’t mean more mainstream or massmarket casino resorts couldn’t benefit from a holistic wellness concept, but again, consumer preferences and tastes are key. “You could build something with the right audience,” says McCahill. Developments with more natural, scenic locations such as some of the gaming resorts in Arizona and California have a more seamless connection to holistic wellness and could be some of the best candidates for these concepts. Recognizing that holistic healing and wellness are integral parts of many Native American cultures and history, tribal casino resorts can connect holistic wellness concepts to their heritage—further strengthening property brands. As for the actual patrons of holistic wellness concepts at gaming resorts, McCahill believes that many will be gaming-adjacent. “Spouses of gamers are a key customer group,” she says. Through retreats, holistic wellness concepts provide the opportunity to keep couples and other customer segments on property longer. Traditional spa treatments and services typically keep a customer in the spa for a couple of hours, while package spa trips last around four hours, says McCahill. This time includes the use of amenities like steam rooms, saunas and the like. This compares to holistic wellness retreats that can be more than four hours per day for multiple days. Additionally, retreat packages could be an added midweek demand channel, bringing new patrons on property and filling low-occupancy periods. Ignoring gamers with a holistic wellness concept could be a missed opportunity. Including holistic wellness services and activities in comp packages 16

Global Gaming Business JUNE 2020

MGM Grand introduced the Stay Well rooms and suites, designed in cooperation with spiritualist Deepak Chopra (r.), to address a growing market of customers who wanted to enjoy a healthy visit to the property. The rooms and suites are all located on separate floors and include a private registration desk, specialized lighting designed to stimulate melatonin, natural memory-foam mattresses on all beds, air purification systems, in-room aromatherapy, special cleaning regimes and more.

could be a way to let your customers know you care about their well-being and increase loyalty. “Morning meditations could be messaged as helping players (mentally) on the gaming floor,” says McCahill.

Concluding Thoughts While wellness travelers spend more than other travelers, a holistic wellness amenity may not be the best expansion opportunity, financially, for many resorts. In doing highest and best use studies for our clients, a parking garage— something that could not be further from a holistic wellness amenity—often provides the highest ROI potential. For gaming resorts with the right location, customer base and brand, a holistic wellness concept may create a unique market positioning and catalyze incremental revenue and demand—something that’s welcomed by operators, whether they’re in recovery efforts or not. Will holistic wellness flow into the mainstream and become something the broader consumer seeks? Consumer trends indicate an ongoing shift towards health and personal well-being, but it will undoubtedly be some time before holistic wellness amenities are commonplace in gaming and hospitality resorts—if ever. One thing is certain: the current global turmoil, which is inextricably linked to an illness, is causing many more people to prioritize their health and well-being. McCahill jokes, “My colleague told me when we come out of this (crisis), people are going to fall in one of three categories… hunk, chunk or drunk.” If there are more “hunks” and health and wellness trends accelerate in the aftermath of the pandemic, holistic wellness concepts may be commonplace sooner than we think. Michael Vanaskie is vice president, international development for The Innovation Group.

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Brave New World

Covid-19 will change the gaming industry, ready or not By Roger Gros photo by erin o’boyle

ncertainty. As the gaming industry and the world headed into late May, it was still unclear how casinos would reopen safely, with health protections that would make customers comfortable enough to return to their favorite pastime. Two months away can be a long time. With dire predictions of a resurgence of Covid-19 ringing in their ears, players may be more comfortable playing online, in social or real-money casinos, in poker rooms or at mobile sportsbooks (once sports get up and running). Maybe they won’t be able to return because they lost their jobs or businesses. Uncertainty. Even when casinos reopen, they will look different. Every other slot machine—if not two of every three—will be shut off. In most casinos, employees will be stationed nearby with sanitizers to wipe down machines and chairs after every use. But how can you decide if people are strangers, or members of the same family who may have been locked down together for the last 10 weeks? Uncertainty. And who will want to come back right away? Will it be your best players or just some of the marginal customers who have a severe case of cabin fever looking to escape for a day? Who should you target with your marketing? Will they respond or be offended? Uncertainty.

Open Sesame By the end of May, many casinos had begun to reopen. Lots of tribal casinos got back to work, because as sovereign nations, they weren’t subject to the orders of state governors. But most of them opened with stipulations that honored the requirements of the Centers for Disease Control and Prevention (CDC).

Global Gaming Business JUNE 2020

At the Seminole Hard Rock casinos in Florida, which reopened May 21, all guests and employees were subject to temperature checks, and were required to wear CDC-approved masks. The capacity of the casinos was limited to 50 percent. Seminole Gaming management erected Plexiglas dividers separating slot machines and table game positions. According to Jim Allen, CEO of Seminole Gaming and chairman of Hard Rock International, safety was paramount in the decision to reopen. “Hard Rock and Seminole Gaming have made a tremendous commitment to sanitary protocols and a safety-first mentality for both guests and team members,” Allen says. “We are making sure our resorts are safe and sound so our guests and team members have peace of mind when they return.” Oklahoma’s Cherokee casinos reopened with a plan called “Responsible Hospitality,” which places an “unwavering commitment to team member and guest safety above all else.” “How we move forward from this pandemic will be a part of our legacy,” says Chuck Garrett, CEO of Cherokee Nation Businesses. “We intend to emerge confident in the knowledge that we did all we could to implement industry-leading protocols that promote the health and safety of our team members and guests. While the guest experience will be different than before, we will continue to deliver the same first-class hospitality and entertainment our guests have come to know and love.” The first commercial casinos to open were in South Dakota, in Deadwood, which were the last to close. Caleb Arceneaux, chief executive officer at Liv Hospitality, owners of Tin Lizzie Gaming Resort, Cadillac Jack’s Gaming Resort and four Deadwood hotels, says, “We were about 15 percent or 20 percent higher than a typical weekend business, which is significant. Cabin fever’s real, and I think people wanted to get out and experience gaming again.”

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“You’ve furloughed every one of your employees, you have a skeleton crew to work with, yet you have to execute all the big things that have to be done to reopen.” —Luann Pappas, President, Scarlet Pearl Casino

Arkansas casinos opened May 18, but with only one-third capacity. Delaware North’s Southland casino quickly reached that capacity. Lines stretched around the building while players’ temperatures were checked. Casinos in Mississippi were permitted to reopen May 21 with a capacity of 50 percent. Luann Pappas, president of the Scarlet Pearl Casino in D’Iberville, on Mississippi’s Gulf Coast, says lots of planning went into the reopening effort. “They use the word ‘unprecedented,’ and I can underscore that,” Pappas tells GGB. “You’ve furloughed every one of your employees, you have a skeleton crew to work with, yet you have to execute all the big things that have to be done to reopen.” She even oversaw the development of social distancing panels for use on the casino floor, all designed and constructed in-house. “We had a lot of vendors come forward who could build those Plexiglas panels, but they were six, eight or 12 weeks away from being able to do it in volume,” Pappas says. “So we did the research, bought the supplies at local stores, built a prototype and had it approved. We built our own. We built them for every table game and every slot machine.” In California, where tribal casinos shut down before the statewide lockdown imposed by Governor Gavin Newsom, casino reopenings came long before Newsom was ready to lift his order, which now extends into July and beyond. The first casino to close, San Manuel, wasn’t the first to reopen, as a

Sycuan Casino Resort was one of six casinos in San Diego County to open, over the objections of the county’s health department

new tribal chairman was involved in a task force set up by Newsom. Kenneth Ramirez, who replaced longtime chairwoman Lynn Valbuena in April, says it wasn’t time to lift the casino’s closure. “In consultation with our medical experts, local and state health officials, and in consideration of Governor Newsom’s plans to reopen California, we determined that anything before then would not be in the best interest of our community,” Ramirez says. “Bottom line is, we have no intention to be the first casino to open. Instead, we’re focusing on making sure we open when it is safe to do so, and when we can provide the best experience for our guests.” Other California tribes weren’t so reticent, although one was a bit more realistic about its reopening plans. Rincon Chairman Bo Mazzetti says when the county sheriff ordered the casino closed citing health issues, it wasn’t enforceable because his tribe is a sovereign government. But, he added, you can’t fight city hall. “What he (would) do most likely is to shut down the ingress and egress from the roads. There he has jurisdiction. So you’re better off to comply.” Nevertheless, the Rincon casino, Harrah’s Southern California, reopened May 22, with all the safety precautions in place. Mazzetti says revenues won’t return to normal until all players feel safe. “It’s that safety factor. ‘Do I feel safe? Do I feel comfortable? Am I confident of my health that I’m ready to go out?’” Win River Casino in Northern California, operated by the Redding Rancheria, was the first to open in the state, followed quickly by San Diego County casinos Valley View, Viejas, Sycuan and three other tribal casinos. The reopenings took place over the protest of San Diego Public Health Officer Dr. Wilma Wooten, who threatened to seek backup from the CDC. On May 14, Wooten declared, “We feel the health officer’s order does extend to the tribal nations in this particular situation, and we are working with the CDC to try to address this issue further.” Casinos in Arizona were given the green light to reopen May 15, but with an abundance of caution. By all reports, lines were long waiting to get into Phoenix-area casinos, with players just happy to get back to their favorite pastime. But what about the gaming capital, Nevada? Despite having relatively low Covid-19 infection rates and deaths, Governor Steve Sisolak insisted that casinos would not reopen until Phase 3 or Phase 4 of a multi-level recovery process. By late May, the state was still mired in Phase 1, with no real concept of what encompassed further phases. Most Las Vegas Strip casinos outlined reopening plans, but the start date continued to be pushed back by Sisolak’s reticence to set a date. His contention that he would leave the decision up to the Nevada Gaming Control Board continued to ring hollow. JUNE 2020 www.ggbmagazine.com

p. 18 covidJune:Layout 1 5/20/20 8:43 PM Page 20

“It’s that safety factor. ‘Do I feel safe? Do I feel comfortable? Am I confident of my health that I’m ready to go out?’” —Bo Mazzetti, Chairman, Harrah’s Rincon

Who Will Come? matter what jurisdiction you’re talking about, you’re going to have reThe No. 1 question—If you open, will they come?—is still unresolved. duced capacity. You have to be thoughtful about how you segment that Most casinos seem to be taking a wait-and-see approach, and opening in big database and how you issue that message to the different populations. stages: first the casino floors and a few restaurants, then hotels in a limited Properties are going to want to target their best guests first. It makes sense. capacity, followed by lounges reopening with social distancing requireAnd I’m not just talking about the biggest, highest rollers, I’m talking ments, and finally theaters and meeting spaces. about the ones that are there frequently, that are engaged with and have a Josh Swissman is a founding partner of the Strategy Organization, and connection with the brand and the property.” has previously worked in senior-level marketing positions for MGM and With most casinos requiring employees to wear masks, at least for the Station Casinos. Swissman says there are fundamentals that marketing deearly stages of reopening, some wonder how can you convey that special partments should consider when reopening. customer service outlook without a smile. Swissman says he doesn’t think “There are three important concepts we’re going to need to weave into it will be a problem. every casino’s brand positioning and messaging,” he says. “No. 1 is the idea “I’m convinced that you can see someone’s smile through a mask,” he of an escape or a getaway. The second is the notion of value. And the third says. “I’ve seen it, I’ve experienced it. Guest service was always important, is the reliability of health and safety and sanitation. I think those will be but it becomes supremely imcritical. Properties will really portant right now—the ability have to be thoughtful about “When guests walk through those to welcome guests in these unintegrating all three in a way that makes sense and is on-tardoors for the very first time and they’re certain times. “When guests walk get for them. It will be chalmet with a warm greeting and a smile through those doors for the lenging, but there are ways to through that mask and a helpful hand, very first time and they’re met do it.” six feet away, they will begin to feel with a warm greeting and a Health and safety is the smile through that mask and a priority, but Swissman says more comfortable. They’ll begin to helpful hand, six feet away, one size does not fit all when it enjoy themselves more.” they will begin to feel more comes to the comfort of re—Josh Swissman, Partner, the Strategy comfortable. They’ll begin to turning to a casino. Organization enjoy themselves more.” “It’s going to be different Swissman believes fun is for everyone,” he says. “Simat the core of the casino expeply put, people will get over rience, and to ignore that element to make people feel safe is wrong. their fear of going out in public when they feel it’s safe to do it again. Some “It gets back to guest service and having your team members be laserpeople will want to wait for a vaccine until they arrive at that conclusion. focused on delivering a great guest experience, especially in the beginSome will wait for guidelines from local or state government before they ning,” he says. “This will be the first time they’ve been back in a casino for return. many weeks or months. And it’s going to feel and look different. To the “If you take a look at what we in the hospitality and travel industry can extent that our team members around the country are able to acknowlcontrol, it comes down to two factors: how safe will people feel when they edge that and work around that in their customer service delivery, it will step back into a casino, a hotel room, a restaurant and so on, and how safe go a long way to promoting an environment of fun. Even if we can’t be as they will feel traveling on an airplane, if they’re not within driving disclose to each other as we used to be. Even if we have a half inch of Plexitance. Those are two big factors that we can ultimately control.” glas between us. Those are just small barriers, which solid guest service can Some casinos are inviting their special players back early. Others are overcome. controlling who returns simply by volume. Swissman says marketers “There are going to be a lot of fun things that are going to be available should target everyone. to people when doors open. With the getaway and the notion of escape, “Marketers ought to work with their analytics teams to cast as wide a some people will find they’ll take great joy in just staying in a hotel room.” net as possible,” he suggests. “That said, you can’t do it all at once. No

Global Gaming Business JUNE 2020

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Partners Helping Partners

Many vendors are helping operators by offering discounts on maintenance, service and system contracts during the Covid-19 shutdown

t’s no secret that during the shutdown of the casino industry due to the Covid-19 pandemic, no operator was buying slot machines, gaming tables or other equipment from suppliers. It’s also no secret that direct equipment purchases are only one cog in the gaming economy. Much of the business casinos do with suppliers involves long-term contracts, with monthly fees for system maintenance and service, daily lease fees on gaming machines and other contractual services. As the shutdown continued, operators faced the challenge of meeting these obligations with zero revenue coming in the door. Many vendors helped their customers meet those obligations, by discounting support and maintenance fees for the time casinos are closed due to the pandemic. One such supplier is Tulsa-based Casino Cash Trac, which provides financial software and systems for casinos in several states, including the largest casino in the world, WinStar World in Thackerville, Oklahoma. Casino Cash Trac’s Casino Insight casino audit system tracks revenue from the games to the hotels to the casino vaults to bank deposits. According to Wanor Franca, chief revenue officer of Casino Cash Trac, the idea of discounting fees for customers arose after discussions with one of its biggest customers—the Chickasaw Nation, owner of WinStar and 22 other Oklahoma casinos—back in March, when casinos first shut down. The operator inquired about contract invoices if the shutdown were to last beyond April 1. (At the time, many actually expected to reopen in April.) “I met with my management team, and said let’s be proactive,” Franca says. “We offered (to discount) 50 percent of their support and maintenance for the time of their closure. Right now, we’re offering it for April and May; if they continue to stay closed, we’ll continue to offer those discounts.” Franca adds that the company is offering free reports to customers using the supplier’s cash analytics module, which will be important in quickly restocking cash for reopening. “A lot of casinos are having to go through an exercise to manage their liability accounts,” he explains, “and they have to now decide, when I reopen, how much should I have on ATMs, how much should I have on my floor, and how much did I deposit? We’re going to work together with them, and provide them with some reports for them to be better prepared when they reopen.” He adds that when the shutdown began, most

of the casinos chose to drop their entire floor— slots, tables, ATMs, cage—and transfer all the cash to their vaults. “Our software is the main software in the vault managing all their cash operations,” says Franca, “so through our software, they make their deposits. Some clients chose to keep money in the vault for cash on hand, but probably 70 percent chose to deposit in the bank.” The banks have been very good about working with operators, not commingling that cash-on-hand money with other deposits, he says. “The banks are keeping some of the clients’ money aside, so if they need to reopen in a two-week period they’re able to get that money pretty quickly back into the casinos.” Franca says many clients have indicated that most of the major slot manufacturers are working with them on daily lease fees, maintenance fees and other costs involving major, long-term contracts. “Those are very large contracts for a lot of the casinos,” Franca says. “Some of our clients reached out to those vendors almost immediately to see if they could provide them with some kind of discount, because they know those are some of the larger bills they will have to pay over the next six months. We’ve contacted Aristocrat, Konami, IGT and Scientific Games on some of the clients we have in common, just to get them some guidance and let them know that maybe they should be proactive as well.” Many of those major slot suppliers are in fact taking that proactive approach to helping their customers get through the shutdown. “In the face of uncertainty surrounding Covid19, Konami is committed to supporting its global customer base to the greatest degree possible while protecting employees and the public health,” says Steve Sutherland, president and CEO of Konami Gaming. “Our position is to remain open and available to deliver business services and technical support—keeping with the latest guidelines from the CDC. Our Games Customer Service & Support lines remain active during normal hours, and Synkros Systems Service & Support lines remain active all day, every day.” “The gaming industry is making incredible sacrifices to support public health and safety in the communities we serve,” adds Tom Jingoli, Konami’s executive vice president and chief operating officer. “That’s how we operate—dedicated to creating thriving communities, through every season. As our casino customers continue that mission, Konami stands ready to support each step of the way.

“Our service and support channels remain 100 percent operational. And Konami teams spanning compliance, quality assurance, sales, marketing support and research and development are working diligently to deliver uninterrupted business response. Konami is focused on providing true partnership commitment, as we’ve done for over two decades.”

Operator Appreciation Those operators appreciate the support as they attempt to maintain liquidity through the industrywide shutdown. Dawn McGrady, chief financial officer of Michigan’s Little River Casino Resort (LRCR), says the casino reached out to vendors immediately at the beginning of the Covid-19 shutdown in March. “Our team at LRCR did a great job contacting our vendors to see if they were open to assisting us,” McGrady says. “We contacted them and requested a suspension of payments for daily fee games, requested postponement of payments on purchases and other monthly lease requirements, and have received positive responses. “We took a look at all our monthly maintenance agreements, and the vendors we contacted agreed to provide us maintenance relief during this time. Some agreements ranged from a percentage reduction of monthly costs to no payments during this time, in exchange for extending their current agreement by the number of delayed payments.” McGrady says many of the casino’s vendors have remained in constant contact, offering assistance as the operator moves closer to reopening. Additionally, many are retooling parts of their operations to manufacture products that will aid a safe return to business. “During this time, vendors seem to have changed up their product offering, such as reaching out to us letting us know they now offer protective devices between gaming equipment,” McGrady says. “Vendors that normally would have provided us equipment are now offering temperature kiosks, which are all things needed to help us reopen safely. Our vendors have taken a very proactive approach in ensuring that we are successful in getting through the closures, and ensuring we’re ready to reopen, as we all depend on one another in this business. “It is extremely valuable to have a good partner that is willing to work with you. Our vendors have been very receptive and understanding, and by making some accommodations, it strengthens our partnerships.” —Frank Legato

JUNE 2020 www.ggbmagazine.com

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HEALTH

The End of Smoking? The role of casinos in reducing the risks of Covid-19

By James M. Galloway, MD, FACP

he Covid-19 pandemic has closed all 989 commercial and tribal casino properties in the U.S. This is an unprecedented opportunity to reevaluate the risks and benefits of making these facilities smoke-free. We’re well aware of our need to minimize the risk of transmission of Covid-19. We know we must implement Centers for Disease Control and Prevention (CDC) recommendations regarding physical distancing and barriers, masks and handwashing, and evaluate team members for evidence of infection. We also know that older individuals and those with chronic disease are at substantially increased risk for more severe disease. Notably, 58 percent of casino players are aged 50 years or greater. Additionally, there’s emerging evidence that smokers are also a group vulnerable to Covid-19. In addition to its role in the development of chronic diseases such as heart disease, stroke, chronic obstructive pulmonary disease and cancer, smoking cigarettes has been determined as a risk factor for severe complications and death from Covid-19 by both the CDC and the World Health Organization (WHO), as well as others in the medical profession. In addition, while young adults are at a lower risk, the effects of smoking on the respiratory system make it more likely that smokers may have increased susceptibility to the virus. Smokers may be especially susceptible to transmission because they move cigarettes to and from their mouths (and associated mucous membranes) and then touch and contaminate surfaces—by necessity, without a mask in place to protect others nearby. Recent studies reveal that chronic secondhand smoke exposure worsens pulmonary inflammation and compromises the host’s ability to combat chronic and acute respiratory infections. That increases the likelihood that smokers will

contract Covid-19, and limits their defense against it, in addition to increasing the well-known risk of both heart disease and lung cancer by 20 percent to 30 percent. The fact that secondhand smoke compromises the host’s ability to combat respiratory infections raises serious health and liability concerns about casinos that allow smoking in their facilities. Finally, as revealed in two recent studies, growing evidence reveals that aerosolized coronavirus particles exist in the air. A recent New England Journal of Medicine article raised concerns regarding aerosol and fomite transmission of SARS-CoV-2, especially since it’s been shown that the virus can remain viable and infectious in aerosols for hours.

hand smoke.” Unfortunately, we’re also aware that, as noted by the American Society of Heating, Refrigerating, and Air Conditioning Engineers (ASHRAE), that casino ventilation systems do not eliminate exposure to the gases, toxins, carcinogens and particulate matter contained in secondhand smoke and e-cigarette aerosol. In fact, ASHRAE states, “The only means of effectively eliminating health risks associated with indoor exposure is to ban smoking activity.” This position is strongly reinforced by both the CDC and WHO. While Nevada gaming operators have maintained a longstanding opposition to suggestions that smoking be prohibited in casinos, many other states and cities have moved forward with very good results. There are now more than 800 smokefree gambling venues in the U.S. Over the past few years, operators in multiple states such as Maryland, Massachusetts, Ohio and New York have developed smoke-free casinos. These casinos have been shown to successfully compete with others, whether smoking or not, in their regional markets. Smoke-free indoor air is simply not a barrier to providing a successful casino business, especially since 87 percent of U.S. adults are nonsmokers, including most casino visitors. With casinos now closed until the pandemic parameters improve, and considering that reopened casinos will likely require masks for visitors, now is the time to move forward on making our casinos smoke-free for their employees and guests and to mitigate their liability.

The fact that secondhand “ smoke compromises the host’s ability to combat respiratory infections raises serious health and liability concerns about casinos that allow smoking in their facilities.

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”

As asymptomatic or pre-symptomatic but infected individuals exhale smoke through an infected respiratory system which is then expelled into the surrounding air, there exists the potential risk of coronavirus-carrying secondhand smoke particles that actually rise into the air instead of falling to the ground due to the warmth of the smoke. This would actually lengthen the duration of airborne coronavirus particles in the air with the potential for entering the ventilation systems for wide distribution. Another group of researchers noted, “Of paramount concern is transmission from asymptomatic but infected caregivers via secondhand aerosol from e-cigarettes and second-

James M. Galloway, MD, FACP, is a cardiovascular medical doctor, media commentator and speaker. Galloway was assistant U.S. surgeon general, a rear admiral in the United States Public Health Service and the regional health administrator for the U.S. Department of Health and Human Services under presidents Bush and Obama.

Honor the Sacred. PROTECT THE AIR.

The next generations have spoken. The number of adults who smoke cigarettes continues to decline every single year, and the time has come to respect the voice of the future and honor the ancestors of the past by protecting everyone from the dangers of commercial tobacco use and secondhand smoke exposure. www.smokefreecasinos.org The mural above was created from community members and stories on their vision of what health and traditional tobacco looks like in their communities. We worked with artists Mario Henriquez (VOTAN) and Gregg Deal. This mural is at the Minneapolis American Indian Center. The project was funded and supported by ClearWay Minnesota in collaboration with the Native Youth Alliance of Minnesota and community members.

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: ks oc s e h A t r o k er f c s: A How to Navigate Financials as Gaming Reopens By Sean McGuinness and David Waddell

his year’s Covid-19 crisis has jolted the gaming industry. As of May 1, all casinos in the United States, commercial and tribal, were closed. Since then, state by state, gaming regulators have been formulating protocols for reopenings, in consultation with their governors, public health officials, gaming regulators and industry counterparts. It’s evident that once casinos have fully reopened, the gaming experience will be drastically altered. A seismic shift has taken place. Casino closures have caused an adverse impact on gaming companies (casino operators, manufacturers/distributors and gaming vendors), their employees and shareholders, as well as state, local and tribal governments that rely on gaming revenue for income. Suppliers aren’t ordering new product. Conferences and industry events have been canceled. The closures have caused some gaming companies to default on financial covenants with their lenders, adding more stress as they look to get back to business.

Initial Tremors

Based on what transpired in 2008, most operators will seek to manage and from the Recession reduce their capital Lessons Based on what transpired during the financial crisis in expenditures and 2008, the first step most casino operators will take is to to manage and reduce their capital expenditures and other expenses to seek other expenses to maximize and improve cash flow. This will likely negatively impact gaming suppliers maximize and and vendors as well as the construction trades, as operaimprove cash flow. tors spend less on new products and expansions to deal

When the Coronavirus Aid, Relief and Economic Security (CARES) Act passed in March, the American Gaming Association succeeded in ensuring that the industry was not explicitly excluded from eligibility for relief funds. Gaming was generally included with the resort/hotel industry. But a problem quickly arose when the Small Business Administration (SBA) elected to use a qualifying policy from the late 1990s to exclude companies with more than one-third gaming revenue from eligibility for the Paycheck Protection Program (PPP). Essentially, this disenfranchised smaller casinos with fewer than 500 employees, including many tribal facilities as well as casinos in Colorado, 24

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Iowa, rural Nevada and elsewhere. Before the initial PPP funding was depleted, the SBA changed the eligibility to allow for 50 percent gaming revenue in 2019, so long as that amount also did not exceed $1 million. This helped some, but not all small Nevada taverns. In response to intense efforts by the AGA and all segments of the casino industry, Congress then funded additional monies into the PPP program; the SBA finally relented and harmonized its eligibility requirements with what was in the CARES Act to begin with (no casino exclusion for fund eligibility at all). The problem was, by the time this took place, there were many other small businesses in line for these funds. So, it’s not clear how many small casinos will be able to receive PPP funds at the end of the day.

with the reduction in business caused by the closures, reopenings with reduced occupancy, and the cancellation of convention and meetings business. Companies in the gaming industry (both operators and vendors) are in a precarious position. They’ll need to consult with their lenders to emerge from this crisis and seek to work out acceptable plans so operations can continue. In many cases, this will involve changes in loan covenants/liquidity requirements, payment forbearances and forms of equity participation (board/officer positions and sharing in gaming revenue), as well as changes in officers/owners of the gaming companies themselves.

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“Early and frequent communication with regulators is as important as communications with the court and creditors.” —Martin A. Sosland, Butler Snow LLP Bankruptcy and Restructuring Group

These will obviously trigger gaming regulatory issues that may require licensing or approvals of some form. In some instances, companies will be able to negotiate with their lenders out of federal bankruptcy court. In other instances, they will have no choice but to go through a formal bankruptcy restructuring process. Gaming bankruptcies are unique animals, given the inherent conflict between federal supremacy (the Federal Bankruptcy Code and the federal statutory requirement that bankruptcy trustees and debtors operate a business in compliance with valid state law) and the 10th Amendment (state regulatory licensing control). Gaming licenses are “privileged” in most jurisdictions that don’t automatically flow with the assets, and the value of casino enterprises is dependent on the license remaining in good standing. So it’s vitally important to assure gaming regulatory compliance when going through this process. As casino bankruptcies have become more common, there’s ample precedent where bankruptcy courts and the gaming regulators have consistently worked together in a cooperative manner. “Keeping the court, creditors and interested parties informed of the status of regulatory issues is key to ensuring an efficient restructuring process,” says Martin A. Sosland of Butler Snow LLP’s Bankruptcy and Restructuring Group, adding, “When the court and creditors are left in the dark, unnecessary motion practice and inefficiencies are bound to occur.” For example, in practice, bankruptcy judges have almost always made gaming regulatory approval a condition for a debtor to successfully exit bankruptcy. Likewise, gaming regulators have timely processed and investigated the necessary individuals/entities to allow a debtor to successfully exit bankruptcy, and have taken appropriate steps to approve debtor-in-possession (DIP) financing, and/or other credit arrangements in bankruptcy. Part of the reason for this is the acknowledgement, from both regulators and the bankruptcy court, that it’s preferable to keep casinos open and operational, if possible, during a bankruptcy process. This enhances value for creditors, but also allows the states to continue to receive gaming taxes. In addition, employees remain employed and vendors remain in place during the proceedings. A hallmark in this is keeping the gaming licenses in good standing. This has even been able to happen when there

have been multi-jurisdictional bankruptcies involving multiple commercial gaming regulatory agencies. A bankruptcy case can be commenced either voluntarily (by the debtor) or involuntarily (by a group of creditors). While possible, involuntary cases are rare—accounting for less than one-tenth of 1 percent of all filings.

Types of Bankruptcy There are two primary types of bankruptcy cases: Chapter 7 (liquidation) and Chapter 11 (reorganization). Chapter 7 cases are for companies that don’t have the cash flow to justify continuing operations. Chapter 11 cases are generally for companies with adequate cash flow to continue operations and restructure their obligations; however, companies may file Chapter 11 to undertake an orderly liquidation. Initially, a debtor in a Chapter 11 case has the exclusive right to propose a plan of reorganization. This allows the debtor to negotiate with its creditor constituencies. Creditors are generally classified into these categories: (a) classes of secured creditors; (b) classes of unsecured creditors; and (c) classes of equity interests. The debtor’s primary objective is to garner sufficient support from the various creditor classes to achieve agreement upon and confirmation of a plan of reorganization for the company. To the extent that it can happen, the process can move more quickly. If consensus doesn’t arise, the debtor’s exclusive right to propose a plan may expire or be terminated, allowing creditors to propose a plan. Often, debt structures, collateral values and other considerations make a traditional reorganization through a confirmed plan impractical. In these situations, the debtor may propose a sale process under Section 363 of the Bankruptcy Code. This essentially is an auction to the highest bidder. A sale process can also, at times, be part of an agreed-upon transaction or a reorganization plan. Most often, the debtor will identify a stalking horse bidder, negotiate a sale contract, and seek bankruptcy court approval of a sale process. Upon approval by the court, an auction date is set and the highest bidder prevails, winning the right to purchase the company’s assets—contingent upon the highest bidder obtaining all required gaming regulatory approvals. “Understanding the regulatory aspects unique to gaming assets is of

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As casino bankruptcies have become more common, bankruptcy courts and the gaming regulators have consistently worked together in a cooperative manner.

paramount importance,” says Sosland. “These aren’t your typical sales of a manufacturing facility, and require access to professionals that understand both the restructuring and regulatory overlay.” If a debtor who enters Chapter 11 needs capital to fund ongoing operations to keep the casino open and operational, that debtor may seek DIP financing. Senior secured lenders are often the most likely candidates to make a DIP loan, because an approved DIP loan will solidify the secured creditor’s priority and preserve the value of the assets which serve as collateral for its pre-petition loans. Another alternative in the chapter context is a process where the debtor and creditors agree to a prepackaged plan of reorganization before the company enters bankruptcy. This essentially means that the negotiations that would normally take place post-filing occur before the case is filed and, if successful, result in a restructuring support agreement (RSA). If the company can obtain commitments from a sufficient number of creditors in the various classes to ensure that its plan can be confirmed, the company will file a Chapter 11 case and its plan on the same day and seek prompt confirmation of the plan to which creditors have already agreed. Obviously, this streamlines the Chapter 11 process and minimizes the delays and expense associated with the formal bankruptcy process. It’s vital to have proactive communications with gaming regulators, both in advance of a bankruptcy filing and during the bankruptcy proceeding itself. Regulators don’t want to be blindsided and learn of a licensee’s bankruptcy after the fact. As Sosland says, “Early and frequent communication with regulators is as important as communications with the court and creditors.”

Compliance and Communication Richard Kalm, executive director of the Michigan Gaming Control Board—who dealt with a casino bankruptcy during the 2008 financial crisis—says, “We’ve found that direct lines of communication between the director and casino CEOs during times of transfers of interest, restructuring or during time of crisis lead to quicker, more confident decision-making by the entity and the board. “Our casinos want to comply, but don’t want unknown regulatory action. So if we can discuss concerns ahead of time, the subsequent decisions can more readily fall in place for them. In turn, we have a much better understanding for the causation of their actions and can make suggestions to avoid any regulatory pitfalls.” Similarly, Brian Ohorilko, administrator of the Iowa Racing and Gaming Commission, comments, “Most jurisdictions have fairly specific requirements for their licensees with respect to financing and what should be reported to the respective regulatory authority. The

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good news for licensees operating in multiple jurisdictions is that many states have similar or identical requirements. The best advice I would give to licensees is to communicate with their regulators on a routine basis, as concerns or opportunities are presented. In many instances, the regulatory body can assist licensees by advising of the proper filings and disclosures that need to be made if they find themselves in an unfamiliar position. “In addition, the regulatory body will appreciate understanding the challenges of the licensees in their state to appropriately respond to questions that may come up by various policy makers.” Sandra Douglass Morgan, chairwoman of the Nevada Gaming Control Board, has this observation: “A very few number of cities were hit as hard as Las Vegas by the 2008 financial crisis and recession, which resulted in a number of Nevada gaming entities filing for bankruptcy protection. At that time, the Nevada Gaming Control Board assembled a team with management from each division and the Attorney General’s Office to discuss case status and ensure applications were ready for board and commission consideration and disposition. “I anticipate this group will be reconstituted to address the return of the gaming industry due to the Covid-19 crisis. Regular and consistent communication with the Gaming Control Board is imperative and critical. Given our history of addressing bankruptcy-related matters, the board is ready and able to provide guidance on the relevant Nevada statutes and regulations to ensure that applications are processed as quickly and efficiently as possible.” Having a productive dialogue with the gaming regulator also will help maintain the licenses applicable to the company during the bankruptcy process. To keep the licenses active and in good standing, it’s important to identify these in advance of a proceeding and to regularly track dates when renewal filings need to be made. It’s also important to continue to comply with reporting obligations to the gaming regulators and adhere to requirements for debt approval/debt covenant approvals (DIP loans), as well as filing the necessary applications required by a confirmed plan of reorganization so the company can emerge from bankruptcy as soon as possible. In some instances, regulators may allow the application process to commence sooner than the date of plan confirmation. Again, it’s important to have an open, consistent dialogue with all gaming regulators to move through the process as quickly as possible. Native American financing for tribal gaming enterprises/casinos has unique considerations, as it’s not clear whether a tribe can afford itself of the federal Bankruptcy Code. Further complicating the issue is tribal reluctance to waive tribal sovereign immunity. Accordingly, bankruptcy proceedings may not be an option for tribal gaming enterprises on Indian lands. That said, the same restructuring principles apply, just outside of a court proceeding.

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Surviving Intact In conclusion, Covid-19 has caused a seismic shift that’s impacting the entire economy. It means companies in all segments of the gaming industry must take proactive steps to manage expenses, work with lenders and gaming regulators to rework or reframe debt covenants, which, in some cases, may require either formal or informal business restructuring. If restructuring becomes necessary, the question then is: Can the parties achieve this outside a formal bankruptcy process? In many cases, formal detailed transactions memorializing the deals struck between the constituencies are a viable path. If such deals can’t be struck, then a formal reorganization plan confirmed by a bankruptcy court is the likely path. Regardless of whether a transactional deal is struck or whether there’s a formal reorganization plan, it’s vitally important to keep gaming regulatory considerations in mind in finalizing the process.

Sean McGuinness is a partner at Butler Snow, LLP. A multi-jurisdictional gaming regulatory attorney licensed in Colorado, Iowa, Mississippi and Nevada, he is a member of the International Association of Gaming Advisors and the International Masters of Gaming Law. McGuinness started his career in gaming law as a regulator in Iowa and Mississippi. David D. Waddell is an attorney and president of Regulatory Management Counselors, P.C. A co-author and creator of The Michigan Gaming Law Legal Resource Book, and chief editor of The Michigan Gaming Newsletter, he is a member of the International Association of Gaming Advisors and the International Masters of Gaming Law. His practice helps clients navigate complicated regulatory compliance issues involved in reorganizations, restructurings and bankruptcy.

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Gathering TOGETHER Trade shows and the new normal By Frank Legato

he industrywide shutdown due to the global pandemic has challenged everyone, from operators with zero revenue to suppliers with zero sales. But some of the earliest victims of this crisis were trade shows. Trade shows, in fact, are still disappearing, even as a combination of social distancing and ingenious technology to zap germs with UV light have made the reopening of casinos seem imminent. Large gatherings cause spikes in infection amid a pandemic, and a trade show is, by definition, a large gathering. Thus, a trade event calendar that many thought was already more crowded than it should be was clearing its slate by mid-April. Indian Gaming: Postponed until further notice. ICE North America/Southern Gaming Summit: canceled, although ICE producer Clarion Gaming was very successful in staging a digital version last month. ICE Asia and SiGMA Manila, the IAGA International Gaming Summit, G2E Asia, ASEAN Gaming Summit, East Coast Gaming Conference, the OIGA Conference and Trade Show—all canceled or postponed. At press time, the supply sector was still awaiting word on the two largest industry trade shows—the Global Gaming Expo in Las Vegas, at press time still scheduled for October; and next February’s ICE London show. Officials of the American Gaming Association and Reed Exhibitions, producers of G2E, spoke to suppliers—as G2E exhibitors, the show’s lifeline—at the May board meeting of the Association of Gaming Equipment Manufacturers, where they fielded inquiries from increasingly impatient supplier executives seeking a firm decision on whether or not the trade show will go on in October as planned. “We’ve had lot of conversations over the last month with exhibitors,” Will Wise, Reed Exhibitions’ group vice president for G2E events, told 28

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AGEM board members. “And of course, the natural question everyone has right now is, will the October event definitively happen or not? The real answer to that is pending.” Wise said the show’s producers must consider, “first and foremost,” the health and safety factor. “Is it going to be viable to do an event in the fall?” he said. “Every other trade show or conference in the fall is addressing the same question. “But equally for our industry, we have the serious consideration and question mark of the business viability, the business opportunity. And that is a major question right now.” The show’s producers have been meeting the buyers and the operators—“our common customer here”—to assess whether they will draw value from the show. AGEM board members, who ultimately will be the ones spending millions to exhibit at G2E, pressed the show’s producers for more specifics, and noted that their own conversations with operators have typically resulted in what AGEM Executive Director Marcus Prater described as, “What, are you crazy? We’re not even interested in G2E; we’re trying to save our business.” Prater went on to say that those same operators said they are likely to attend G2E in some capacity if it does go on. However, another AGEM board member commented that some operators are planning to send a handful of officials, where normally they would send 50 or 60. “At some point in time, you have to address the individuals and the companies who are exhibiting and spending the money at this trade show, and not the attendees,” the official said. Korbi Carrison, G2E event director for Reed Exhibitions, assured the members that they will have the answers regarding G2E within the coming weeks. She said the AGA and Reed have employed a third-party consultant to do a fast but exhaustive survey of potential G2E attendees, for the pur-

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pose of helping exhibitors make plans for their participation. “We’re looking at a sampling of over 2,000 previous G2E attendees,” she said, “and those are folks we previously identified as key buyers. They’re going to be segmented into a sampling of the attendance of G2E. We’re looking at not only the U.S. and Canada, but international attendees, and we’re looking at representatives across Native American gaming, commercial gaming—a cross-section of the attendees that come to G2E.” The survey results were expected to pour in the last two weeks of May, with results by mid-June. Meanwhile, Reed and the AGA are offering flexible terms to make it easy for exhibitors to adjust their participation according to changing financial situations during the shutdown. On April 24, Allie Barth, senior vice president of industry relations for the AGA, outlined the rules, which, she wrote, would allow “a lot of creativity to reinvent the exhibitor and attendee experience.” G2E exhibitors would pay no penalties for downgrading booths, there would be on-site material handling and freight services subsidies, on-site marketing services and free meals, among other services.

New Look If and when G2E 2020 does take place, it’s certain it will not look like G2E 2019. “G2E in 2020 will not be the same as years past,” says Carrison. “The health and safety of our exhibitors, attendees and employees is our No. 1 priority. We are following all public health regulations from local, state and federal officials as we move forward with planning. “Visible changes to G2E will accommodate health and safety requirements that are still being established, and embrace newer ways of connecting the industry, conducting business, and advancing the profession. Several trade show associations and groups are formulating best practices that will be considered. Additionally, Reed Exhibitions USA has formed a health and safety task force that will identify, develop and implement policies and procedures for our events.” The education portion also will reflect changes brought about by the pandemic. “Our goal with G2E education is to provide leading, quality content,” says Meredith Pallante, the AGA’s senior director of events. “This need has never been more urgent. None of the ways that any of us have traditionally delivered content, convened, or shared information has been the same as pre-Covid. We anticipate greater integration of new technology in all aspects of this year’s show, including G2E education.” Carrison says health and safety, though, will come first. “Our team is actively coordinating with the Sands Expo and Convention Center, monitoring public health guidelines, and taking steps to ensure health and safety,” she says. “None of us have been through a global pandemic, so there’s still a lot that we’re all figuring out to ensure we’re creating a safe, secure environment. “Some of the trends that we anticipate include additional sanitizing stations, increased spacing of aisles, signage to support physical distancing requirements, designating directional traffic flows, and more. Learning from the hundreds of trade shows that Reed Exhibitions has within its global

“The industry has shown huge faith in us, particularly in the ICE brand. The industry has helped us to grow and to develop, and it’s our responsibility to repay that faith in any way or ways that we can.” —Kate Chambers, Managing Director, Clarion Gaming

portfolio (in addition to G2E) will be an incredible advantage for implementing the best approach.” Clarion Gaming, producer of the other huge industry trade show, ICE London, has a similar advantage. Clarion has hosted trade events in multiple industries, including the ICE family of trade shows. Kate Chambers, managing director of Clarion Gaming, says the company is adapting to the changing situation, even seven months before ICE London is slated to occupy London’s ExCeL Centre. “My key message to our community based throughout the world is that we are not going to hide from the challenges that lie ahead and we are not going to duck the responsibilities that we have to the industry,” Chambers says. “The industry has shown huge faith in us, particularly in the ICE brand. The industry has helped us to grow and to develop, and it’s our responsibility to repay that faith in any way or ways that we can. The ICE brand will continue to represent the best interests of the industry and we will work even harder on the industry’s behalf.” Chambers says even at this early date, she can promise that ICE London 2021 will be different than previous editions—as will everything else in the post-Covid world. “Already the world is a very different place,” Chambers says. “The U.K. went into lockdown on March 23, and even in that (relatively) short time frame, there have been huge shifts in human and commercial behavior... “What I can do, however, is provide some insight into how we are working as a team, the lessons that we have learned and continue to learn as well as the thinking that we are applying to what is the biggest human and economic challenge the world has faced for 100 years.” “There’s absolutely no doubt that ICE London 2021 will be different,” Chambers says. “Our challenge is to do everything possible to demonstrate and ensure a healthy environment at ICE London. “As we create a vision of what the future could look like we are also drawing on the experience of other events that will go live before ICE London, and to also look at the social distancing, hygiene and people management undertakings being made by other commercial sectors such as food, retail and professional sport.”

Going Digital Chambers says Clarion’s current efforts are aimed at defining what the “new normal” will be for trade events. If this year’s Covid-19 shutdown has shown anything, it’s that digital events are going to be a big part of that new normal. Already this year, several trade events have produced virtual shows, using the internet to substitute for the in-person events to great success. SBC Digital held a virtual Sports Betting America conference at the end of April, and ICE Asia and SiGMA Manila will be presented in virtual form as well. JUNE 2020 www.ggbmagazine.com

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“We don’t know for certain what the coming months will look like for industry events, but those planning decisions have to be made now. As of today, Konami has taken the position to remove trade show events from our budget for the remainder of this fiscal year, and instead focus investment on our team members.” —Tom Jingoli, Executive Vice President and Chief Operating Officer, Konami Gaming, Inc.

But the biggest digital success so far was Clarion Gaming’s ICE North America Digital, prepared in record time after the decision was made to cancel the May 13-14 New Orleans event, planned to coincide with the Southern Gaming Summit. “We wanted to be able to provide delegates and attendees with information, which I think is still important, regardless of what’s going on at the moment,” says Rory Credland, Clarion’s events director for the ICE Totally Gaming portfolio. “Everyone’s still hungry for education and knowledge. We discussed how to bring ICE North America New Orleans to additional formats, and how much of that we can replicate as closely as possible to what people would have experienced in a physical format.” The event was an unqualified success. The week-long, free-to-attend gathering of operators, suppliers and regulators featured 50 speakers during five days of content dedicated to the land-based, online and tribal betting and gaming markets in the U.S, as well as its growing hospitality tech sector. It attracted over 4,000 registrations from 558 companies based in 85 countries around the world, who recorded over 7,000 visits to the site. The networking area of the Swapcard platform upon which it was hosted was equally popular, witnessing over 5,000 business discussions take place and 2,000 new connections made. “We were all disappointed when we couldn’t meet up in New Orleans, but we were acutely aware that the show—in one form or another—had to go on,” Credland says. The AGA’s Pallante says that in the event G2E does not go on as planned in October, a digital G2E would be a possibility. “Nothing is off the table as we plan what G2E may look like this fall,” she says. “As we’ve seen in recent months, a lot can change very quickly, and we’re accounting for a variety of scenarios for G2E 2020.”

Planning for the Future The Covid-19 pandemic and subsequent shutdown of the industry will change more than just this year’s trade show calendar. With many suppliers in the industry struggling to meet an increasingly demanding trade event schedule, the current crisis may change the look of trade events for years to come. “In general, suppliers are in agreement there have been too many trade shows and conferences at their expense in recent history,” says AGEM’s Prater, “but certainly no one wanted what we’re seeing now with everything canceled or postponed. The future is uncertain as we stand here in mid-May, and so it’s difficult to predict what the landscape will look like going forward.” 30

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Prater adds that the current crisis should not, in itself, be an excuse to avoid in-person events in the future. “Yes, here in mid-May,” he says, “the idea of hanging out closely at a trade show with thousands of people doesn’t sound very good, even though we miss our friends, colleagues and customers that make this industry so unique. “The future is unclear how things will look in the coming months. I hope we don’t lose the ability for face-to-face business at shows, or anywhere else for that matter, but we will have to continue adapting and being thankful for the digital connections we have been relying on during lockdown. I do know the suppliers will continue to reduce expenses in all areas as we fight through this.” Tom Jingoli, executive vice president and chief operating officer of major G2E exhibitor Konami Gaming, Inc., says the Covid-19 crisis is giving the industry more immediate challenges than the months of planning that go into trade show participation. “Now as we speak in the third week of May, we’ve all seen how Covid-19 has impacted every area of our industry,” Jingoli says. “Throughout the crisis, employee health and safety has been of paramount importance at Konami Gaming, and we hear the same from casinos we serve across the globe. “Similar to our competitors, Konami has been forced into employee furloughs and layoffs. Large cuts in revenue have placed us in the position to have to make difficult decisions to ensure the long-term viability of the business. All considered, we believe the ROI is greater on investing in our employees than investing in trade show participation. “We don’t know for certain what the coming months will look like for industry events, but those planning decisions have to be made now. As of today, Konami has taken the position to remove trade show events from our budget for the remainder of this fiscal year, and instead focus investment on our team members.” Jingoli adds that this year’s decision is not a long-term decision with respect to G2E. “Trade shows represent a substantial investment, which is why Konami has historically been active in evaluating each event individually on a regular basis, to ensure the timing makes sense for our customers, people, and products,” he says. “Based on what we’ve observed so far on the effects of Covid-19 on public events through mid-May of this year, it clearly has to be considered as part of the investment equation. And unfortunately in many cases, a paring back will have to take place. As an industry, any return to large trade show events will need to clearly advance our shared growth, success, innovation, responsibility, and of course, safety, to appropriately balance the health risk and financial costs.”

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Actions you can take through the THG 360° Strategic Planning Process: • Address the immediate challenges that COVID-19 represents to your Tribe, workforce and customers • Address the near-term cash management challenges and broader resiliency issues • Create a detailed strategic plan to return the business back to scale quickly • Re-imagine the “new normal” – and the implications of how Tribes should safely resume operations

Jeff Hartmann | Founder & CEO mobile: 860-984-6424 jeff@thehartmanngroup.net 455 Boston Post Road | Suite 202 B Old Saybrook, CT 06475 860-391-0400 THEHARTMANNGROUP.NET

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MAKING MY POINT

Winners, Losers & ‘Crisitunity’ To find opportunity in this economic and health crisis, think like the Great Gretzky

egend has it . . . … that Isaac Newton, while he nodded, clearly napping, suddenly there came a tapping. Of an apple. Of an apple that broke from its stem. Of an apple that broke from its stem and hit him on the head, knocking into his noggin the notion of gravity. Cute. Happens to be total BS, but cute nonetheless. Legend has it… …that Walt Disney, whose eponymous company created Frozen with a capital F, is himself “frozen” with a lowercase F—as in locked away in some cryogenic lab, perhaps next to the disembodied head of Red Sox slugger Ted Williams. Well, OK, the second part of that is true. And speaking of dead baseball players, legend has it… …that Babe Ruth was calling his shot that day in the 1932 World Series, when he pointed to centerfield and sent a homer to the same spot, helping the Yankees win it all. No, no, Nanette, if the Bambino was pointing at anything, it wasn’t the flagpole beyond the centerfield fence at Wrigley Field. He was more likely calling out some loudmouth in the Chicago Cubs dugout or catcalling some woman in the grandstand. But hey, why let the facts get in the way of a good story, right? Likewise, there’s an etymological tall tale that everyone from John F. Kennedy to Homer J. Simpson have taken as gospel: that the Chinese use the same word for crisis that they do for opportunity: “Crisitunity!” Sorry, Homer, but that portmanteau is based more on fable than on fact. Doh! But so what? “Crisitunity” may lack literal accuracy, but can you find a better metaphor for our industry today? With all but a few of the world’s casinos closed, and the ones that are opening getting sparse play, it’s easy—and

Global Gaming Business JUNE 2020

By Roger Snow

perhaps human nature—to focus on the danger. Maybe you lost your job. Maybe your friend or a family member did. Maybe your property won’t reopen until July. Maybe when it does, business levels will trigger increased decreases in staffing. The dangers are easy to see. The opportunities? Now they’re tricky. Because there aren’t that many of them and they tend to be camouflaged if not outright disguised.

there’s a “Whenever seismic shift in the

status quo, you need to think of who stands to prosper and who stands to suffer. Winners and losers, it’s as simple as that.

”

But a trained eye and a disciplined mind can spot them. Here’s how: Whenever there’s a seismic shift in the status quo, you need to think of who stands to prosper and who stands to suffer. Winners and losers, it’s as simple as that. Right now, look no further than your TV screen. Movie theaters— save for drive-ins, which are experiencing a mini-renaissance—are getting smacked around like a piñata on bat day. But who’s the winner? Cable, satellite, streaming services like Netflix and Vudu. Loser: Televised sports. For the love of all that’s holy and righteous, ESPN last weekend aired the “stone-skimming” championship, which, amazingly, is exactly what you think it is, a bunch of grown men throwing flat rocks sidearm-style and tallying the times it skims atop . . . you know what? This is too boring to keep talking about. Winner: Televised news. Everyone is entrapped and enthralled; it’s like a hurricane that lasts three months and it’s the only thing the

talking heads are talking about. Loser: Fancy schmancy restaurants. Winner: Uber Eats. Now do this for our world, and this industry. Who’s going to win and who’s going to lose? Conventional wisdom says the biggest winner coming out of this Covid coma is electronic table games. No cards to handle. No chips to handle. No dealer to breathe onto. And the biggest loser? Well, most people seem to think it’s poker. Because you can play blackjack with three or four players (everyone is one on one vs. the dealer), but poker lives on liquidity and action; cutting more than half the people from the game kills the spirit of the game. Maybe casinos will adopt spin-and-go tournaments, which are dealt three-handed online. Maybe they’ll think of something else. Or maybe players will adapt. But if not, poker may reverse all its gains since 2003 or simply migrate online. You must challenge yourself to think along these lines, and not get caught in the muck of self-misery and group commiseration. Leave that for the lemmings. Go against the grain and the crowd, and figure out where this will all end up. It’s like Wayne Gretzky said about hockey —and in this case, there’s a 99 percent chance he actually said it: “I skate to where the puck is going, not to where it’s been.” In other words, anyone can see what’s happened. Great leaders see what’s about to happen, and capitalize on it before the competition does. Great advice for all of us. 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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iGaming Boom Could Continue, Post-Shutdown

For more than two months, due to the coronavirus, online gambling was the only game in town. Analysts believe the surge could continue when Covid-19 is just a memory and casinos are up and running. By Bill Sokolic

ith the exception of sports betting, iGaming grew 66 percent year-on-year in New Jersey in March, to $65 million. The spike continued in April. With virtually all casinos in the U.S. closed due to the Covid-19 outbreak, New Jersey posted almost $80 million in combined iGaming and poker revenues. Online gaming alone brought in $74.8 million for the month, a 114.3 percent increase over April 2019, when it brought in $34.9 million. Poker did even better, up 208.7 percent from $1.7 million in 2019 to $5.1 million. In those dismal weeks, with casinos’ doors firmly locked, most sports betting on the bench and the majority of Americans shut in at home, iGaming took off. The phenomenon caught the attention of policymakers, and could hasten the already-rapid growth of iGaming across the country. Covid-19 will likely “force (states) to look for new sources of taxes,” Morgan Stanley analyst Thomas Allen said in an April client note. “In addition, legalization and the rollout of online forms of gambling can be much quicker than building brick-and-mortar casinos.” Stephen A. Murphy, co-founder and CEO of New York-based sports gaming provider Boom Sports, agreed. “States move at their own pace, and whatever happens, gambling legislation is just one of many things they need to look at in a given year,” he told GGB. “But I think you’ll see an acceleration in the next 12 to 18 months. From the land-based and pro sports leagues’ perspective, they’re more incentivized now than ever to get online games up and running.”

“I think you’ll see an acceleration (of iGaming legislation) in the next 12 to 18 months.” —Stephen A. Murphy, co-founder and CEO, Boom Sports

Global Gaming Business JUNE 2020

The Domino Effect Currently only a handful of states including New Jersey, Nevada, Pennsylvania and Delaware allow online casino gambling; more than 15 states permit online sports betting and even more allow sports betting at physical casinos. According to the Pennsylvania Gaming Control Board, casino revenues for March predictably revealed a deep year-on-year drop, with all the state’s 12 casinos shuttered for half the month. Revenues were down 51 percent overall compared to the $316 million logged in March 2019. The spiral continued in April, with all casinos closed, and casino tax revenues down a gut-wrenching 84 percent. Again, the good news—the only good news—was online. From March to April, iGaming revenues rose 73 percent from the previous peak of $24.9 million. “Pennsylvania is one of the few states that has an online gaming option,” Doug Harbach, spokesman for the Pennsylvania Gaming Control Board, told the Philadelphia Inquirer. “That’s continued to keep tax revenue flowing.” For the first quarter, Pennsylvania online casinos generated more than $57 million in wagers compared to $34 million the entire first half of 2019. Meanwhile, iGaming revenues in neighboring Delaware increased 78 percent to $515,000 in March. Most online sports bets are placed on mobile phones. Experts say once

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professional sports resume, the trend may continue, causing fewer people to visit a casino for traditional games like blackjack, craps and slots.

‘A Boon’ for Casinos, States

gaming experience. “With Sears or Macy’s or Amazon or insert-your-brand-here, it’s much easier to have a better experience online. And while online gaming can make gambling more convenient, I’m not sure anyone’s really succeeded in making it more fun.”

The dramatic increase in iGaming revenues since the shutdown “demonstrates how it can be a boon for casinos, state taxes and consumers looking for internetbased entertainment options,” says Jeff Ifrah, founder of iDevelopment and Economic Association (iDEA), which seeks to expand online interactive entertainment in the United States. Ifrah, too, looks for the legions of legal states to grow, propelled by lawmakers hungry for tax revenues. Those who may have been on the fence may now find it easy to come down in favor of iGaming and iPoker, which are “bolstering tax revenues at a time when money is desperately needed to fund needed projects and programs,” Ifrah said. Michigan and West Virginia are actively considering iGaming. States like Indiana and Iowa, which already have mobile sports betting tied to land-based casinos, could easily add iGaming. “Layering iGaming on top of an existing mobile product will be an easier lift for state legislators who may be skeptical of expanded gambling,” said Allen. Ifrah’s iDEA has actively worked in Michigan to fast-track the state’s iGaming regulations. As a result, the Wolverine State will be able to launch sooner than planned (Q1 2021 was the anticipated launch), and its cash-strapped retail industry may have a revenue stream by fall. Ifrah and his team are mapping out other target states and gathering data to share with lawmakers—and takes a cautious approach. “Often, when states are in a budget SPORTS BETTING, ESPORTS & SOCIAL GAMING | TECHNOLOGY | COMPLIANCE | LICENSING | crunch, they tend to over-tax and impose GOVERNMENT AFFAIRS | INDIAN / FIRST NATIONS GAMING | INTERNET GAMING huge fees on a new industry,” he said. “To be Kate C. Lowenhar-Fisher | 702.550.4459 | klowenhar-fisher@dickinsonwright.com clear, the revenue from iGaming will not solve Jennifer J. Gaynor | 702.550.4462 | jgaynor@dickinsonwright.com any state budget crisis. It needs to be looked Gregory R. Gemignani | 702.550.4468 | ggemignani@dickinsonwright.com at as one option of many that states will conMichael D. Lipton, Q.C. | 416.866.2929 | mdliptonqc@dickinsonwright.com sider this year and in 2021.” Jeffrey A. Silver | 702.550.4482 | jsilver@dickinsonwright.com Kevin J. Weber | 416.367.0899 | kweber@dickinsonwright.com For all the new interest in iGaming, Boom Sports’ Murphy is confident the live casino experience will endure. “The world is increasingly digital and online, and when you ARIZONA CALIFORNIA FLORIDA KENTUCKY MICHIGAN NEVADA OHIO TENNESSEE TEXAS WASHINGTON DC TORONTO | DICKINSONWRIGHT.COM think about casino gaming, we’ve been behind the curve on that. But there’s something This is an advertisement. Services may be provided by others. unique and compelling about a land-based

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Will Covid Crisis Grow iGaming? Q&A with Sue Schneider

n late April, GGB spoke to industry veteran Sue Schneider about the lasting impact of the coronavirus outbreak on gaming—specifically, iGaming. Schneider is vice president of growth and strategy, Americas, for Sports Betting Community (SBC), organizer of the Betting on Sports America trade show. She is also head of the eGaming Brokerage and editor-in-chief of the Gaming Law Review. GGB: More people tried iGaming during the shutdown. Will some continue to prefer it, even after casinos return?

Schneider: People have to feel comfortable with the medium. Older folks, for example, who may be a bit technophobic, have had to become more comfortable with being online if they want to see their grandkids. Some people may learn to love iGaming but still look to interact with others at the casino. I’m not sure iGaming will become more dominant, but it certainly exposed a lot of folks who were too inhibited to try it before. Could the fact that iGaming is contactless—and perceived as safer—be an advantage?

There’s a lot of discussion about safety issues in gaming, whether it’s cash-handling, touch machines or dividers between machines or table players. Even kiosks with touch screens may not be as attractive as in the past, given the potential for contamination. Some who visit terrestrial casinos may be more inclined to use on-property personal devices in the future if they remain dedicated to being super-careful. In some markets, reportedly, there hasn’t been a meaningful boost in iGaming due to the coronavirus. Michael Dugher of the U.K. Betting and Gaming Council said the opposite is true, with total revenue down by up to 60 percent. What have you seen?

It depends on the jurisdiction. In New Jersey and Pennsylvania, they’ve seen an increase, but it’s still new and shiny there, as opposed to the U.K. Another factor is that many folks have been laid off or furloughed and don’t have the disposable cash they had in the past. Or they’re busy home-schooling their kids while working from home. A lot of factors come into play.

Global Gaming Business JUNE 2020

Some industry groups say limiting ads for gambling, banning credit card use for gambling, as in the U.K., and imposing high tax rates are surefire ways to keep the illegal market alive. What do you think?

When it comes to advertising, the U.K. and Australia are highly regulated. They have government watchdogs that monitor both the frequency and content of gaming ads. We’ve not experienced the glut of ads in regulated jurisdictions in the U.S., and U.S. operators would do well to learn from the experience across the pond. With some restraint from the industry, we can avoid a repeat of what we’ve seen in other countries. About the tax rates, that’s one of the biggest fears, as states scramble to make up for lost revenues due to Covid-19. Legislators may see iGaming as easy pickings, and increase the tax rates on operators to ridiculous amounts. But that would have the unintended consequence of driving more players offshore, and will likely drive some in the gaming industry out of business. How will this double-whammy—a health crisis that became an economic crisis—change gaming in the future?

We won’t soon take for granted things that were the norm before. Gaming has been cut off. Concerts, restaurants, sporting events, etc., have all been stopped in their tracks. The big question is, how quickly will people feel comfortable coming back to the properties (given) unknowns about future waves of the virus? The world has not really experienced anything so widespread geographically, so quickly and so hard. It may take a while to come back. And there may be ongoing changes in human behavior, such as not going out as much. The uncertainty is fueling anxiety. We’ll have to take this one step at a time to see how consumers respond. There’s that old saying about crisis and opportunity. We’ve certainly seen the crisis. Where are the opportunities?

Again, jurisdictions that allow remote gaming may see increases, which might help offset some of their losses from being closed. And other verticals like esports are seeing a bump, since traditional sporting events are closed. There are some winners in this situation, but you have to dig to find them. The conventional wisdom is that jurisdictions that were reluctant to legalize iGaming may revisit those views given the experience. I expect this may be the case; iGaming does offer a bit of a lifeline for some operators.

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Safe Return

Innovators and inventors produce technology to allow for a safe, healthy return to casino operations

SAFETY FIRST

By Frank Legato

fter enduring months of an unprecedented shutdown of the casino industry, operators in May began preparing to open their doors once again to the public. However, everyone knows opening up the casino industry is not as simple as flipping the light switch, cranking up the machines, staffing the tables and opening the doors. Operators and customers alike will return to a new normal—a world in which social distancing, constant cleaning and disinfecting of surfaces and products to guard against contagions will be necessary companions to spinning reels, playing cards and dice. Some have thought it impossible to reopen the casino industry before a vaccine is developed for the Covid-19 coronavirus that has kept people around the world in their homes for more than two months. Operators must consider the health and safety of customers as they slowly ramp business up again. That means safety measures must be in place to guard against spread of the deadly virus—before those doors open up. The problems of keeping customers safe upon the reopening of casinos and hotels mean players will ultimately return to gaming floors that look significantly different than before the global pandemic hit. Customers will face monitoring of their temperatures upon entering, slot floors with fewer operational machines—perhaps separated from each other by physical dividers— and table games with fewer play stations available. The challenges of keeping customers and employees safe have inspired the innovators, researchers and inventors of the industry to produce technology that will allow the industry’s businesses to safely ramp up operations. As technology has transformed the gaming floor of the past, it is reinventing the operations of the future, with the goal of assuring customers health and safety as they enjoy gaming. Here is a sampling of some of the innovations that will promote a safe return to gaming operations for both players and employees.

Quick Temps, Safe Gateways The first line of defense against the Covid-19 virus will be present at the front door of the casino, whenever that door does open. It is widely believed that one important safeguard against the spread of the coronavirus will be to screen out customers who already show symptoms of the virus. One of the most obvious ways to do that is by taking everyone’s temperature at the door. The temperature threshold suggested by the Centers for Disease Control and Prevention to require further testing for the virus, and quarantine, is 100.4 degrees Fahrenheit. Consequently, several vendors are offering thermal

Global Gaming Business JUNE 2020

devices that will screen temperatures at entry points to a property. Two products from Las Vegas-based Empire Technological Group, and affiliated company Pro-Tek, LLC—both companies are owned by entrepreneur Frank Feng—are designed not only for the sole purpose of guarding against the spread of the pandemic, but for continued use once the pandemic has passed or an effective vaccine is found. A perfect example is the Eye-Pod, a freestanding temperature sensor that resembles an iPhone, that can operate either as a stand-alone unit or linked to a casino’s system network. In addition to an instant temperature gauge, the Eye-Pod is a facial-detection, facial-recognition unit, not to mention a method for employees to clock in and out with no common touching of a surface, as would be necessary with a time clock. “The Eye-Pod is a fever-detection, facial detection, face recognition system,” says Kelcey Allison, vice president of Pro-Tek and CEO of Empire distributor GSL Gaming. “In layman’s terms, you walk up to the device, it scans to make sure you are a physical human and reads the temperature of your skin within 200 milliseconds, to determine whether you have a temperature anomaly or not.” However, the Eye-Pod will retain its usefulness even if the need to gauge temperatures goes away. First, its facial-recognition capabilities will allow casinos to quickly identify customers who may be banned from casino play, either by self-exclusion or blacklisting. Second, those same capabilities, when the unit is networked with player tracking systems, will aid casino hosts in recognizing when their best players are in the house. “(Hosts) can go up to players and greet them very quickly, instead of the player taking his player card, going to a kiosk, and touching a screen,” Allison says. “It’s all done by facial recognition.” Finally, operators can use the Eye-Pod as a freestanding electronic time clock. “It will be a clock-in/clock-out device for employers, so their employees can come up to the Eye-Pod device, and scan their face, make sure they don’t have a fever or anomaly in their temperature, and clock them in for the day,” Allison says. “And when they leave, they clock out the same way. They’re not touching any devices.” Allison says Pro-Tek’s challenge with the Eye-Pod is keeping up with demand. “We’re shipping them daily by the bushel-load,” he says. Pro-Tek is offering a second temperature-sensing product with a dual use, called the Walk Thru Thermal Gate. This is a gate that is a combination temperature monitor and metal detector. “We incorporated both tech-

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nologies,” Allison says. “The reason is, especially after October 1 (2017, the date of the Mandalay Bay mass shooting), no casinos put the metal detection in. So it was a very good launching pad for us to start with the metal detection, because obviously with the Covid-19, Nevada is at 19 percent unemployment. We’re having incidents in grocery stores already with knives... We just want to keep our employees and patrons safe.” The Walk Thru Thermal Gate is compact and effective. “We wanted to focus on incorporating technology that is quick, and as unobtrusive as possible when walking into a casino,” says Allison. “As you’re walking up, it detects (temperature and any metal) from 30 feet, with a span of about 15 feet wide. “We use weapons-grade thermal technology that you cannot buy off the shelf, manufactured in Germany. As you’re walking up to the monitoring station, it actually can see people prior to them coming into the safety gate. Once they go through the safety gate, if there is anomaly, we can say, ‘We need to talk to you.’ If there’s nothing wrong, you keep on walking though. There’s no intrusion whatsoever.” Allison says Pro-Tek has sold around 200 of the thermal gates already, and one customer, a large California casino, offers a glimpse of the “new normal” in is application, which is a lot like the combined entry/exit points used by Target and other retailers. “They’ve reconfigured their porte cochere,” he says. “The new normal is that if you have a 12-door entry to your porte cochere, six would be for entry and six would be for exit. It’s very quick.”

UV Solution Once patrons are inside the “new normal” casino, social distancing will be the norm, at least for the near term. This will be achieved through floor configuration to maintain six feet between players, or through a variety of acrylic shield products being produced by various manufacturers that provide a physical barrier between players. Any of these methods, of course, still require consistent cleaning and sanitizing of all slot machine surfaces, as well as constant sanitizing of cards, chips, dice, and even cash. Gaming Arts, the Las Vegas-based bingo and slot supplier founded by David Colvin, offers a simple solution to this latter necessity: UV lighting. Colvin, who is CEO of Gaming Arts, was a well-known inventor with a list of patents to his credit even before he founded the supplier. Among others, he is credited with inventing the “Product Activation” technology that solved the problem of pirated software that was costing software producers billions annually. Around the time the first notions of an extended industry shutdown cropped up in early March, Colvin began researching the use of UV solutions

to battle the spread of the Covid-19 virus in casinos. “As you may be aware, UV lighting is extremely effective in killing microbial viruses,” Colvin says. “Such products were generally confined to the medical industry. We started work on a number of different applications of the technology.” The R&D focused first on the surfaces of electronic gaming machines, or EGMs, which was the initial concern leading to the industry shutdown, since Covid-19 can live for days on such surfaces. According to Colvin, Gaming Arts has developed a variety of delivery devices for UV lighting that can disinfect all surfaces of a slot machine. All are offered under the brand name PlayerGuard. “On a slot machine, we have probably a dozen different locations where we could mount UV lighting,” Colvin explains. “That would either be in the form of a UV lamp or a UV LED. We would mount those on the slot machine so it would decontaminate the entirety of the machine, with a concentration on the button deck and the peripheral deck. “As an example, almost all slot machines now have the LED trim— the lighted classic ornamental trim. One of our embodiments would be to replace a conventional R-G-B LED lighting strip with our lighting strips, which also include UV protection. Other embodiments include a retrofit model. So, it wouldn’t necessarily apply only to new machines.” The technology also sanitizes ancillary slot equipment like bill validators, magnetic card readers and printers. PlayerGuard, though, is not just for slot machines. It has applications across all levels of the gaming floor, including all table games. “As we were starting to look into this, it struck me that casinos are unique, in that they have a great deal of possibly contaminated items, with many hands on these items,” says Colvin. “We have embodiments for existing shufflers; JUNE 2020 www.ggbmagazine.com

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we have embodiments where it’s a separate device, where it works similar to a shuffler. Let’s say you have a six-deck shoe. Once you collect the cards, you would run them through a sterilization unit first—it doesn’t take long. You would then transfer them over to an existing shuffler. So, nothing that’s contaminated goes into the shuffler itself. When the dealer removes those six decks out of the shuffler and the cards go into play, each card has been sanitized.” PlayerGuard also has applications for chip trays with the UV lighting under the actual chips, constantly disinfecting them. “We would basically swap out the chip trays for a UV version, where the UV would come from underneath,” Colvin says, “so, as the chips either enter or exit the chip tray, they are subjected to the UV lighting to disinfect those chips.” The same principle applies to the dice in craps games. “We have a UV device which would sit on top of the craps table,” says Colvin. “You collect the dice and leave the dice there until you have a new shooter. As the dice sit there in this tray, they will be disinfected.” While Colvin has filed for patents for the UV technology, Gaming Arts is making the technology available to other suppliers and operators. “The company has made the decision to work collaboratively with customers as well as other manufacturers who have interest, to make sure that the entire gaming industry and all casinos will have access to these technological advances that protect players and staff alike,” Colvin says. Gaming Arts also is offering acrylic barriers for the slot floor. Called SlotShield, the barriers, already in the advanced prototype stage, are ready for production. They have been designed with player use in mind. “One of the things we look at is optimal implementation,” says Colvin. “We look at very subtle characteristics, like whether a shield would interfere with someone having a drink.” Sizing also is crucial, he says, as barriers should not reduce space in aisleways. According to Colvin, while the SlotShields are ready for mass production, one thing hampering that production is the availability of the acrylic material used to produce them. “A property with 2,500 machines may require 2,000 of these shields. So, we’re going through a great deal of acrylic sheets. And we live in a world where everybody wants these shields, from supermarkets to the DMV to offices to bars.” He says casinos should consider reconfiguring slot machines into pods before considering acrylic shields, noting that circular pods generically place at least six feet between players, achieving social distancing without extra equipment. Where he says shields will be required is at typically crowded

Global Gaming Business JUNE 2020

video poker bars and at table games, as an alternative to reducing the number or players per table. Gaming Arts has shields designed for both specific purposes. “One suggestion going around in Nevada is that with a typical blackjack table, you’ll have to decrease from six positions to two,” Colvin notes. “Being a former casino owner, I know that with two players, you would have to raise the minimum bet to $25 just to break even. So, in the case of table games, we have shield dividers, so hopefully people will feel safe playing with six or seven players.”

UV Sanitizer Gaming Arts is not alone in looking at ultraviolet lighting for its ability to decontaminate objects and surfaces. In late May, London-based TCSJohnHuxley, one of the world’s largest suppliers of table game equipment, officially launched the first products in its new “Care & Protect” range, headed by The Chip Sanitiser, a unit that uses UV-C light technology to sanitize more than 80 chips within a few minutes. The Chip Sanitiser utilizes UV-C light technology to quickly neutralize germs that can cause infection, using a unique patent-pending design that ensures every surface of the chip is cleaned. It also incorporates a safety mechanism, so the machine will not operate unless the unit is completely shut, guaranteeing no harmful UV light can escape. Its flexible design allows for one unit to be fixed under a gaming table playing surface or multiple units to be stacked in the gaming pit to sanitize hundreds of chips in minutes. “Since the shutdown of casinos worldwide, it was evident that the industry was going to have to make radical changes to ensure the safety and wellbeing of their staff and customers once they were back up and running,” said Tristan Sjöberg, executive chairman of TCSJohnHuxley, in a statement. “As a result, we have developed our Care & Protect range of products that will provide the right tools to kick-start our industry as well as bringing peace of mind to everyone who works in or visits a casino. The offerings will continue evolving and expanding to serve the needs of our customers.” According to the company, the Chip Sanitiser will be ready for delivery when gaming operations are ramped up. The Chip Sanitiser utilizes UV-C light technology to quickly neutralize germs that can cause infection, using a unique patent-pending design that ensures every surface of the chip is cleaned

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Smart Spaces

Long-Lasting Disinfectants

Many suppliers are using combinations of methods that can help effect a safe Colvin, of course, isn’t the only accomplished inventor in the gaming space. return to gaming operations. Sister companies Dulce Solutions and RBY GamJohn Acres, the inventor of player tracking and bonusing systems, has his own ing are proposing a collection of products to sanitize surfaces and gaming arm’s-length list of patents. When the call for innovators went out, it’s no surequipment, headed by the Zoono long-lasting disinfectant and Terminator, prise Acres and his Acres 4.0 systems company would answer the call. which uses high-intensity UV lighting to sanitize not only gaming equipment Many casinos will opt to achieve social distancing by shutting off one or two in the pit, but protective masks to be worn by employees and customers. slot machines on either side of each active machine. That will not only require Zoono is a liquid disinfectant that has been used in a variety of applicashutting down otherwise high-earning games, but will require manpower to tions, including hospitals, hotels, convention space and theaters. It has been clean and disinfect the ones that are in service after each use. proven to kill 99.99 percent of germs on surfaces, and key to its potential in Acres 4.0 is offering two products that will address these problems, both casinos is the fact it lasts up to 30 days on any treated surface. It also can be based on system technology already in place from Acres. used on the skin, and one treatment lasts up to 24 hours. It is water-based, alClean Machine automatically detects when customers finish each play sescohol-free and non-toxic. sion and instantly dispatches an employee to clean the gaming machine, using “Independent testing has proven Zoono is effective in Covid-19, as well as Acres’ Kai system of employee alerts. A placard is placed on each cleaned macreating a protective surface barrier to combat against it,” says Candice chine to help players quickly find games that are ready for play. Clean Machine Chandler-DeGregorio, president of Dulce Solutions. intelligently schedules hand-washing hygiene breaks to keep employees safe, and She adds that unlike other antimicrobial products, Zoono works when dry. is readily adaptable to table games. “As a liquid, Zoono is less toxic than vitamin C and coffee,” she says. “When Acres says the company is going to provide the Clean Machine module for free to anyone who wants it. Smart Space, offered as a module to Acres 4.0’s CyberMax casino management system, allows casinos to operate slot floors without removing gaming machines or chairs, or even picking which games to shut down. When play begins at a gaming machine, adjacent machines, within a casino-defined social distance, are instantly disabled. When play ends, the surrounding machines are automatically enabled and the just-played machine is disabled until it is appropriately cleaned. www.FantinisGamingShow.com w ww.FantinisGamingShow.com “The alternative is to turn off every other game, remove chairs or remove them from the As A sC COVID-19 OVID-19 h has as ccaused aused tthe he ccancellation ancellation o orr p postponement ostponement floor,” Acres says. “This way, they don’t have o any ttrade rade sshows, hows, h ere iis s yyour ou r o pportunity tto o ttake ake yyour ou r off m many here opportunity to do any of that reconfiguration. We’ve got a p roducts tto oap ersonalized o nline experience. experience. products personalized online couple of places that are really excited about this.” W eh ave ccreated reated tthis his u nique sspace pace ffor or yyou ou to to e xhibit a our We have unique exhibit allll o off yyour Under the system, the casino decides the g aming p roducts a nd m erchandise.You ccan an u pload p hotos, gaming products and merchandise.You upload photos, social distancing required. “When you begin play and put your card in, the machines vvideo ideo d emos, a nd d escriptions o ven p ublilish n ews rreleases. eleases. demos, and descriptions orr e even publish news around you lock up; they are disabled,” Acres says. “When you are finished, the other maT hrough tthis hi s o nline ttrade rade sshow how a nd n ewsroom, w e Through online and newsroom, we chines unlock, and using Kai, we call a cleaner, h elp yyou ou d eliver yyour ou r p roducts a nd n ews tto o a ttargeted argeted help deliver products and news and when the cleaning is finished, that maa udience sspecific pecific tto o yyour our g aming n eeds. audience gaming needs. chine unlocks.” He adds that the system is flexible enough that an attendant can easily unlock a second T ob ecome a ne xhibitor, ccontact ontact To become an exhibitor, machine when couples want to play adjacent Dee D ee W Wild ild a att D DWild@FantiniResearch.com Wild@FantiniResearch.com games.

or 730 3793 or +1 +1 302 30 2 7 30 3 793

JUNE 2020 www.ggbmagazine.com

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The VisiDeal Shield is a heat-formed, curved Plexiglas shield, produced in the form of dividers that can accommodate from two to six players on a table game

“We are excited to partner with our friends at Tioli Gaming as the exclusive distributor for the VisiDeal Shield,” Hemberger says. “As casino operators adapt to the ‘new normal’ with a focus on protecting their patrons and staff, this is nice way to do it.” According to Hemberger, AGS and Tioli have already signed agreements for more than 500 VisiDeal Shields, and they are rapidly approaching 1,000. “These VisiDeal units will be installed across the U.S., including in Florida, Connecticut, West Virginia, California, Arkansas, Mississippi and Washington.”

What About the Restroom?

applied to a surface by spraying, wiping or ‘fogging,’ Zoono leaves behind a mono-molecular layer that is permanently bonds to the surface. Routine cleaning can continue and does not disrupt the Zoono molecule or its antimicrobial activity.” The Terminator is a system of high-intensity UV-C lamps that primarily is used to disinfect protective masks for reuse. According to Chandler-DeGregorio, the Terminator can disinfect up to 700 masks an hour, allowing them to be reused by the same employees up to 10 times. Beyond masks, though, the lamp system can be used in the pit to sanitize gaming chips. “The Terminator can be placed in gaming pits, and has the ability to sanitize gaming chips at a rate of 100,000 chips per hour,” says ChandlerDeGregorio. “Gaming chips are likely some of the dirtiest objects in a casino, and for players (and staff) to see them being sanitized regularly in front of their eyes will go a long way in gaining trust.”

Once customers are safely in casinos, they, of course, will need to use the restrooms, which were a point of concern for hygiene even before the Covid-19 crisis. One company that was already in line to solve this problem was Brill Hygienic Products, which has been providing the Brill Sanitary Toilet Seat Cover as part of 35 years of supplying the casino hotel industry. The Brill seat uses a feeder system to place new, sanitary plastic covers over toilet seats without the customer having to touch anything. The customer simply uses a hand-activation device on the wall to feed a new, sanitary covering to a toilet seat.

Shielding the Tables Software and UV solutions will join a variety of clear-shield products as casino floors reopen. Some are being produced and distributed by more traditional gaming suppliers. One such product for the table-game pit is the VisiDeal Shield, being distributed by supplier AGS for Tioli Gaming. The VisiDeal Shield is a heat-formed, curved Plexiglas shield, produced in the form of dividers that can accommodate from two to six players on a table game. It is easy to install, and fits all standard blackjack and novelty table games. Custom manufacturing is available to accommodate craps, roulette and poker tables as well. “The key to the VisiDeal Shield is that it was designed by an experienced group of table games industry veterans,” explains John Hemberger, vice president of table products for AGS. “Everything about the player and dealer experience was considered when designing it, so that dealing procedures can stay as close to ‘normal’ as possible while adding this additional layer of player and dealer safety to the table games experience.” The product has a simple installation process that utilizes three industrialgrade poles installed into the table top for blackjack-style tables. “This allows for a very sturdy and secure installation,” Hemberger says. “Removal is quite simple, allowing for the table to return to pre-install conditions, and easy storage of the VisiDeal Shields on property.

Global Gaming Business JUNE 2020

The Brill Sanitary System is already in use at over 40 casinos including Mohegan Sun, Resorts World New York, Morongo, all three Creek Casinos in Alabama, Wind Creek Bethlehem, Rivers Casinos, Chumash, Muckleshoot, Snoqualmie, Ilani Casino, Mystic Lakes and many others. “Before Covid 19, people were concerned about bathroom sanitation, sitting on a dirty toilet seat or even using a porous paper seat cover that many times didn’t cover the seat completely or fell off the seat prior to sitting,” says David Jablow, COO of Brill Hygienic Products. “Now with the Covid virus, we know you can transmit it just by touching paper or a metal surface—and this has made everyone very nervous. “With the Brill Sanitary System, just a waive of the hand over the wallmounted sensor will provide the user with a 100 percent sanitary surface to sit on without touching any paper or a metal dispenser.” It’s just one necessary item among the many that will be required as the casino industry reopens. “Never in my half-century of gaming experience have casinos faced a threat as potentially disastrous as this Covid crisis,” says Acres. “But with effort, perseverance and innovation, I am convinced we can build an exciting, successful new future of fun and success.”

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EMERGING LEADERS Delayed Sports Report Kevin Fulmer Vice President, Digital Sports, Caesars Interactive Entertainment s vice president of digital sports for Caesars Interactive Entertainment, Kevin Fulmer prepared for the bettors’ paradise that is March Madness. Then poof, it was wiped out by a germ. “One day we’re getting ready for the NCAA Men’s Basketball tournament and all that comes with it, and the next we’re looking at offering wagers on table tennis in Eastern Europe,” he says. “Quite the change!” Fulmer didn’t bargain for a global pandemic when he took the position in January 2018. But as Nina Simone once sang, “Life has its problems and I get my share.” “It’s been an adjustment from going into the office every day to working from home,” he says. “Sharing my workspace with my wife is something I never thought I’d have to do, but I’m grateful we’re both healthy.” Fulmer grew up in Brigantine, just across the Absecon Inlet from Atlantic City. His father, also named Kevin, worked for Bally’s for almost 30 years. The business is in his blood. “As soon as I could legally do so, I was working in a casino,” he says. “I started as a valet attendant at Caesars Atlantic City.” After graduation from Providence College in 2004 with a B.S. in finance, Fulmer landed a job at Bellagio in Las Vegas, and worked there until 2008 as compensation manager and financial manager. He spent more than three years at Aria Resort & Casino and several more at the Cosmopolitan of Las Vegas, where he served as senior director of slot operations and then vice president of casino marketing, among other posts. At Caesars, Fulmer has a dual responsibility in retail and online sports. “With Covid-19 and the casinos temporarily closed, attention has shifted online. We’re working on launching online sports in new jurisdictions.” His team recently unveiled Caesars Online Sports in Pennsylvania, and expects to add more jurisdictions in the near future. “I focus a lot of

Global Gaming Business JUNE 2020

“I think it will be commonplace in daily lives. You’ll see more mainstream media and sports broadcasters including wager terminology that was taboo for national television in the past.” time on our partnerships with ESPN and Bleacher Report, as well as developing policies and procedures and risk management oversight for retail and online.” In addition to his father, Fulmer counts Bill McBeath as one of the first mentors who helped along the way. “I worked for Bill for 10-plus years, starting my career with Bellagio, then Aria and most recently at Cosmopolitan. Every conversation I’ve had, I’ve learned something new,” he says. Another instrumental person is Michael Peltyn. “I appreciated his leadership and his ability to prioritize. Over time I’ve enjoyed our friendship.” Christian Stuart and Melanie Gross at Caesars Entertainment also played integral roles in Fulmer’s career. “The way they pivoted and changed focus after the Supreme Court’s ruling to permit sports betting was remarkable,” says Fulmer, who’s a big sports fan—loves the Golden Knights, and still roots for the Eagles. Sports betting will grow, Fulmer says, with the majority of states legalizing it. “I think it will be commonplace in daily lives. You’ll see more mainstream media and sports broadcasters including wager terminology that was taboo for national television in the past.” Opportunities abound for new entrants in the industry, and he tells them first and foremost, never to be afraid to ask questions. “Ask the whys,” he says, “and push to understand the reasoning behind the logic.” — Bill Sokolic

Traffic Unjammed Nicole Stewart Vice President and Transportation Engineer, Urban Systems, Inc. icole Stewart is the vice president and a transportation engineer at Urban Systems, Inc. located in New Orleans. The company has served the gaming industry in the areas of planning and engineering since the early 1990s. Stewart joined as an intern in the aftermath of Hurricane Katrina in 2005, and never looked back. Today, she’s focused on serving casino clients in the design and construction of new roadways and access points, on-site vehicular and pedestrian circulation, signage and parking solutions. Stewart received a bachelor of science in civil engineering from Southern University and A&M College in Baton Rouge. She also earned a bachelor of science in physics from Xavier University of Louisiana in New Orleans. She’s registered as a professional civil engineer and traffic operations engineer. Her specific areas of expertise include traffic control device plan design, traffic signal design, traffic impact analysis, signalized and unsignalized intersection analysis and traffic signal timing studies. Stewart also has experience in roadway and subsurface drainage design, as well as construction management. With day-to-day responsibilities in project management, design and the management and training of technical staff, Stewart became a principal of Urban Systems in 2012. In reaching that pin-

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Visi V isi

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nacle, she points to her mentors, Urban Systems founding partner Denis Finigan and current partner Alison Catarella-Michel. In describing her work in the casino industry, Stewart refers to several projects that highlight the firm’s contribution. The Southland Casino and Racing complex in West Memphis, Arkansas stands out. As the property upgraded and expanded in recent years, Stewart led the Urban Systems team in modernizing its traffic and transportation systems. In the process, she gained an appreciation for the unique needs of gaming managers and customers, and the importance of solutions to bring older guests into the property from remote parking areas, and state-of-the-art wayfinding signage systems.

Urban Systems has also served the Resorts World Casino in New York City, Scarlet Pearl Casino in Mississippi, Harrah’s New Orleans, and Native American casinos in more than 10 states. Stewart is a member of the American Society of Civil Engineers and the Institute of Transportation Engineers, where she was president of the Deep South Section in 2015. She is affiliated with the Southern University and A&M College Civil Engineering Council of Visitors and the St. Mary Academy Alumnae Association. And with her three children, she also supports the Pradat Playground in New Orleans—both recreationally and philanthropically. —Michael Soll, President and CEO, The Innovation Group

Presented by The Innovation Group and Global lobal Gaming Business

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NEW GAME REVIEW by Frank Legato

Emperors Tree/Emperor’s Frog Everi Holdings

his dual release is featured on Everi’s two portrait-style premium portrait-style cabinets, the Empire MPX and the curvedscreen Empire Flex. The two base games, Emperor’s Frog and Emperor’s Tree, are unique in their configuration. Both employ 3-4-5-4-3 reel setups (three symbols on the outer reels, four symbols on reels 2 and 4, five symbols on the center reel). The games are “ways to win” scatter-pay setups, with no paylines and wins registered through adjacent symbols. In this reel setup, that results in 720 possible ways to win on each spin. Randomly during primary-game play, double symbols will appear on the grid—they count as two symbols in one symbol’s space. The top-paying two symbols can appear as double symbols, leading to wins of up to nine of a kind. The base game also features random expanding wild symbols, wilds that can expand to fill up the all the spaces in the reel. There are two bonus features. The free-spin bonus offers the player a choice of four different

volatilities, through various reel configurations. The lower free-spin totals match the highest number of ways to win on each spin. There are five progressive jackpots, with resets ranging from $20 to the top $3,000. Three or more game logo symbols trigger a progressive picking bonus, in which the player is presented with a field of gold coins, and picks coins until matching three to win the corresponding jackpot. In a unique twist, if the player reveals one of the game logo symbols—the frog or the tree—the lowest progressive symbol is eliminated from the field of coins, leaving the player a guaranteed win of one of the higher jackpots. Manufacturer: Everi Holdings Platform: Empire MPX, Empire Flex Format: Five-reel, 720-ways-to-win video slot Denomination: .01, .02, .05, .10, .25, .50, 1.00, 2.00, 5.00, 10.00, 20.00, 50.00, 100.00 Max Bet: 880 Top Award: Progressive; $3,000 reset Hit Frequency: 25.66% Theoretical Hold: 4%-16%

Royal Phoenix AGS

his new game is featured on the AGS Orion 49 Curve cabinet, with its 49-inch curved portrait-style monitor. The base game is a 50-line video slot on a four-by-five layout (five reels, four rows of symbols per reel). There are two main bonus features. The free-spin event, awarding six or more free spins with a trigger of three or more bonus symbols, includes a unique “Dropping Wild” feature. During the free spins, if three or more wild symbols land on reels 2 through 5, the wilds drop to the bottom spots on the reels and remain there for the rest of the feature. Reel one locks and keeps on spinning while reels 2-5 continue to spin until no more wilds land. Reel 1 then stops spinning and the wins are evaluated.

Global Gaming Business JUNE 2020

There are five levels of progressive jackpot, won through a progressive bonus event. When the event is triggered, the reels transform into a setup with only jackpot symbols and blanks. Each of the jackpot symbols has a color corresponding to one of the progressives. Each time a Jackpot symbol lands on the reels, it drops to a stack depicted below the reels. Once one or more of the five reels fills to the top with four jackpot symbols, the bonus ends and awards all the jackpots corresponding to reels with four stacked symbols. Manufacturer: AGS Platform: Orion 49 Curve Format: Five-reel, 50-line video slot Denomination: .01 Max Bet: 500 Top Award: Progressive; $10,000 reset Hit Frequency: 29.48% Theoretical Hold: 5%-14%

 Global Gaming Business Magazine

      

BIA’s PROGRESS IMPACT OF E-TABLES NIGC’s CHAUDHURI MONSTER MARKET IN MANILA

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Big Data

Use it or lose it

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  

Official Publication of the American Gaming Association

Trusted. Respected. Preferred.

All in all, our team has been working in gaming for over 188 years! You would think we’d seen everything, but we’ve never seen anything like this year. If there is a shining light, it was the way our industry came together to support each other through this. And, while we still have a way to go, we know you want to - need to get back to business. GGB is the longest running, printed monthly publication in the gaming industry, nationally and internationally. In our 19th year of publication we have earned your trust and respect and have no plans to do otherwise. So, the question is, are you ready to start telling your story to your target audience?

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CUTTING EDGE by Frank Legato

Safe Distancing PRODUCT: SafePlay UV Partitions MANUFACTURER: Smith Rosen Gaming Partitions

s casinos prepare to reopen, a new startup company comprised of outof-work designers, engineers, and entertainers has introduced a proven, proactive technology engineered specifically to mitigate the proliferation of virus and bacteria in a casino environment. The group at Smith Rosen Gaming Partitions accomplished this during quarantine, in the midst of a statewide shutdown. Most gaming regulators in the United States are adhering to the CDC’s recommendation that stringent social distancing measures be implemented when the casinos reopen. Smith Rosen Gaming Partitions has begun manufacturing and distributing scratchresistant slot machine partitions that not only enforce social distancing, but actually clean themselves, through the application of concentrated UV-C light on the surface of the partition. SafePlay UV is the first of many patent-pending UV-C solutions Smith Rosen has developed for the specific purpose of keeping casino guests and employees as safe as possible. Plastic dividers, although well intentioned, inadvertently create a catch basin for every single thing that flies out of people’s mouths. Plus, in addition to completely destroying the aesthetic of the casino, require a small army to maintain. According to the CDC, the virus that causes Covid-19 is

thought to spread mainly from person to person, mainly through respiratory droplets produced when an infected person coughs or sneezes. These droplets can land in the mouths or noses of people who are nearby or possibly be inhaled into the lungs. Spread is more likely when people are in close contact with one another (within about 6 feet). The CDC suggests that novel coronavirus may remain viable for hours to days on surfaces made from a variety of materials. Cleaning of dirty surfaces followed by disinfection is a best practice measure for prevention of Covid-19 and other viral respiratory illnesses in community settings. Jeff Smith, CEO of Smith Rosen, reminds his clients that UV-C has been used safely to disinfect surfaces, air, and water, for over 100 years. “Games that call someone to clean them, static plastic barriers, and dormant machines are not actively killing anything,” he said. “Out of plain old fear, we designed something big and pretty, to kill stuff that’s small and ugly. We didn’t invent the wheel, we just figured out which direction to spin it.” Smith Rosen Gaming Partitions is now hiring dozens of new employees to meet the growing demand for the product. For more information, contact Darryl Rosenblatt at dr@smithrosen.com or visit smithrosen.com.

Harnessing CRM PRODUCT: CRM, RMS Platforms MANUFACTURER: Cendyn

endyn is the leading innovative cloud software and services provider for the hospitality and gaming industry. With a focus on integrated customer relationship management (CRM), sales technology and revenue strategy platforms (RMS), Cendyn drives sales, marketing and revenue performance for tens of thousands of hotels and casinos across the globe. Cendyn’s unique offering aligning both CRM and RMS platforms allows hoteliers to create a one-of-a-kind experience for every guest, while moving the needle for every revenue source on property. Harnessing the power of CRM and RMS dataset alignment can futureproof a business. By merging customer spend data with behavioral information from multiple touch points and channels, hoteliers are able to create a single, robust guest profile that includes specifics such as demographics, preferences, source markets, visited locations—getting as granular as pre-

Global Gaming Business JUNE 2020

ferred room temperature and pillow type. When a team has access to all this data, they can create highly personalized experiences that are proven to drive guest retention and drive loyalty. With 80 percent of customers willing to make a purchase when they’re offered custom-tailored experiences, those who utilize this method see an improvement in demand forecasting, marketing and loyalty programs. An integrated solution puts the operator in the driver’s seat to determine the optimal rate to charge for those customized services, revenue-managing them in the same manner as room rates to help increase profitability throughout the guest travel journey. The coupling of rich guest profiles with integrated data points from various property systems, including gaming, gives hotel casinos a superpower to truly know and understand their most valuable guests. For more information, visit cendyn.com.

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FRANKLY SPEAKING by Frank Legato

Back to the Casino!

o, it looks like everyone’s ready to start operating casinos again—with restrictions, of course, meant to protect everyone from all the microbes flying around out there. If anything is certain in this crazy time, it is that technological innovation is poised to save the industry, with a number of innovative schemes being proposed that can allow patrons and employees to safely return once casinos are permitted to reopen. No, we’re not going to turn on a light switch and have things be like they were before. But the good news is that there is a wealth of technology being introduced that will at least get everyone safely back in business. From what I understand, the latest plan is to have each individual customer inside a transparent bubble, like the Bubble Boy. Bubble Boys and Bubble Girls will roam the casino floor, comingling with Bubble Dealers and Bubble Croupiers and Bubble Pit Bosses. (The latter will have black bubble shirts with white bubble ties.) In an alternate plan, customers will don NASA space suits at the door. They will travel among machines and gaming tables in small Mars rovers (bearing the casino’s logo, of course). There will be special zero-gravity areas where customers can golf like the astronauts did on the Moon. Seriously, though, while I’m sure I will sample the “new normal” casino floor, it will be because it’s the only way to get back to the “old normal,” which is the normal that I like. That’s the normal where I throw dice and cheer with a bunch of other humans, and where still other other humans bring me stiff drinks that I don’t have to pay for. To get there, we’ll have to deal with whatever is needed to keep health and safety in place, even if it means betting through a Plexiglas shield like the one at 7-Eleven. Here’s an idea: Let me rent your casino, like Elvis used to do with amusement parks. I’ll rent the casino and the hotel room, with only room service for meals. In fact, it doesn’t even have to be the whole casino. Just open one craps table and one video poker game—8/5 Bonus Poker, if you

Global Gaming Business JUNE 2020

please. I would only ask for maybe three other craps players in addition to the table staff, all properly vetted and tested for hygiene, and everybody wearing masks, of course. We’ll have a great time playing craps, and then I’ll play video poker until I hit a royal flush or the sun comes up, whichever is first. It will be just like the old days! This, of course, would be a pilot program for a safe room offer that can be granted to very wealthy people during the current shutdown, for maybe half a million a night or more. I, of course, would be offering my services to do the pilot test stay. I wouldn’t even charge the casino. Hey, it’s the kind of guy I am. I’ll do it for the good of the industry—not because I’m having any kind of withdrawal from casino gambling, mind you. It’s not like I’m binge-watching the Ocean’s Eleven movies, Rounders and Casino. It’s not like I tell my wife she has to make her point before I do the dishes. Really, it’s not like that at all. But as I write this, the big buzz in the biz is about the gadgets, gizmos and gimmicks that will allow us to return to casino operations. (I know; gimme a break. I’ve been home for two months.) In this issue of Global Gaming Business, you’ll find a showcase of some of the products that will assure a safe return to business. There are shields, there are UV lamps, there are uber-cleansers that last for days. There is stuff that will continuously disinfect chips, cards, dice, shufflers, tables, chairs, discarded chewing gum wrappers and trouser lint. OK, I made the last two up. But the rest of that stuff is actually going to start appearing as we all tiptoe back into the casinos and ever-so-gingerly begin to once again leave all our disposable income, sanitized though it may be, on the disinfected felt of the New Normal Casino, Hotel, Spa and Sanitized Decompression Chamber. Don’t forget to stop at the door. You’ll need to be monitored for body temperature, facial characteristics, pre-existing conditions, and net worth in cash. I still like the Bubble Boy idea.

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GOODS&SERVICES SCIENTIFIC GAMES REPORTS NET LOSS, MORE COST-CUTTING

ue to the Covid-19 pandemic, which shut down the industry in mid-March, Scientific Games Corp. reported a $155 million net loss for the first quarter of 2020. In a statement, company officials announced a plan to maintain liquidity during the crisis through extensive cost-cutting measures. The company reported Q1 revenues of $725 million, down 13 percent from $837 million in 2019. The net loss “includes a $54 million goodwill impairment charge related to our legacy U.K. gaming reporting unit and a negative impact of $37 million related to gaming business segment receivable credit allowances and inventory write-down charges, all driven by Covid-19 disruptions,” according to the statement. Consolidated adjusted EBITDA for the quarter was $200 million, down 39 percent from last year’s $328 million. Net cash from operations was $120 million, versus $167 million a year ago. The statement predicted improvement in the second quarter on quarterly cash flows, thanks to a program of cost-saving measures. Consolidated net cash flow for the second quarter is estimated at $70 million to $90 million, on the assumption that the pandemic will have passed its peak. Liquidity at present is $967 million, the statement said. “We are working around the clock to take care of our employees, customers, shareholders and other key stakeholders in these difficult times, while providing uninterrupted products and services to those customers who continue to operate,” Scientific Games CEO Barry Cottle said in the statement. “I am confident that the measures we are implementing now will allow us to take advantage of opportunities to strengthen our business and prepare us to come out of the crisis even stronger than before.”

SANDS CHINA MODELS NEW HEALTH STANDARDS

ands China Ltd. has introduced a new program, “Sands SafeStay” at its Macau integrated resorts. The initiative, developed in response to the Covid19 pandemic, is designed to protect workers and visitors through enhanced health and safety measures, including more stringent cleaning protocols and more contactless services. The Macau subsidiary of the U.S.-based Las

Global Gaming Business JUNE 2020

Vegas Sands Corp. runs the Venetian Macao, the Parisian Macao, Sands Cotai Central, the Plaza and Sands Macao. The new measures include “360-degree sanitization” using hospital-grade disinfectants in all public spaces and common areas, including restrooms, meeting and convention spaces, casinos, restaurants, bars, shopping malls and recreational facilities. Sands’ 12,500 hotel rooms will be thoroughly and routinely cleaned and disinfected, and key cards will be sterilized prior to check-in. Social distancing measures have been improved through the rearrangement of restaurant tables, slot machines and gaming tables. Occupancy levels of recreational facilities such as the Eiffel Tower, Qube, gondola rides and swimming pools, along with meeting and convention spaces, have been reduced.

SYNERGY BLUE APPROVED IN NEVADA

very different, and we got good data from both. It was a great success and in some ways, it was better than expected. “Our goal has always been Generation X, who are some of the first arcade-game players,” Washington said. “They also have more disposable income. “It’s a different world than it was two months ago, but I still believe skill-influenced games will play a part in the new world,” Washington added. “I’m optimistic about that. Yes, there’s going to be some lag time, because we will have to ramp up all the industries, but at the end of the day humans are social beings. Once it’s safe and appropriate for people to be back in casinos, I think they will be back. “They’re getting stir-crazy sitting at home, and they’ll be ready for some fun to bet on.”

GARY PLATT PRODUCING COVID-19 MASKS

eno-based casino seating supplier Gary Platt Manufacturing has retooled a section of its factory to produce face masks, and has donated a generous supply to Reno’s Renown Regional

he Nevada Gaming Commission recently approved supplier Synergy Blue to sell its arGeorg Washington cade-style, “skill-influenced” gaming machines statewide. The supplier completed field trials of the games before the Covid-19 shutdown. Georg Washington, CEO of Synergy Blue, said in an email to GGB that the company will not issue a press release on the commission’s decision. “While this is a huge milestone for Synergy Blue, (a press release) didn’t feel appropriate, with all that is going on in the industry due to Covid-19. “We’re honored to gain approval in our home state of Nevada,” he wrote, “and we’re grateful that we can contribute to local and industry recovery once these uncertain times have passed.” Speaking to CDC Gaming Reports, Washington said the trials showed strong appeal for the company’s skill-influenced games among Generation X customers, those aged 40 to 55. “We got great feedback from players and incorporated a good majority into the games,” Washington said. “The Red Rock and Linq are

Medical Center. “When Reno Mayor Hillary Schieve sent out a plea for face masks, we heard her loud and clear,” said Gary Platt CEO Joe Esposito. “We immediately converted part of our operation from manufacturing casino seating to manufacturing masks. We have donated them to local hospital Renown Regional Medical Center, to help those first responders stay safe and protected while they serve our community. “We live here, we work here, and we wanted to help,” he continued. “We have the capabilities and the skilled workers to make face masks, and we are happy to help our host community of Reno and Renown.” Gary Platt is also offering mask sales to any business that may be in need. The masks are 100 percent cotton, washable and reusable, and handcrafted with the same quality that that brand’s name holds to. Inquiries and order requests can be directed to 800-969-0999 or at info@garyplatt.com.

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GAMECO VGMs GET THE GO-AHEAD IN NEVADA

ameCo LLC, which developed the first video game gambling machines (VGMs) for the gaming industry, last month announced the successful completion of the field trial for its platform in Nevada. The company is now approved to distribute and install new VGM games in North America’s largest Nothin’ but Net 2 casino market. The Nevada field trial began in October 2019 and was conducted at four casino properties: the Linq, MGM Grand and Park MGM in Las Vegas and Atlantis Casino Resort & Spa in Reno. It included two of GameCo’s VGM titles, Nothin’ but Net 2 and All-Star Hoops. GameCo’s goal is to reach and monetize younger millennial customers with games tailored expressly for them. According to a statement from the company, more than 80 percent of GameCo’s

“coin-in” spending came from millennial and Gen X players, as compared to about 20 percent for traditional slot machines. Additionally, GameCo realized 12 percent more uncarded play than other skill games or slot machines. “We are thrilled to complete our field trial, and this a major milestone for a startup in such a highly regulated industry,” said Blaine Graboyes, co-founder and CEO of GameCo. “We appreciate the support of our trial partners and the Nevada Gaming Control Board.” GameCo currently has a presence in California, Oklahoma, Connecticut and Mississippi.

BETCONSTRUCT LAUNCHES NEW GAME

ward-winning technology and services provider BetConstruct has introduced a new game, Striker, to its iGaming Suite. In a news release, the company described Striker as “a game of

luck based on our certified RNG system that delivers a provably fair gaming experience. “The idea behind Striker is very simple: a bet is made either on a specific number from one to 99, or a range between two numbers. The end result of a gaming session reveals the winning digit. Striker is ready-made for any market.” The company said it is confident the game will perform “regardless of region … within any online gaming platform.” Rafayel Badalyan, chief innovations officer at BetConstruct, said Striker will appeal “across a huge demographic. The idea of strength-testing games has been around for more than a century. Though in different formats, the concept of the high-striker is known almost in every corner of the world. It’s a quick and fun entertainment which can be perfectly adopted into gambling.”

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PEOPLE MACAU’S TOP REGULATOR RESIGNS

n May, Paulo Martins Chan resigned as head of Macau’s Gaming Inspection and Coordination Bureau (DICJ). A former government prosecutor, Chan served a lit- Paulo Martins Chan tle over four years as head of the DICJ, as the inspectorate is known by its Portuguese initials. He will return to the Public Prosecutions Office, according to local news reports. Chan took over as top casino regulator in December 2015 in the midst of an official campaign across mainland China targeting corruption and lavish spending by government and Communist Party officials. High-rolling gamblers got the message and went on hiatus. VIP gambling revenues, which at the time accounted for around two-thirds of total winnings, plummeted. And the junkets that facilitate the high-end trade through various underground banking means found themselves in an unwelcome spotlight; dozens went out of business. Accordingly, Chan’s tenure was marked by a tightening of gaming regulations, especially as it applied to junkets, and he is credited with bringing greater transparency and supervision to what largely had been an opaque and loosely managed system. Chan was succeeded by Adriano Marques Ho, an adviser to Secretary for Security Wong Sio Cha. Ho formerly was in charge of a unit of the government’s Judiciary Police, investigating gaming-related and economic crimes. He also served for several years as head of the local division of the China National Central Bureau of Interpol. Chan’s crackdown hastened calls for Macau’s development into a more diverse resort-style destination with a greater focus on mass-market tourism. As he departs, all eyes are on how these goals will affect the current six casino concessions, which will expire in 2022. While it’s widely expected the concessions will be renewed, Chief Executive Ho Iat Seng has said an open tender will be conducted, with no restrictions on bidders. A public consultation to be held later this year could mean amendments to the gaming laws that govern this process.

MGM SHUFFLES LEADERSHIP

our presidents of MGM Resorts Las Vegas Strip properties will not return when the casinos reopen following the Covid-19 lockdown. Randy Morton of Bellagio, Cindy Kiser Murphey of New York-New York, Cliff Atkinson of Luxor and Eric Fitzgerald of Excalibur were laid off, and other

senior-level management was reorganized. In April, MGM Acting President & CEO Bill Hornbuckle said New York-New York and Bellagio would be the first two properties to reLongtime New Yorkopen, with other properties New York President to follow. Cindy Kiser Murphey MGM announced a rewas out in a vised lineup of property pres- leadership shakeup at MGM Resorts idents and top executives responsible for more than one MGM property on the Strip: Bellagio and Park MGM/NoMad:

Anton Nikodemus, President Franz Kallao, SVP of Hospitality Doug Sandoval, CFO Aria and Vdara:

Steve Zanella, President Mark Lefever, CFO Mandalay Bay/Delano and Luxor:

Chuck Bowling, President Kevin Holyfield, VP Hospitality Heith Bettelman, CFO MGM Grand Las Vegas and New YorkNew York:

Mike Neubecker, President Patrick Miller, SVP Hospitality Mark Czerniak, CFO The Mirage and Excalibur:

Nik Rytterstrom, President Jeff Segan, VP Hospitality Sarah Rogers, CFO The regional properties will be headed up by Jorge Perez, president of MGM National Harbor. Reporting to him will be Melonie Johnson, the former head of National Harbor and now president of Atlantic City’s Borgata. Johnson replaces Marcus Glover, who joined Borgata in 2017. Chris Kelley is now in charge of MGM Springfield and Empire City in Yonkers, New York. Travis Lunn heads up Mississippi’s Beau Rivage and Gold Strike. And David Tsai will be president of MGM Midwest, which includes MGM Grand Detroit and MGM Northfield Park in Ohio.

ESPINOSA OUT, ARANA IN AS SPANISH REGULATOR

ast month, a surprising leadership change removed Juan Espinosa as Spain’s top gaming regulator and replaced him with Mikel Arana. Arana was appointed director-general of the DGOJ, an appointment that was made public

when it was published in the May 5 Ministerial Gazette. Espinosa held the senior position for three years and spent a total of eight years with the DGOJ. Arana is a former MP for Mikel Arana the Basque autonomous community, and most recently served as regional leader of Izquierda Unida (the United Left), Spain’s socialist coalition for the Basques. Arana’s appointment was reported personally ordered by Alberto Garzon, Spain’s minister of consumer affairs, who himself is on order from the PSOE-Podemos coalition government to overhaul federal gaming laws.

888 COFOUNDER DIES IN PLANE CRASH

hay Ben-Yitzhak, cofounder of Gibraltarbased online gaming provider 888 Holdings, died May 2 in the crash of a small private plane. The accident took place shortly Shay Ben-Yitzhak after takeoff from an airfield in in Sharon, Israel. Ben-Yitzhak, 52, was accompanied on the flight by his 11-year-old son, who survived and was airlifted to a hospital in serious condition. Ben-Yitzhak and his brother Ron were the original founders of 888, originally known as Casino-on-Net. In 1997, they joined with Aaron and Avi Shaked, also brothers, and formed what would later be 888 Holdings.

GGB

June 2020 Index of Advertisers

AGEM . . . . . . . . . . . . . . . . . . . . . . . . . . . . .51 American Nonsmokers Rights Foundation . . . . . . . . . . . . . . . . . . . . . . .23, 59 Brill Hygienic Products . . . . . . . . . . . . . . . . .43 Casino Player Media . . . . . . . . . . . . . . . . . .55 Casino Style . . . . . . . . . . . . . . . . . . . . . . . . .37 Dickinson Wright PLLC . . . . . . . . . . . . . . . . .35 Emerging Leaders . . . . . . . . . . . . . . . . . . . .45 Empire Technological Group LTD . . . . . . .9, 17 Erin O'Boyle Photographics . . . . . . . . . . . . .54 Everi . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5, 11 Fantini Research . . . . . . . . . . . . . . . . . . . . . .41 Fox Rothschild . . . . . . . . . . . . . . . . . . . . . . .27 G2E . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .49 GGB Magazine . . . . . . . . . . . . . . . . . . . . . . .47 GGB News . . . . . . . . . . . . . . . . . . . . . . . . . .10 Hartmann Group . . . . . . . . . . . . . . . . . . . . .31 iGP . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .56 IGT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2, 7 J Carcamo & Associates . . . . . . . . . . . . . . . .53 Konami Gaming . . . . . . . . . . . . . . . . . . . . . .60 The Innovation Group . . . . . . . . . . . . . . . . .33

JUNE 2020 www.ggbmagazine.com

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CASINO COMMUNICATIONS

Sandra Douglass Morgan

Chairwoman, Nevada Gaming Control Board

n April 29, Nevada Governor Steve Sisolak extended the state’s stay-at-home order until May 15. At the same time, he gave responsibility for reopening Nevada casinos to the Gaming Control Board and Chairwoman Sandra Douglass Morgan, while warning that casinos would not reopen until Phase 3 or Phase 4 of the state’s recovery plan. (Phase 1 began May 9.) By April 30, Morgan was already deep in preparations. She spoke by phone that day with GGB Publisher Roger Gros, discussing how casinos would reopen, the rules they would operate under, and how those rules would be enforced. A full podcast of this interview is available at GGBMagazine.com.

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

diligently with state and local providers. I foresee the board, in short order, issuing a policy to nonrestricted licensees, our large casinos, and then our restricted licensees, mainly our bars and taverns, as to what we would expect from a health and safety standpoint when they reopen. I really have to publicly thank the University Medical Center. We had a chance to meet with Dr. Luis Medina-Garcia, an infectious disease physician there. We’ve also met with the Southern Nevada Health District, which covers Clark County and Las Vegas, and the Washoe County Health District, which covers Reno. They were kind enough to lend their expertise to review the policy and the guidance that we issue. The guidance would require casinos to submit plans to confirm that their properties have been deep-cleaned and disinfected prior to opening, and ensuring that signage is posted so employees and patrons are reminded of proper hygiene. Em58

Global Gaming Business JUNE 2020

ployee training is obviously going to be very important to ensure that employees understand their responsibilities and knowledge of how to combat the spread of Covid-19—everything from hand-washing and sanitization (to) personal protective equipment, such as masks that may be recommended or even required by the Centers for Disease Control and Prevention. Can you envision a process that allows locals casinos to open first, with strict social distancing requirements and the things you just mentioned?

I don’t see a legal or regulatory basis for carving out one section of the city or county. I think we’ll set out guidelines and policy expectations, and those operators will have to make business decisions as to whether or not they can operate within these parameters. I don’t really foresee saying one section of a city is opening first. If they can meet the guidelines that we’re setting forth in a safe way, then they will be able to reopen. Even though the non-restricted casino licenses are grouped together, there are some big size differences. I imagine there has to be some flexibility there when it comes to the larger and smaller casinos.

Absolutely. This is a fluid situation. Nobody knows everything about this virus, but we’re learning more about it every day. We have more than 2,000 unrestricted licensees, and I only have 400 people on staff. So we do what we can, and we answer questions when we can, either by email or phone. I’m very, very proud of the Gaming Control Board—not only the board members, but all the employees as well. How deeply are the regulators going to get involved here? Are these guidelines you’re issuing, or will they be strict regulations that will be enforced?

“I don’t really foresee saying one section of a city is opening first. If they can meet the guidelines that we’re setting forth in a safe way, then they will be able to reopen.”

Remember, the ability for the Gaming Control Board to do this was under the governor’s emergency directive, so there is an enforcement mechanism. But I will be very blunt. This is a pandemic. No one has gone through this since 1918. Our goal is not to go out and arrest people; the goal is truly compliance. And compliance in this new reopening phase is going to look different. You know, our enforcement officers and our agents are going to be looking at different things. Licensees are going to have to find different ways to operate. We definitely want to make sure that we have a presence, and that the Gaming Control Board is communicating with the properties. Obviously, the policy of the state is to have a strict regulation for gaming; we will enforce it while allowing the industry to change and flourish and kind of find new ways to reopen. The goal is ultimately compliance. But yes, we will have enforcement ability for this.

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