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GGB Global Gaming Business Magazine
CASINOS AFTER COVID ONLINE GAMING FRICTION PAYMENT PRODUCTS IGT’S JOE ASHER
March 2022 • Vol. 21 • No. 3 • $10
21 FOREVER Blackjack’s continued evolution in a changing industry
Crypto Logic Will gaming ever be able to use Bitcoin and its relatives?
REIT View How real estate investment trusts work in gaming
Association of Gaming Equipment Manufacturers
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CONTENTS
Vol. 21 • No. 3
march
Global Gaming Business Magazine
COLUMNS
20 COVER STORY Blackjack Today The game of blackjack has long been the most popular in the pit. However, today’s game, dominated by multiple decks, 6-to-5 payouts on blackjack, and new rules on dealer busts, side bets and other aspects, is much different than the old single-deck mainstay. An expert explains the differences, and the advantages to the house. By Bill Zender
24 Casinos and REITs The ownership structure under which land is owned by a real estate investment trust and operating assets are owned by an established operator is growing. But is it good for gaming? By Frank Legato
30 Casinos After Covid As casinos explore ways to take cash out of the casino equation, cryptocurrency is a choice that has been increasingly popular. By Bill Sokolic
Casey Clark
12 Fantini’s Finance Go American Frank Fantini
41 Making My Point Word Games Roger Snow
DEPARTMENTS
FEATURES
14 Choosing Cryptocurrency
10 AGA Super Sunday
The Covid-19 crisis certainly posed its challenges to the industry, but it also prompted changes that will far outlast the pandemic.
4
The Agenda
6
By the Numbers
8
5 Questions
13 AGEM 36 Emerging Leaders With Marina Bay Sands’ Eunice Chua, Everi’s Travis Bussey, Scientific Games’ Brett Colbert, and Aristocrat’s Jamie Smith
42 Frankly Speaking
By Marjorie Preston
48 New Game Review
38 Bricks, Mortar and
50 Cutting Edge
Cyberspace Despite initial predictions that online gaming would cannibalize brick-andmortar gaming, a number of synergies have arisen between the two, to the industry’s benefit.
52 Goods & Services 53 People
By Brendan D. Bussmann
54 Casino Communications
44 Modern Payments
With Joe Asher, President, Sports Betting, IGT
Technology is advancing the methods by which gaming is funded both online and in the land-based industry. By Dave Bontempo
MARCH 2022 www.ggbmagazine.com
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THE AGENDA
Enough Already!
Vol. 21 • No. 3 • MARCH 2022 Roger Gros, Publisher | rgros@ggbmagazine.com twitter: @GlobalGamingBiz Frank Legato, Editor | flegato@ggbmagazine.com twitter: @FranklySpeakn
By Roger Gros, Publisher
hen I was growing up, it was considered cool to smoke. My father smoked his entire life—unfiltered Chesterfields—and I never thought of him as cool (although he turned out to be quite cool), so smoking was something I didn’t plan on doing. He knew that smoking was bad, however, and offered me $500 when I turned 18 if I didn’t smoke. It also helped that the group of kids that I hung out with didn’t smoke, so I used my $500 to buy my first car, a Volkswagen Karmann Ghia. Not smoking can be quite profitable. So not smoking wasn’t something that was a challenge for me, I just didn’t like it. But I never looked down at people who did smoke. It’s their body, their choice, I figured. But when I started my career in gaming as a dealer at Caesars Atlantic City, their choice invaded my body. Working five or six days a week, nine or 10 hours a night, I must have inhaled a pack a day, especially from those lovely players who relished blowing smoke in your face when you beat them with a six-card 21. When I became a baccarat dealer, it was even worse because the dealers were standing above the players (dealing on a “big,” 14-player bacc game at the time). Smoke filtered up into our faces, and even more disgusting were the many bacc players who smoked stinky cigars! So it was a red-letter day in my life when I dealt my last casino game and was able to escape the smoke. That’s why I can empathize so strongly with the group of the brave Atlantic City dealers that have organized to support a law that bans smoking in casinos completely. Of course, I get the objections that the casinos have—revenue will decrease, players will spend more time away from the games in smoking sections, and jobs will potentially be lost. But we’ve heard this song for years and data now shows that the revenue loss is temporary and sometimes even non-existent. And smart casino executives can prepare for the inevitable. I visited with my friend Mark Birtha when he was running the Hard Rock Northfield casino (now MGM Northfield). Indoor smoking is banned in Ohio, so Hard Rock developed an outdoor slot area, with a roof and walls that were open
W
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Global Gaming Business MARCH 2022
about 3 feet under the roof. Mark told me that the machines on the smoking terrace won triple what the machines won on the main floor. Live! Casino in Maryland did the same thing with similar results. It was 1964 when the Surgeon General’s Office in the U.S. drew the link between secondhand smoke and cancer. So how can it be almost 60 years later and casinos haven’t really accepted this study? Are they content to continue to risk the health of their employees and customers? There are lots of studies demonstrating that the majority of casino players prefer a smoke-free environment. There is no place else in society where you are still permitted to smoke indoors, so even those who enjoy smoking while gambling will understand a smoking ban. More importantly, if all casinos go smokefree, the impact will be far less than if they do it one at a time or one jurisdiction at a time. If Atlantic City casinos ban smoking, but Pennsylvania casinos do not, the impact will hurt the Boardwalk joints. But in fact, there are two Philadelphia-area casinos—Parx and Live! Philly—that have “temporarily” suspended smoking, and guess what? Their revenues have increased during this time! Why don’t New Jersey and Pennsylvania legislators join together and simultaneously ban smoking? Since New York, Ohio and Maryland casinos already prohibit smoking, players in these states will be forced to fly to Vegas to satisfy their smoking jones. Even better, perhaps the American Gaming Association can proactively encourage all its member casinos to ban smoking at the same time. What a service to the employees and customers this would be! And the impact would be minimal, with a possible positive result bring increased revenue from non-smoking players who might return. Come on, my executive friends. I’ve heard you complain about how smokers actually cost your casino money by forcing the installation of heavy-duty air handling machines, frequent replacement of felt on the tables, holes in the upholstery from cigarette burns, and increased cleaning costs to rid the casino of the stench and filth of tobacco use. It’s time to do something about it. Make it happen!
Marjorie Preston, Managing Editor mpreston@ggbmagazine.com Monica Cooley, Art Director mcooley@ggbmagazine.com Terri Brady, Sales & Marketing Director tbrady@ggbmagazine.com Becky Kingman-Gros, Chief Operating Officer bkingros@ggbmagazine.com Lisa Johnson, Communications Advisor lisa@lisajohnsoncommunications.com twitter: @LisaJohnsonPR Columnists Casey Clark | Frank Fantini | Roger Snow Contributing Editors Dave Bontempo twitter: @bontempomedia Brendan D. Bussmann | Keli Elkins Bill Sokolic twitter: @downbeachfilm Bill Zender | Michael Zhu __________________
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.
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Stephen Martino, Vice President & Chief Compliance Officer, MGM Resorts International, twitter: @stephenmartino
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Jim Rafferty, President, Rafferty & Associates
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Thomas Reilly, Vice President Systems Sales, Scientific Games
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Michael Soll, President, The Innovation Group
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Katherine Spilde, Executive Director, Sycuan Gaming Institute, San Diego State University, twitter: @kspilde
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Ernie Stevens, Jr., Chairman, National Indian Gaming Association twitter: @NIGA1985
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Roy Student, President, Applied Management Strategies
•
David D. Waddell, Partner Regulatory Management Counselors PC Casino Connection International LLC. 1000 Nevada Way • Suite 204 • Boulder City, NV 89005 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 2022 Global Gaming Business LLC. Boulder City, NV 89005 GLOBAL GAMING BUSINESS is published monthly by Casino Connection International, LLC. Printed in Nevada, USA. Postmaster: Send Change of Address forms to: 1000 Nevada Way, Suite 204, Boulder City, NV 89005 Official Publication
GGB
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BY THE
NUMBERS
LOcaTiOn, LOcaTiOn, LOcaTiOn J
ust over a week after New York’s highly anticipated sports betting launch, GeoComply data shows the state continues its remarkable start. More than 1 million accounts have been created across the five authorized sportsbooks and the action is not slowing down. “The momentum of New York’s sports betting launch has continued and it is mostly home-grown,” says Lindsay Slader, managing director of gaming at GeoComply. “The vast majority of users are brand new to regulated sports betting in the U.S. The data tell us that New Yorkers are dumping illegal sportsbooks for the new legal options and operators are also excelling at attracting first-time bettors.” Data from the launch for the first week showed: • 1.2 million accounts active in New York, with 878,000 unique players—more than New Jersey and Pennsylvania combined over the
Growing Distribution
T
he latest product from Eilers & Krejcik Gaming and Fantini Research is an addition to the Eilers-Fantini Central Game Performance Database covering route operations. The latest edition covering the fourth quarter of 2021 showed why distributed gaming and route operations are such a growing segment of gaming. The report is designed to provide a detailed overview of VLT/route operations performance trends with a focus on individual game performance primarily for the North American gaming market. The games are operated by both government and commercial operators. The first graphic illustrates where legal distributed gaming is occurring, along with the states that are considering it. Illegal games are operated in many states; the Eilers-Fantini report focuses on only legal distributed gaming. The second chart shows the suppliers and how they participate in the distributed gaming market. To get a copy of the report, contact Rick Eckert at reckert@ekgamingllc.com.
Supplier Market Share
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Global Gaming Business MARCH 2022
same period. • Only 9.3 percent of New York players have placed bets previously in New Jersey, easing cannibalization concerns. • 770,840 or 87.8 percent of New York players are brand new to regulated online sports betting—never before seen in GeoComply’s systems. • New Yorkers are mostly loyal to one sportsbook so far, with an average of 1.36 accounts per player. • New York geolocation transactions on the second weekend (17.9 million) exceeded transactions from launch weekend (17.2 million). • New Jersey is unfazed—averaged 12.6 million geolocation transactions the two weekends before the New York launch and 13.1 million the two weekends since launch.
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NUTSHELL
“They
5
Questions Anthony Cabot Distinguished Fellow in Gaming Law, UNLV William S. Boyd School of Law
A
nthony Cabot is one of the most effective gaming attorneys in the industry, so it was no surprise when he was named Distinguished Fellow in Gaming Law by the Boyd School of Law at the University of Nevada, Las Vegas upon his retirement. But you can’t keep a good man down, so he’s been able to promote the law school and recently was included in an announcement that Entain, the British iGaming provider, would launch an online gaming program for operators, regulators, lawyers and others who work in and around the global gaming industry. He spoke with GGB Publisher Roger Gros via Zoom from the law school in January. For a full video and audio podcast of this interview, visit GGBMagazine.com.
1 2 3 4 5
GGB: What does it feel like to be able to shape the next generation of gaming attorneys with this new program? Anthony Cabot: It is actually quite a lot of fun because one of the great advantages of being at UNLV
and particularly at the law school is that they bring in people from all over the world. So now I get the opportunity not only to deal with a lot of young students, but also a lot of people who have experience in gaming and regulation in countries throughout the world. So it’s been very rewarding. How did the program come about? Was it Entain’s idea?
They told us that they were interested in helping us sponsor an executive education program. One of the things we always hear at our G2E booth from people from other jurisdictions is that they don’t have time to go back to law school and become a lawyer, but gaming law is really important to what they do. They could be compliance officers or internal audit officers or regulators. So we’re going to have a program that’s going to be for non-lawyers. What are some of the classes you’re going to offer?
I will be teaching a class called Intro to Gaming Law, which is kind of an overview of how gaming law covers all sorts of topics—licensing, anti-money laundering, internal controls, technical standards, and many other things. But at the same time, the students can take a number of other classes. Bill Buffalo, a longtime industry member, is teaching Gaming Operations in the Law. That will be more applicable to somebody who’s an executive and wants to learn more about how gaming law impacts operations. Katherine Rand and Steven Light, very well-known professors in the area of Indian gaming, are going to be teaching a class on Indian gaming law. And Alan Feldman and Dayvid Figler will be teaching a class on problem gambling and responsible gambling. That’s our first four. We’ll probably end up with a total of about eight to 10. What will be the format?
It’s all online. About 80 percent of it is pre-taped, so they can go through the lessons at their own pace, along with the materials to read, quizzes and things of that nature. And then about 20 percent of it will be online, so we can have interaction with the students. You wrote an article for GGB in our January issue on responsible gaming programs in Nevada. For a state that depends so heavily on gaming revenue, you said it had become a big problem for state regulators. What has the response been so far to that article?
It’s interesting. I’ve actually gotten some response, but I haven’t heard anybody from Nevada specifically. But I’ve heard from regulators in other states who’ve told me this is worth talking about and that there’s a need for a different approach. They like the idea of having some carrots instead of going back to the old method where you punish people for not meeting certain standards. One of the big problems is that the state is awful with regard to funding. They give a funding amount of about $1.5 million per year. For an industry that’s generating $12 billion a year that is very little money. We try to get the majority of that money into treatment, and that’s fine, but we don’t even understand the scale of the problem because we haven’t done any prevalence tests. Right. We don’t know where the needs exactly are in the communities that need these services. But the legislature has not responded.
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Global Gaming Business MARCH 2022
Said It”
“It is a real and significant threat. It will not stand. If the (Premier Doug) Ford government is not willing to address the harms caused by its decision, we will have to make them accountable in an election year.” —Kelley LaRocca, chief, Mississaugas of Scugog Island First Nation, objecting to Ontario’s plans to open an online sports betting and iGaming market
CALENDAR March 1-4: SiGMA Africa 2022, Nairobi, Kenya. Produced by SiGMA. For more information, visit SiGMA.world/Africa. March 14-16: Casino Marketing Bootcamp, New Orleans, Louisiana. Produced by J Carcamo & Associates. For more information, visit CasinoMarketingBootcamp.com. March 20-23: SiGMA Asia, Dubai, UAE. Produced by SiGMA. For more information, visit SiGMA.world/Asia. March 21-22: iGaming Next New York City ’22, The Convene, 46th Street, New York City. Produced by iGaming Next. For more information, visit iGamingNext.com/NYC22. March 22-23: ASEAN Gaming Summit, Shangri La at the Fort, Manila, Philippines. Produced by Asian Gaming Brief. For more information, visit AseanGaming.com. March 23-25: SPiCE India (Strategic Platform for iGaming Conference & Exhibition), Goa Marriott Resort & Spa, Goa. Produced by Eventus International. For more information, visit sportsbettingevents.com. March 30-31: SAGSE Latam 2022, Hilton Buenos Aires Hotel and Convention Center, Buenos Aires, Argentina. Produced by Monografie. For more information, visit SAGSELatam.com. April 5: Prague Gaming Summit, Vienna House Andel’s Prague. Produced by Hipther. For more information, visit hipther.com/events/ praguegamingsummit. April 12-14: ICE London, ExCeL Centre, London. Produced by Clarion Gaming. For more information, visit ICELondon.uk.com. April 13-14: iGB Affiliate London, ExCeL Centre, London. Produced by Clarion Gaming. For more information, visit london.igbaffiliate.com. April 19-22: Indian Gaming 2022, Anaheim Convention Center, Anaheim, California. Produced by the National Indian Gaming Association and Clarion Gaming. For more information, visit IndianGaming.org/events.
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AMERICAN GAMING ASSOCIATION
Super Sunday The Big Game stepped up big time in February By Casey Clark
Editor’s Note: This article was first published as a GGB News Special Report on February 11, 2022, two days before the Super Bowl.
A
mericans love to bet on sports— and this year’s Super Bowl between the Los Angeles Rams and Cincinnati Bengals will be no exception. According to new American Gaming Association research, a record 34.1 million Americans will wager an estimated $7.61 billion on this year’s big game. Wagering will be up across all betting methods this year compared to 2021: • 18.2 million American adults will place traditional sports wagers (online, at a retail sportsbook or with a bookie), up 78 percent from 2021. • 18.5 million plan to bet casually with friends or as part of a pool or squares contest, up 23 percent from 2021. • 12.9 million plan to place a bet online this year, up 70 percent from 2021. • 4.7 million plan to place a bet in person at a sportsbook, up 231 percent from 2021. Notably, this is the first year that the number of American adults placing traditional sports wagers nearly equals the number of us who will casually bet with friends and colleagues. This is in large part due to the industry’s expansion: 45 million more American adults have gained access to the legal market since last year’s game. By next year’s Super Bowl, legal sports betting will be available in even more states, giving consumers access to the protections of the regulated market. As legal sports betting expands, the industry must continue to build on our shared responsibility to promote responsible gaming and build a safe, sustainable market. The AGA is helping lead these efforts through our “Have A Game Plan. Bet Responsibly” campaign, which is convening sports betting stakeholders—including NFL team partners Washington Commanders
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and New York Jets—around educating fans on how to bet responsibly. Importantly, we’re already seeing tangible impacts from the industry’s consumer education efforts thus far: • 76 percent of Americans planning to bet on Super Bowl LVI say it is important for themselves to bet through a legal operator, up 11 points from 2021. • 106 million Americans adults (41 percent) recall advertising related to responsible gaming in the past year—an increase of 32 million people (12 percent) from 2020.
“
A record 34.1 million Americans will wager an estimated $7.61 billion on this year’s big game.
”
The data is clear: Americans want to bet on sports and want to bet on them legally. They deserve safe, regulated betting options and a sports betting industry that puts responsibility first. Let’s give them both. Find more Super Bowl LVI wagering trends below: • 18 percent of Super Bowl viewers plan to wager on the game. • The Northeast has the highest expected betting participation (16 percent), followed by the West (15 percent), Midwest (10 percent) and South (10 percent). • 55 percent of bettors plan to wager on the Los Angeles Rams compared to 45 percent on the Cincinnati Bengals. • While legal sports betting is not available in either California or Ohio, more Rams fans (26 percent) than Bengals fans (22 percent) plan to bet on the game. Casey Clark is senior vice president of the American Gaming Association.
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FANTINI’S FINANCE
Go American When gaming companies go public, they go to the U.S. and list on the Wall Street exchanges
O
ne of the obvious but little-discussed trends in the past couple of years is for international gaming companies to publicly list in the United States. The most recent case is Allwyn Entertainment, the European lottery operator formerly known as SAZKA. The operator of lotteries in Austria, Czech Republic, Greece, Italy and elsewhere has its eye, like so many others, on iGaming, sports betting and lottery growth in the U.S. It will go public on the New York Stock Exchange through Cohn Robbins Holdings Corp., itself publicly traded as CRHC, which will own 83 percent of the company that expects to generate $810 million in EBITDA on $1.7 billion in revenue this year. Allwyn follows a long line that includes games providers like Bragg, sports betting data companies like SportRadar and Genius Sports, and iLottery operator NeoGames in either dual listing or going public in U.S. markets.
By Frank Fantini
mer CEO of a multibillion-dollar international conglomerate has not relocated from his native Austria to the Mojave Desert just to run a penny-stock outpost. Ainsworth has been executing on a growth plan that hasn’t drawn much attention because of its small size and Australian home base. That strategy has focused on broadening its product line, growing its games library, becoming more assertive in putting games online, and building its leading position in the fast-growing but little-followed world of historical horse racing machines in the U.S. Again, it takes capital to grow and it makes more sense for Ainsworth to tap the U.S. capital markets than for a now Austrian-owned and U.S.-headquartered company to continue to list solely in Australia. The stock sells for under $1 a share, but do a reverse split of the 330 million-plus shares, combine it with some other Novomatic assets in the U.S. and, voila, you have the makings of a substantial U.S.listed gaming technology company.
Go Go Local Catena and Ainsworth Next? So, who’s next? Two candidates come to mind: Catena Media and Ainsworth Game Technology. Catena is a betting affiliate that gets around 60 percent of its revenues from casino and most of the rest from sports betting. A decade-old Swedish company that trades in Stockholm, Catena calls the U.S. an unparalleled opportunity. It has been capitalizing on that opportunity by introducing publications in states that have legalized sports betting and iGaming under brands such as Play USA and Legal Sports Report. Capitalizing on opportunities takes capital, and there is no bigger source of funding than the home of the unparalleled opportunity, the U.S. Perhaps a hint: last year Catena appointed an American, gaming industry veteran Michael Daly, as CEO. And he’s based in the U.S., not Sweden. The tip that Ainsworth has big U.S. ambitions came when the company hired Harald Neumann as CEO and based him in its expansive Las Vegas facility. Neumann was CEO of parent company Novomatic for many years. It makes sense that the for12
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As the economy returns to normal in shaking off the effects of the Covid pandemic, it is becoming clear that regional casinos focused on local players are recovering fast. The clearest examples have come from the most focused locals operators, those who cater to the residents of the Las Vegas Valley. Red Rock Resorts and Boyd Gaming reported fourth quarter performances that show the Nevada locals casino business is back. A good portion of Red Rock’s outlook is company specific, such as focus on high-end locals, ownership of eight properties that can be sold or developed, and development of a $750 million casino on Durango Boulevard, which is surrounded by twice the number of adults per gaming position as its highly successful Green Valley Ranch and Red Rock Resort casinos. Red Rock’s leaders also boast of a balance sheet with debt at just 3.5 times EBITDA and an average 3.5 percent interest rate, which allow for both investment in growth and returning capital to shareholders. The company recently has done that to the tune
of $700 million in share repurchases and a special dividend. Likewise, Boyd’s locals EBITDAR soared 76 percent and produced margins of 52.3 percent compared to the upper 30s in Downtown Las Vegas and at its regional casinos. These kinds of results have been reported by locally focused casino operators around the country. Destination resorts will take a while longer to fully return, especially the Las Vegas Strip, where group and convention business recovery will lag. But the trends are clear—the impact of Covid on the U.S. casino industry will soon be in the rearview mirror.
Wanna Buy A Planet? Caesars’ announcement that it will transform Bally’s Las Vegas into a Horseshoe gives another hint that Planet Hollywood will be the Las Vegas property that it sells sometime this year. Planet Hollywood has several characteristics that make it the likely sale candidate: 1) It’s the only property on the east side of the Strip physically separate from the other Caesars resorts; 2) it’s the furthest from Caesars’ Forum convention center; 3) it’s an odd property with its surrounding shopping mall and long trek to the parking garage on the other side of the retail center; and, 4) its well-known brand name and upscale qualities should be able to fetch a good per-square-foot or per-hotel-room price. The other Caesars properties are in a line, from south to north: Paris, Bally’s (which shares a garage with Paris), Cromwell, Flamingo, LINQ, and Harrah’s, with Caesars Palace just across the street from Flamingo. Flamingo and LINQ share the LINQ entertainment and restaurant promenade, the High Roller observation wheel and proximity to the Forum convention center. CEO Tom Reeg might pull a surprise, or might have an offer that he can’t refuse, and that would give Caesars a new strategy for the Strip, but at this point, it would appear Planet Hollywood is likely to leave the Caesars orbit. Frank Fantini is principal at Fantini Advisors, investors and consultants with a focus on gaming.
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AGEMupdate AGEM Member Profiles
Silver Member Profile Gaming Partners International (GPI) Web Address: www.gpigaming.com
In 2019, the Angel Group acquired GPI, the world’s premier casino chip and dice company, to expand more globally, with a wider range of items. The Angel Group is a global company focused on manufacturing, making high-quality casino playing cards and trading card games.
Bronze Member Profile Action Gaming Web Address: www.actiongaming.com
Action Gaming is a casino game designer and inventor that specializes in developing and bringing games to market. With a focus on improvements and new ideas that relate to video poker, the company also develops other games.
Associate Member Profile
AGEM Board of Directors Actions for February 2022 • For the final time in his current role, Executive Director Marcus Prater presided over the February AGEM monthly board meeting, with Daron Dorsey taking over on March 1, although Prater will be available to assist Dorsey for a six-month transition period. President David Lucchese led the praise by thanking Prater for his strong and steady leadership over a period of 14 years and 168 consecutive monthly membership meetings that saw the organization grow in size and stature to become a strong and relevant voice in the industry, allowing suppliers to have a “seat at the table” alongside operators and regulators. AGEM has accomplished a significant amount under his stewardship, and he has set the foundations for the organization to grow and prosper as the industry evolves further into online and sports betting sectors. • Following the formal presentation of AGEM’s petition on allowing gaming technology to take place in the cloud to the Nevada Gaming Commission and the subsequent edits to the petition requested by Jim Barbee, chief of the Gaming Control Board’s Technology Division, more positive developments have evolved. AGEM has been joined by operators through the Nevada Resort Association and Caesars Entertainment supporting these efforts, who have submitted letters to the commission in a bid to push the process along. These combined endeavors show good cooperation from the industry and will hopefully see a draft bill presented in the next month or so. • Following the January meeting where AGEM members talked in detail about concerns with the new ICE show dates in April, a number of large exhibitors subsequently pulled out of the event. Although AGEM strongly supported members and was working behind the scenes, it was left to individual companies to make their own decisions. AGEM was supportive of Clarion postponing the show in December, saying at the time it hoped new dates could be found that worked well for the industry. It was, however, wrongly reported in the press that AGEM supports the new dates in April. • AGEM welcomed iPost as a new Associate member at the February meeting. Based in San Mateo, California, iPost is an enterprise email marketing and automation provider for gaming/casinos, franchises, agencies, associations, restaurants, entertainment, publishing, and retail. This takes the total number of members worldwide to 172.
Forthcoming Events • The fourth annual EKG Slot Awards Show held on February 24 at the Cosmopolitan of Las Vegas saw two outstanding industry veterans, Michael Laubach and Robert “Bob” Luciano, inducted into the Hall of Fame. Bob Luciano is the fourth inductee to this award under the Game Development category while the late Michael Laubach is the second inductee under the Slot Operations category. • The Southern Gaming Summit will take place May 3-6 in Biloxi, Mississippi, and will now consist of a conference only and not include an exhibition. AGEM members approved a sponsorship request of $4,000 to support the Responsible Gaming Session.
AGEMindex
Agilysys Inc. Web Address: www.agilysys.com
Agilysys Inc. is a leading developer and marketer of proprietary enterprise software and other products for the hospitality industry. The company specializes in point of sale, property management, inventory and procurement, document management, workforce management, and mobile and wireless products.
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.
In January 2022, the AGEM Index declined by 45.71 points to 925.87, marking a 4.7 percent decrease from December 2021. Compared to one year ago, the index increased by 229.8 points for an annual growth rate of 33 percent. In the latest period, nine of the AGEM Index companies reported stock price decreases amid a broad market decline. As a result, three companies posted positive contributions to the index, while the other nine posted negative contributions. The top contributor to the monthly index was Konami Corporation (TYO: 9766), whose 11.1 percent increase in stock price led to a 16.69-point gain for the index. The largest negative contributor to the index was Aristocrat Leisure Limited (ASX: ALL), whose 7.4 percent drop in overall stock price resulted in a 35.24-point decrease in the AGEM Index. A double-digit drop in the stock price for Scientific Games Corporation (Nasdaq: SGMS) was also a driving factor in the monthly drop in the index. The company reported a 13.7 percent decline in stock price, which led to a 15.63-point decline to the index. All three major U.S. stock indices decreased over the latest period. The Dow Jones Industrial Average declined 3.3 percent, while the S&P 500 fell by 5.3 percent. Meanwhile, the NASDAQ experienced a 9.1 percent fall.
MARCH 2022 www.ggbmagazine.com
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CrYpTic Message Can cybercurrency ever become a choice for gambling in a regulated environment? By Bill Sokolic
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ryptocurrency does not refer to a misspelled monetary system on Krypton, Superman’s place of birth. But the names affixed to various types of cryptocurrency sure sound like they could be from Krypton. Or Middle Earth. Bitcoin. Ethereum. Shiba Inu, Dogecoin. And don’t forget blockchain, which supports everything else in the crypto universe. I know what you’re thinking: Tales from the Crypt. Closer than Krypton in spelling. Sorry. Wrong answer. Cryptocurrency, and everything that goes with it, is a monetary system, but one that has nothing to do with fantasy worlds. To a growing percentage of the populace, the system is the next big thing in finance. The origin of crypto, the word, comes from cryptography. “Cryptography is the origin of blockchain, and blockchain produces cryptocurrency,” says Earle G. Hall, CEO of AXES.ai and vice chairman, International Gaming Standards Association. “Blockchain is a methodology to secure information in a database by replicating the information over many computers in the same or different networks simultaneously to infinitely reduce the risk of intrusion, tampering or theft.” Sounds confusing, but casinos are beginning to understand. “Most casinos accepting cryptocurrencies at the moment are only allowing guests to exchange crypto for cash at the casino cage,” says Josh Swissman, 14
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founding partner, the Strategy Organization. Or through the use of an ATM-style device. The latter includes the Casino @ Dania Beach near Miami as an example. “Our slot machines and poker tables do not currently accept crypto, but our casino is constantly evolving to exceed our guests’ preferences and expectations,” says Armando Suarez, general manager of the property. “The Coin Cloud Digital Currency Machine is a fabulous amenity which now offers our guests a convenient and easy way to buy and sell Bitcoin, Ethereum and over 40 other digital assets with cash.”
A Crypto ATM “Cryptocurrency will evolve much like ATMs did in the late 1990s,” Hall says. The Coin Cloud DCM allows guests to conveniently sell their digital currency for cash to play at one of the casino’s 750 slot machines or poker tables. They could also convert their winnings into crypto if they choose. ATM-type Bitcoin machines have appeared all over the world in the last couple of years, as it is a very easy way to cash out of your cryptocurrency account into the local fiat currency for whatever country you’re in. And often vice versa. Coin Cloud’s team constantly investigates which coins customers are actively considering and adds new offerings after a proprietary
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“I will say that it is much more likely that the more well-known and stable coins are likely to be the ones you will see most frequently in the casino space.” —Josh Swissman, founding partner, the Strategy Organization approval and compliance process. “Our first DCMs were installed in casinos in our home base of Las Vegas,” says Chris McAlary, founder and CEO of Coin Cloud. “Today, we provide digital currency for more than 4,500 installations across the U.S. Our latest at The Casino @ Dania Beach demonstrates that commitment and represents a perfect location to appeal to both digital currency beginners and experienced investors.” The Casino @ Dania Beach believes having on-site access to cryptocurrency will soon become necessity in the digital future. “Cryptocurrency is quickly becoming mainstream and appears to be here to stay,” Suarez says. Casinos aside, major credit card companies such as Visa are currently reporting record cryptocurrency-based transactions. “Every quarter the trends and metrics prove that cryptocurrency is being adopted as a universal means of funds transportation,” Hall says. “It is very early in the process and many casinos are still working through their cryptocurrency policies, so it is tough to discuss which specific coins will become widely accepted,” says Swissman. “I will say that it is much more likely that the more well-known and stable coins are likely to be the ones you will see most frequently in the casino space.” But not at the moment in most gaming locales, Atlantic City included. “Crypto is not authorized for the receipt of wagers, or the payout of winnings,” says Lee Moore, spokesman for the New Jersey Division of Gaming Enforcement. Neither is it available at Dania Beach beyond the DCMs. To be classified as a cryptocurrency, Hall says, there can be no human intervention, no central authority that can influence or corrupt the transaction and proof of ownership. “A cryptocurrency can only be done by a cryptographic signature which resembles a serial number that is automatically generated when the transaction is made.” In case you’re wondering, cryptocurrency is not the same as digital cur-
rency, although you might think so. “A digital currency is a fiat currency such as the U.S. dollar that is transported by an electronic means, whereas a cryptocurrency has no fiat equivalent,” Hall says. Fiat currency is a term given to the traditional monies that countries use for commerce: the aforementioned U.S dollar, the Canadian dollar and the euro as examples. With fiat the currency is backed by a traditional banking system. Fiat is used to define any currency that is legal tender and authorized by a country to use for barter and trade, Hall says. Crypto is not country-backed, nor is cryptocurrency attached to any country’s economy. As big crypto exchanges like FTX and others become commonplace, conducting cryptocurrency transactions also becomes a more prevalent and trusted way to pay for goods and services, Swissman says. “I think the nongaming amenities and payment opportunities will be the first to manifest. For gaming crypto transactions to occur, much regulatory updating would need to take place.” Now that we got that straightened out, one of the greatest myths is that cryptocurrency is anonymous. In fact, most cryptocurrencies operate in public blockchains, Hall says. This means that the operators of the chain— known as miners—can see every transaction without being able to intervene or influence said transaction. All they see is transaction numbers, but the transactions are in the public logs called, appropriately enough, ledgers. Another falsehood that has surfaced is that crypto is a haven for illicit activities. It’s not. “In today’s world, to sign up for a reputable exchange to buy and sell crypto, you must adhere to all the know-your-client policies and disclosures. MARCH 2022 www.ggbmagazine.com
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“Casinos must consider the integration of a cryptocurrency strategy as players are moving to this much more affordable and efficient way of moving funds from one source to another.” —Earle G. Hall, CEO, AXES.ai; Vice Chairman, International Gaming Standards Association
There is no difference in 2022 between fiat and cryptocurrency transactions, and all depend upon KYC policies of the buyer and seller,” Hall says. The only difference remains in the political and legal framework of a country to permit such transactions. Then there is the volatility with certain coins. “In the cryptocurrency world, Bitcoin and Altcoin have evolved as volatile coins that trade upon the perceived or speculated future value, much like stocks on a traditional stock market but without a direct link to a physical asset,” Hall says.
Finding Stability Since early December, Bitcoin and Ethereum, two of the largest crypto platforms, have had daily average price swings of 4.8 percent and 6.2 percent respectively with individual daily price swings of as much as 20 percent, says Cory H. Morowitz, managing partner of Morowitz Gaming Advisors LLC, a consultancy firm. With such swings, cryptocurrencies are not appropriate methods of payment exchange for casinos, he says. “Imagine trying to manage a casino cage or manage daily cash reserves with a currency that fluctuates to that level. Until that volatility is solved, these are not appropriate for businesses that have high turnover and cash needs.” Stablecoins may be the answer to that dilemma at the moment. “A stablecoin is a cryptocurrency with a fixed value equivalent to a fiat currency in most cases,” Hall says. “Casinos must consider the integration of a cryptocurrency strategy as players are moving to this much more affordable and efficient way of moving funds from one source to another.”
Stablecoins are not subject to dramatic swings in value and could work best in a casino environment 16
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Some best practices to follow are: • Employing a strict KYC policy to accept cryptocurrency to ensure that you are in line with all future compliance and SEC guidelines. • Moving a cryptocurrency-recognized trading partner to migrate the Bitcoin to a stablecoin to remove the risk of the fluctuation and volatility immediately upon reception. • Ensure that your electronic wallet partner has all the compliance, regulatory and intellectual property rights and technology to accept cryptocurrency from the various sources and to migrate them to your cashless environment. An electronic wallet exists on the internet. But e-wallets are every bit as real as the leather wallets sold at Macy’s or Kohl’s. Electronic wallets are the new standard in financial transactions, Hall says, more so in the aftermath of the Covid pandemic. Truth is that an electronic wallet doesn’t differ much from cashless gaming or cashless anything. When you pay for your shopping order with a debit card on your cellphone, you’re using an electronic wallet. When you send money to your cousin Vinny via Venmo, you are relying on an electronic wallet. “Just as the casinos moved from coins to cashless, they will also move from cashless to electronic wallets, including crypto,” Hall says. What’s more enticing is an electronic wallet is universal. A person can cash in from the same wallet to an iGaming, sports betting and land-based account all from the same source. “Cryptocurrency is already being accepted in many of these environments, and the core, generic source of legitimacy is a strong KYC process,” Hall says. “The electronic wallet can be used to cash in and out of literally any gaming activity and will become the common denominator.” As younger people mature, their e-wallet will become their primary source of fund movement and their choices of entertainment, product and service purchasing will depend on the availability of electronic wallets, Hall says. As vendors such as Venmo, Robinhood and cryptocurrency buy-andsell platforms become more and more widespread, cryptocurrency will evolve as the electronic fund of choice, he says. The advantage of a cryptocurrency wallet as opposed to a debit card or Venmo comes down to cost and speed. ATM cards employ the fiat-based banking system that is very costly. Transaction fees are simply too high. Cryptocurrency has fees, but much smaller ones, Hall says. Moreover, using blockchain eliminates the traditional checks and balances used in other transactions. The traditional ways e-wallets work is neither fast, secure or cheap, he says.
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© 2022 IGT. The trademarks and/or service marks used herein are either trademarks or registered trademarks of IGT, its affiliates or its licensors.
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Stadiums can offer electronic versions of many games, reducing costs for both the casino and the players
Modern Blackjack What has changed and where is it going? By Bill Zender
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ack in the 1970s, the casino game of blackjack was simple and for the most part unchanged from the games dealt when the Las Vegas Strip was known as the “Old L.A. Highway”—single deck, dealer stands on all 17s, and player received a 3-to-2 bonus on two-card blackjacks. The cards were hand-shuffled using a riffle, riffle, strip, riffle shuffle recipe with the dealer offering the cut by placing the deck in front of a player and allowing them to hand cut the deck. Simple, quick, to some boring, and to the casinos, vulnerable. Basic mathematical house advantage was low, but the lack of educated strategy players allowed the game to operate at a very decent overall house advantage. This is the blackjack game that the author grew up with and eventually learned how to deal. The ’80s brought the first major changes with casinos opting to increase the number of decks and in some cases employing a dealing shoe, which had formerly only been found on baccarat tables. First used to deter card counters, adding more decks to the game also happened to increase the mathematical house advantage (unknown by the casinos at the time). Downtown and off-Strip casinos started to emulate Reno casinos and implemented the rule for the dealer to hit any “soft” hand of 17. This option in20
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creased the average total of the dealer’s hands, which increased the game’s mathematical advantage (by 0.2 percent). This trend continued into the ’90s with more casinos opting for shoe-dealt blackjack games and even Las Vegas Strip properties that chose to hit soft 17. The ’90s also witnessed the expansion of casino gaming outside of Nevada and Atlantic City with the opening of historical riverboat/townsite gambling as well as the start of full casino tribal gaming. What about the new millennium? What changes have the game of blackjack witnessed in the last 20 or so years? And will the gaming industry experience more changes to the noble game of blackjack moving into the 2020s and beyond?
Blackjack Payoffs Have Changed For decades blackjack players knew that a winning two-card 21, also known as a “blackjack” or “snapper,” paid a premium of one and a half. Not so today! A lot of players are surprised when their $20 blackjack pays $24 instead of the anticipated $30. Originally implemented in the late ’90s to sidestep the blackjack adaptation known as Super Fun 21, the rule
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Most casinos today use shuffling machines such as TCSJohnHuxley A-Plus shuffler on all card games. Some dealers don’t even know how to shuffle because of the wholesale usage of shuffling machines
of paying 6-to-5 on blackjacks has become extremely popular with casinos operating in destination-resort locations with single- and double-deck games. The underpayment provides the casino with an added mathematical edge of 1.4 percent (rounded) without drawing too much animosity from the lower-limit blackjack players. The payoff rule change also discouraged the practice of counting cards, at least on those tables. The house advantage increase is quite hefty, and forces any would-be counter to increase their bet spread requirements (about five times greater) to compensate for the payoff change. Even at a lofty bet spread, profitable card counting is marginal. Primarily, the 6/5 rule is used on single- and double-deck games; however, casinos have installed the rule on their six- and eight-deck games with some success. The downside of this this strategy is that the corresponding increase in mathematical advantage has reduced the customer’s perceived entertainment value—otherwise known as “bang for their buck.” The gambling customer does not expect to win all the time, but they do feel their entertainment time on the table needs to correspond with the cost—in this case, the session-experienced loss.
Dealers Do Not Know How to Shuffle Anymore Recently, a casino executive related an interesting story that happened when the multiple-deck (MD) shuffling machine broke down on one of her blackjack games. After being instructed to proceed to shuffle the cards by hand, the dealer informed the floor supervisor that he didn’t know how. Further examination discovered that he didn’t even know how to conduct the basic of manual shuffling. The dealer explained that he had learned how to do the “dovetail riffle shuffle” in dealing school but had not had to employ it since then. Other than for a few higher-limit blackjack games where a “big player” attraction is the manual card shuffle, almost every card game, not just blackjack, utilizes an electronic shuffling machine. In some jurisdictions, the use of a shuffling machine is a regulatory requirement. It is understandable how dealers could go years without hand-shuffling cards, especially on multi-deck blackjack games. Shuffle machines accomplish two basic purposes: The machines eliminate the non-productive time of shuffling, and provide the casino with a more randomized mixing of cards, especially in multi-deck games, eliminating manual shuffling weaknesses that create advantage play opportunities such as “shuffle tracking.” In addition, the use of a continual shuffling machine (CSM) can speed up the game even more. The CSM eliminates not only the shuffle time, but also the deck transfer time experienced with MD shufflers. The CSM also eliminates all threats of card counting if the card loading procedures are ad-
hered to. If too many cards are held out until inserted into the CSM, the game could experience “card latency” which may well result in a unique card counting situation.
Dealer 22 Does Not Mean The Dealer “Busts” Just because the dealer hits out to a total of 22 does not mean the players’ wagers remaining will automatically receive payment. Not on the “no bust 22” blackjack games. This form of blackjack is becoming very popular as a traditional blackjack alternative game. The rule change comes into effect when the dealer hits their hand with the exact total of 22. Normally a “busting” hand, the rule variation dictates that the dealer must push all remaining bets on the table (except a player’s two-card blackjack, which is paid). This simple rule change has a huge effect on the mathematical advantage of the game (a whopping 6.9 percent increase) and allows for the addition of very attractive “player-friendly” rules. These appealing rule changes include doubling down and splitting hands at no additional cost, switching cards between two wagered hands (legally), surrendering certain undesirable two-card hands at no cost, and allowing the players limited dealer hole-card information before the players act on their hand. The downside to this blackjack format is the dealers must strictly follow the rule of pushing hands when hitting a multiple-card 22. If the dealer was to forget and inadvertently pay remaining wagers on a hand of 22 as they would in a standard blackjack game, the mathematical edge flies out the window, and it will take approximately three quarters of the next hour of table play to break even from this costly mistake.
Cards In Blackjack Pitch Games Are No Longer Pitched If one walks into most Las Vegas Strip casinos and looks for a handheld blackjack game, they may be in for a surprise. Several casinos still offer handheld blackjack, but the procedures do not include pitching the cards. Instead, the dealer delivers the cards to the players by placing them face-up in front of the customers’ bets, like dealing cards from a shoe. The reason? To keep the cards out of the player’s hands so the casino does not have to be worried about customers marking or switching cards. It’s management’s intent to offer a desirable handheld single- or double-deck game but without the game protection concerns or the deck replacement frequencies that come with cards players can pick up and hold. The real question is whether the customers are attracted by the “handheld” games, or are more attracted to blackjack games where they can pick up and MARCH 2022 www.ggbmagazine.com
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Side bets make blackjack more interesting for the customer and more profitable for the casino
handle the cards. Another debate is whether the face-up delivery process speeds up the game and provides more hand decisions. Face-up dealt games allow the dealer to anticipate hand playing decision, but does this process compensate for the extra time of the card placement procedure? To “place” or to “pitch”—the jury is still out.
The Dealer’s Shift at the Table has Changed A standard blackjack table dealing shift used to last 40 minutes with a 20minute break—that was in the ’70s and early ’80s. In the late ’80s, casino management found that working a blackjack dealer 60-minute table shifts did not reduce dealer accuracy or game pace. It was noted that the increased table time help to reduce the casino’s payroll, and at the same time provided an added incentive, tip rates for the dealer by cutting the number of dealers sharing in the tip pool. In recent years, the corporate demand for reducing employee expenses has led to another increase in table shift time. In many gaming operations throughout North America, dealers are required to deal for 80 minutes, and it appears that this is becoming more of the gaming industry norm. Although this latest table shift time increase has reduced cost, the savings are much less than when the casino jumped from 40-minute to 60-minute table shifts. The downside: Increased wear and tear on older employees. Dealers who are in their 20s and 30s are fine, but once the employee gets near to the upside of 40 years, their ability to produce on a similar level is questionable. Solutions for this problem are the use of floor mats positioned at the dealing area of the table, and the use of more sit-down/ADA-type tables. Both solutions will reduce physical aches and pain and fatigue, and should help maintain desired levels of game production.
Playing Blackjack Doesn’t Mean You Are Just “Playing Blackjack” (Side Bets) Being a blackjack game purist, the author was against side bets in blackjack. That was until he did the mathematics behind revenue increase based on reasonable player utilization of the side bets. Not only do side bets increase blackjack’s theoretical win, but side bets increase both average table mathematical advantage and the overall hold percentage. Side bets also provide the customer with a gambling alternative which is perceived as a table game added value. An occasional side bet win helps keep the player interested in the game and on the table for an additional time. One perceived shortcoming by the casino executive is that the side bets slow down the game. However, the game would only slow down when the bets are wagered. When wagered, the higher mathematical advantage of the side bet more than makes up for any slight game pace reduction. Based on the advantages of offering side bets, casino management at many locations are looking into installing more than one side bet on their lower-end blackjack games. Note: A good strategy is to use one side bet that is decided immediately after initial card delivery and a second side bet decided after the dealer determines the outcome of their hand. Also consider using a side bet with a high hit frequency, but low payoff combined with a low hit frequency but a high multiple pay. Adding a $1 progressive bonus bet has also seen good success. 22
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The Future Several casinos across North America have rolled out different versions of “stadium games” utilizing a human dealer (versus an animated likeness). This format allows a single dealer to deal a table game from an elevated platform while the customers place wagers on video terminals located in the immediate area. A number of customers, sometimes up to 50 players, can wager on one or several table game types such as baccarat, craps, roulette and blackjack. To make a wager in stadium blackjack, the customer sits at a terminal, inserts his or her currency or cash card into the terminal, chooses a game type such as blackjack and proceeds to gamble based on the cards drawn by the dealer on the stadium stage. Even though this format allows the casino to offer a number of different side bets with the main blackjack game, the entire experience of social interaction, the factor that makes live table games attractive in the first place, becomes a very impersonal experience. This format does offer any “beginning” table games customer an entryway into developing enough game confidence to participate in the socially interactive live game, but the author does not see this as a doable long-term table game market. It should also be noted that in most stadium formats, the players have the option to wager the same type of table games in a video, quasi-slot machine format. Note: There are several points of confusion with stadium games. First, are the live table games of the stadium format attached to the table games or the slot department? Second, the operational game hold percentage is extremely low. Why? Because it is a comparison between total wager “handle” and win, not “drop” and win used in standard table games. The hold percentage is on the same par as the games’ operational mathematical advantage, which hovers around 3 percent to 4 percent (with side bets, 6/5 payoffs, combined with a higher-percentage game like roulette). Even slot managers, used to slot machine floor pars of near 10 percent, are bothered by this low hold percentage number.
Fully Electronic Eliminates “Traditional” Costs, But Is It Really The Same Game? For over 20 years, the author has been forecasting that table games will eventually drift to being fully digital games. A fully electronic game would eliminate the cost, and in some cases, security concerns experienced in traditional card and chip table games. Playing cards, casino value chips, shuffling machines, hole-card peeking devices, and dealing shoes will no longer be needed. The savings on eliminating playing cards alone is worth the consideration for developing a strategy for conversion to a total digital format. Player rates will no longer be guesswork, and traditional game security can be greatly reduced. With that said, it is the author’s belief that a live dealer must stay at the table in order to keep the game “live” and to make the games attractive. However, the qualifications to deal the games will no longer be whether they can “get around the layout” but how well they interact with the customers at the table. Instead of hiring experienced live game dealers, casino HR departments will be looking for people fresh out of college with a degree in communications. Will going to fully digital table games be the path to the future? Only time will tell. As former Nevada Gaming Control agent, casino operator, professional card counter and casino consultant, Bill Zender has been involved in various areas of gaming and hospitality since 1976. He has instructed courses on game protection, card counting, advantage play and gaming operations at various colleges and institutions throughout the country. As a member of JMJ, Inc., Zender was an owner and operator of the Aladdin Hotel and Casino. He has additional operational experience in card room casinos in California and is considered an expert in Asian gaming. For more information, visit billzender.com.
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The REIT Route Gaming real estate investment trusts continue to soar with income that’s virtually bulletproof, but are they good for the industry? By Frank Legato
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hen the global pandemic shut down multiple industries including casinos in 2020, real estate investment trusts that own nearly three quarters of the malls in the U.S. had to negotiate on rent payments: Tenants with zero sales found keeping up with the rent more than difficult. Not so in the case of the gaming REITs. Even through months of industry shutdowns, casino properties owned by REITs continued to pay their rents, and the gaming REITs—dominated at that time by Gaming and Leisure Properties, Inc. (GLPI), VICI Properties and MGM Growth Properties (MGP)— continued to roll right along. It’s an illustration of the stability of the REIT model as it applies to gaming properties, which is a relatively new phenomenon. Penn National Gaming created the gaming REIT when it spun GLPI off from Penn in 2013. Peter Carlino, who founded Penn National and served as its chairman for nearly 20 years, became chairman and CEO of the new REIT. It was quite a new concept for an industry once dominated by owner/operators like Sam Boyd and Benny Binion. The REIT acquires and controls the real estate; the casino owner pays rent to the REIT while continuing to manage casino operations. The operator gets an instant infusion of cash from the purchase to pay down debt, build new amenities and invest in growth opportunities, in exchange for a new line item on its operating budget for rent. And even in a pandemic, those rents mean the gaming REITs have a stable, reliable income source. “It took several years of very complex work to get a structure that could fly, but it made all the sense in the world,” Carlino recalls today. “Though, I must confess, it has been infinitely more successful than I could have imagined. It was simply a matter of a commitment to continue to build shareholder value. 24
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And it was a surprise to me as a major shareholder of Penn National that all this value lay unopened just below the surface.” While Penn National is known to dominate the regional casino market with 44 properties spread across the U.S., it didn’t take long for the REIT phenomenon to catch on with the major Las Vegas Strip operators. In 2016, MGP was spun off from MGM Resorts International. In 2018, as Caesars Entertainment emerged from Chapter 11 bankruptcy, it created VICI Properties as a separate public company and moved major assets to the new REIT. This year, VICI will close on its acquisition of MGP, which will extend its ownership of gaming real estate to 43 properties, including the most iconic names in the industry, from Caesars Palace and Harrah’s to MGM Grand and Mandalay Bay. And the growth is far from over. REIT ownership only accounts for 40 percent of the gaming properties in the U.S. (compared to 70 percent for malls, as an example), and iconic names continue to sell their real estate to REITs. So far, the gaming REIT phenomenon has been a smashing success, particularly for investors who have continued to receive dividends quarter after quarter, regardless of the vagaries of the overall gaming market. But are REITs good for the industry? “There’s definitely a divide in opinion,” comments Frank Fantini, principal of Fantini Advisors. “Obviously, the companies that have done it think it’s wonderful. MGM has reduced debt dramatically, and they put billions of dollars into their account by selling their properties, so they now can invest in growth opportunities. “The other story is that they have sold a depreciating asset and created a new expense that will continue forever, because now they are a tenant. Now they have to pay a landlord.”
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“I must confess, it has been infinitely more successful than I could have imagined. It was simply a matter of a commitment to continue to build shareholder value. And it was a surprise to me as a major shareholder of Penn National that all this value lay unopened just below the surface.” —Peter Carlino, Chairman and CEO, Gaming and Leisure Properties, Inc.
Fantini adds that the fact the gaming REITs deal in triple net leases—the landlord owns the real estate, the tenant pays rent, property taxes, insurance costs and maintenance—does pose some risk. “What happens when it’s time to upgrade these properties?” he says. “Under this triple net lease, the tenant is responsible for the maintenance of its properties, not the landlord. So what happens if their casino gets a little down in the dumps and it needs a billion-dollar makeover? They’re going to have to pay for that. So they’re paying a billion to make over a property somebody else owns.” Still, Fantini stresses that this risk doesn’t mean REITs are bad for the industry. In fact, he says the opposite is probably true. “These are smart people,” he says of gaming REIT executives. “They’re not going to be like slum lords, trying to take every nickel and dime that their tenants have. They realize that it’s in their long-term interest to have vibrant, successful properties as tenants, so they’re going to do the things that are necessary to make sure that not only they make money, but that their tenants prosper as well.” Many analysts agree on the long-term viability of the gaming REIT. “I think the industry owes Peter Carlino a huge sign of gratitude for creating this vehicle,” says Barry Jonas, managing director and head of equity capital markets for Truist Securities. “The amount of shareholder value that’s been extracted here has been tremendous. (REITs) basically found a new investor base, willing to enter the space and willing to pay a higher multiple than traditionally seen. “Yes, to a large degree, this is financial engineering, but I think it extracts a lot of value for both companies, as well as shareholders. And from a consumer perspective, there’s really no difference. The typical visitor or player at a casino that’s part of this model has no idea that there’s a different real estate owner.” For the operator, the REIT puts income to use in a way that makes financial sense, Jonas adds. “Ultimately, the REIT model basically says, let’s take the bedrock of earnings—let’s take approximately 50 percent of your EBITDA and transfer that to a REIT, and the multiple that an income investor would place on that, given the relative safety of getting paid that rent, is clearly higher than what investors typically place on a wholly owned gaming asset. “So effectively, this is financial arbitrage which just matches cash flows to investors looking for varying degrees of risk and willing to pay an appropriate multiple given their objectives. But I think a tremendous amount of value has been created, well beyond whatever tax advantages you get by being a REIT.”
GLPI focuses on regional casinos, like those managed by Penn National Gaming, including the Hollywood brand casinos at Charles Town racetrack in West Virginia; the flagship casino in Harrisburg, Pennsylvania; adjacent to the Kansas Speedway; and Penn’s latest “mini-casino” in Morgantown, Pennsylvania
Win-Win-Win Certainly, operators and the REITs themselves are continuing to realize tremendous value from the model. “For the operator, it’s a long-term capital source,” says Carlino. “Imagine having a loan, if you will, that you never have to pay off. It’s flexibility.” “When you think about our business, we’re almost in a sense like a bank,” adds Matt Demchyk, senior vice president and chief investment officer for GLPI. “I come from the real estate world, and when this asset class came out, there were a lot of questions. Is this really an asset class? Is it financial engineering? Then, you look at the bottom line of what we’ve been able to deliver at GLPI over these many years, and it’s exceeded, in stability and in growth, the number of companies with similar business models.”
“Generally, REITs are good for the gaming industry,” comments Ed Pitoniak, CEO of VICI Properties, “because they’ve created another source of capital that helps the industry grow, that helps the industry with balance sheets, that generally serves as an underpinning for the industry that will be there for decades to come. “Unlike a lender, we’re not going to come and go from gaming based on how we see the risk profile of lending to gaming. Unlike equity investors in gaming stocks, we’re not going to say we love you today, but we don’t like you tomorrow. MARCH 2022 www.ggbmagazine.com
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VICI Properties is acquiring MGM Growth Properties, giving it high-profile Las Vegas Strip casinos like Caesars Palace, MGM Grand, Bellagio and The Mirage (soon to be Hard Rock). At the same time, VICI has acquired the real estate of the Venetian and Palazzo from Las Vegas Sands.
Our weighted average lease term is 43.5 years. So at a minimum we’re around for the next 43.5 years, and likely for decades after that. We are huge believers in what our operators do, and we back up our belief with the will to commit to them through our capital for decades to come.” More and more operators are utilizing REITs, although many choose to maintain part of their property portfolios as wholly owned properties. Others, like Golden Entertainment, eschew the REIT model and choose to sit on valuable real estate—and in markets like the Las Vegas Strip, that value continues to rise—for possible future organic growth. VICI’s Pitoniak says there is no blanket answer as to whether the REIT model fits any specific operator. Many use the REIT as a specific vehicle to expand into other markets. “In the case of Caesars, we own the real estate of Caesars Palace because it was all part of the workout of the Caesars bankruptcy,” Pitoniak says. “But subsequently after our emergence on October 6, 2017, we announced a deal with Caesars whereby they sold us the real estate of Harrah’s Las Vegas, and one of the reasons they did that is because they wanted to create a funding source to go buy two magnificent assets in Indiana. So, the answer to why a gaming operator either owns or chooses to sell real estate is usually going to be situational or circumstantial, based upon their growth ambitions, their funding needs, and the degree to which their real estate represents an asset that can for them be a really compelling source of liquidity.” In REITs, operators have a reliable source to create that liquidity. Their financial stability means they have access to capital that most operators cannot boast. “We just did a debt deal for 10-year debt, unsecured by anything, at 3.32 percent,” comments John Payne, the veteran Caesars executive who is now president and COO of VICI Properties. “We can raise equity very efficiently. We can raise hundreds of millions, even billions of dollars efficiently overnight. And by packaging that with an audience that really wants these durable cash flows and values them in isolation, we can give the operators incredible prices for real estate.”
Perpetual Growth There’s no slowdown in sight for the growth of gaming REITs. New arrangements pop up in the news every month. Among the major deals being accomplished this year are VICI’s purchase of the Strip real estate for the Las Vegas Sands properties, including the Venetian, Palazzo and Venetian Expo Center, with Apollo Global Management buying the operational assets. Along with VICI’s acquisition of the MGP properties, that means the REIT will add eight more Strip properties. Other deals include GLPI’s planned purchase of the Tropicana Las Vegas real estate under a 50-year lease, which is linked to Bally’s Corp. buying the operating assets—a deal which could see Bally’s making substantial changes to the Trop property, including the possibility of a total razing/rebuild project. And then there is a unique deal GLPI signed with Baltimore’s Cordish Companies, a 39-year ground lease under which GLPI will buy the real estate for all Cordish Live!-branded casinos in Maryland and Pennsylvania, with the added promise that GLPI will assist in financing on any future growth projects for Cordish—gaming and non-gaming. Cordish, a 111-year-old real estate developer that only became a casino operator with the 2004 opening of its first Live! casino in Maryland, surprised many with the move to sell its gaming real estate. The reason, according to Cordish Chairman and CEO David Cordish, is simple: “The answer, in one word, is growth,” the company’s third-generation leader said in a recent exclusive interview with GGB. “We’ve built five major casinos from the ground up— we designed the two Hard Rock properties in Florida; we did the architecture, the engineering, the construction, we put up the equity. We financed them, then the property in Maryland, Philadelphia Live! and Pittsburgh Live! 26
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“REITs are good for the gaming industry because they’ve created another source of capital that helps the industry grow, that helps the industry with balance sheets, that generally serves as an underpinning for the industry that will be there for decades to come.” — Ed Pitoniak, CEO, VICI Properties
“Casinos are highly capital-intensive investments, and we’re extremely liquid for a privately held company... All five of the casinos we’ve done from the ground up are on the East Coast. This (REIT arrangement) will enable us to go further afield, and definitely grow faster.” Cordish also noted the tax and balance sheet benefits of partnering with a REIT. “GLPI paid off 100 percent of the debt on all our casinos, so the three casinos we actively own and manage are debt-free,” Cordish told GGB. “In lieu of debt, we have a ground lease—and a ground lease is a business expense, fully deductible. If you have debt service, principal is not a deduction when you pay it; the interest is deductible, but the principal is not. So, it’s extremely tax-efficient. “Ground rent represents a fairly minor percentage, and it’s covered several times over. All that income continues to go to us.” “The Cordish Group is a family company that has been around for 111 years,” says Carlino. “In that time they’ve only sold properties. They never entered into an ongoing sale/lease-back with anyone—111 years, and they picked us, and it wasn’t because it was the best price. It was because it was the best choice, in their words. “Remember, we are a long-term source of financing. The Cordish deal was only limited by (what the law requires). If they could have signed a 100year deal, I think they would have done it. They don’t have to worry about the vagaries of the economy; they don’t matter. They’ve got a fixed arrangement. It’s predictable. It’s certain it doesn’t get pulled. Nothing bad can happen—not now, not 10 years from now, not 50 years from now.” “One of the fundamental differentiators for our real estate as a real estate asset class, especially within the so-called triple net sector, is the sheer magnitude of our properties,” comments VICI’s Pitoniak. “They average around 2 million square feet, they tend to sit on at least dozens of acres of land, and they’re highly, highly utilized. “So because of the magnitude of our properties and because of the opportunity to creatively expand them or improve them, we have an opportunity most other triple net REITs would not have, which is to invest incremental capital into our resorts in return for incremental rent.”
Greenfield Ahead There is still plenty of greenfield space for the gaming REITs to grow. Opportunities exist not only among the 60 percent of existing gaming properties still wholly owned, but in the new properties that will appear as more jurisdictions approve casino gaming. “Our job, of course, is to be mining for opportunities as we find them,” Carlino says. “I think the runway is still there.” That runway also could lead to the tribal gaming properties. One of VICI’s front-burner deals is to acquire the real estate under The Mirage, with operations being acquired by Hard Rock International, owned by the Seminole Tribe of Florida. While that deal—which stands to totally transform the Mirage property—is for a commercial casino, VICI also controls the real estate for the Class II Harrah’s Cherokee properties in North Carolina, and 28
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Payne anticipates further deals in Indian Country. “I spent a lot of time in my former career developing relationships with Native American nations,” he says, “and we continue to see opportunity to help them grow not only in commercial casinos, but there could there be a time where we can help them develop their casinos on their tribal land.” Other growth opportunities lie in what’s known as “experiential” real estate, which can encompass pure hospitality and entertainment plays as well as gaming properties. But for now, there is a broad array of opportunities in the casino market—not only in existing properties, but in future properties. “We had offered to participate in Massachusetts with several bidders,” Carlino says, “people who might have been able to secure a license who we told yes, we would like to fund it. “You’ll see us pretty much everywhere as new licenses evolve. There’s no way you can screw up a greenfield opportunity in a limited-license state if you spend wisely and proportionate to the market.” “We have been around for only four years,” comments VICI’s Payne. “We’ve had the opportunity to do almost $30 billion in transactions during that time. We are in the process of closing two transformative transactions—we’ll close the Venetian in the first quarter of 2022, and we hope to close our acquisition of MGP, which was the second largest gaming REIT, by the first half of this year. “We will own 10 assets on the Las Vegas Strip. We’ll have 43 properties nationwide in 15 states. We’ll have world-class destination resorts, best-inclass regional facilities, drive-to and local casinos, racetracks, and riverboats as part of our portfolio. We will continue to work with casino operators to see if there are opportunities to acquire their real estate over the years. “We think there is a lot of opportunity to continue to do that inside of Vegas, in the regional markets, the Downtown market of Las Vegas, and the locals markets of Las Vegas, as well as many other regional markets where we don’t have casinos. “When Ed and I started the company, it was born a gaming REIT, but it was always positioned as what we would call an experiential REIT. We always knew that we’d continue to buy gaming real estate, but we also positioned the company with expertise to acquire things like golf courses, amusement parks, family entertainment centers, water parks, ski resorts and other entertainment forms. “We’ve announced a couple smaller transactions with ClubCorp and their Big Shots brand. We’re working with Blackstone and their Great Wolf brand, we’ve been involved in a deal at Chelsea Pier in New York. So we’ve started on that journey, and you’ll see us do experiential real estate, as well as gaming real estate, as we continue to grow.” For now, though, there is plenty of gaming business to be had. Carlino points to the fact that GLPI and VICI work with the best operators in the industry—as proven by the continuation of rent payments “through the worst of times,” when there was no revenue coming in their doors. “Will we be someplace else someday? Probably,” Carlino says. “But so far, we’re in a space that is, dare I say, bulletproof.”
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In early 2020, the world went viral as Covid-19 shut down nations and industries and sent people into lockdown—and gaming operators wrote a new handbook for survival By Marjorie Preston
COVID-19: How We Survived I
n March 2020, as the reality of the Covid-19 pandemic was setting in, Tilman Fertitta told Texas Monthly his companies were on borrowed time. “I don’t think anyone can survive past the end of the year,” said Fertitta, the billionaire owner of Golden Nugget casinos and Landry’s restaurants. “If the country is shut down come October or November, it’ll be anarchy in the streets.” Fertitta was both right and wrong. The pandemic caused scores of businesses to falter, and some to close. Yes, there was a little anarchy along the way. But surprisingly, though the virus persisted far beyond 2020, gaming has proven resilient. With some serious belt-tightening and a little help from iGaming, the strongest survived and in many cases, outpaced their pre-Covid performance. For example, in 2020 Golden Nugget Online Gaming’s third-quarter revenues were up 93 percent from 2019. By then, Fertitta had changed his tune, and called the company “pandemic-proof.” In Atlantic City, revenues plummeted 69 percent during the first month of the shutdown. But like a kid on a trampoline, the industry bounced back. In 2021, retail betting, sports betting and iGaming hauled in $4.737 billion—64.5 percent more than 2020 and 36 percent more than 2019. A lot has changed in the past two-plus years, and some changes are for keeps. Let’s take a look back and a glimpse ahead.
Battening Down In early 2020, U.S. commercial casinos closed for months in response to the pandemic, then reopened with a tightship strategy that buoyed the bottom line. Nevada-based Red Rock Resorts, for one, negotiated new terms with lenders and vendors, streamlined marketing and pared back non-gaming amenities. In doing so, it saved $150 million in costs that year. “That’s been the story for months now—reduced revenues but greatly improved margins,” says Brian Wyman, 30
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senior vice president of operations and data analytics for The Innovation Group. “Operators reduced marginally profitable or unprofitable outlets, and that did great things for the bottom line.” But that was then. Adds Wyman, “Initially there was so much pent-up demand, people were comfortable with less” when they visited their favorite casinos. “But we’re hitting a point where the closure of amenities, which really drove a lot of the margin improvement, comes at the expense of experience. Now there’s more clamor for things to be the way they were”—as in more F&B, more entertainment, more fun. “Operators are being very thoughtful and metered about the pace at which they bring things back, and deciding which things to bring back at all.” Which brings us, inevitably, to a time-honored tradition: the casino buffet. Buffets were “on thin ice” prior to the pandemic, says Wyman: “The concept is a little tired.” And these days, a buffet protected by a “sneeze guard” is few people’s idea of appetizing. Nationwide, Caesars Entertainment has reopened just one of these all-you-can-eat feasts—the aptly named Bacchanal at Caesars Palace, at $94 a pop. Other casinos are phasing out the concept altogether, opting for food service that’s easier to operate, attracts a younger crowd and generates less surplus (according to a 2017 study, half the food at hotel buffets goes to waste, making buffets a king of the loss leaders).
“It was a great opportunity to hit the reset button, to rethink the business and make smart changes that are permanent.” —Brian Wyman, Senior Vice President of Operations and Data Analytics, The Innovation Group
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On reopening, casinos offered fewer table games at higher minimums and yields, with fewer player positions, for savings all around. They installed more electronic tables and removed some slot inventory for social distancing and to make room for Plexiglas shields. At that time, online gaming was the ace in the hole, says gaming and hospitality expert Bob Ambrose. “There’s no doubt iGaming saved the industry during the shutdown, and it continues to grow. Yes, brick-and-mortar does share this revenue stream in third-party arrangements, but when the landbased doors were closed, it was a lifeline. “Legal sports betting added another pathway to the future, and the acceleration into the mainstream has been driven by the pandemic.”
“It was a perfect storm—not only the pandemic, but everything that followed: employment issues, challenges with the airlines, commodity challenges, supply-chain disruptions, higher prices. How do you manage all that?” —Mark Birtha, General Manager, Hard Rock Casino & Hotel Fire Mountain, Sacramento
The Perfect Storm Hard Rock Casino & Hotel Fire Mountain faced unusual challenges during the pandemic. The $440 million Sacramento property had opened the previous October with almost 1,600 slot machines, 57 tables, a hotel, meeting spaces and of course, a buffet. That same month, half a world away, a market vendor in China became Patient Zero, the first human being infected with the mystery virus now known as Covid-19. Four months after opening its doors, Fire Mountain—operated by the Enterprise Rancheria and Florida’s Seminole Tribe—was compelled to close. General Manager Mark Birtha calls it a “perfect storm—not only the pandemic, but everything that followed: employment issues, challenges with the airlines, commodity challenges, supply-chain disruptions, higher prices. How do you manage all that?” Two months later, when the resort reopened, Birtha’s goal was to “understand the market and drive efficiency. The delicate balance is ensuring we don’t focus so heavily on efficiencies that we dilute the hospitality experience. Say you’re not running valet or offering entertainment, or you’ve turned off your buffet. Those may be things guests can live without. But we don’t want to go too far down that road. We are in the hospitality business—people taking care of people.” On reopening, one staffer memorably said, “You never know how many doors you have until you have to sanitize them all.” “It was humorous at the time,” says Birtha, “but a year and a half later, it’s still very relevant.” In response, Hard Rock International created its Safe & Sound protocols, “well over 100 pages of sanitation and safety precautions that were vetted through the CDC and other medical and health experts.” And while cost-cutting was essential, the property also made prudent investments, including a $500,000 air-filtering system that “literally creates hospital-quality air purification,” says Birtha.
“So you make capital investments like that for the benefit of your employees, your owners and your guests. And I think the guests truly appreciate it— they feel safer to come and stay. But who would ever have thought this would be a key point of our advertising and messaging?” Covid-19 has reminded the world it’s still vulnerable to broadsides outside anyone’s control. So how do operators in a changing environment prepare for the unknown? “It seems we’re in a newer normal every three to six months,” Birtha observes. “It’s incumbent upon us as operators to be fluid and flexible—it’s not so much about having a ‘Plan B,’ but being very much in touch with the needs and expectations of our companies, our owners, and more importantly, our guests and team members. It’s just new challenges all the time.” Hard Rock Fire Mountain is roaring back. It will open its 3,000-capacity Hard Rock Live indoor concert venue in spring in collaboration with Live Nation. Importantly for a tribal endeavor, it’s part of a larger $75 million expansion that also includes a gas station, a convenience store and other “economic engines” that are less subject to pummeling by a health crisis.
The Human Touch At this point in the Covid saga, some people remain wary of close quarters, and technologies allow them to keep their distance. As the industry moves to contactless technologies, could it diminish the fundamental experience of hospitality—of dealing with “my bartender, my dealer, my host?” “It’s a strategic fine line,” says Ambrose. “There’s always a chance that the lack of personalized employee service can be a negative for some guests.” That said, “the future of the hospitality industry is bedrocked in technologies that will interact with both the physical and virtual world for customers.” Cashless gaming has become a priority, of course. “In many ways the casino MARCH 2022 www.ggbmagazine.com
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WORLD VIEWS
Andrew Tottenham
Tottenham & Co., International Gaming Consultants
A
ndrew Tottenham has a long history in gaming in Europe, both in operations and development, with broad expertise both in land-based development and iGaming. He explains the ongoing repercussions of the global pandemic on gaming around the world. GGB: A lot of gaming expansion plans were in the works before Covid-19 hit. How has the virus affected those plans, in places like Asia, Europe and Brazil? Tottenham: To a great extent, a casino’s success
will depend on whether it’s dependent on inbound tourism and the policies of the governments in the main feeder markets. Macau, for example, is dependent on gamblers from mainland China. As long as China follows its zero-Covid strategy, Macau will suffer. If Europe doesn’t keep bouncing in and out of lockdowns, casinos should open up and the new casinos in Cyprus and Greece should do OK. Brazil would be an exciting market, and by the time legislation has passed and major resorts have been built, Covid should be in the rearview mirror. In the short- to medium-term, the strategy has to be to preserve cash, because we don’t know what’s coming around the corner, and focus on local and not on VIP, a market that is going to take time to come back. Longer-term will depend on how this disease progresses. If we see the emergence of a highly transmissible virulent strain that evades vaccines, people are going to be increasingly reluctant to go places where there are many other people. This is unlikely, but possible. Has the outbreak strengthened online gaming at the expense of land-based operations?
Inevitably, Covid restrictions have had a devastating impact on the hospitality sector. The impact has been twofold. The negative impact on balance sheets has been immense, despite government grants and loans. Companies are in a much weaker position than before the pandemic, and some will struggle as we emerge from the pandemic. The other impact has been on staffing. Many people have left casinos, hotels and restaurants. Many have made the decision not to return. The industry has lost a great deal of human capital that will not return. Online betting suffered initially because of the lack of events to bet on, but recovered and has gone from strength to strength. As long as we don’t go into more prolonged lockdowns, I tend to think the land-based industry will come back. It still has to
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“Land-based gambling is a social activity, a shared experience, something the online sector cannot offer. Barring further lockdowns, I’m confident the land- based sector will return to pre-pandemic levels in the next year or so.” —Andrew Tottenham, Tottenham & Co. International Gaming Consultants deal with the problems it was facing pre-Covid, like an aging customer base, but land-based gambling is a social activity, a shared experience, something the online sector cannot offer. Barring further lockdowns, I’m confident the land-based sector will return to pre-pandemic levels in the next year or so, and online will continue to benefit. For convenience as well as safety and cost savings, the industry is moving toward cashless, touchless, contactless. Will these technologies change the essential nature of hospitality, making it less hospitable and human?
There are already hotels where you can put your credit card into a machine that dispenses your room key and stay without ever speaking to a soul. This is a niche market, but I think the move to cashless provides companies with the means to offer more personalized services. Front-line personnel will be freed from mundane tasks and can spend more time interacting with guests. However, if management sees the move to cashless purely as an opportunity to save money, then human interaction will decrease and it will become less hospitable. What will a post-pandemic industry look like, if we ever get there?
I’m optimistic we’ll get back to “normal” over the next two years. There will be casualties. Balance sheets will be badly battered. But management will learn how to make their businesses more robust, and innovation will provide solutions to make the industry more resilient. Once we’re through this, management can get back to trying to attract a wider segment of society, turning around political efforts to shrink the industry and attracting and retaining talent.
industry is catching up to other industries where experience has shown that ecommerce is the present and future model. We’re in an age of smart technology. This will be so important moving forward.” Virtual experiences aren’t always ideal, but they may have to do until the pandemic is well and truly over. And they may remain optional for the long term. “We’ve seen the new format for conventions,” says Ambrose. G2E 2021 was “a perfect example, where attendees had a choice of physical or virtual. Maybe this model is short-term. Maybe it’s a permanent option for some industries. Personally, I think this should have been an option years ago. It has its value. “There’s a loss to the revenue stream for hotels, restaurants, casinos and a city when people attend a conference or convention virtually, as well as a loss of networking opportunities. But at least in the short term, as companies try to recoup their decimated budgets, it’s a great cost-saving on the way to a gradual ramp-up.” What can operators do now to ensure a successful post-pandemic? “On the employee side, they have learned an entire new meaning to the term, ‘front-line,’” Ambrose says. “Company leadership must make time to communicate and encourage them. Operate with transparency. Have meetings. Remember, they, too, have to adapt to the new environment in the workplace. They are the face of the property to the guest, even if they’re still masked.” And that kind of support may help restore a bottomed-out workforce. Last November, when the Omicron variant came along, customers who had relaxed about gathering became alarmed once more. “We were back on the merry-go-round, masking up again,” says TIG’s Wyman. Those kinds of jarring shifts may happen again before the virus finally recedes. It’s frustrating. “On the other hand, it’s a great opportunity to hit the reset button, to rethink the business and make smart changes that are permanent.” Birtha adds, “A post-pandemic industry could literally be learning how to live with this at some level. The industry has been through so many challenges over the last few decades, from the Gulf War to 9/11 to the Great Recession and now the pandemic. We’re a very resilient industry. We’ll survive this too.”
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EMERGING LEADERS Risky Jump Shot Jamie Smith Business Development Executive, Aristocrat Technologies, Inc. hen it comes to Jamie Smith, there are two things you should know. She grew up in paradise. Kailua, Hawaii. Second, she’s a pretty good basketball player. She left one paradise for another when she accepted a basketball scholarship to the University of Nevada, Las Vegas, with dreams of playing in the WNBA. In the end, Smith played pro ball in Portugal. She didn’t like it, so she returned to UNLV to earn a master’s degree and entered the gaming industry with AGS, working her way to director of sales for table games. Smith majored in criminal justice at UNLV with plans to work for NCIS or the FBI. While studying for her master’s, she entertained thoughts of becoming an athletic administrator. “Who hasn’t jumped career paths in college?” Smith quips. “I had a friend who suggested that I check out this up-and-coming gaming company called AGS.” AGS had just started a table games division. “Being a lover of blackjack and poker games, I decided to apply for a sales position,” she explains. “Once I started to meet others in the industry and learned that these people genuinely love their jobs and what they do, I knew I wanted a career in gaming.” Once she got a taste of gaming at AGS, “there was no turning back. I fell in love with the industry.” As director of sales, Smith oversaw a team of five. The team is responsible for meeting a sales budget. She also has her own territory, spaced around North America, from Mexico to Canada, from Nevada to North Carolina. “My daily job included ensuring we build relationships with our customers,” she says. The Covid pandemic taught Smith to approach sales with new tactics, learning to navigate and manage relationships without physical interaction. “I had to get creative with communication and selling.” Smith faces obstacles every day, beyond Covid. Maybe an installation doesn’t go as it should. Maybe she needs to negotiate a new deal.
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“Once I started to meet others in the industry and learned that these people genuinely love their jobs and what they do, I knew I wanted a career in gaming.” “I’ve learned that listening is key in almost every situation. Also leaning on other members of the team to do their parts is important; it is all about teamwork,” says Smith, who works out to relax, to clear her mind and improve her mental attitude. John Hemberger, senior vice president of table games at AGS, has been a mentor for the past six years. “He took a chance on me when I first broke into the industry as I had no experience in gaming other than gambling in the casinos,” she says. “He took me under his wing and taught me the ins and outs of the industry.” Hemberger liked Smith’s approach enough to promote her to director of sales in just 18 months. The promotion gave her the chance to learn the back end of a gaming company and to manage a team of unique personalities. If Smith could speak with her younger self—or anyone coming into the industry—she’d say take chances. Take risks. And she lives by her mantra. On February 2, she started a new job as business development executive at Aristocrat. She’ll learn even more about the industry, this time from the slots end. —Bill Sokolic
Curious Cat Brett Colbert Director of Product Management, Global Gaming Operations, Scientific Games f there’s an underlying theme to Brett Colbert’s career in gaming, it’s curiosity. Born and raised near San Diego by two teachers who encouraged exploration, understanding and, thus, question-asking, he comes by it naturally. And, when a friend and member of the Barona Band of Mission Indians helped him land his first gig after college at Barona Resort & Casino, it served him well. “When I started at Barona, my job was still fairly undefined,” says Colbert, but he soon found himself working with Will Dunn, then director of planning and analysis. Dunn was undertaking a project to help the operator better understand each game on the casino floor. He tasked Colbert with looking for patterns in play and trying to understand why the games performed the way they did. “This was in the early days of Barona’s shift to what is now one of its core values: providing players the best possible experience,” says Colbert, and that ethos has driven his career ever since. That work with Dunn led Colbert to a few online courses in data mining and ultimately Chuck Hickey’s slot analytics team at Barona, where he was really pushed to engage with the customer, walk the floor, and understand how players approached the casino and its games. “Chuck was a great mentor,” he says. “He taught me how the slot industry worked, and how to work with vendors.” Colbert was driven by the work, but knew he needed some hard skills to continue this
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path. Conveniently, the University of California, San Diego had launched a master’s program in data science, which he undertook and completed while still on the job at Barona. “That got me over the hurdle,” says Colbert. “Everything really opened up from there.” In addition to Hickey, Colbert worked closely with another mentor, Donne Grable, to direct Barona’s successful slot program. “He was a huge influence on me learning about slots and how to see things from the player’s point of view,” Colbert says. “We were walking the floor trying to solve a puzzle, analyzing data, talking to players, working with our vendors and their game designers. We were all learning together.” After more than a decade of success at Barona, Colbert moved on in late 2020 to become director of product management, global gaming operations, at Scientific Games, where he helps drive games from concept to completion. “As a data scientist, you really must be an expert in what you’re measuring to be successful,” he says. After getting to control the floor at Barona, selecting the games and where they went, he says he kind of hit a wall: “I had to make the jump to the vendor side to continue to grow my understanding of how the games work.” While his new role is less focused on analytics, it’s still primarily driven by questions. “We’re trying to find the signal in the noise, to see why games are performing the way they are. We’re asking: ‘What are our competitors doing? What are they making? Where is our performance by comparison? Why are we making the games the way we are?’” Colbert is excited to be learning from Nathan Drane, Scientific Games’ senior VP of global product management, whose insights and understanding of games he describes as “beyond incredible.” “I used to be able to pick a game and put it on the floor, put it to work, and analyze the data. Now, when I collaborate on a game concept, it’s going to take 18 months to get to market and another six months to see how it plays,” Colbert says. “That long cycle is a humbling challenge.” Embracing that challenge speaks to the advice Colbert offers other young professionals in gaming: “Strive to be comfortable being uncomfortable. Find mentors who are the best in their field and ask them how you can be better at what you want to do. Ask questions, make mistakes, and learn as much as you can.” —Keli Elkins is director of corporate communications and marketing for The Innovation Group.
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Engineering Solutions Travis Bussey Vice President, Hardware Engineering, Everi Holdings hen Travis Bussey applied for a mechanical engineer position at what is now Everi Holdings, he wasn’t too sure what kind of product the company produced. But he was excited to land the position just after receiving his bachelor’s degree from the University of Texas. He was even more excited to find out the company, then known as Multimedia Games, served the casino industry. “There were challenges, but it’s been super fun working on the hardware to make gaming products,” Bussey says. “I love making entertainment products.” The company had offices in Bussey’s hometown of Austin, Texas. Having a workplace devoted to gambling in a state with no casinos seems a little odd, but Bussey’s not complaining. He’s just surprised he’s still with the company after all these years, moving up the chain of command even as Multimedia merged with Global Cash Access to form Everi in 2015. “My role and responsibilities have changed just about every year for the past 14 years. These new challenges have helped keep me interested in gaming,” he says. As vice president, hardware engineering, Bussey bears responsibility for new product development from initial sketch through production, as well as supporting existing products; some machines are 10 years old. “Early on, Multimedia Games was slow to develop new hardware products,” Bussey says. “That’s not the case anymore.” The company scheduled a major release every three years on average. These days they’ve expanded production, and have multiple game studios beyond Austin: Reno, Chicago and Las Vegas. The studios are game development-centric. “My teams build out prototypes,” he says. “There’s lots more effort involved, with more content and more diversity.” Covid arrived. Everi’s offices shut down. “To my surprise, everyone seemed more efficient working from home,” he says. “They can do designs at home.”
W
But to build prototypes you need people in the office, Bussey says. The hardware team has the largest presence. “My perspective is there is no reason to go back to requiring everyone to come in. Yet there are still benefits to an in-person team.” Post-Covid has brought new challenges. Parts shortages and shipping problems, he says. “We’re focused on rapid redesigns,” he explains. “But if we can’t get a capacitor, we have to wait or go through another redesign.” Engineering school teaches important information like problem solving. No one knows everything. Find subject matter experts and leverage that. Bussey wants to give a shout out to the executive team and upper management team for their feedback. He offers high praise to Keith Riggs, senior vice president and games chief technology officer, because of his “logical mind.” “He gives me feedback regularly and keeps an even keel when things get tricky,” says Bussey, who likes spending time outside with his two young children. As far as advice for the engineer of the future, Bussey has three important words. “Always stay hungry. Build relations with people around you, not just your department. Never rest on your laurels.” —Bill Sokolic
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Tourism Champion Eunice Chua Director of Strategic Planning & Analysis, Marina Bay Sands unice Chua’s passion in the integrated resort (IR) business started more than a decade ago when she joined the Singapore Tourism Board and was assigned to the Marina Bay Sands portfolio. She considers herself “extremely fortunate” to have had the opportunity to work closely with senior executives from Marina Bay Sands to facilitate the opening of the megaresort and to bear witness to a historic turn that saw the transformation of Singapore’s tourism on the global stage. In the unique dual role of a regulator and a tourism champion, not only did Chua examine the IR’s obligations to the Singapore government, but she also gained, through the process, a much deeper appreciation of the IR business’ contribution as an engine of economic and tourism growth. Chua recalls that during the early days of her career, it was a demanding but beneficial challenge to expeditiously ramp up the steep learning curve of the gaming industry. “The scale, depth and breadth of the learning experience was overwhelming at the beginning—understanding the casino regulations, learning about customer segments, appreciating the nuances of the gaming organization, running analytics, remembering game rules and the math behind them, etc.,” Chua says. However, by dint of sheer determination and a “never-settle” attitude, challenges transformed into opportunities. “I stayed hungry for information and knowledge,” says Chua, “always feeling like I knew only as much as the tip of the iceberg, and I continued to stay curious and learn from anyone and everyone who was willing to help. Over the years, I was fortunate enough to have met important mentors who were incredibly generous with their help and guidance, undoubtedly impacting my career and life in defining and meaningful ways.” As part of the support that she gives back to young professionals in the organization and the industry, Chua has been part of the CHASE program that was spearheaded by one of her mentors and a former executive at Marina Bay Sands, Andrew MacDonald. Standing for “Committed, Hardworking, Ambitious, Smart, and Execute,” the program not only provides learning and development opportunities beyond one’s normal day-to-day responsibilities within the organization, but also allows for a number of platforms for growing professionals to collaborate
E
across departments and functions as they work together on ad hoc projects, attend industry events and summits, and go on study trips to learn from competition in the region. Moreover, this program opens up tremendous networking opportunities and serves as an effective channel for the “team of teams” concept to crystalize. As Chua suggests, “You don’t necessarily have to follow the same formula. Go create your own ‘CHASE’ and let it evolve over time as you grow and learn. Everyone should have their own ‘CHASE,’ and ultimately it’s all about lifelong learning, humility, and never settling.” Looking back, Chua recalls taking the leap of faith to accept a relatively junior position at the entry level into Marina Bay Sands. “I remain extremely grateful for the opportunity that I jumped at and have no regrets to this day,” she says. As she sees it, Marina Bay Sands is a unique property with its own dynamism, scale, and pace. “It is such a huge organization that while it means there are 1 million things happening at any one time, it also means there are countless opportunities at the same time,” she says. “It can be easy to be lost in the day-to-day work with the fast-paced nature of the businesses, but it’s the diverse scope of the integrated resort model that emerging leaders and young professionals should be excited about.” Evaluating the trends in today’s gaming industry that open doors for young professionals, Chua believes the gaming industry is ever evolving. Despite its complex regulatory environment, there are always new trends and opportunities for innovation and change that allow emerging leaders to carve their own paths and chart their own career trajectories. As she looks forward to the coming years, “the Covid-19 pandemic has accelerated many changes, including digital transformation and emergence of a new generation of premium customers. All of these open up many possibilities, and I am definitely excited about the future of the gaming industry.” —Michael Zhu is a partner and a senior vice president of The Innovation Group.
MARCH 2022 www.ggbmagazine.com
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Reaping the
g r e n Sy ies
Avoiding the frictions of interactive gaming and land-based casinos By Brendan D. Bussmann
A
s the gaming industry has evolved, one of the keys has been how advancements in technology can advance the experience for the guest. The industry continues to engage the existing customer but also attracts a new customer into the mix that may not have been interested in casino gaming previously for various reasons. Normally, this customer is one that may have not previously enjoyed the gaming experience because of perceptions of the industry or the lack of desire to go on a casino floor. However, as the industry has moved, so has the technology that has made some of these games more attractive to a wider audience. This has been through the use of interactive tools including online gaming, mobile gaming or sports betting as drivers to engage individuals into the brick-and-mortar facilities. Driving customers into the facility while using interactive gaming as an extension to the floor has always been a delicate balance. However, strong operators have continued to find ways to avoid the friction between these two worlds and create a symbiotic relationship that allows the customer to enjoy the experience in an interactive setting as well as in person to drive both gaming and non-gaming revenue. This has broadened the experience and customer base that has in turn driven additional revenue opportunities and further diversification of the product.
Free to Play as an Entry Point Both commercial and tribal entities have looked for the “secret sauce” to try and use free-to-play (F2P) games online or through a
mobile device to attract a new customer to the mix. While iGaming has largely not been adopted as quickly as thought in some markets, free to play offers a strong entry point with a lower cost of acquisition for a new customer to the land-based experience, but also provides entertainment for those patrons when they are not at the facility. One such example of this has been the free-to-play interactive gaming that has been established by Wind Creek Hospitality, owned by the Poarch Band of Creek Indians. Wind Creek, which has land-based properties in several states and the Caribbean, has integrated its free-to-play program into the overall guest experience to drive both gaming and non-gaming revenue. The mobile app links to their rewards program while allowing the player to engage when it is convenient to them. This allows the player to translate those rewards and be redeemed in several non-gaming aspects of their landbased operations including hotel, getaways, and food & beverage. In the convergence of “whatever whenever,” this has also translated into additional play within their facilities, as guests will enjoy the entertainment of casino gaming while redeeming rewards on non-gaming amenities as much as or more than they did before. They have become further engaged through the interactive experience. Other tribes and commercial operators have found the same success that allows both the guest and the operations to benefit from this engagement experience on both sides of the equation. This further exemplifies that land-based gaming can be driven by interactive play, whether it be free-to-play or realmoney games. The same can be said for driving real-money gaming as an extension of the casino floor. Free-to-play games can also be a transition to real-money gaming if intersected properly into a player rewards program, and it can go across all segments. Not every player always wants to use a real-money game to engage in entertainment. Free to play has provided a strong option for player acquisition, retention, and engagement in the overall guest experience.
Sports Betting as Another Entry Point Since the repeal of the Professional and Amateur Sports Protection Act (PASPA) by the U.S. Supreme Court in May
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One of the challenges with sports betting is to get the mobile customer into the casino and create a seamless experience that also drives additional gaming and non-gaming revenue. 2018, the focus on sports betting has been intense by industry leaders. The intersection between sports and wagering is nothing new, as illegal wagering was occurring offshore for years or with a local bookie until PASPA was overturned due in part to the state of New Jersey and then-Governor Chris Christie’s desire to create a legal and regulated market. To date, more than 30 states and jurisdictions have legalized sports betting in the United States. However, one of the balances was to drive these new and existing guests into the casino, but also maximize the experience by allowing mobile wagering; this is not only convenient but also allows for the engagement of the player during contests and on their own time. One of the challenges with sports betting is to get the mobile customer into the casino and create a seamless experience that also drives additional gaming and non-gaming revenue. Adding to this challenge is the issue of acquiring customers, which in some markets has gone into the thousands of dollars to try to get market share and drive customers to specific platforms. As the continued shift within the market is to not only drive customers to other aspects besides sports betting, it is also to find profitability within the sports betting space at an earlier rate than has previously been desired by some operators. Prudent operators right now are looking at how to balance their marketing spend as to not “blow the budget” just to encapsulate market share at the expense of long-term profitability. This is in addition to creating an interactive and innovative experience that understands the customer. Creating loyalty programs to drive people into gaming facilities will further help highlight how creating an immersive, land-based sportsbook can help drive the customer in during events to help both gaming and non-gaming revenue grow beyond their current levels. Free to play also offers a solution for interaction between the sports bettor and the operator as well as to other key stakeholders including teams, leagues and media companies. As the landscape continues to evolve, fans continue to look for different ways to interact with sporting events. Sports bettors and fans looking to engage in sports betting are looking for that continually innovative experience. Companies like FanBeat, an app that was designed around the fan engagement process, has found, like others, a cost-effective way to attract and monetize the fan experience in a lower-cost method than some of the current promotions that are being provided in markets as they launch. Mobile wagering continues to be the dominant revenue driver for sports
betting, as it on average is over 80 percent of the revenue in full mobile markets. However, translating these guests into the land-based experience is key to create the driver for brick-and-mortar facilities. Interfacing with the rewards program at MGM Resorts not only integrates sports betting and online gaming experiences through BetMGM, but also expands the offering to include both gaming and non-gaming opportunities for rewards across the enterprise.
iGaming as the Next Step Like many of the other advancements in gaming, bringing the casino experience to the internet or to a mobile device has been a huge advancement. It has also been riddled with claims that it will be the death of the in-person gaming experience, taking these brick-and-mortar facilities into the past. If done properly, there is no friction that is caused between these two segments, and they can be drivers for both segments of the market to create further engagement with customers. A recent study commissioned by the iDevelopment and Economic Association (IDEA) highlighted that there is a distinct ability to drive additional revenue to the casino, attract a different customer to the market, and not have an impact on the existing land-based revenue. The study, which was done in coordination with the Casino Association of Indiana, highlighted how establishing a legal, competitive market with safeguards established could drive consumer demand for iGaming while also complementing the state’s land-based operators that have a strong and robust casino gaming business. This is in addition to the existing sports betting market that is still in its early years. The study looked at markets that had iGaming prior to the start of the pandemic and evaluated their gaming revenue return from land-based gaming as well as the state of online play over the same period. This included some of the key iGaming markets of New Jersey, Pennsylvania and Michigan. It compared these markets to those that did not have iGaming to see if there was an effect on the return of land-based revenue. The study took into consideration the most recent effects on the industry from the Great Shutdown and further fluctuations in government mandates that the industry has faced over the past two years. After evaluating both the Northeast and Midwest markets in the United States, the study states that “based on currently available data, both group comparisons recovered in a similar fashion highlighting that iGaming had little to
MARCH 2022 www.ggbmagazine.com
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One of the many things that can be learned from the pandemic is that people crave an engaging experience and will return to those experiences when they feel safe. no impact on land-based revenues.” The information in the study highlighted that Indiana could add significant revenue to the state based on either the current legislative proposed tax rate of 18 percent or the recommend tax rate of 15 percent that creates the optimal tax rate to allow growth and reinvestment in the market to effectively compete with the existing illegal market.
Regulatory Consideration When trying to create the perfect paradigm between the interactive and land-based spheres, it is not only important that operators in the market understand how to create the ideal experience to create a balance between these two worlds. It is equally important that the regulatory environment also create the same healthy balance to allow for a frictionless experience for the operator and the customer. As the market in the United States has seen a growth in sports betting over the last few years, the infrastructure for consumer protections is already in place. This includes key components like age and identity verification, know-your-customer (KYC) systems, geolocation, cybersecurity, secure payments, anti-money laundering and anti-fraud tools, customer data security, and responsible gaming measures. With technology as an aid, there are arguably more protections, security and verifications that can be in place to aid the guest and operators. Regulation, though, must keep up with innovation and technology. This includes verification that the games are being played to offer the consumer a solid experience, whether they be free-to-play or real-money games. The partnership must exist to allow education equally between operators, suppliers and regulators in the industry. This will add a new, dynamic environment to be created and is key to a frictionless experience for both land-based and online operators. Markets such as New Jersey, Michigan and Pennsylvania have moved forward with these initiatives while other jurisdictions are playing catch-up to add these advances, protections and innovations to the regulations. Responsible gaming is a key measure to this effort. As technology con40
Global Gaming Business MARCH 2022
tinues to evolve, it also offers opportunities for both land-based and interactive gaming to further understand the player and provide additional protections. The ability for players to set limits through apps like PlayMyWay, to understand the level of play they may have both in the land-based and online experience, and protecting consumers that either desire to opt out or are not of age, benefit the entire industry. It utilizes technology that cuts across both platforms, further reducing friction between the experiences. The industry continues to work through the expansion opportunities that interactive offers in terms of product, experience and innovation to create that balance with the existing land-based product. Those industry leaders that have already found the “secret sauce” will continue to excel in providing an exceptional customer experience to their guests but also drive revenue through both gaming (land and interactive) and non-gaming sources. Those operators that continue to embrace the “old-school” thoughts that land-based gaming will go by the wayside to online will be left behind. The industry has continued to evolve beyond its initial roots. It has been long said that destinations like Las Vegas would die with expansion beyond Nevada. However, Nevada has seen 10 straight months of $1 billion in gaming revenue. There is a customer that will be driven by the interactive experience that the industry is currently missing. It can attract that customer with the right innovative and engaging experience. One of the many things that can be learned from the pandemic is that people crave an engaging experience and will return to those experiences when they feel safe. They also favor a new experience where the industry can continue to grow and should embrace. Creating a frictionless environment can be achieved in developing the balance between land and interactive gaming. It is being accomplished today and will be embraced by many more in the years to come. Brendan D. Bussmann has over two decades of experience in the gaming, hospitality and sports sectors. He currently is a partner and the director of government affairs with Global Market Advisors (GMA).
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MAKING MY POINT
Word Games How to shake things up in your career and your life
By Roger Snow
S
VOOBUI If you’ve ever played the oldfashioned board game “Scrabble” or the newfangled online copycat “Words with Nerds” or whatever it’s called, you know there comes a time when you look at your tiles and draw an absolute blank. Because you can’t see the next move. Your eyes scan left to right, desperately seeking something more impactful than “BOO” or “SUB,” or pluralizing a word already played. But unfortunately for you, the paradox—speaking of a seven-letter bingo!— is that the longer you look and the harder you look, the less likely you will find it.
teeming with possibilities. The passion and curiosity are still there; they’re just sleeping. Here’s how to awaken them. First, Do Nothing Multitask, schmulti-task. Researchers long ago determined our brains are not wired to do two or more things simultaneously, unless they’re autonomic tasks like—and boy, is this ironic—walking and chewing gum. High-quality, high-level thinking requires focus, singular focus, and focus can’t coexist with distractions. You may think you think better with music playing or while answering texts and DMs, but think again. Because you don’t. Famed British comedian John Cleese knows this; in fact, his great dissertation on YouTube identifies three keys to creativity, and they all pretty much orbit around the concept of being left alone. So, starting today, try this: shut off your phone and shut your eyes for 10 minutes. Just chillax and let your mind wander over and around some problem or opportunity presenting itself. You’ll be amazed what you can do when you do nothing at all.
older we get, “The the more closed-
minded we get. Happens to all of us. And time and tide are not on your side; to reverse this, you actually have to take action.
USOIVOB But there is a trick you can use to shake things up. And it’s exactly that: Shake things up. Literally physically rearrange the letters, the way a gin player would when collating the cards in his hand. Or, if using your smartphone or laptop, click that “shuffle” button over and over and over until the optimal word becomes, well, it becomes...
OBVIOUS Same goes for your career. If you’re like most tenured professionals, then you know that there comes a time when you look at your title—or your paycheck, for that matter—and you draw an absolute blank. Because you can’t see the next move. Be it board game or board room, the remedy is the same. Shake. Things. Up. Because, simply put, if you want different outputs, you need different inputs, from what you see to what you hear to what you experience. Think back to when you started in your field and it was all so new and interesting and
”
Get With the Times It’s not your fault, but if you’re over the age of 40, you probably have more outdated references than Marcos has shoes or Carter has liver pills. Uh, case in point. Think fast: Who (or what) is a Demi Lovato? True or false: Zendaya is the name of that African country they used to call Rhodesia? What did Geraldo find inside Al Capone’s vault? Remember when Jim Carrey was funny... or Jerry Springer was serious? Yeah, thought so. Time to update those references, to find out what’s hip and fashionable in
’22… as in 2022. It’s easy today to live in the past, what with streaming reruns and satellite oldies stations. That’s fine for comfort food, but you’ve got to expand your palate. Download Instagram and TikTok and start scrolling away the moments that make up a dull day. Listen to a podcast from someone you’ve never heard of. Next time on Netflix, binge something you hear other people talking about, like, uh, “Game of the Squid” or “Gambit of the Queen.” Immerse yourself, at least partially, into contemporary culture, and it will help reignite your spark. Viva La Difference Finally and perhaps most importantly—and definitely most counterintuitively—the best way to find your mojo is to look for it somewhere else. Or at least look for inspiration somewhere else. Go online and read what’s going on in the film industry. Or tech. Or sports. Or fashion. Or media. Or social media. Or blockchain. WTF that is. The point of this is to expand your frames of reference. The older we get, the more closedminded we get. Happens to all of us. And time and tide are not on your side; to reverse this, you actually have to take action. The good news is the smash factor on moves like this is high: even the slightest effort provides tremendous benefit. And here’s the ultimate boss move to expand your horizons and get you thinking differently: Next time you’re walking past a convention hall and there’s a big congregation inside talking about cosmetic implants or vitamins or cannabis regulations or some Amway-style-multi-levelmarketing-BS-or-whatever, here’s what you do: Grab a badge and walk in, sit down, listen, and stay until they 86 you. Just make sure you grab a couple of snacks and the goodie bag first. 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. MARCH 2022 www.ggbmagazine.com
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FRANKLY SPEAKING by Frank Legato
Faux Legends
I
f you’re one of the Adele fans outraged over the English singer canceling her residency at Caesars Palace in January, Tropicana Las Vegas has the answer: Faux Adele. And it’s free. A little background: The famed singer was set to begin her Las Vegas residency at Caesars Palace in January. Caesars even gave her the hallowed ground of Celine Dion’s former dressing room for the gig. Then, the day before her first performance, she canceled. She cited a depleted staff due to Covid-19, but there were conflicting stories. Rumor has it (sorry) she had a big fight with the designer of the extravagant production. Whatever it was, there were a lot of disgruntled fans, many who had arranged travel from around the world to see their adored heroine. If you’re one of those folks, don’t worry—the Tropicana has your back. The Trop is offering spurned Adele fans free entry to Faux Adele. OK, the show’s probably not called that, but it’s a tribute act dedicated to the singer featuring Janae Longo, who people say really nails both the visual stage presence and voice of Adele. Longo’s part of the Legends In Concert revue at the Tropicana, a complete lineup of fake stars. Fans who have canceled Adele tickets from Caesars Palace are invited to see Longo’s act for free until September 5. If you stay, maybe you’ll also get to see Elvis. Personally, I was never one for tribute acts, but I do remember Legends In Concert from the old days at Bally’s Atlantic City. In fact, Legends was a thing way back when that property was still known as Bally’s Park Place. I saw it when I worked for the Atlantic City Insider in the ’90s. They had faux Michael Jackson, even though the real MJ was still alive. They had faux Madonna, faux Little Richard, and fake versions of just about every other legendary star you can think of, all leading up to the coda: faux Elvis, all decked out in the white jump suit, looking like The King in his Vegas heyday, before the peanut butter and banana sandwiches caught up with him. He had the curled lip, the karate moves, the great voice—the whole enchilada. I remember really enjoying Legends when I saw it, which really surprised me, because normally, I can’t bring myself to suspend disbelief 42
Global Gaming Business MARCH 2022
and buy into a tribute act, and I’ve seen a couple that bordered on ridiculous. I remember a Beatles tribute act at an Atlantic City casino where the group changed outfits three times to reflect the different Fab Four eras. The guy playing Paul McCartney was almost believable, but the John Lennon and Ringo Starr guys were chubby, which made them look fairly comical in those Sgt. Pepper outfits. As I recall, my review in the Insider called them the “Fat Four.” From all I’ve heard, the fake Adele, part of the Trop’s Legendary Divas version of the revue, is actually a spot-on reproduction of the star. And by the way, I gave the wrong impression a few paragraphs back when I said you might see Elvis—the Trop show is all about divas, so no Elvis, no Sinatra, no Sammy. Of course, you can see Sinatra and Sammy at any number of dead-guy revue shows around Vegas, and you can see Elvis on just about every street corner. The Legends show, meanwhile, will have come full circle this year when Bally’s Corp., the operator that now owns Bally’s Atlantic City, buys the operations of the Tropicana Las Vegas. No word on whether they’ll keep the show, though, or any other aspect of the iconic Trop. There’s talk of a complete makeover. If it remains as the Tropicana, I’m guessing they’ll change the name to TROP, all caps, like Golden Entertainment did with the Stratosphere (the STRAT) and Dan Gilbert did with the JACK casinos. Enough with the caps. It’s like the casino is shouting at me. Speaking of the STRAT, a guy threatened to blow the place up last month. According to press reports, some nutball told security he had a hand grenade and was going to pull out the pin. Police were called, and they sensed he was lying when, according to the article, he started “saying random things and talking about Joe Rogan and his ex-wife.” They said he even claimed to have the grenade hidden in his derrière, and he was threatening to pass gas. (Can’t make this stuff up.) Police found no explosives on him, and threw him in jail. I hear they subsequently released him, because he did a killer Elvis impersonation. I’m guessing he snapped because he had Adele tickets.
BENEFITING
23rd
23rd
23rd
LET’S MAKE IT UN-FORE-GETTABLE
At the 23rd Annual AGEM & AGA Golf Classic Presented by JCM Global W E D N E S D A Y, M A Y 1 1 , 2 0 2 2
After 23 years, we can look back on a lot of fond memories. Join us to create more! Mark your calendar now and experience more meaningful moments at the 23rd Annual AGEM & AGA Golf Classic Presented by JCM Global! Proceeds benefit the International Center for Responsible Gaming and their impactful research into important topics like sports wagering, lottery, and more. For information about participation and sponsorship opportunities, visit golf.jcmglobal.com or contact JCM Marketing at 702.651.0000 or marketing@jcmglobal.com for more details. To help advance research, education, and awareness for responsible gaming, visit icrg.org. Global Gaming Business
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Paying It Forward gaming, cashless gaming and sports betting continue to spread across the U.S.,
As online
vendors providing payment technologies flourish By Dave Bontempo
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ere’s the figurative sound of sweet financial music: “Ching” signaled the early January launch of New York state mobile betting, which routinely cleared $600 million wagered in the first couple of days. “Ching” marked the debut of Louisiana in the final week of January. That’s two new states, bookending just one month, to mark just the sports section of the overall online casino gaming market. More states are expected to unfurl online gaming this year. These developments, coupled with several states that launched online gaming last year, continue a golden era for companies providing payment options to players. Not since the nationwide spread of gaming itself three decades ago has this level of opportunity swept over an entire gambling industry, or even one sector. A harvest has come for companies that anticipated this development years ago. Their seed planting, marked by investments and product enhancement, came to fruition.
IGTPay-Day IGT has excelled both in the land-based and mobile realms. The adoption of cashless in the land-based casino sector steadily accelerates via growing acceptance from operators and regulators. IGT’s product rollouts embrace the trend. “We’re in the midst of deploying full-service cashless via our IGTPay and Resort Wallet solutions at some of the most innovative casinos in the U.S., including Indigo Sky in Oklahoma and all three Agua Caliente properties in California,” says Ryan Reddy, IGT’s senior vice president of global product management, VLT systems, payments and poker. “In Nevada, we’ve recently completed a successful field trial and gained regulatory approval for our entire suite of products for cashless land-based wagering.” The Covid-19 pandemic drove a renewed surge of interest in cashless due to the perceived safety benefits, Reddy asserts. Expanding sectors like sports betting and iGaming in the U.S. increase the need for digital payments processing in these verticals. “As the sector evolves, we’re forging strong alliances with stand-alone payment gateway providers to give our customers a true end-to-end offering tailored to our industry,” Reddy indicates. “We’ve announced partnerships with Global Payments and Sightline to include their funding solutions into our Resort Wallet with IGTPay solution, which helps ensure we’re offering the industry’s widest range of external funding sources to IGTPay users. “In addition, we recently partnered with Marker Trax to enable players to 44
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create safe and secure casino markers on their personal mobile device and to fund an IGT-enabled Cashless Wagering Account.” IGTPay is the company’s proprietary turnkey payments processing gateway, integrated across the systems and platforms in each of the company’s verticals. It’s a mature and field-proven full-service solution that’s securely processed a high volume of payments internationally since 2013, and since 2018 in the U.S. The product is available as an optional feature of its award-winning Resort Wallet module for the IGT Advantage casino management system in the land-based gaming environment, and through its PlayCommand platform for the iGaming and iLottery verticals, he says. It also integrates with the company’s PlaySports platform in the mobile sports betting space. Operators leveraging the IGTPay feature through IGT systems or platforms can offer their players the option to fund their Cashless Wagering Accounts directly using their personal mobile devices. For land-based operators, this eliminates players’ need to handle cash or visit a casino cage, ATM or kiosk, he says. With Resort Wallet and IGTPay, players can securely transfer funds to and from their Cashless Wagering Account from a range of external payment sources such as bank accounts, credit and debit cards, or Sightline Play+ prepaid accounts. Funds in the PIN-protected Cashless Wagering Account can be seamlessly transferred to and from a slot game with a simple tap of a smartphone. “Unlike IGTPay, stand-alone payment gateways don’t always offer players access to the complete range of payment options, including e-wallets, credit/debit cards, and bank accounts,” Reddy says. “Players might also have to take multiple steps to sign in to a third-party wallet, whereas with IGTPay, players access their Cashless Wagering Accounts in a convenient single step. “We know from experience that effective cashless wagering solutions can unlock greater liquidity for the operator, so turnkey deployment and ease of adoption are paramount.” IGT’s in-house Payment Services can help clients across all wagering
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verticals set up and operate a cashless program leveraging IGTPay, according to Reddy. “The service comprises an experienced team that lives and breathes gaming funding— we understand gaming operators’ and players’ unique needs like no other payment gateway supplier in this space,” Reddy says. “We can manage the external funding function from end to end, provide vendor management, funds management, risk management, and player support services, saving operators from the hassle and distraction of running an ongoing external funding service by themselves.”
The VIP Lineup Global Payments greets the burgeoning industry sector with an array of products and services. “We, along with other industry experts, can only see iGaming continuing to grow year-over-year for the near future,” says Christopher Justice, president of Global Payments Gaming Solutions. “Gaming and sports betting have also seen more acceptance across the country, and the demand for iGaming reflects the rising demand from gamers to place bets in more locations, resulting in more states making iGaming legal.” Meeting that demand, the ability of technology to provide services in a completely digital, intuitive and concierge-like environment has transformed the way all industries view the customer experience, he indicates. “As the iGaming sector continues to grow, we’ve seen operators place a greater emphasis on enhancing the user experience,” he says. “To succeed in this space, operators must create a seamless gaming experience for patrons at every touchpoint.” Global Payments’ solutions leverage an omnichannel approach to create a quicker and safer onboarding experience for patrons, he asserts. One of its major products is VIP Mobility. Users can enroll within five minutes because the online operator connects their TITO systems directly into a bank’s existing AML controls, making it simple to set up an account. Once enrolled, Global Payments’ iGaming solutions provide patrons with unparalleled convenience and functionality. The VIP Lightspeed platform connects online and brick-and-mortar gaming experiences, making account funding easy. Additionally, the VIP Preferred e-check network enables patrons to gamble at more than 400 land-based and interactive gaming sites without having to re-register their account. With Global Payments’ iGaming solutions, operators can tap the tools needed to overcome the traditional challenges associated with funding and disbursements in iGaming. “VIP Preferred is Global Payments’ decades-old, industry-standard e-check and ACH network, and serves as the foundation for our current innovations,” says Justice. “VIP Preferred connects online and brick-and-mortar experiences through the VIP Mobility app. Global Payments launched VIP Mobility in 2021 and we’ve seen great traction with the app. As patrons continue to use VIP Mobility, their level of trust in the app, as well as transaction volumes, continue to grow.” By harnessing the flexibility and ease of Global Payments’ industry-leading VIP Preferred account network, plus functions like eCheck and Choice4 deferred settlement, patrons can directly transfer funds from their VIP Preferred balance to their favorite game.
As the only omnichannel funding solution in the market, VIP Mobility delivers a seamless funding experience to patrons across all mobile and online devices, Justice says. Global Payments provides patrons with several benefits, including higher limits, lower fees, and around-the-clock customer support. The company has released an enhanced version of its Partner Assist Program with Engaged Nation. The program creates a way for operators to engage directly with consumers, ultimately building patron loyalty. The Partner Assist Program drives awareness and adoption of Global Payments’ VIP Preferred product suite, ultimately boosting transactions on the casino floor and increasing operators’ return on investment.
The MoneyLine Leighton Webb, vice president and general manager, iGaming & sports betting for PayNearMe, believes the iGaming sector hits a new age ripe for innovation. “We call this new era Payments 3.0, which is a technological approach that to whatever extent possible makes the payment experience frictionless,” he says. “Legacy payment systems focus on the transaction, which leaves operators with a disjointed view of the player’s journey and an experience that stacks on friction for the player. With evolving player expectations, fasttracked from this rapid innovation in payments, operators will need a nextlevel approach. They need to use data as a foundation for delivering the easiest player experience possible.” Webb believes the biggest area of growth in this sector is sheer market size. “Entering the year, I expected gaming would see increased adoption, but the rate at which states have been able to pass regulation and launch— for example, in Arizona and Louisiana—has been surprising,” he indicates. “An interesting output of this rapid pace is a broader acceptance of iGaming and sports betting throughout the U.S., particularly by household names such as Disney getting into the space.” Webb considers the growth in the iGaming and sports betting space similar to the late ’90s, “when we saw a heavy adoption from dial-up to broadband gaming consoles, which became the next generation to what we’re all used to, and the market began to develop more online platforms with new technology and allowed for more interactions between consumers.” The company’s hottest product in this space is MoneyLine, which simplifies end-to-end money movement for iGaming and sports betting operators. In short, the platform makes it easy for players to make deposits and payouts, he asserts. The platform consolidates the most popular deposit and payout methods in the industry into a single platform with a consistent look and feel. This improves the player experience dramatically as it increases their trust in the product. For the operator, it means a simplified integration with one vendor to manage their money movement needs, which gets them to market faster and reduces their overall cost by reducing complexity and lowering cost per acquisition. With proprietary SmartLink technology, operators can offer their playMARCH 2022 www.ggbmagazine.com
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ers the simplest and fastest way to make a deposit. Operators can deliver a customized link, through a variety of channels, based on the player’s past payment preferences, that brings them directly into a deposit flow to complete a two-tap deposit. Speed of deposits is a challenge for many; MoneyLine speeds the process by allowing the operator to use data to automate decisioning in the approval process. Finally, the company has built technology to bridge the gap between online and offline. “Our cash-at-cage feature allows players to load and receive cash easily out their online accounts at a brick-and-mortar casino,” Webb says. “If the last year has taught us anything, it’s that the gaming industry is not slowing down and neither are payments. PayNearMe is uniquely positioned to help operators get to market quickly and reliably because we sit at the intersection of these two highly regulated markets.”
Play+ Rolls On Sightline Payments was among the first companies to process payments for iGaming, starting with the 2013 launches of New Jersey’s online casino market and Nevada’s online poker market, according to Jonathan Michaels, Sightline’s senior vice president, strategic development and government affairs. A few years later, the market is blossoming. “It was a record year in 2021 thanks to a major jurisdiction launch in Michigan and the continued maturation of markets like New Jersey and Pennsylvania,” he indicates. “Sightline’s Play+ allowed players with Covid concerns to conveniently fund and withdraw from their gaming accounts from the comfort of their homes. Our products bridge the gap between iGaming and mobile sports betting platforms, benefiting both players and operators, creating stronger retention. “In 2022, we expect continued growth, particularly within nascent markets like Connecticut. However, states are legalizing iGaming at a dramatically slower rate than sports betting. There is a real opportunity for the industry to collaborate with legislators to unlock new online casino markets.” Sightline’s flagship Play+ product is a prepaid solution that allows consumers to easily transfer funds to and from their wagering account through Sightline’s propriety network. It has more than 1.5 million account holders in the U.S. across more than 70 partners in the online gaming, sports betting, lottery and horse racing industries. Customers can fund their white-label Play+ card and easily transfer funds to and from their wagering account via Sightline’s proprietary network. This significantly reduces the time it takes for withdrawals to post to a customer’s account. Michaels adds that debit card providers are far more accepting of gaming transactions now than in years past. In 2017, only 50 percent of debit transactions for sports betting and iGaming were accepted. Today, that figure stands at 95 percent. “This rapid change has shifted users’ focus from who will process their money to how fast they can access their money,” he says. “Multiple studies, including from Paysafe and the American Gaming Association, show that quick payouts are a top factor for which sportsbook consumers choose. Play+ meets that demand by enabling customers to withdraw their money quickly and securely.” Throughout the industry, by whatever payment method and innovation they produce, top companies echo a similar theme regarding the payment-processing realm: it’s a great time to be a player.
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SECURING PAYMENTS here are two components regarding the rapid ascent of iGaming. One is the payment processing. The other concerns security. George Connors, senior vice president of gaming solutions for Fiserv, touts his company’s presence in both areas. Fiserv has enabled payments for online gaming since November 2013 when iGaming went live in New Jersey, he says. The 2018 repeal of the federal U.S. sports betting ban created another dimension of the company in this space. “We’ve worked to support online operators with our payment processing technology, security and fraud mitigation solutions, and have shared our expertise to help others navigate the regulatory landscape,” he indicates. “In doing so, we are committed to enabling the gaming industry to operate efficiently, provide players a secure payments environment, and position online gaming for future growth. “Fiserv is well-known in the gaming industry for our card acquiring and ACH warranty solutions, capabilities which have become ‘table stakes,’” he says. “However, the areas that really excite us—and a focus for our innovation—is how we can now augment payment processing with digital capabilities that allow businesses to operate more efficiently.” A few examples include:
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Authorization Optimization: Using artificial intelligence and machine learning
to help the operator improve authorization rates of card-based transactions. This is done via proactive management of a merchant’s card on-file database, which helps securely update new payment information, without customer intervention. Limiting card declines not only improves authorization rates, but has a positive impact on the player experience. Least Cost Routing: Debit card transactions can be routed via multiple debit
networks, and each debit network has a different fee structure to process a payment. Using technology to efficiently route each individual card transaction via the optimal payment network creates an immediate cost reduction for an operator. Turning Payment Data into Insights: As players increasingly make more cardbased transactions, Fiserv can help operators use their payments data to understand more about their mix of players—such as the operator’s share of wallet compared to competitors.
On the flip side, Fiserv is diligent in the security area, Connors says. “As online gaming continues to develop and mature, so do the bad actors that are figuring out how to game the system,” he says. “Emerging digital opportunities create gaps that can be exploited to negatively impact online gaming operations. “How businesses mitigate all types of fraud —including payment fraud, promotion fraud, account takeover fraud, and synthetic ID Fraud, to name a few— on an ongoing basis will be pivotal as iGaming continues to grow in the years ahead.” Connors says a distinct advantage Fiserv has as a large firm is the infrastructure and resources to handle the challenges fraud presents. Fiserv has internal teams dedicated to fighting financial crime, who work with clients and partners to address their risk levels. These teams have built intelligent solutions that help operators with AML, KYC, behavioral analytics, device fingerprinting, geolocation and other fraud mitigation tools. These teams and capabilities are trusted not only in the gaming industry, but by some of the world’s largest merchants and financial institutions across the globe, he says. —Dave Bontempo
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NEW GAME REVIEW by Frank Legato
88 Link Lucky Charms Zitro
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his multi-game progressive link from Zitro is featured on the Allure cabinet, which deploys three 27-inch HD monitors, the upper screens synchronized to create a visual spectacle. 88 Link Lucky Charms offers four inaugural base games—Daruma Mystery, Koinobori Party, Kokeshi Dolls and Maneki Neko. All four feature colorful Asianthemed graphics enabled by the Allure platform. All are five-reel, 243-ways-to-win video slots featuring a five-level mystery jackpot triggered through a bonus sequence initiated by a ring symbol on the reels. The bottom two jackpots are static by total bet—a $176 “Mini” and a $440 “Minor”—with progressives resetting at $1,000 (“Big”), $5,000 (“Super”), and $15,000 for the top “Mega” prize. The Jackpot Bonus can be triggered in both primarygame and free-game spins. On all base games, the free-spin bonus, triggered by three scatter symbols, awards eight free games, on a reel array with the lower-paying symbols removed (Kokeshi Dolls and Maneki Neko). Three triggering symbols during a free game trigger eight additional free games. The “Extensive Wild” symbol on the third reel during free spins doubles all wins (Koinobori Party and Daruma Mystery).
Manufacturer: Zitro Platform: Allure Format: Five-reel, 243-ways-to-win video slot Denomination: .01 through 2.00 Max Bet: 880 Top Award: Progressive; $15,000 reset Hit Frequency: 50% Theoretical Hold: 6.79%-11.77%
Brave Firefighter
Ainsworth Game Technology
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his new game on Ainsworth’s A640 cabinet carries a firefighting theme in reel symbols and graphics, with an extra row of symbols above the four-by-five reel array. The base game is a five-reel, 50-line video slot including a unique free-spin feature and a cash-on-reels “Extra Prize” bonus. Three or more firefighter badge symbols trigger a freespin wheel. The player spins the wheel to uncover five, eight, 10, 12, 15, 17, 20 or 25 free games on a bonus reel set, at the wagering level of the triggering spin. The paylines double during the free spins, which play out on a 100-line array. During free games, two, three, four or five badge symbols trigger three, five, eight or 10 additional free games, respectively. Prize Balls are cash-on-reels symbols displaying from two to 300 credits times the total bet each. On random spins, the image of a firefighter can appear in the row of symbols above the main reel array. When that happens,
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Manufacturer: Ainsworth Game Technology Platform: A640 Format: Five-reel, 50-line video slot Denomination: .01 through 100.00 Max Bet: 500 Top Award: 6 million credits Hit Frequency: Approximately 40% Theoretical Hold: 5%-16%
the player collects the credit amounts of all Prize Balls on that reel. The firefighter will then move left to right on each subsequent spin, awarding more Prize Ball amounts, until disappearing to the left of the screen. The Extra Prize feature is active both on primary game an free-game spins.
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Lucky Envelope Konami Gaming, Inc.
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his new game group on Konami’s Dimension 49J cabinet features unique cash-on-reels events and a progressive bonus feature. Inaugural games for the series are Lucky Envelope Jade Wealth and Lucky Envelope Plum Riches. Both are five-reel, 243-ways-to-win formats. The main cashon-reels feature is called the Coin Feature in both games. When wild symbols land on the first two reels with at least one coin symbol on reels 3, 4 or 5, cashon-reels Prize Symbols substitute for the coins and award the player the credits. In Jade Wealth, multipliers are added to the awards. The Coin Feature is available both in primary and free-game rounds, but the free games differ slightly in each version. In both games, three scatter symbols trigger 12 free spins. In Plum Riches, the Coin Feature is triggered on a free spin with only one wild symbol on the first reel. In Jade Wealth, a wild on reel 1 or reel 2 multiplies the total coin prize for that
Manufacturer: Konami Gaming, Inc. Platform: Dimension 49J Format: Five-reel, 243-ways-to-win video slot Denomination: .01, .02, .05, .10 Max Bet: 880 Top Award: Progressive; reset at 1 million times denomination Hit Frequency: 23.91% Theoretical Hold: 3.52%-12.54%
spin by two or three, except in the case of Minor or Mini jackpot wins. Randomly, a wild symbol on the first or second reel will trigger a progressive bonus picking feature. The player selects icons until matching three correlating to one of four jackpots—on the penny version, static prizes of $10 (Mini) or $25 (Minor); or progressives resetting at $500 (Major) or $10,000 (Grand).
Available on all devices: Apple Podcast | Spotify | GGBMagazine.com | GGBNews.com MARCH 2022 www.ggbmagazine.com
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CUTTING EDGE by Frank Legato
Hardware Impact PRODUCT: IMPACT 49 Slot Platform MANUFACTURER: Eclipse Gaming Systems
clipse Gaming Systems is introducing the premium IMPACT 49 slot platform, launching in early 2022 exclusively for Class II tribal gaming markets. The IMPACT 49 is the newest addition to Eclipse’s IMPACT cabinet family, which also includes the proven IMPACT 43 and IMPACT 27 platforms. With its sleek lines, crystal-clear 49-inch 4K floating portrait display, dynamic LED lighting, and a library of entertaining game content, the IMPACT 49 is a striking attraction designed to maximize floor performance. The cabinet’s vivid and expansive 49-inch 4K floating portrait multi-touch display is designed to showcase engaging new 4K game content that delivers an elevated player experience. Dynamic LED lighting and enhanced audio immerse players in a cinematic gaming experience engineered to keep them entertained. The cabinet also features a sleek, ergonomic button deck with physical repeat dual bet (bash) buttons to enhance the experience,
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while an integrated USB charging port adds an additional layer of player comfort and extends the play experience. Crowning the cabinet is a 27inch video topper designed to attract, while multiple base configurations seamlessly fit into any casino footprint. Game content for Eclipse’s IMPACT 49 slot platform includes a library of video slot titles offering player-favorite features such as multi-level jackpots, wheel bonuses, pick features, free games, hold-and-spins, and expanding reels. Upcoming themes include Raging Bull, Big Shake Neon, Big Shake Carnival, Lucky Bao Bai, and Big and Bad Bolt, to name a few. For more information, visit eclipsegamingsystems.com.
Hassle-Free Funding PRODUCT: VIP Preferred MANUFACTURER: Global Payments, Inc.
IP Preferred is Global Payments’ industry-standard e-check and ACH network, and serves as the engine that brings the company’s product suite to life. VIP Preferred provides several benefits to patrons, including hassle-free cash access, higher limits and lower fees. After a one-time enrollment, VIP Preferred members have access to more than 400 North American land-based, mobile and online gaming locations. Patrons can effortlessly transfer balances from one operator to the next using a single account. VIP Preferred leverages a multi-channel approach to connect online and brick-and-mortar experiences through the VIP Mobility app. Global Payments’ VIP Mobility is the industry’s first mobile solution enabling true cashless gaming. By harnessing the flexibility and ease of Global Payments’ groundbreaking VIP Preferred account network, plus functions like eCheck and Choice 4 deferred settlement, patrons can directly transfer funds from their VIP Preferred balance to their favorite online game or casino game with the touch of a screen. VIP Mobility’s intuitive user interface takes the legwork out of the funding process, ensuring that play is never interrupted. As the only omnichannel funding solution in the market, VIP Mobility delivers a seamless funding experience to patrons across all mobile and online devices. VIP Mobility interoperates with VIP Financial Center, the industry’s first full-service solution providing convenient self-service TITO tickets, bill-breaking, e-check, ATM and cash advance capabilities to casino guests who prefer to use cash. The high-performance solution equips casino operators with robust service capability, high dependability, easy serviceability, and enhanced security,
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all in a slim profile design. This enables casinos to achieve maximum value for the floor space occupied by their kiosk solution, saving more room for revenue-producing slot machines or table games. VIP Financial Center not only enhances the patron experience, but it helps casinos maximize spending across all properties. Delivering a single source for self-service ticket redemption, cash access and cashless gaming capabilities, Global Payments’ solutions are designed to meet the payment preferences of all patrons. Global Payments’ solutions provide patrons with safe, secure and trusted cash access at the cage, on the casino floor, and online. With more than 3 million patrons currently using VIP Preferred, it is the premier way for them to enroll and play in a new, digital, innovative manner. For more information, visit globalpayments.com.
Strength in Numbers
More than 160 member companies from 22 countries Nearly $21 billion in direct revenue • 61,700 employees 13 publicly traded companies • ONE POWERFUL VOICE Address worldwide industry expansion, regulatory and legislative issues • Discounts on major trade show booth space Promote responsible gaming initiatives • Updates from influential global industry leaders Advertising discounts in leading industry publications • Educational partnerships benefiting students and members Visibility in AGEM’s print advertisements • Exposure for publicly traded companies in the monthly AGEM Index Join AGEM today and work together with the world’s leading gaming suppliers. Marcus Prater, Executive Director +1 702 812 6932 • marcus.prater@agem.org Tracy Cohen, Director of Europe + 44 (0) 7970 833 543 • tracy.cohen@agem-europe.com Connie Jones, Director of Responsible Gaming +1 702 528 4374 • connie.jones@agem.org Design & photo-illustration by Jeff Farrell.com • AGEM and charter ESP member since 2007.
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©2022 Association of Gaming Equipment Manufacturers (AGEM). Membership list current as of February 2022.
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GOODS&SERVICES PLAYTECH VOTES DOWN ARISTOCRAT TAKEOVER OFFER
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he bid of Australian slot supplier Aristocrat Leisure Ltd. to acquire London-based online gaming giant Playtech PLC has been rejected by Playtech shareholders. At the company’s general meeting, shareholders voting yes on the proposed US$2.9 billion acquisition mustered only 54.68 percent of the total, far below the 75 percent vote threshold required for the deal to go through. “Accordingly, the acquisition of Playtech by (Aristocrat subsidiary) Bidco has been terminated and the scheme has lapsed,” Playtech said in an investor note. “As a result, Playtech is no longer in an offer period as defined by the City Code on Takeovers and Mergers.” The vote to terminate the acquisition bid was not unexpected. Aristocrat released an ASX statement on the day of the vote anticipating the rejec-
tion, and blaming the outcome on Playtech investors who only bought shares after the takeover was announced in October last year. However, another former suitor may be reviving its takeover bid for Playtech. TTB Partners Ltd., the parent company of Gopher Investments, was one of three original suitors for Playtech. Hong Kong-based Gopher Investments is the No. 2 shareholder of Playtech PLC, holding a 4.97 percent stake. The company dropped out of the bidding contest in mid-November, indicating it was going to pursue a deal to buy Playtech’s financial trading division, Finalto, for $250 million, in a deal expected to close in Q2 2022.
ACRES LAUNCHES FOUNDATION APP STORE
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cres Manufacturing Company announced the debut of the Foundation App Store, an opento-all environment that allows any developer to provide applications for any slot machine or table game deploying Acres’ Foundation casino management system technology. The Foundation App Store enables casino operators to seamlessly add the newest
content from developers through an open API in an effort to quickly address evolving consumer interests. With the open API, casinos only pay for the cost of the application, not for the interface. Currently, casinos may have to purchase the same interface for each application they want to buy. This obstacle prevents many casinos from installing new applications, thereby depriving them of incremental revenue and earnings, according to Noah Acres, chief operating officer of Acres Manufacturing. Another significant difference with the Foundation App Store is that Acres allows any app, whether or not it competes with present or future Acres applications. Typically, fees are charged by legacy systems for any interface with competitive products. At launch, the Foundation App Store includes 17 developers with applications tested and certified as “Foundation Compatible” by Acres. Initial applications encompass categories such as reporting, analytics, cashless gaming, bonusing and more.
SIGHTLINE, IGT PARTNER FOR SKY CASINO APP
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ightline Payments announced the planned launch of its mobile loyalty platform, Joingo, at Indigo Sky Casino & Resort in Wyandotte, Oklahoma in Q1 of this year. Leveraging Joingo’s seamless integration with the IGT Advantage casino management system, the Indigo Sky branded mobile app will feature mobile marketing tools that give patrons a unified experience from the convenience of their iOS or Android devices, enhancing the experience for all GO Rewards Club members. Owned and operated by the Eastern Shawnee Tribe of Oklahoma, Indigo Sky boasts one of the largest casinos in northeastern Oklahoma. Its casino floor features over 1,400 gaming machines, various table games, and a bingo hall. The resort includes two hotel towers and an RV park, and its Creekside Bar & Grill offers the area’s only golf simulator. In 2021, Sightline Payments announced a partnership with IGT to provide solutions to aid in the deployment of cashless gaming technology through IGT’s suite of systems innovations, including Resort Wallet with IGTPay. They recently expanded the partnership to include Sightline’s mobile loyalty platform, Joingo. The launch of the Joingo mobile loyalty solution at Indigo Sky Casino & Resort will be the first product launch for Sightline with IGT following these announcements.
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PEOPLE ZITRO NAMES MOOBERRY USA CEO
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itro last month named Derik Mooberry as the new CEO of Zitro USA, responsible for overseeing the development of Zitro’s U.S. and Canada business Derik Mooberry and leading the company’s expansion strategy in these regions. Mike Magrisi will continue to lead all commercial operations and technical service as vice president of sales and service, reporting directly to Mooberry. Mooberry has more than 20 years of experience in the gaming industry, including 14 years at Bally Technologies, where he served as senior vice president of gaming and senior vice president of products and operations. Mooberry also served for six years as executive vice president and group chief executive of gaming at Scientific Games. Mooberry has extensive knowledge in business management, finance, business consulting, sales, marketing, product management/key strategy and customer relations, among others.
ATKINSON NAMED PRESIDENT OF FONTAINEBLEAU LAS VEGAS
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ospitality veteran Cliff Atkinson has been appointed president of Fontainebleau Las Vegas. He has already assumed leadership of the Stripbased property—due to Cliff Atkinson open in the fourth quarter of 2023—as it builds its in-house team. Most recently, Atkinson served as founder and CEO of WE Advisory Group, providing direction on business development strategies, revenue management services, operations, turnarounds and new building development. Prior to that, he was president and chief operating officer of Luxor Hotel and Casino on the Las Vegas Strip. Atkinson also has served as senior vice president of hotel strategy for MGM Resorts International and in general manager roles for Mandarin Oriental Hotel Group in Las Vegas and San Francisco and New York’s Gramercy Park Hotel. In 2014, he was named “Hotelier of the Year” by the Nevada Hotel and Lodging Association.
HBG DESIGN NAMES PEAK AS NEW PRACTICE LEADER
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BG Design has announced the appointment of Nathan Peak, AIA, LEED GA, as practice leader of the 100-person, Top 10 nationally recognized hospitality Nathan Peak design and architecture firm. In his new role, Peak will oversee design and practice leadership for HBG’s three offices in Memphis, San Diego and Dallas. His promotion represents the initial step in HBG Design’s transition to a third generation of firm leadership. Peak is a principal in HBG Design’s Memphis headquarters. During 20-plus years with the firm, Peak has served as design director for nearly a decade, leading and guiding the design direction of the firm’s national hospitality and entertainment projects. Peak plans to build on the firm’s deep bench of talented professionals to further position HBG Design’s national presence in multiple sectors of the hospitality industry.
ACTING HEAD OF GAMBLING COMMISSION NOW OFFICIAL CE
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he acting head of the U.K. Gambling Commission, Andrew Rhodes, has been appointed to the position on a permanent basis. The commission named Andrew Rhodes Rhodes acting chief executive in June 2021, after the sudden resignation of Neil McArthur and the temporary appointment of Sarah Gardner. Rhodes, who received an 18-month contract, plans a sterner approach as expected reforms of gambling legislation take center stage this year. The commission would take on any gambling company that violated the conditions of their license more than once. As chief executive, Rhodes will lead the way for two key moments: the gambling review and coordinating the bidding contest for the fourth national lottery license, choosing whether incumbent Camelot or challengers Allwyn, Sisal and Northern & Shell Group will secure the 10-year contract. Rhodes served as a director of operations at the Department for Work and Pensions and also served as chief operating officer of the Food Standards Agency. He was also chief operating officer of Swansea University, his alma mater, and chair of the community trust at Swansea City football club.
BLUBERI NAMES BRENNAN CHIEF PRODUCT OFFICER, SUAREZ AS VP OF OPERATIONS
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aming company Bluberi made two significant hires last month. Mike Brennan was added to its executive leadership team in the role of chief Mike Brennan product officer. An industry veteran with a proven record of success, Brennan will lead the company’s product strategy and game development efforts. Brennan joined Bluberi after more than 16 years with Ray Suarez Atronic/GTECH, now IGT, ending his tenure there as vice president of product management. He led market-facing global product teams and visited properties throughout the world, observing player, operator and industry needs firsthand for well over a decade. Ray Suarez has joined Bluberi as the company’s vice president of operations. Suarez is an industry veteran with more than 40 years of military and business experience, having served in the U.S. Marine Corps before entering the business world and finally the gaming industry. He spent eight years at Konami Gaming as vice president of sales operations, and then became a consultant focusing on supply-chain management, operations, manufacturing, procurement and product launch for both gaming and non-gaming clients.
GGB
March 2022 Index of Advertisers
Acres . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7 AGEM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .51 AGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2 Aristocrat Technologies . . . . . . . . . . . . . . . . . . . . .9 Aristocrat Technologies/Games . . . . . . . . . . . . . .56 Axes.ai . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17 Bill Zender and Associates . . . . . . . . . . . . . . . . . .37 Casino Player Media . . . . . . . . . . . . . . . . . . . . . . .33 Eclipse Gaming Systems . . . . . . . . . . . . . . . . . . . .11 Everi . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5 Fantini Research . . . . . . . . . . . . . . . . . . . . . . . . . .52 Global Gaming Business . . . . . . . . . . . . . . . .10, 49 IGT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18, 19 IGT Global Solutions Corp. . . . . . . . . . . . . . . . . . .55 Interblock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23 JCM Golf Tournament . . . . . . . . . . . . . . . . . . . . .43 J Carcamo & Associates . . . . . . . . . . . . . . . . . . . .47 NNAHRA Conference . . . . . . . . . . . . . . . . . . . . . .27 Reed Expo(RX) . . . . . . . . . . . . . . . . . . . . . . . . . . .29 Scientific Games . . . . . . . . . . . . . . . . . . . . . . . . . .35
MARCH 2022 www.ggbmagazine.com
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CASINO COMMUNICATIONS
Q
&A
Joe Asher President, Sports Betting, IGT
W
hen the deal was struck to sell William Hill to Caesars Entertainment last year, Joe Asher, the president of William Hill US—the part of William Hill that Caesars really wanted—had to find another job. It happened sooner than expected as Asher accepted a position with IGT to lead the company’s sports betting division. A pioneer in U.S. sports betting, Asher rose from a humble beginning in the Delaware horse racing business to experience the full roller coaster that was the legalization of sports betting in the U.S. He spoke with GGB Publisher Roger Gros at the IGT headquarters in Las Vegas in February. To hear a full audio and video podcast of the interview, including Asher talking about the horse racing business, visit GGBMagazine.com.
GGB: You had just completed the massive deal selling William Hill to Caesars when you got another job. What really attracted you to IGT to become president of the sports betting? Joe Asher: After the Caesars deal closed, I had no
idea what I was going to do next, other than being dead set on taking the summer off and going to Del Mar (racetrack in Southern California), which was great. I got a call from Enrico Drago, who’s now my boss. I’d been friendly with Enrico because William Hill and IGT had partnered to win the sports betting contract for the Rhode Island Lottery. He called me over the summer, and my attitude at that time was listen to everything, commit to nothing. I told him to call back after the summer when the kids are back in school. So on the first day the kids go off to school, it’s quiet in the house. It’s 9 o’clock, what am I going to do? Right then, Enrico called me. He had remembered that was the first day of school. So we started a discussion that eventually morphed into a fulltime job and started October 1. IGT obviously has a great reputation in the industry. Is the PlaySports program what sets it apart from your competitors?
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To set the foundation, it has all the hardware and software you need to operate a sportsbook. You have two choices when setting up a sports betting operation. If you’re a big enough operator, you can own your own technology, but that comes with great cost. If you’re not, or you don’t want to own your own technology because of the cost, you can use third-party technology. And an IGT is an obvious place for a lot of people to look because they’re already using IGT products today. The customer base is a mix of pure online sports betting companies, like FanDuel, and big companies and organizations like the Rhode Island Lottery or casino operators like Boyd Gaming or Resorts World in Las Vegas. Then all these tribes across the country that got the right to offer sports betting under their compacts are obviously familiar with IGT. The technology is very modular so it facilitates integrations quite easily. And once you learn how to use it, it’s fairly straightforward. How many more states do you expect to legalize sports betting?
My prediction is that sports betting will be legal in all 50 states. I know people say, “Oh, it’ll never happen in Utah,” but I truly think it will be all 50 states. I’m not going to give you a date, but the public clearly likes to bet on sports. The leagues have embraced it firmly. Through advertising, the knowledge of its availability is quite apparent to everyone. They’re having record ratings for the NFL playoffs. Yes, the games have been great, so people stay engaged, but the tuning in to begin with is some aspect of that because they can now bet on it. There are so many sports betting operators with market share in single digits. Consolidation is coming at some point, so when is that going to really start?
It started a little bit last year with Penn buying theScore, and DraftKings buying Golden Nugget
Online. As consolidation continues, there’s going to be a handful of major operators who have the ability to compete. There will be niche opportunities for others in particular regions and particular markets. Some of them will throw in the towel or be acquired for less than they’ve invested. I think that’s inevitable. What do you think is going be the big accelerator of revenue growth in sports betting? How much will inplay betting contribute to that?
In-play betting has always been an important and growing part of the business. But what people principally are betting in play, by the way, is on the outcome of the game, not on whether the next play is going to be a run or a pass. That’s very granular, frankly. It’s disruptive to the viewing experience. I think video streaming integrated into the sports betting app is clearly one area where the business is going to grow. So if I’m watching a game on my phone, the betting options will be overlaid on the video. Personalization is another area where I think we’re not anywhere close to where it ought to be. For example, I like to bet the under on the Golden Knights hockey game. So if I log in a half hour before puck drop, the first betting option I see should be that, to make it more efficient. You mentioned some of your clients—FanDuel, Rhode Island Lottery and others. How do you scale what you offer to these big clients so smaller clients can also afford it?
It’s a function of trying to keep the infrastructure costs relatively low so we can offer something directly for that customer on a cost-efficient basis. Folks realize that sports betting brings people into the property. There’s no doubt about it. And then once you get them into the property, you have a shot to get them to do something else, whether it’s play the tables or slots, eat at a restaurant or go to the spa. I’ve said this before. I think sports betting is the single greatest customer acquisition tool in the history of the casino industry.
Technology and Expertise to Drive Your Sportsbook Success IGT’s PlaySports solution is playing a pivotal role in shaping the U.S. sports betting market. Its capacity to support a wide range of operators and move the player experience forward are driving growth for customers. Our next-generation betting engine and highperforming omnichannel platform are quickly becoming the industry’s preferred technology stack, processing the largest share of legal U.S. sports wagers placed in 2021. Backed by scalable technology, turnkey services, and dedicated experts, operators get the inside edge with IGT’s comprehensive market-ready solutions, designed to increase ROI and enhance customer success.
Leading U.S. B2B sports betting provider. GLI-approved solutions deployed in 60+ retail locations in 22 states.
Contact your IGT representative today. www.IGT.com/PlaySports
© 2022 IGT Global Solutions Corporation. The trademarks used herein are owned by IGT or its affiliates, may not be used without permission, and where indicated with a ®, are registered in the U.S. 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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