IAG FEBRUARY 2016

inside asian gaming 

IN FOCUS 

What future for 

Koreans IRs? 

february 2016 

30 MOP 

INDUSTRY 

PROFILE 

Albert Yu 

TECH TALK 

Slot tournament 

management 

Money 

theMiddle 

in 

Catering to China’s new generation 

of mass consumers 

www.asgam.com

COVER STORY Contents February 2016 

Cover Photo: © IAG 

6 

Money in 

the middle 

If Macau is to prosper it will 

have to figure out, and cater 

to, China’s emerging middle 

class – the new generation of 

mass consumers. 

INDUSTRY 

PROFILE 

12 Albert Yu 

In five short years Albert Yu has worked his way up to become 

General Manager of the Macau office of Japanese gaming 

equipment manufacturer, Aruze Gaming. IAG took some time to 

get to know Albert better. 

TRADE EVENTS 

16 ICE gets even hotter 

IAG has just attended ICE which has now firmly staked its claim 

as the world’s premier gaming show. 

IN FOCUS 

20 What future for Korean IRs? 

This month the Korean government is expected to announce 

the winners in its request-for-proposal process to build two new 

integrated resorts. Will there be any? 

TECH TALK 

26 Competition management simplified 

Slot tournament management systems are gaining popularity in 

casinos, creating simplicity for operators and bringing fun and 

excitement for patrons. 

BLAST FROM THE PAST 

34 The good, the bad and the ugly 

Steve Karoul’s guide to successfully working with junket reps is 

perhaps much more timely now than it was when it was written 

exactly seven years ago. 

BRIEFS 

42 Regional Briefs 

44 International Briefs 

46 Events Calendar

EDITORIAL 

Upping Macau’s Tourism Game 

Chief Executive Officer 

Andrew W Scott 

Managing Editor 

Steven Ribet 

Editor at Large 

Muhammad Cohen 

Other Regular Contributors 

Paul Doocey, Kareem Jalal, Rui Pinto Proença, 

I Nelson Rose, Andrew W Scott 

Graphic Designer 

Rui Gomes 

Photography 

Ike, Gary Wong, James Leong, Wong Kei Cheong 

Founder and Adviser 

Kareem Jalal 

◊ 

Chief Marketing Officer 

Derrick Tran 

Chief Operating Officer 

Michael Mariakis 

Director 

João Costeira Varela 

Administrator 

Cynthia Cheang 

Administrative Assistant 

Suie Ng 

Inside Asian Gaming 

is published by 

Must Read Publications Ltd 

+853 2883 6497 

For subscription enquiries, please email jh@asgam.com 

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or call +853 6688 7214 

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ISSN 2070-7681 

Inside Asian Gaming 

is part of 

On 21 January Macau’s Secretary for Administration and Justice Sonia Chan made 

the curious comment that hundreds of the city’s laws and regulations needed to 

be abolished. The rules, she explained, dated back to the Portuguese colonial era 

and had lost relevance under the rapid development caused by the explosion of the 

casino industry. As long as times were good, she said, social problems were not hard to resolve. 

But now with gaming revenues in a protracted slump, Chan said social conflicts had appeared 

to highlight the laws’ inadequacies. 

Although Chan was talking about the law, according to some her comments could equally 

have referred to the management of Macau’s tourism industry. Fifteen years ago the territory 

was not a shadow of what we see today, with a visitor offering to match. Today it has soared 

into the ranks of the world’s top destinations. In 2014, for example, visitors to Macau spent a 

staggering US$54 billion. While admittedly the lion’s share of that amount is gaming revenue, it 

was still more than three times as much as they spent in London. Yet in terms of how it markets 

and serves visitors from its most important market (see cover story) and farther afield, there 

is an acknowledgement that Macau is still behind where is should be, and the lag is now being 

painfully exposed. 

Take, for starters, branding. An Asian urbanite will immediately be able to tell you what 

images spring to mind when he hears “Paris” or “Las Vegas.” Say “Macau”, however, and after 

getting past “casinos”, he or she will probably come up blank. As one commentator puts it, 

“Macau was the original laboratory for West meeting East. It has plenty of world class stuff but 

has failed to turn them into world-class attractions. Cooperation is lacking between the Macau 

Government Tourist Office (MGTO) and the big integrated resorts, to co-ordinate their offerings 

for visits that take in sightseeing and a show, as well as a visit to a casino.” Forward planning 

is another area. While the tourism departments of top destinations routinely draw up lists of 

scenarios to prepare for, the slump in gaming seem to have caught the Macau Government 

Tourism Office completely off guard. Then there is research. Cities like New York and Hong 

Kong spend huge amounts of time and money talking to target customers in different parts 

of the world; to find out how they are perceived and why foreigners want to come. Recently a 

Macau university academic told us in Macau such efforts are largely confined to MGTO staff 

standing at the border to approach new arrivals with a questionnaire. 

The challenge facing any tourist destination can be put in four simple sentences: Attract 

more visitors. Get them to stay longer. Get them to spend more during their trip. Get them to 

come back. Yet on all four accounts Macau is now in decline. According to the city’s statistics 

service, visitor arrivals last year actually fell by 2.6%. The average length of stay is a brief 1.4 days 

and has been steady around this number for the best part of a decade, compared with 4.2 in 

London (for both domestic and overseas visitors) and 3.6 for Las Vegas. Non-gaming spending 

shows no sign of making up for collapsing gaming revenues. Worst of all, only 8% of those who 

have come say they intend to return, according to recent research by CLSA. That compares with 

37% for Japan and 25% for Hong Kong. 

Last September the MGTO made the wise move of hiring a top consultancy AECOM Asia 

to spend 18 months researching and drafting a “Local Tourism Master Plan.” The report will 

recommend a strategy to open Macau to the world and diversify its tourism products over the 

short, medium and long term. Implementation will be crucial. 

Pundits are fond of saying Macau should learn from Las Vegas. Yet if the city cannot up its 

game, another reference might be Atlantic City. America’s east coast hub for gambling turned 

out to have little else to offer after neighboring states started opening casinos of their own. 

Macau’s emerging competitors in Korea (see this edition’s “In Focus” article), the Philippines 

and Australia are much further away, so the comparison may be overblown. Yet given that 

tourism generates some 90% of Macau’s GDP, the consequences of a failure to improve its 

tourism offering could be equally severe. 

4 

inside www.wgg9.com 

asian gaming FEBRUARY 2016 

Steven Ribet 

We crave your feedback. Please email your comments to steven@asgam.com.

Cover Story 

Money 

in the 

Middle 

If Macau is to prosper it will have to 

figure out, and cater to, China’s new 

generation of mass consumers. 

By Muhammad Cohen, Editor At Large 

Muhammad Cohen also 

blogs for Forbes on gaming 

throughout Asia and 

wrote Hong Kong On Air, a 

novel set during the 1997 

handover about TV news, 

love, betrayal, high finance 

and cheap lingerie. 

The opening of Melco Crown’s Studio City in 

October heralded Macau’s pivot away from focusing 

overwhelmingly on the high end of the market and 

turning toward the middle class. The resort opened 

without VIP gaming and features an array of nongaming 

attractions, including theme park style rides, magic shows, 

international nightclub brand Pacha and a 5,000 seat arena hosting 

the likes of Mariah Carey and Aaron Kwok on opening night and 

Madonna this month. 

6 

inside asian gaming FEBRUARY 2016

Cover Story 

“Ultimately, the rise of the 

middle class is what drives growth 

in Macau and Asia.” 

Lawrence Ho, at the opening of Studio City 

“Ultimately, the rise of the middle class is what drives growth in 

Macau and Asia,” Melco Crown Co-chairman and CEO Lawrence Ho 

declared at the Studio City opening. He says Studio City’s location, 

virtually adjacent to the Lotus Bridge border crossing, destined 

it to be a mass market property even before Macau’s VIP market 

collapsed. Last year high roller revenue fell 39.9%, while mass market 

gaming was off 26.3%. It was just over a year ago, after VIP gaming 

revenue fell 10.9% in 2014 while mass win rose 13.8%, that Mr Ho 

wondered “how many more billionaires are going to drop out of trees 

in the next ten years” in China, underscoring the pivot to middle class 

customers. 

Even with the mainland’s economic growth falling below 7%, its 

lowest rate in 25 years, China’s middle class will expand to as many as 

half a billion people within a decade, and that group that will account 

for the bulk of the projected 200 million Chinese outbound travelers 

expected annually by 2020. The question that’s most relevant is how 

many of those middle class travelers, not only from China but the rest 

of Asia, will drop into Macau and whether they can make up for the 

shortfall in high end visitors. 

Citing various sources, Institute for Tourism Studies (IFT) 

Assistant Professor IpKin Anthony Wong estimates the Chinese 

middle class numbers between 109 million people with net worth of 

US$50,000 to US$500,000 and 340 million individuals with annual 

earnings from US$6,000 to US$25,000. China Market Research 

Group Principal Ben Cavender describes China’s middle class as 

earning US$9,000 to US$35,000 and conservatively estimates that 

group numbers 10% of China’s 1.3 billion people. Multiple observers, 

including Global Market Advisors Partner Andrew Klebanow, note 

that official reports likely understate actual mainland income. 

Depending on which numbers you prefer, Macau is capturing 

between 6% and 30% of the mainland middle class market, assuming 

that all mainland travelers to Macau are drawn from that pool. In 

reality, Macau visitors span the mainland economic spectrum, so 

there’s substantial room to increase its middle class penetration. 

MIDDLE MUSCLE 

Some question whether there’s enough spending power in that 

middle class to replace Macau’s missing high end players. Mr Wong 

estimates Chinese visitor spending at MOP$5,000 (US$625) per 

capita. Macau’s Statistical and Census Service’s third quarter Visitor 

Expenditure Survey puts per capita mainland visitor spending, 

exclusive of gaming, at MOP$1,776. The most recent IFT Visitor 

Profile Survey, conducted during last year’s second quarter, finds 

50% of mainland visitors spent more than MOP$2,000, excluding 

gambling. It also found that 75% of the 1,000 people surveyed 

said they didn’t gamble at all (a statistic IAG has previously raised 

questions about), and among those that tried their luck, 57% spent 

MOP$2,000 or less. 

Those spending levels indicate Macau would need a substantial 

increase in visitor numbers to make up for last year’s MOP$120 billion 

FEBRUARY 2016 inside asian gaming 7

Cover Story 

decrease in gaming revenue. At Mr Wong’s estimated MOP$5,000 

per visitor, Macau would require some 24 million additional visitors 

to produce that lost revenue. On the other hand, Mr Cavender 

estimates that for a major trip, China’s middle class consumers 

could spend US$10,000 in Macau. At that rate of spending, 1.5 

million visitors would make up for last year’s fall in gaming revenue. 

All of that money would not be spent on gaming, but some would go 

to segments with higher profit margins, most notably lodging. 

“Mass market customers who are willing to spend at a 

more premium rate than the previous low end mass that Macau 

was accustomed to will be key moving forward,” Hogo Digital 

Managing Director Chris Wieners says. “It will become a volume 

game – and I believe it’s a game Macau can win. Considering 

China’s middle class and the growth potential over the next five 

years, any anomalies withstanding, and the fact that the majority 

of the Chinese middle class have never stepped foot in Macau, the 

destination has potential to become the destination of choice for 

Chinese consumers.” 

Slower economic growth in China is having an impact on 

spending, Mr Cavender, whose firm tracks mainland consumer 

trends, says. “We are in an economic cycle where consumers are 

still spending, but where they are being much more choosy about 

how and where they spend.” The challenge is to get those potential 

middle class visitors to choose Macau. 

PRICED RIGHT 

Some believe there’s an affordability factor keeping middle class 

visitors away, but experts disagree. Macau is “totally affordable,” 

Mr Wong says. “Most of the entertainment and dining options 

are affordable.” The exception is accommodation during high 

Galaxy’s Broadway 

gets mixed reviews 

By Muhammad Cohen 

Galaxy Entertainment Group spent HK$5 billion 

(US$644 million) to remake Grand Waldo into Broadway Macau as a 

middle market compliment to predominantly high end Galaxy Macau 

next door. With the lowest hotel rates in Cotai, a 3,000 seat arena, 

intimate casino plus Macau-centric retail and casual dining options 

in a street festival setting, “Broadway Macau is a mass market 

dream,” Hogo Digital Managing Director Chris Wieners says. Eight 

months after raising the curtain along with Galaxy Macau Phase 2, 

this Broadway isn’t yet a runaway hit. 

Broadway Hotel has “almost 100%” occupancy for its 320 rooms, 

a Galaxy spokesperson reports. Room rates starting around MOP$800 

(US$100) include access to Galaxy’s signature Grand Resort Deck with 

its wave pool and river rides. The arena, filling a niche between Sands 

China’s 1,700 seat Venetian Theatre and Melco Crown’s 5,000 seat 

venue at Studio City, has hosted a variety of shows. 

Overall, Broadway attracts between 8,000 and 14,000 visitors 

daily. Galaxy says 55% of visitors patronize its F&B offerings, featuring 

Macau specialties along with retailers of local food souvenirs with 

a mobile stage and busker style entertainment. Studio City features 

a similar food concept, Macau Gourmet Walk, though it’s located 

indoors, a level above the shopping mall and includes international 

chains. The Macau government has made support for local small 

and medium enterprises a criterion for allocating additional gaming 

tables, and it could also become a factor in awarding gaming 

concessions, which will start to expire in 2020. 

The question lingers whether Macau themed F&B is a winning 

concept for tourists or a market “distortion” created by government 

policy that GamePlan Consulting founder Sudhir Kale warned 

about at November’s Macao Gaming Show. Institute for Tourism 

8 


Cover Story 

China’s middle class will expand to as 

many as half a billion people within a 

decade, and that group that will account 

for the bulk of the projected 200 million 

Chinese outbound travelers annually 

expected by 2020. The question that’s 

most relevant is how many of those middle 

class travelers, not only from China but 

the rest of Asia, will drop into Macau…. 

season periods such as China’s Golden Week holidays at the start 

of May and October, when Mr Wong calls room rates “insane” at 

MOP$4,000 to $5,000 a night. “However, during most days of the 

year, the rooms are quite affordable ranging from a few hundred to 

a couple thousand [patacas].” 

“Macau is relatively affordable,” Mr Wieners concurs. “While 

accommodation prices are up and down, I don’t currently consider 

this a crux to mass market success.” He believes, “The bigger issue, 

more than price, is access to the amenities, infrastructure – for 

example, adequate transport services – and a generally welcoming 

experience for a lower spend customer than was previously the key 

target of operators.” 

Studies Assistant Professor IpKin Anthony Wong argues there’s “no 

empirical evidence” that tourists like the Macau style dining featured 

at Broadway. Moreover, for visitors that do like the concept, Mr Wong 

contends, “The scale of the offerings is small, and things are not 

cheap.” With similar options abundant around town, Mr Wong feels 

Broadway Macau “lacks novelty and the wow factor.” 

Hogo’s Mr Wieners suggests “diversification of the food and beverage 

offerings through introduction of [additional] concepts, both Chinese and 

Western, could make Broadway a hit.” He also says Broadway can make 

better use of its other facilities to stimulate interest. “The concert hall looks 

great, but there are so many other types of entertainment not yet available 

that could be offered at this location to drive both an inbound tourist as 

well as a domestic Macau and Hong Kong crowd,” he says. 

Then there’s the immutable law of real estate: “I don’t think the 

location has helped,” Mr Wieners says. Broadway is off the beaten 

path in Cotai and best reached from sister property Galaxy via a 

footbridge with a moving walkway. Galaxy management has tried 

to mitigate the location issue by offering free two hour parking at 

Broadway and says that move has doubled its arrivals by car. However, 

not many middle market tourists come to Macau by car. 


Cover Story 

“The challenge here is still moving beyond the image of hard core 

gambling as this isn’t necessarily what younger middle class consumers 

are looking for. Macau has absolutely added more attractions for nongamblers 

or casual gamblers to enjoy, but there is still room to go.” 

Some properties and operators are more ready than others 

for middle class customers. Mr Wieners mentions Sands China’s 

Venetian Macao and Studio City as middle market friendly properties, 

and he believes Sands’ Parisian will join that group. “Through a 

combination of room inventory, available space to build further 

amenities, and their commitments to promote non-gaming offerings, 

I feel these resorts will resonate with the new middle class Macau will 

need to begin attracting,” he says. 

Mr Wong sees all of the operators tilting toward the middle class 

to some degree, noting that Wynn and MGM, long focused on the 

high end and lacking Cotai properties, have been increasing their 

mass market tables and slots. Galaxy Macau’s first phase retail mix 

included shops that targeted middle class consumers, including drug 

chain Mannings and watch shop City Chain plus a range of casual 

dining along with more upmarket offerings. Galaxy’s Broadway 

Macau, opened in May along with the resort’s second phase, aims 

squarely at the middle market. Even before Studio City, Melco Crown’s 

City of Dreams had a Hard Rock Hotel and later introduced SOHO, 

a dining and entertainment area catering to the middle market. Later 

this year, SJM Holdings will reopen its redeveloped Jai Alai casino 

near the Outer Harbor Ferry Terminal with a 130 room hotel and 

retail, expected to target middle class customers. 

MAKING THE TURN 

“I think there is an understanding amongst the major players that 

middle class consumers want something different but it’s difficult to 

transition quickly,” Mr Cavender says. “So, the resorts are going in 

the right direction but it may take time for the market to develop and 

for middle class consumers to come in enough numbers to offset any 

losses to revenue from VIP gamblers and junkets.” 

Simply having facilities to serve the middle market isn’t enough, 

Mr Wieners suggests. “From a marketing perspective, organizations 

like Sands are well oiled machines that understand their customers 

and where they sit,” the marketing executive says. “Regular road 

shows and familiarization trips to Chinese agents and end-consumers 

have allowed Venetian Macao to remain a household name for those 

traveling to Macau. I see this happening with Parisian upon its 

opening and partly due to its iconic Eiffel Tower structure. Studio City 

has much to gain from the same exposure in key inbound markets, 

and a sexy, exciting product that will visually stimulate but must be 

combined with the right sales pitch.” 

It’s not a matter of the sales pitch, but what Macau has to sell. 

“Macau requires a major reengineering of products and services,” 

Mr Wieners says. “The majority of properties today have been 

planned and fitted out with a premium market in mind. In order to 

see success, the destination as a whole must work to reinvent the 

perceived service offerings available to visitors.” 

Citing a new generation of Chinese consumer that have traveled 

overseas, or see it as a genuine alternative to Macau, Mr Wieners 

says, “While we need to remain culturally relevant in our offerings, 

the lack of diverse offerings across entertainment, food, beverage 

and amusements are keeping the Macau brand off the travel lists for 

many in the Chinese middle class who perceive Macau as ‘boring’ 

or ‘just a gaming destination’ or ‘not a place for quality family 

entertainment.’ I believe the incoming Cotai resorts are aware of 

this and are in the process of shifting what they can with regards to 

10 


Cover Story 

service offerings to maintain relevance with what this new Macau 

tourist will be seeking.” 

NOT SO HOT 

“Right now Macau as a whole may have a branding issue,” Mr 

Cavender says. “It really isn’t seen as a hot destination for younger 

consumers, and those are the consumers who are spending on travel 

right now.” He says, “The challenge here is still moving beyond the 

image of hard core gambling as this isn’t necessarily what younger 

middle class consumers are looking for. Macau has absolutely added 

more attractions for non-gamblers or casual gamblers to enjoy, but 

there is still room to go.” 

For today’s Macau, it’s still “hard to compete for consumer 

time and money when they have so many other destinations that 

they are interested in,” Mr Cavender says. “As consumers look 

at traveling to new destinations, they are also considering Korea, 

Singapore, the Philippines, markets that offer a lot more besides 

gambling.” 

“Singapore, Korea, and Taiwan have done excellent jobs in 

promoting the destinations by having an assortment of leisure 

and entertainment options catering to Chinese visitors,” Mr Wong 

says. “Singapore and Korea both have casinos, and they have better 

“Like it or not, Macau must go the way 

of previous gaming destinations like Las 

Vegas and develop a quality destination 

brand campaign that reaches out and 

stimulates not only the Chinese market, 

but those throughout Asia as well.” 

shopping options than Macau. Their food variety and authenticity 

are excellent. These places are also rich in sightseeing options 

and entertainment activities. Taiwan will pose a genuine threat 

to Macau’s market once it opens up casinos,” a prospect that 

may have become more remote with the Democratic Progressive 

Party winning last month’s presidential election. (Beijing has said 

it won’t allow mainlanders to travel to Taiwan for casinos, and 

the DPP is considered less friendly to Beijing than the outgoing 

Kuomintang party.) New integrated resorts will help make Macau 

more attractive to travelers, Mr Wong says, but beyond casino 

facilities, the city remains “reluctant to add new tourism facilities 

and activities.” 

“Like it or not, Macau must go the way of previous gaming 

destinations like Las Vegas and develop a quality destination brand 

campaign that reaches out and stimulates not only the Chinese 

market, but those throughout Asia as well,” Mr Wieners says. 

“Macau must work to drive the mass markets of other inbound 

locations, Southeast Asia, Korea, Japan. When the bulk of Asian 

markets begin coming to Macau en masse, the Chinese consumers 

will follow.” 

Mr Wong also sees Las Vegas providing “the best model” for 

Macau. “Las Vegas is no longer just Sin City and a hardcore gambling 

destination,” he says. “The city has so many affordable attractions and 

leisure activities: shopping, shows and entertainment, exhibitions, 

golfing, dining, and much more, all at affordable prices. 

“The key here is scale,” Mr Wong says, but he doubts pintsized 

Macau can match the breadth and depth of attractions in 

Las Vegas, which began with a vast blank desert canvas. “Macau 

is too crowded for mass tourism. It is not even pleasant to walk 

around the city, a major problem that inhibits tourists from staying 

longer. With the soaring cost associated with service operations, 

Chinese tourists will soon realize – maybe they have already – that 

it may not be worth visiting Macau unless the city makes major 

improvements to its tourism infrastructures and facilities. With 

such a small piece of land, I don’t think Macau will ever be able to 

solve this problem.” 

But as US$23 billion of new operator investment rolls out, Macau 

may never have a better opportunity to reinvent itself yet again. It’s 

not just about attracting the middle class but making Macau the 

world center for tourism and leisure that government authorities say 

they want. That would be a new normal worth with a visit. 


Industry 

profile 

Albert 

In five short years 

Albert Yu has 

worked his way up 

to become General 

Manager of the Macau 

office of Japanese 

gaming equipment 

manufacturer, Aruze 

Gaming. IAG took 

some time to get to 

know Albert better. 

IAG: Let’s start at the beginning. Tell 

us a little about your career before 

you entered gaming. 

Albert Yu: I was born and raised in Hong 

Kong and then went to the US for high 

school and university. After I graduated 

I came back and took over my father’s 

business manufacturing camera bags. 

We had 300 workers in our plant in China 

producing for the likes of Olympus, Nikon 

and Canon. I was in charge of everything 

from sourcing materials to logistics, 

budgeting and marketing, so it was a 

very good learning experience on how to 

manage an entire company. 

IAG: How did you join Aruze? 

AY: I had been running the family 

business for seven years when a Japanese 

colleague introduced me to Aruze. 

Gaming and production of gaming 

machines was a completely different 

industry, but I knew about manufacturing 

and marketing so I was able to make 

the transfer. Kazuo Okada wanted to 

set up in Hong Kong and he put me in 

charge of everything from registering 

the business and hiring staff, to finding 

him an apartment and buying him a car. 

Then he sent me to Aruze’s factory in the 

Philippines to train for a few weeks. 

IAG: How did you come to Macau? 

How was the transition for you 

personally? 

AY: Mr Okada transferred me to Macau 

to get first hand experience of the casino 

industry. When I arrived I hadn’t gambled 

beyond the occasional small-stakes 

card game with friends. There were slot 

machines that we could try out in the 

office, with no money involved. I realized 

that wasn’t enough. I had to start using 

my own money in casinos, to play our own 

12 


Industry 

profile 

I had to start using my own money in casinos, to play our own machines and 

those of our competitors. It was the only way to experience the joy and pain 

that comes from playing slots, and really understand what makes different 

machines fun and compelling. To begin with I had no idea of how to play 

and I lost a lot of money, but making the transition from a non-gamer to 

something of a hard-core gamer was a very memorable experience for me. 

machines and those of our competitors. It 

was the only way to experience the joy and 

pain that comes from playing slots, and 

really understand what makes different 

machines fun and compelling. To begin 

with I had no idea of how to play and I lost 

a lot of money, but making the transition 

from a non-gamer to something of a 

hard-core gamer was a very memorable 

experience for me. I also have to say I 

learnt a great deal from Mr Takahiro Usui. 

He mentored me for many years and he 

has been a great teacher and boss. 

IAG: How has Macau changed over 

the years? 

AY: When I arrived five years ago Galaxy 

and Sands Cotai had just opened, and 

business was booming. Then came the 

downturn with revenues down every 

month, junkets moving out and tourist 

numbers dropping. I think this a normal 

development because relying 90% 

on junkets and one game, baccarat, 

FEBRUARY 2016 inside asian gaming 

13

Industry 

profile 

was not sustainable. We have to make 

the transition to a Vegas-style massmarket 

based more on non-gaming 

entertainment. Of course that will be 

painful and it won’t happen overnight, but 

I’m confident it can be achieved. I think 

in the second half of this year the decline 

may stop and growth may return; slow, but 

constant and sustainable. 

IAG: How do Aruze’s offerings cater 

to the Asian market? 

AY: We’re an Asian company with one 

R&D center in Japan and another in the 

Philippines so our understanding of Asian 

gamers is very deep. Our background is 

pachinko and there’s a strong element 

of that in our designs. Mr Okada himself 

has made direct input into many of our 

products. 

We don’t do live tables, but on the 

machine side there’s not one genre we don’t 

have, whether it’s electronic table games, 

community games or stepper machines. We 

have something for any first time player and 

our diversity makes us well positioned for 

the current transition to mass-market. 

IAG: Obviously there has been a lot 

of talk about casino gaming coming 

to Japan over the years. What are 

your feelings on its chances? 

AY: I think it will happen but not very 

I’m a huge sports 

fan. I’ll get up 

at 4am to watch 

my favorite team 

in the NBA or 

NFL. For the 

English Premier 

League I’m a 

great supporter 

of Liverpool. 

Win or lose, I’m 

forever red. 

soon. Last year there was a push to get 

a law passed but it was unsuccessful. I 

think it will be another year before their 

congress meets again on the matter. 

IAG: Who in the industry do you 

admire most? 

AY: I think that has to be my boss, Mr 

Okada. He has a great deal of experience 

and understanding of the industry, so he 

can pinpoint what makes a product stand 

out from our competitors. He’s personally 

very involved in the process of product 

development. 

IAG: What do you like to do in your 

spare time? 

AY: My family is in Hong Kong so when 

I go back there at the weekend the time 

I can spend with them is very important 

to me. Apart from that, I’m a huge sports 

fan. I’ll get up at 4am to watch my favorite 

team in the NBA or NFL. For the English 

Premier League I’m a great supporter of 

Liverpool. Win or lose, I’m forever red. 

IAG: Where do you see yourself in 

five to ten years? 

AY: In a stronger Aruze. Although we’re 

established in Asia there’s a lot we can 

do to grow our business in Singapore, 

Malaysia and the Philippines. In Europe 

we are still young and don’t have much 

footprint. Step by step, we’re looking to 

expand our market share. 

14 



Trade events 

16 


Trade events 

ICE 

IAG has just attended 

ICE which has now 

firmly staked its claim 

as the world’s premier 

gaming show. 

By Steven Ribet 


Trade events 

London’s ICE Totally Gaming, 

which IAG has just attended, is 

now clearly the largest trade fair 

in the global gaming industry. 

But for ICE’s Chris Jones its 

impressive numbers alone are not enough. 

“Being the biggest show isn’t necessarily 

the same as being the best. You have to look 

at quality; not just measured in terms of how 

many hours each visitor spends here and 

whether or not they come back, but in terms 

of what they’re actually doing,” he says. 

“When you’re here you can feel the 

energy; a palpable sense that things are 

happening. Everywhere you look people 

are making connections and doing deals. 

I like to think of it as a cross between a 

hypermarket and a souk, with the zest and 

energy that only gaming has.” 

Floorspace this year was a vast 39,000 

square meters, or about the same as six 

World Cup football pitches. A total of 527 

companies came to exhibit, with the largest 

display alone (belonging to Austrian slot 

maker Novomatic) occupying 5,000 square 

meters. While audited visitor numbers have 

not yet been released, organizers Clarion 

expected 25,000 professionals to attend. 

Last year they came from 133 different 

countries. 

A favorite story of Jones’ relates to 

Cabo Verde; a tropical island nation in the 

eastern Atlantic that, like Macau, is a former 

Portuguese colony. “As a tourism destination 

it’s a bit like a poor man’s Caribbean. Last 

April I took my family there on holiday. I 

remember remarking to friends that in terms 

of its economy and overall development, 

the place would benefit hugely from a really 

good casino resort,” Jones says. 

It came as no surprise to Jones, then, 

when three months later casino operator 

18 


Trade events 

“When you’re here you can 

feel the energy; a palpable 

sense that things are 

happening. Everywhere 

you look people are making 

connections and doing 

deals. I like to think of 

it as a cross between a 

hypermarket and a souk, 

with the zest and energy 

that only gaming has.” 

Macau Legend announced it had concluded 

talks with the government of Cabo Verde and 

agreed to invest US$275 million to build a 

resort in the nation’s capital Praia. When he 

looked over the list of visitors registered to 

attend last year’s ICE, there was indeed a 

small delegation from Cabo Verde. “I like to 

think the germ of the idea that will transform 

the whole country was hatched right here in 

London,” he says. 

The International Casino Expo (which 

ICE is the acronym for) started life in 1936 as 

the Amusement Trades Exhibition. It was a 

small event organized by makers of the penny 

machines that fill amusement arcades in 

English seaside towns. In the 1980s visitors 

to the show started arriving from Las Vegas, 

in search of equipment that could be used 

to transform the American gambling capital 

into a more family-oriented destination. 

That prompted the fair’s British exhibitors 

to look at how they might in return do what 

the Americans were doing and expand their 

business into high stakes gambling. In 1991, 

16 UK companies making casino machines 

were allowed to exhibit and the show’s name 

was changed to ICE. 

Five years ago the show relocated from 

west London’s Earls Court to ExCel; a huge 

new convention center in the area of East 

London rejuvenated by the 2012 Olympics, 

that had in fact hosted several Olympic 

events. The move turned out to have been 

a wise one, because there has been enough 

demand for the show to have doubled in size 

since then. 

ICE’s main rival, the Las Vegas’ Global 

Gaming Expo (G2E) can still compare by 

some measures. In 2014 (the last year 

for which G2E has released figures), the 

American event quoted 16,579 attendees, 

compared to ICE’s 17,905 independently 

audited attendance. ICE is also only slightly 

ahead in terms of its total number of 

exhibitors. But if current trends continue, 

the London expo will soon be leaving all 

competitors far behind. Next year’s show 

will add 8,000 square meters of space, for 

a total of 47,000 square meters (about 7 

football pitches) versus 28,000 in Las Vegas. 

In an interview published on ICE’s last day 

on February 4, organizer Clarion said that 

by 2020 it expected the show to take up all 

of ExCel’s 44 halls, giving it a total area of 

87,000 square meters. 

Some joke that ICE is so-named 

because it is held in the depths of London’s 

winter, but we here at IAG predict in the 

years to come the show will just get hotter 

and hotter. 


Feature In Focus 

Mohegan Sun’s proposed US$5 billion mega-resort, 

the first stage of which is named “Inspire.” 

for Korean IRs? 

This month the Korean 

government is expected to 

announce the winners in its 

request-for-proposal process to 

build two new integrated resorts. 

Will there be any? 

By Steven Ribet 

After a roaring start a year ago South Korea’s plan to 

build two more integrated resorts is foundering and 

could even fall flat. Nearly three dozen parties expressed 

interest when invitations were first sent out in February 

2015. But by the final deadline last November 30, 

full proposals actually submitted had dwindled to just six. Korea’s 

Ministry of Culture, Sports and Tourism (MCST) says the number left 

in the running is now only two. 

The winners are due to be announced this month (February), 

but analysts are saying the scheme may be scrapped. A Korean 

academic, meanwhile, reckons the government may be pressured 

into postponing, or revising down its requirements. 

Koreas love affair with integrated resorts has been going on for 

three years. The country today has 16 licensed foreigner-only casinos 

operating in tourist hotspots, plus just one open to its own citizens 

20 


In Focus 

in a remote, run-down inland mining area. Foreigners, predominantly 

Chinese and Japanese, flock to these gambling halls, which are 

typically on a scale of around 40 tables. Aside from paying muchneeded 

taxes many argue they do little for the Korean economy. 

A typical integrated resort, by contrast, involves a massive 

investment of at least a billion US dollars. With leisure facilities 

galore backed up up by a thousand-plus hotel rooms, it should 

accommodate over a million visitors each year, employing thousands 

of locals and boosting tourism nationally. 

Tourism from China was burgeoning when Korea gave the 

go-ahead for its first IR in 2013. It’s a US$1.7 billion joint venture 

between the largest domestic casino operator Paradise Group 

and Japanese gaming company Sega Sammy, slated to open 

next year. Construction on a second started soon after; a tie up 

between Indonesia’s Lippo conglomerate and Las Vegas’ Caesars 

Entertainment that should start operations in 2018. It is projected to 

cost US$1.9 billion. Both are now under construction on Yeongjong 

island, a free-trade zone in Incheon City some 50 kilometers west of 

Seoul, that houses the country’s main airport and aims to become 

a mini-Macau. 

National gambling revenue had seen nine straight years of 

growth when MCST issued the request for concepts for two more IRs 

in February last year. The surge in visitor numbers to Korea from the 

main target market China was continuing, shooting up 42% to 6.1 

million in 2014 alone. 

MCST’s requirements for bidders were relatively strict. An 

investment of at least 1 trillion won (about US$850 million) was 

specified, to build more than 1,000 five-star hotel rooms, conference 

facilities, 20,000 square meters of retail space and amenities for 

leisure and culture, including a “themed attraction” costing at least 

US$60 million. Gambling could take up no more than 5% of the 

resort’s total floor space. As before, the casino would be off-limits 

to Koreans. 

In spite of these demands, by the June 30 deadline 34 parties 

had submitted a plan. Among them were Macau’s Melco Crown, 

which proposed to build its IR at the Incheon cruise terminal on the 

Korean mainland a few kilometers across from Yeongjong, and the 

Philippines’ Bloomberry Resorts. 

Bloomberry’s concept was among the most publicized. The 

operator of the Solaire Resort and Casino in Manila proposed a 

project spanning a pair of smaller islands; Muui and Silmi just off 

Yeongjong’s southwestern corner. Twice-daily tide changes making 

it possible to walk across the sea channel separating the two 

would provide a unique attraction. On top of this natural marvel, 

Bloomberry’s IR would feature an all-weather waterpark, weddings by 

New York designer Vera Wang and a Tommy Hilfiger/Karl Lagerfeld 

center to foster new talent in fashion, art and entertainment. Copying 

Steve Wynn’s Treasure Island show in from 1990s Las Vegas, there 

would even be an amphitheater staging recreations of historic Korean 

naval battles. 

On top of five locations on Yeongjong island and one at the nearby 

Incheon cruise terminal, MCST was offering bidders three other sites 

for development. Jeju Island might have seemed a natural choice. 

Located off South Korea’s south coast it is already Korea’s number 

two tourist destination with eight operating licensed casinos; the 

largest concentration in the country. Yet Korea’s political structure 

gives Jeju autonomy to grant its own casino licenses, so it was not 

included in the national IR proposal process. Outside Yeongjong and 

the Incheon cruise terminal, therefore, the three other locations were 

Korea’s second largest city Busan, which already has two casinos, 

MCST’s requirements for 

bidders were relatively strict. An 

investment of at least 1 trillion 

won (about US$850 million) was 

specified, to build more than 1,000 

five-star hotel rooms, conference 

facilities, 20,000 square meters 

of retail space and amenities for 

leisure and culture, including a 

“themed attraction” costing at 

least US$60 million. Gambling 

could take up no more than 5% of 

the resort’s total floor space. As 

before, the casino would be offlimits 

to Koreans. 



An artist’s rendition of Imperial Palace’s “Pacific Palace” 

“With a projected $5 billion to build out on 

325 hectares over 20 years, the first phase 

of Mohegan Sun’s project, called “Inspire”, 

will include 1,200 suites in three luxury 

hotels, a 15,000 seat arena (billed as “one 

of the most spectacular entertainment 

venues in Asia”), 20,000 square meters 

of luxury retail and a unique “beauty and 

wellness hub” offering cosmetic surgery.” 

and sites at cruise terminals in the southern port cities of Yeosoo 

and Jinhae. 

In the event however, nearly all proposals submitted were for 

Yeongjiong or the neighboring mainland cruise terminal, with prospects 

of ocean borne tourists patronizing the others not considered attractive 

enough. “Seoul is still faraway the top tourism destination for Chinese. 

The Yeongjong sites are all 10 to 15 minutes away from its gateway 

airport,” explains Brian Lee, an analyst at brokerage and investment 

group CLSA. “Korea’s southern coast is not yet attractive to Chinese 

tourists, and has few other facilities for entertainment or sightseeing.” 

Unsurprisingly, then, the proposals of the four frontrunners that 

emerged during the autumn were all for Yeongjong. These bidders 

were seen as strong because of a credit rating of BBB or above, good 

connections within the Korean government and experience with big 

projects catering to Chinese. 

In addition to Bloomberry, one was state-owned Grand Korea 

Leisure, which now runs two casinos in Seoul and one in Busan 

under the “Seven Luck” brand. Another was the Chinese property 

developer Macrolink, which signed an agreement to partner up with 

the Incheon City Government. The fourth was Chow Tai Fook, a 

Hong Kong hotel, property and jewelry conglomerate that is building 

casinos in Australia and Vietnam. 

Yet by late November all four had dropped out, together with 

all but six of the original 34 applicants. And for the November 30 

deadline, only two deposited the US$50 million guarantee required 

by MCST. What happened? 

For starters, four of the last six did not have the BBB rating 

demanded by MCST, and instead submitted investment guarantees by 

22 


In Focus 

potential partners. Three of them were mid-tier Korean construction 

companies or resort operators – Ocean View, Booyoung World and 

Yeosoo Kyungdo – with no track record of big projects. The other was 

Global Gaming Asset Management (GGAM), a US firm headed by 

William Weidner, who used to be president and COO of Las Vegas 

Sands but no longer has the wherewithal of the global gaming giant 

behind him. 

For more qualified candidates, the main reason for pulling out 

was undoubtedly given by GKL which cited “shrunken demand” from 

China when announcing its withdrawal. Last year the mainland’s 

souring economy, together with president Xi Jinping’s crusade 

against corruption, sent revenues plummeting in Asia’s gaming 

capital Macau and spread chills across the wider region. “The 

profitability of new casinos will be low, especially if they have to invest 

so much in non-gaming attractions,” says Yang Il-woo, an analyst at 

Samsung Securities. 

Last summer’s Shanghai stock market crash heralded the 

downturn in China. At the same time, the Middle East Respiratory 

Syndrome (MERS) virus hit Korea causing 186 to fall sick and killing 

36. That was one reason visitor arrivals in the country fell by 40% 

year-on-year, in the months of May, June and July. And on top of 

MERS, police in China started cracking down on Korean casinos’ 

marketing operations. In June, officers arrested 13 Paradise and GKL 

employees who had been organizing golf events in China, along with 

other marketing activities. 

Korean casinos run their own direct marketing activities. That 

contrasts with other Asian casinos that depend on junket operators 

for Chinese VIP customers. Junkets have very strong networks 

in China, which enables them to neatly tiptoe around local laws 

prohibiting the soliciting of people to go abroad and gamble. 

“GKL is state-owned, so the arrest of its marketers in China 

created a political problem,” says Yang Il-woo. 

It’s not hard to see why a Chinese developer like Macrolink would 

get cold feet about building a Korean casino under such a change of 

Concept rendition of Mohegan Sun’s “Inspire” 

integrated with Incheon International Airport. 



Imperial Pacific’s newly opened 

casino Best Sunshine on Saipan Island 

environment. “A major reason for the four cancellations was the burden 

of regulatory risk from the Chinese government,” says Brian Lee at CLSA. 

Among casino operators that never entered the bidding process, 

Steve Wynn has said he would consider building a casino in Korea should 

the government allow it to serve locals. Some commentators, indeed, 

suggest that in demanding huge investment, but only giving license to 

admit foreigners, MCST is asking too much and offering too little. 

“There are alternatives to Korea because in a couple of years Japan 

may want to open casinos. The return will be better there because 

Japan will permit its own people to gamble,” says Yang Il-woo. 

Whatever the truth, Mohegan Sun and Imperial Pacific (MCST 

confirmed them as the only two entrants left but otherwise declined 

to comment for this article) still express great enthusiasm for 

building an IR in Korea. 

“We think Korea is an incredible market opportunity,” says tribal 

gaming operator Mohegan Sun’s CEO Bobby Soper. “Not only does 

Korea itself have 50 million people, but there are 700 million people in 

northern China within a 2-hour flight of Seoul. Our site is at Incheon 

airport which serves 45 million passengers annually, forecast to rise 

to 60 million.” 

Mohegan Sun’s targeting of both Koreans and foreigners comes 

from a plan that aims to raise over half of its revenue from nongaming. 

A mere 3% of floor area will be devoted to gambling. “We’re 

taking a lesson from Macau,” says Soper, referring to the collapse 

of the city’s VIP segment. “Our business model is not high-end, 

although we do plan to capture some of it. We’re building an amenitydriven 

property, with a focus on premium mass-market.” 

With a projected US$5 billion to build out on 325 hectares over 

20 years, the first phase of Mohegan Sun’s project, called “Inspire”, 

will include 1,200 suites in three luxury hotels, a 15,000 seat arena 

(billed as “one of the most spectacular entertainment venues in 

Asia”), 20,000 square meters of luxury retail and a unique “beauty 

and wellness hub” offering cosmetic surgery. South Korea is a worldleader 

in this field. So after relaxing in a spa, visitors will be able to 

“Mass- market may indeed be today’s trend 

in Asian gambling. But Hong Kong-listed 

Imperial Pacific is not following fashion. 

Its unabashedly high-end “Pacific Palace” 

is proposed for a site next to the Lippo- 

Caesar’s Entertainment IR now being built 

in Yeongjong’s Midan City which, targeting 

mass-market, is not seen as a competitor.” 

get a nose job. Outdoors there will be a state-of-the-art theme park 

and an eco-park with an aquarium and recreational activities such 

as climbing and “glamping” (luxury camping in safari-style tents). 

The casino itself will offer over 200 tables and 1,500 slots. Uniquely, 

Mohegan Sun has agreed to work with Incheon International Airport 

to build the first private air terminal in Asia. 

Mohegan Sun will take the majority share of a consortium to 

build all of this, with the Korean construction materials-supplier KCC 

as its main partner. Another partner ran a junket operation in Macau. 

Soper declined to detail the “three or four” remaining members of 

his consortium, although he did say all of them have experience in 

Asian gaming. To add to this, Soper counts Mohegan Sun’s flagship 

resort in Connecticut, which serves 35,000 visitors each day, as a 

qualification, together with the estimated 20,000 jobs he reckons his 

proposed IR should create in Korea. 

Mass- market may indeed be today’s trend in Asian gambling. But 

Hong Kong-listed Imperial Pacific, the second party left in the game, 

is not following fashion. Its unabashedly high-end “Pacific Palace” is 

proposed for a site next to the Lippo-Caesar’s Entertainment IR now 

24 


In Focus 

being built in Yeongjong’s Midan City which, targeting mass-market, 

is not seen as a competitor. 

A director of Pacific Palace who declined to be named says the 

reaction to the downturn in Macau’s VIP segment has been overdone. 

“It’s just a correction of an unhealthy market; back to business as 

normal, which is still very good,” he says. “We will not be targeting 

Koreans or the mass-market. We will concentrate on what is in our 

hand, and what is in our hand proves we can be really successful 

providing VIP service to the highest standard in the world.” 

Imperial Pacific recently opened a casino on Saipan after 

obtaining a 40-year gambling monopoly there. The Pacific island is 

4½ hours by plane from China. According to the executive, profits 

from the casinos 50 tables averaged US$195 million in each of its first 

two months of operation, November and December. That’s more 

than half the total for all 16 foreigner-only casinos in Korea. 

The executive says the super-rich Chinese who patronize Saipan 

go there for its pure, unpolluted environment. Imperial Pacific sells to 

them through part-ownership of Macau junket promoter Hengsheng. 

After Korea, it is looking to develop one or two more IRs around the 

Pacific, to achieve synergies in marketing to Chinese, Russian and 

Japanese high rollers. “Our Korean offering will be more urban and 

modern than Saipan’s sunshine and clear air and water,” the Imperial 

Pacific executive says. “Local companies don’t have our experience in 

marketing to Chinese, so it’s a natural fit.” 

Imperial Pacific wants to partner with Korea’s Hanwha Resorts 

for a US$2 billion project on 16½ hectares, featuring 1,200 hotel 

rooms, 500 serviced apartments, a conference center, performance 

arena and a 15,000 square meter shopping mall. The project’s indoor 

theme park will be “not Disneyland, not international” but rather 

focused on Korea’s strong contemporary pop-culture. “Korea has 

a lot of famous artists in cinema, television and music, but they’ve 

never used them to create a theme park,” says the executive. “We 

have a very strong background in entertainment. We are going to 

create something that has never been seen in Korea before.” 

Will MCST be convinced by all of this? According to analysts, 

neither Mohegan Sun nor Imperial Pacific have good connections 

within the Korean government. Mohegan Sun lacks experience in the 

Asian market. Imperial Pacific does not have a proven track record in 

managing large resorts. 

“I don’t believe any candidate will be selected as a new player in 

the current bidding process,” says Yang Il-woo at Samsung. “Perhaps 

the only qualified is Mohegan Sun, but they don’t have any relationship 

with the Korean government, so the possibility is quite low.” 

Brian Lee at CLSA says, “The Korean government was very 

aggressive to introduce these casino resorts in 2013 and 2014. 

In those days the overall market was very good and there was no 

kind of regulatory issue from the Chinese government. But overall 

conditions have deteriorated. In my view the whole process could be 

postponed or fall through.” 

At Seoul National University, economics professor Pyo Hak-gil 

made a study of the case for building new IRs in Korea. His initial 

estimate of demand for more than two has been scaled back to “1.2 

or 1.4 after accommodating the China shock.” 

“I don’t think the government can cancel the whole plan just 

because there are only two bidders left,” he says. “Local government 

is committed to this and killing it would be politically burdensome.” 

Says Pyo, “On the other hand, the government wants competition 

so an uncontested process would be an embarrassment. I think it 

may invite more local bidders and lower its conditions. These things 

may turn out to be flexible.” 

“Imperial Pacific wants to partner 

with Korea’s Hanwha Resorts for a 

US$2 billion project on 16½ hectares, 

featuring 1,200 hotel rooms, 500 

serviced apartments, a conference 

center, performance arena and a 

15,000 square meter shopping mall.” 

An artist’s rendition of Imperial Pacific’s 

proposed “Pacific Palace” property 


Tech Talk 

The Bally Tournaments Express 

product from Scientific Games can 

be used on any slot that is equipped 

with the company’s iVIEW Display 

Manager technology 

Competition Management 

Simplified 

Slot tournament management 

systems are gaining popularity 

in casinos, creating simplicity for 

operators and bringing fun and 

excitement for patrons. 

By Joan Mantini 

Slot tournaments bring energy, excitement and 

competition to the casino, which is perhaps the reason 

they are gaining popularity with patrons both on and off 

the casino floor. 

In addition to creating excitement, slot tournaments 

provide operators with a number of tangible benefits such as 

the ability to keep customers at the facility longer (and hopefully 

gambling more), cross promotion with other areas and attractions 

within the resort and, if successful enough, much needed distinction 

in increasingly competitive gaming marketplaces. 

The good news for operators seeking to make a slot tourney 

splash-gaming suppliers are continuing to evolve slot tournament 

management systems. These advancements in technology are 

making it easier for slot tournaments to be more automated, 

increasing game selection, decreasing operator responsibility, and 

lowering the overall operating expenses by making tournaments 

more efficient. 

“Casinos have always seen the value for slot tournaments, and 

with today’s tournament systems, they are able to run them in a 

cost effective manner to help increase overall revenue,” said Keith 

Riggs, vice president of gaming technology at Everi. “Additionally, by 

providing appealing content and seamless integration, casinos now 

have the opportunity to engage and entertain players with a different 

gaming experience that encourages social interaction, making them 

feel like part of a community.” 

As an added incentive, fully-integrated slot tournament 

management systems allow the casino operator to build a slot 

tournament marketing program around real-time incentives. 

“Casinos are able to define targeted actions — such as new loyalty 

card sign-ups, particular wager amounts, or time on device — and 

26 



Tech Talk 

automatically reward players through the casino management 

system based on whether carded players have completed 

qualification criteria,” said Michael Ratner, director, product 

management, systems, for Konami Gaming. This helps operators 

customize slot tournament marketing to the wants and needs of 

a specific patron and perhaps get that player to visit the casino 

more frequently. 

Indeed, as slot tournament technology continues to evolve, 

it’s likely casino operators are no longer faced with the decision 

of “should we get a tournament system,” but rather, “what 

tournament system will work best for our operation?” After all, 

there are currently plenty of slot tournament systems from which 

to choose. Here is a quick rundown of the latest technological 

advancements from some of the most popular slot tournament 

systems providers: 

Scene from this year’s 

TournEvent of Champions 

contest in LasVegas 

EVERI 

TournEvent is Everi’s award-winning slot tournament 

management product and their TournEvent of Champions 

event continues to grow each year as a result of its success. The 

TournEvent product line is currently used in hundreds of casinos, 

making Everi one of the undisputed leaders in slot tournament 

management systems and technology. 

“Over the years, we’ve taken feedback from casino operators 

and marketing teams, combined with lessons learned through 

our National TournEvent of Champions program, to enhance 

the platform,” Riggs said. “TournEvent is so easy to use that 

just one casino promotions employee can manage an entire slot 

tournament, greatly impacting staffing and costs.” 

TournEvent continues to revolutionize slot tournaments 

for both slot operators and players with the release of 

their latest version, which includes new operator-friendly 

functionalities such as the ability to seamlessly switch from 

in-revenue gaming to out-of-revenue tournaments in seconds 

with the click of a mouse, according to Riggs. TournEvent 

also continues to increase operator efficiency with updated 

features in scoring, reporting and round management. 

“TournEvent enhances the player experience and eliminates 

operator headaches with a number of features that prove 

this system triumphs above the rest, and when you add our 

patented TournEvent of Champions campaign to the mix, 

there simply is no comparison,” Riggs said. 

TournEvent of Champions (TOC) is a six-month slot 

tournament tour that takes place across more than 100 casinos 

in North America and culminates with a finale in Las Vegas 

where the finalists compete for a US$1 million top prize. In 2015 

alone, TOC traveled 50,000 miles and interacted with more 

than 250,000 players. “It’s a game-changer and we’re looking 

to keep the momentum going as we celebrate TOC’s five-year 

anniversary in 2016,” Riggs said. 

Many new features of TournEvent have been implemented 

to ease the operation of slot tournaments which results in an 

enhanced player experience, Riggs remarked. “While the industry 

attempts to match the capabilities of TournEvent, we look to the 

future, with the belief that there is opportunity for innovation 

through delivery of the tournament experience to a wider 

audience in the form of new and exciting games,” Riggs added. 

28 



Tech Talk 

KONAMI GAMING 

Konami’s SYNKROS casino management system offers True-Time 

Tournaments. It’s one of SYNKROS’ top marketing tools, with awardwinning 

functionality, according to company literature. True-Time 

Tournaments gives operators a single location to configure, manage 

and monitor both Player-on-Demand and SYNKstart synchronized 

tournaments. Casino properties are able to choose from a broad 

library of available tournament themes. In addition, Player-on- 

Demand tournaments allow patrons to choose which tournament 

theme they wish to play, in true multi-game format to help keep 

promotions fresh and engaging. 

True-Time Tournaments allows players to earn tournament 

entries from any machine and play tournaments on machines that are 

picture-in-picture enabled. Any touch- screen enabled machine can be 

instantly transformed into a tournament-capable machine, and then 

returned back into revenue-generating game play. Casino operators 

do not have to reserve dedicated tournament-only machines, nor do 

they have to purchase specific machines from a vendor in order to 

launch tournament capabilities across their casino floor. Everything 

is managed, controlled and deployed through a single location within 

SYNKROS. 

“One of Konami’s high priorities is to deliver as much loyalty 

information to the player as possible directly onto their smartphone,” 

Ratner said. “Konami’s SYNKiosk mobile application pulls real-time 

information from their SYNKROS casino management system and 

will allow players to access and view information that is typically 

available to them while they are at the slot machine, such as bonus 

offers and incentives. For instance; allowing loyalty patrons to view 

and redeem their tournament entries on a mobile device. Players will 

be able to play their tournament game via smartphone if the property 

allows. Once a player earns their tournament entry at the casino 

property, they can view it on their phone from anywhere and play 

their entry remotely, or at any video slot machine with windowing 

functionality.” 

“In terms of our outlook moving forward, Konami is uniquely 

focused on delivering player experiences directly on to mobile 

devices,” Ratner added. “For example, the potential for players to 

use their personal smartphone as a medium to view information that 

The SYNKROS demonstration area 

at Konami Gaming’s G2E booth 

30 


Tech Talk 

they would typically see at the slot machine, and offering targeted 

bonusing applications directly on their mobile device. Konami 

aims to augment a player’s gaming experience by using a familiar, 

everyday device that players already have in order to provide more 

opportunities for player engagement.” 

IGT 

Tournament Manager, IGT’s slot tournament solution, has been 

in the field for several years and the company recently unveiled 

Tournament Manager 5.0, its latest iteration of the system. Part of 

the Tournament Manager 5.0 offering is Spin Ferno, a product that 

enables operators to host single or multi-site slot tournaments on 

IGT’s S3000 line of spinning reel cabinets. 

“Spin Ferno debuted at G2E and it was met with resounding 

enthusiasm, as it gives our customers another way to build on the 

successful momentum of the S3000 cabinet,” said Victor Duarte, 

global chief product officer, gaming, for IGT. “Of course the player 

interest in the solution is what drives its success, and response to 

the S3000 cabinet has been remarkable. Our focus groups and G2E 

feedback on Spin Ferno reflect a similar positive sentiment. 

Players really enjoy the touch-panel display below the Spin Ferno 

mechanical reels, as it adds an extra, interactive element to the spinning 

reel slot experiences and encourages players to use both hands in 

tournament play, rather than just bashing buttons repeatedly.” 

According to Duarte, Spin Ferno is going through trials and 

is expected to enter the market in early 2016. “Based on feedback 

collected at G2E and the overall popularity of the S3000 cabinet 

as performance predictors, we believe that this product is wellpositioned 

to be a hit on casino floors.” 

With a 90 percent market share in the video poker space, it only 

makes sense that IGT has also developed a tournament solution 

for the still popular slot game format.The company’s Ultimate X 

Poker with Power Deals Tournament Game is fueled by Tournament 

Manager 4.0 and enables operators to host spirited video poker 

tournament games on their casino floors. 

SCIENTIFIC GAMES 

Online literature states that with the Bally Tournaments Express, 

casino operators can quickly and easily turn just about any iVIEW 

Display Manager (DM)-equipped slot machine on their floor into 

tournament machines, regardless of the slot-management system 

or manufacturer. Once the tournament ends, games can easily be 

switched back into revenue-generating mode, adding versatility 

and the best use of floor space. Using a PC or tablet, Tournaments 

Express can easily change more than 120 different slot cabinets from 

over 20 manufacturers into tournament games within seconds. The 

Tournaments Express game suite includes just about any kind of 

tournament — free-play, invite-only, buy-in, multi-round, group-start 

sessions, or play-as-you-come. 

Tournaments Express is a complete package that includes an 

interactive kiosk for players to self-register — requiring less time and 

fewer operating staff. There is also a display that shows scores and 

results in real-time for everyone to see. A feature setting Scientific 

Games apart from competitors is the full integration of the player 

tracking system. “A lot of the competitive solutions all make various 

portions of the tournament operations, but only the DM tournament 

product enables everything from tournament creation, setting-up 

Spin Ferno reel slot 

tournament system from IGT 

the invite list, segmenting players, all the way through to running the 

tournament and at the very end awarding those prizes,” said Ted Keenan, 

senior director of systems product management, Scientific Games. 

Another claim to fame for Tournaments Express is that it’s the 

first system to offer a Bonus Tournament format which allows the 

game to stay in revenue producing mode. This allows the player to 

continue to play their base game while at the same time playing their 

bonus tournament game. 

“We are taking the tournament application and really expanding 

it into other areas and opportunities,” said Tom Doyle, vice 

president of systems product management for Scientific Games. 

“One of the features that is coming out next year is that we are 

going to allow the people at the machine to suddenly have the 

opportunity to buy into a slot tournament.” Scientific Games’ new 

BetVIEW technology is a new wagering solution that enables players 

to make secondary, concurrent bets, on a variety of games through 

Bally’s iVIEW DM and the Elite Bonusing Suite. Players will be able 

to spontaneously use their game meter credits and place additional 

wagers on secondary games like floor-wide tournaments, without 

leaving their machines. 

Reprinted with permission of Casino Journal. 


32 inside asian gaming FEBRUARY 2016


Blast 

from the Past 

FEB 2009 

The Good, 

The Bad and 

The Ugly 

February 2009 

Exactly seven years ago, in 

anticipation of a wave of 

misbehavior in Macau that 

would follow from the global 

financial crisis pulling down the 

Chinese economy, Steve Karoul 

wrote a guide to successfully 

working with junkets. The 

Chinese downturn didn’t 

happen, and Macau’s GGR 

turned out to be in line for five 

more years of explosive growth. 

His advice, in fact, is much more 

timely now than it was then. 

We need to understand 

what a junket is and what 

it is not. A casino junket 

is a group of individuals 

that “supposedly” have 

a propensity for gaming that are being 

organized by a tour leader — referred to as a 

junket rep — to take them on an organized 

trip to a casino for gaming purposes. A 

casino junket is not a free tour and travel 

vacation compliments of the host casino. It 

is supposed to be a gaming trip. 

I am one of the few casino executives that 

have actually worked both sides of the fence. 

I have hired and fired numerous junket reps 

all around the world when I worked as Vice 

President of Casino Marketing for different 

large casinos. I have worked myself as a 

junket rep when I lived in Hong Kong. And I 

have worked for and with some of the biggest 

junket reps in the world when I also lived in 

Hong Kong, Bangkok and the Philippines. I 

am very familiar with all aspects of casino 

junkets and dealing with junket reps both 

domestically within the United States and 

internationally. 

There are many positive aspects of 

dealing with reputable junket reps. There 

are also many risks and liabilities in dealing 

with not so reputable junket reps. There was 

a very famous management textbook several 

years ago written by Harvey McKay, entitled 

“Learn to Swim with the Sharks without 

Getting Eaten Alive”. There are some 

similarities between the book and dealing 

with not so reputable junket reps. Therefore, 

I always advise casino management to 

proceed with caution when setting up a new 

junket program. 

34 


FEB 2009 

Blast 

from the Past 

Increasing market-share 

It is important to understand that junket reps 

serve a legitimate function in many different 

casinos around the world. They basically act 

similar to an independent manufacturer’s 

sales representative, who represents the 

manufacturer’s line of products on a 

commission basis instead of working on a 

fixed salary, as most casino employees do. 

Casinos today use similar systems with 

their junket reps engaging them as part of 

their external sales and marketing team. 

In fact, many of the large Fortune 500 

companies — IBM, Xerox, Coca Cola, etc. 

— will normally employ both salaried sales 

executives and commissioned independent 

sales representatives at the same time to 

help increase market-share. 

Junket programs are no different than 

a manufacturer’s rep program. Large 

companies recur to the latter in addition 

to their own internal sales force primarily 

due to the logistics and the economics. The 

programs work and they are cost effective if 

managed properly. There is not too much 

difference between this and a casino junket 

program. 

However, some differences should be 

underlined in advance, to help ensure that 

your junket program is set up properly 

from the beginning to help you maximize 

your casino’s true profit potential from the 

junkets. Asian junkets are an exception 

to much of this article. Junket reps in Asia 

tend to issue and control the credit for their 

players. The junkets participate in Asian 

Dead Chip Rolling Baccarat games where 

commission is based upon turn-over or the 

“rolling of non-negotiable chips.” 

The text books will tell you that it is often 

more cost effective to utilize independent 

commissioned sales reps to supplement 

your sales activities. It is cost effective 

because you only pay commission based 

upon productivity. Junket reps work in the 

same manner. Junket reps are only paid 

commission based upon success. The 

casino does not pay medical insurance, 

The text books will tell you that 

it is often more cost effective to 

utilize independent commissioned 

sales reps to supplement your 

sales activities. It is cost effective 

because you only pay commission 

based upon productivity. Junket 

reps work in the same manner. 


Blast 

from the Past 

FEB 2009 

Junket reps take good care 

of their clients to keep the 

casinos’ coffers healthy 

36 


FEB 2009 

Blast 

from the Past 

social security tax or any other expensive 

benefits to their independent junket reps. 

The success measurements vary by casino 

and by gaming jurisdiction. Commissions 

can vary from a percentage of the players’ 

Theoretical Loss to a percentage of the 

actual gaming loss of their customers. In 

Asia, junket reps earn a percent of the nonnegotiable 

chips turnover often referred to 

as “dead chip rolling.” 

Giving and taking 

The natural tendency for a junket rep is to 

service his players and to maintain their 

loyalty. In order to achieve this objective 

they have to constantly offer their players 

exceptional benefits, excellent customer 

service and high value for their continued 

loyal patronage. Therefore, many junket 

reps often represent multiple casinos in 

multiple gaming jurisdictions. As a result 

of this they are able to review every casino’s 

special events, entertainment schedules, 

tournaments schedules, etc. and offer their 

customers the best available from multiple 

casinos. In effect, they handpick only the very 

best offers to present to their customers. 

The only risk or liability to the host 

casino is that they may only see that junket 

rep and his players during times when they 

are running high budget events which may 

not necessarily make the most money but 

are viewed as necessary for the casino to 

run to maintain position, market share and 

be competitive. Ideally, a casino should have 

monthly goals and budgets for each of their 

junket reps to meet in order for them to 

participate in the high cost special events, 

etc. Therefore, financial analysis is important 

for a casino to properly evaluate the amount 

of business that they receive from an 

independent junket rep versus the cost of 

maintaining a salaried employee or a branch 

office where one hundred percent of their 

time and effort goes into marketing your 

casino on an exclusive basis. A few junket 

reps do operate exclusively for some of the 

larger casinos but this is fairly rare today. 

Obviously this is not a simple decision 

and careful analysis is required to estimate 

the size of the market as well as the market 

potential. In some remote locations, time, 

distance, high air fare costs, etc. will limit the 

number of players that can travel on a regular 

basis to your casino. In those situations, a 

reputable junket rep is probably a more cost 

effective solution to your marketing efforts 

versus a salaried employee. 

Finding a reputable junket rep that has 

good relations with his customers is critical. 

It is a lucrative business and therefore there 

are a lot of “wannabe” junket reps out there 

without any real experience and without a 

loyal established customer base. The other 

big problem that usually crops its ugly head 

with inexperienced, unprofessional junket 

reps is regulatory violations. 

One example is that junket reps do 

not get paid until the casino gets paid. 

Consequently there have been numerous 

horror stories of unprofessional junket 

reps using unauthorized methods to try 

to help the collection process. This has 

caused many embarrassing situations for 

highly regulated casinos resulting in high 

fines for the casinos and terminations for 

the marketing executives. Similar stories 

abound about junket reps collecting large 

sums supposedly on behalf of the casino 

and then disappearing leaving the customer 

very upset and angry. 

Another common problem is “loan 

sharking.” Many of the not so reputable 

junket reps enter the business primarily to 

extend their loan sharking business where 

they lend gamblers money at onerous 

interest rates of up to 10% per week and then 

use illegal methods to threaten customers 

in an attempt to collect their money. In 

addition, the casino usually also loses the 

customer as they are still required to try to 

collect on the legal credit obligation. 

My recommendation is to not allow 

a junket rep to be involved with either the 

credit process or the collection process. 

This is different in Asia where junket reps 

are allowed to extend credit to their players 

and collect it, primarily because gambling 

debts are not enforceable in many countries 

in Asia and therefore the casinos cannot risk 

extending credit that they may not be able 

to collect. 

Another problem area that I often see 

is related to lack of training. Junket reps do 

not understand all of the various regulations 

and laws. They often represent many casinos 

in multiple gaming jurisdictions and the 

regulations can vary dramatically from 

country to country and even from state to 

state. Do not leave anything to chance. 

Getting started 

Before you begin a junket program or dealing 

with a new junket rep, a casino needs to do 

the following: 

Ensure that the program is completely 

legal and meets all reporting and 

regulatory requirements. You may want 

to meet with regulators to establish 

good communication channels. 

Develop a formal training program that 

is well documented and you may even 

want to “certify” each junket rep with a 

brief test to ensure that they really do 

understand both the regulations and the 

need for compliance. 

Set monthly financial goals or targets 

for the numbers of players expected 

each month as well as revenue expected 

either in actual results or in theoretical 

win. 

Finalize a fair commission program. I 

like programs that are tiered that offer 

the junket reps more commission 

based on reaching different pre-set 

monthly goals or targets. Also, establish 

minimum play criteria and define what 

an actual trip consists of for the number 

of days involved or number of shoes or 

hands of Baccarat that must be played. 

Plan to support the junket reps that do 

achieve certain goals either with office 

subsidies, pre-printed shells that they 

can use to print their invitations on or 

running player parties in their local 

market. 

Consider a formal junket agreement that 

would limit the junket rep’s activities 

that may be deemed competitive, i.e., 

not being allowed to represent other 

local casinos that you compete against. 

The formal agreement should also 

define all terms and conditions. 

Ensure that your internal organization is 

prepared to issue reports quickly upon 

the completion of each junket and to 

process payments to your junket reps 

quickly and on time. 

Support your better junket reps and 

look for opportunities to recognize 

their loyalty and efforts by running 

parties or mini-special events for them 

and their players at the casino. These 

events are almost always extremely 

profitable and cost effective. 


Blast 

from the Past 

FEB 2009 

Communicate and train your in-house 

staff that your junket reps are basically 

your external sales people who work 

on a commission basis versus a salary 

basis but most importantly that they are 

part of your team and should be treated 

with respect and as they would like to be 

treated. This will help eliminate some 

of the competition between in-house 

casino host or player development 

executives and the junket reps. 

Develop a coding system so that you can 

track productivity of both junket reps 

and in-house staff. 

Never allow an in-house staff to steal a 

junket rep’s customer. 

These are some of the general rules 

and guidelines for establishing a productive 

casino junket program for your casino. The 

most important areas to remember are 

to eliminate internal competition and to 

maximize productivity by using incentives 

and analysis to measure results. 

Good will hunting 

Successful junket reps maintain excellent 

personal relationships with their players and 

often provide excellent customer service as 

well to their customers to help keep them 

loyal. Casinos and junkets can be a cut-throat 

business and it can be extremely competitive 

with other junket reps and sometimes with 

in-house casino hosts trying to steal their 

customers away. Smart casino operators 

understand and recognize the value of good 

junket reps and will usually do everything 

legally possible within their power to be fair 

and to protect their junket reps. This normally 

involves developing a coding system so that 

players are properly classified and coded 

to the individual who brought them to the 

casino initially, whether it is an independent 

junket rep, a salaried casino host or a casino 

player development executive. 

However, not all casino operators are 

capable of monitoring this function within 

their casino and therefore some abuse does 

happen occasionally. This unfortunately 

makes many good junket reps very nervous 

and untrusting of casino staff. It is far better 

to take the time and effort in the beginning to 

develop a fair coding system to better enable 

outside junket reps to work harmoniously 

with in-house casino hosts without the fear 

of losing their customers. 

Similar to bad casino hosts there are 

also bad junket reps. It is important for 

casino operators today to be aware and also 

be vigilant to nefarious junket reps that may 

be legally or illegally working within their 

casinos. Ultimately any negative activity by 

bad junket reps may also reflect badly upon 

the casino as well. 

It is even more important to keep a 

watchful eye during recessionary times when 

people tend to become more desperate and 

more vulnerable. There are many scams 

going on and the majority of junket reps 

can often be misjudged by the actions of a 

few bad ones, who may indirectly represent 

the good, the bad and the ugly in the casino 

industry. 

Don’t be too quick to judge junket reps. 

Take the time to do your homework and 

learn who the “individual” is. I know some 

great junket reps. I actually worked as a 

junket rep for a while in Asia. Most are great 

people. Many are highly successful in their 

Steve Karoul has been there, 

done that. His insights could 

help casino executives get the 

most out of Junket Reps 

own business. Many are very generous when 

it comes to supporting charities and social 

causes. Many work very hard to be the best 

junket rep that they can be to their customers 

and the casinos that they represent. And, 

many lead a very good and comfortable 

lifestyle. Possibly becoming a junket rep may 

be right for you too? Do your homework first. 

Good luck. 

Steve Karoul is one of the top casino marketing 

consultants in the world today with over 30 years of 

experience with top casinos both domestically and 

internationally. He has conducted business in over 

90 different countries. He has also worked as and 

for several of the largest junket reps and therefore 

has the utmost respect for the good ones. He is a 

contributing writer to several different major casino 

publications, often injecting his own experiences 

and opinions. Steve can be reached at by email 

at skaroul@comcast.net. His website is www. 

euroasiacasino.com. 

38 


WE’RE HIRING A DEPUTY EDITOR 

Sick of your current employer? 

Looking for a change? Come join our fun-loving dynamic team! 

Employer 

Position title 

Reports to 

Salary 

Bonus 

Medical coverage 

Working location 

Working hours 

Transportation 

Public holidays 

Annual leave 

Sick leave 

Telephone 

Languages required 

Experience 

Qualifications 

Must Read Publications Limited (incorporated in 

Macau), publisher of Inside Asian Gaming. 

Deputy Editor – IAG and WGM. 

Managing Editor – IAG and Managing Editor – WGM. 

Range of MOP$18,000 to MOP$23,000 dependent 

on experience, qualifications and suitability of the 

successful candidate. 

A very attractive bonus structure is provided. 

Basic medical insurance will be provided. 

The company has offices located in Central Macau and 

Central Taipa. The successful applicant will be able to 

work from home when appropriate, but will generally 

work from company offices. 

Officially Monday to Friday 10:00 to 19:00, but as needed 

to achieve the functions of the role. Great flexibility is 

offered by the company in relation to working hours. 

From home to work and return most days in a chaffeurdriven 

luxury company vehicle (no Macau buses to catch!) 

All Macau government public and bank holidays. 

1.5 annual leave days per full calendar month worked 

(18 days per year), taken by mutual consent of the 

successful candidate and the company. 

Up to 8 sick leave days per year. 

The company will provide a smart phone and data plan 

to be used for company business. 

Fluency in oral English and Cantonese and able to write 

in English and Chinese. 

At least one year of experience in a role involving 

journalism and/or professional writing is highly 

desirable but not essential. 

A tertiary degree in Chinese, English, communications 

or journalism is highly desirable but not essential. 

Training and mentorship 

• As appropriate to the successful candidate, a high level of training 

and mentorship will be provided to the successful candidate by the 

Managing Editors of WGM and IAG. 

Essential skills and attributes 

• Able to write professional level magazine and website copy. 

• Excellent organizational skills. 

• Able to work collaboratively and harmoniously with other staff. 

• Able to confidently attend press conferences and other events 

representing the company at such events and asking appropriate 

questions (with guidance and training). 

• The ability to work with an extensive contact list of many thousands 

of contacts. 

• An outgoing personality with the ability to build genuinely warm 

relationships over time. 

• Basic computer skills: Microsoft Word, PDFs, email, etc. 

Desirable skills and attributes 

• A basic understanding of casinos and gaming. 

• An existing network of contacts amongst Macau local businesses. 

• Video production skills. 

Duties 

• At times publicly represent Inside Asian Gaming and/or WGM. 

• Write professional magazine level copy for Inside Asian Gaming and 

WGM in one of English and Chinese and create a good quality first 

draft translation in the other language. 

• Manage and develop relationships to maintain and build the 

company’s extensive industry contact list. 

• Assist with other operational activities as required, for example with 

conferences and events. 

• Any other duties as necessary from time to time. 

For more information please contact Andrew W Scott at ceo@wgm8.com. 


40 inside asian gaming FEBRUARY 2016


REGIONAL 

BRIEFS 

Da Nang, Vietnam’s third largest city 

Vietnam relaxes restrictions 

on casino cruises 

Da Nang, the chief port of central Vietnam, has become the first 

in the country to allow visiting cruise ships to keep their casinos 

open after docking. International liners have traditionally shuttered 

onboard gambling after arrival in the country. But in mid-January, 

the Da Nang Tourism Department’s deputy director Tran Chi Cuong 

said he had found “no rules that require foreign ships to close 

certain services when docking in Vietnam,” and the restrictions 

would therefore be lifted. The ultimate goal, he said, was to 

encourage more cruise lines to put his city on their itineraries. 

According to local media, the change came about following 

lobbying from Asia’s largest cruise operator Genting. Executives 

of the company’s Hong Kong-based subsidiary Star Cruises had 

apparently been meeting with officials from Da Nang and Quang 

Ninh Province (famous for Ha Long Bay), as well as officers from 

the Vietnam National Administration of Tourism. Da Nang expects 

to receive 110 vessels from the company this year, against a 27.5% 

increase in overall foreign arrivals by sea in 2015. Given burgeoning 

growth in Asia’s cruise industry, the numbers are sure to continue 

growing. 

Vietnam now only allows foreign passport holders to enter its 

eight land-based casinos. Keeping onboard gambling open will not 

change the prohibition on locals, because Vietnamese law views 

international cruise ships as foreign territory. To get on board, 

Vietnamese citizens will therefore have to undergo immigration 

procedures, as they would if they went to casinos in Cambodia. 

coalition partner Komeito Party said there was no reason to pass 

the bill before the elections. “The bill is frozen until the Autumn 

extraordinary Diet session,” he added. 

Since discussion on reversing Japan’s casino law first emerged 

in 2002, therefore, doing so has been postponed yet again, and can 

only now take place late this year at the very earliest. 

Tokyo’s selection as host of the 2020 Summer Olympics in 2013 

provided impetus to the push for casinos, with proponents arguing 

they would serve as an extra draw for visiting spectators. But in 

October last year, analysts at investment bank Union Gaming said 

the earliest any integrated resort would start operations in Japan 

was probably 2022. 

Taiwan election results a setback 

for offshore casinos 

Taiwan has elected its nationalist Democratic Progressive Party 

(DPP) candidate Tsai Ing-wen as president, and also voted the DPP 

into control of the legislature. The results are a setback for efforts 

to build Taiwanese casinos because Tsai spoke against allowing 

gambling during her election campaign. Seven years ago she also 

instructed legislators to vote against a law that would allow gaming 

referenda on offshore islands. 

The attitude of China, whose citizens would be the target 

customers of Taiwanese casinos, should make matters worse. 

Cooperation with mainland authorities would be needed to 

organize cross-strait gambling trips. But relations between the two 

sides look certain to sour given Tsai’s independence-leaning, anti- 

China stance. Even under her predecessor Ma Ying-jeou, who was 

seen as pro-Beijing, mainland authorities were opposed to allowing 

gambling visits to Taiwan. 

In a recent note, Union Gaming said Macau’s “Big 6” gaming 

operators would likely stay away from any Request for Proposals 

from Taiwan to build casinos out of fear of upsetting the Beijing 

government. The slumping regional market, caused by a slowing 

mainland economy and president Xi Jinping’s ongoing campaign 

Japanese casinos still some way off 

Prospects for legislation that would allow casinos in Japan have 

received yet another setback. 

For years now, lawmakers in Japan have been toying with the 

passage of a so-called Integrated Resort promotion bill that would 

amend the constitution to allow, in principle, the construction of 

casino-driven integrated resorts. That would pave the way for a 

second more detailed bill, spelling out the law on gambling industry 

management. 

At the end of last year the newspaper Hokkaido Shimbun quoted 

senior officials in the Liberal Democratic Party (LDP) saying there 

was “no chance” of the IR bill passing in the ordinary Diet session 

commencing at the beginning of this year, as there was “no time for 

it” before this summer’s elections in the legislature’s upper house. 

Meanwhile, an executive in the LDP’s more conservative 

42 


REGIONAL 

BRIEFS 

against corruption should also deter other potential bidders, 

according to the investment bank. 

Passed in 2009, Taiwan’s “Offshore Islands Development Act” 

gave the go-ahead for smaller islands under its jurisdiction to hold 

referenda to allow casino gaming. The island of Matsu, which is 

some 20km off the Chinese coast near to the Fujian provincial 

capital of Fuzhou, has since voted in favor. Further progress would 

require Taiwan’s legislature to pass two more bills; one laying out 

the law for casinos, and another establishing regulations for casinodriven 

integrated resorts. 

In a separate development, Taiwanese police busted three 

illegal gambling operations in the run up to the country’s polls. All 

were taking bets on the outcome of the presidential election. 

Macau junket woes continue 

Amid crackdowns in China and stricter oversight at home, the collapse 

of Macau’s gaming promoters, also known as junkets, is continuing. 

On January 13, Macau’s Gaming Inspection and Coordination 

Bureau (DICJ) announced it would not renew the licenses of 35 

promoters that had failed to comply with new guidelines issued in 

October, requiring them to compile and submit monthly accounting 

reports. That would reduce the total number of licensed junkets 

from 218 reported in 2014, down to 148. While IAG understands 

the 35 promoters represented the smaller end of the industry, the 

announcement is hardly good news. 

A week earlier Iao Kun Group, which operates five VIP rooms 

in Macau, announced that its rolling chip turnover in the city had 

plummeted in 2015 by 61%, to US$6.42 billion. 

Junket operators have long been a vital component of Macau’s 

gambling industry, recruiting high rollers to visit casinos in the city 

with offers of credit and hospitality in exchange for a share of the 

revenue generated. Over the past two years, however, their main 

customer base in China has been hit hard by president Xi Jinping’s 

anti-corruption campaign, together with a crackdown against their 

marketing operations there and the underground banking system 

they use to transfer funds. 

In a January meeting with the Macau Junkets Operator 

Association, Macau’s Secretary for Economy and Finance Lionel 

Leong Vai Tac said there was a need to strengthen law enforcement 

and monitoring of junkets. He also suggested the drafting of new 

industry regulations, something analysts say will push still more 

operators out of business. 

According to Sanford Bernstein, revenue from Macau’s VIP 

segment was less than half the city’s total gambling turnover in 

December, down from around 80% in the boom years. The Macau 

Association of Gaming and Entertainment Promoters says the total 

number of VIP gaming rooms in the city has fallen by 30 to 40 over 

the past six months, leaving around 100 still in operation. 

Nephew of Macau’s king of gambling 

on trial for pimping 

Alan Ho, nephew of Macau’s gambling kingpin Stanley Ho, is 

on trial in the city for running a casino-linked prostitution ring. 

According to the prosecution, the ring occupied a hundred rooms 

and two whole floors of the city’s landmark Lisboa hotel, employed 

2,400 sex workers and took in US$50 million over two years. The 

chief Judiciary Police officer investigating the case said the hotel’s 

senior manager Kelly Wang was in charge of the ring. He added 

that Ho, who is 69 and was the hotel’s executive director at the 

time, assessed the women’s “physical attributes” and took charge 

when Wang was away. Prostitutes employed nearly all came from 

mainland China. They allegedly paid 150,000 yuan (US$23,000) per 

year to attract clients by parading in the property’s shopping mall. 

The Lisboa casino was the centerpiece of the gambling empire 

of Stanley Ho, who held the gaming monopoly in Macau for 40 

years until 2002, making him the most powerful man in the city 

and one of the richest in Asia. While the elder Ho at 94 now takes 

a back seat, two of his children and one of his four wives each a 

holds a substantial stake in one of three of the city’s six gambling 

concessions. Given the clan’s standing, the very public arrest of 

Alan Ho, along with Wang and five other defendants in January last 

year was remarkable. 

Prostitution is not illegal in Macau but pimping carries up to 

eight years in jail. Leaders of criminal syndicates can get eight to 

fifteen years. The goings on at the Lisboa “racetrack” had long been 

common knowledge and widely publicized on YouTube. Given this, 

lawyers representing Alan Ho asked the chief investigating inspector 

why the Judiciary Police had only busted the ring last year. The officer 

replied he could not comment on past investigations. 


INTERNATIONAL 

BRIEFS 

Nevada residents flock 

to gamble in California 

On January 13 the US recorded history’s biggest lottery jackpot, 

when US$1,586,400,000 came up for grabs in the Multi-State 

Lottery Association’s twice-weekly Powerball draw. The kitty was 

over twice as big as the previous record of US$656 million, set by 

another US multi-state lottery, Mega Millions, in 2012. 

With so many people buying tickets, three entries turned out 

to have picked all of the six winning numbers needed to win the 

grand prize, and the money was split accordingly. That compared 

to nobody choosing all six in any of the nineteen previous draws, 

causing the jackpot to be rolled over each time. 

The huge sum on offer resulted from a change in the lottery’s 

number generating machinery. Previously, five white balls 

were chosen at random from from a pool of 59, plus one red 

“powerball” chosen from a pool of 35. But in October last year 

the MSLA increased the number of white balls to 69 and reduced 

the red balls to 26. This lengthened the odds of choosing all six 

from about one in 175 million to one in 292 million, boosting the 

likelihood of a rollover. 

The intention was to increase ticket sales and it certainly seems 

to have worked. Revenue from the January 13 mega-jackpot draw 

alone was about 80% of the US$4 billion raised over the whole 

of 2015, and more than Powerball’s total sales for any single year 

before 2010. The nationwide commotion whipped up gave rise 

to the bizarre spectacle of residents of Nevada, which does not 

participate in Powerball, driving to California to gamble after 

queuing up in the cold outside ticket outlets just across the border. 

While casino interests keep lotteries of any kind out of Nevada, 

religious beliefs ensure they are banned in Alabama, Mississippi 

and Utah. Some of the biggest sales for Powerball come from cities 

bordering on all four states, according to the MSLA. In an era of 

tight budgets, January 13’s jackpot has therefore given ammunition 

to those pressuring for change. 

In Alabama, Republicans and Democrats have introduced 

rival lottery bills for the legislative session that begins in February. 

Bill sponsor and Republican state Senator Jim McClendon said 

the January 13 jackpot highlights the huge number of Alabamans 

buying tickets elsewhere. In Mississippi, state representative Alyce 

Clarke has repeatedly sponsored a lottery bill, but says religious 

opposition always kills the idea. That could change this year 

because of Powerball, she says, enabling the state to raise money to 

improve its schools, and fix its roads and bridges. 

New measures to save Atlantic City 

Atlantic City has stumbled into compromise to save itself from 

bankruptcy. On January 26 the city council approved a revised plan 

proposed by New Jersey State Governor Chris Christie, aimed at 

rescuing the gambling hub’s moribund finances through greater 

state control and new revenue sources. 

Earlier, New Jersey Senate President Stephen Sweeney had 

introduced a bill to have the state take over running Atlantic City, 

allowing it to dissolve city departments, consolidate and privatize 

municipal services, terminate contracts with labor unions and sell 

city-owned assets. The city, led by Mayor Don Guardian, opposed 

the plan, saying it would disenfranchise voters and that similar 

emergency takeovers have not worked in the past. 

Instead, Guardian was backing a group of bills, dubbed the 

“Atlantic City Rescue Plan,” aiming to tax more casino revenue. But 

after the legislature passed the bills, Chris Christie called them “a 

waste of tax payers money” and exercised his veto. Contemplating 

bankruptcy, Guardian was forced into a trade off. 

Backed by both Guardian and Sweeney, the latest plan therefore 

combines elements of the previous opposing plans. It would allow 

both a state takeover and also measures to extract more revenue 

from casinos. Amid this struggle, on January 12 rival lawmakers in 

New Jersey reached another compromise; between competing bills 

that would allow a referendum to end Atlantic City’s monopoly on 

casino gambling in the state. The idea is to build new casinos in the 

state’s north, less than a half-hour’s drive from Manhattan, tax them, 

and channel some of the extra funds to Atlantic City. While Sweeney 

was insisting that only Atlantic City’s existing operators be allowed 

to build new projects, Assembly Speaker Vincent Prieto wanted 

outsiders to be allowed to bid for one too. In the end Sweeney’s 

bill was adopted with the amendment that any new developer must 

invest at least US$1 billion. If three-fifths of the State’s legislature 

can agree, the referendum will be held in November. 

Pennsylvania allowed casinos in 2006 and other states 

neighboring New Jersey soon followed. Since then Atlantic City’s 

casino revenue has fallen from US$5.2 billion to US$2.5 billion. In 

2014 alone, four of its 12 casinos closed. 

The Forbidden City comes to Sin City 

The zoning commission of Las Vegas gave the go ahead for 

construction on what will be the city’s first new big resort for eight 

years, Resorts World Las Vegas. According to the developer Genting 

Americas Inc., its new Chinese-themed, “gaming-changing” project 

will feature “modern interpretations of Chinese details,” a recreation 

of Beijing’s Forbidden City and a panda exhibit. On the 35-hectare 

site at the northern end of the Las Vegas Strip, an initial phase will 

center on a single hotel tower with 3,300 rooms and 61,000 square 

meters of public space, with a cinema and convention facilities. 

Ultimately the project should cost US$4 billion and have four highrise 

hotels, adding more than 7,000 hotel rooms to Las Vegas’ total 

of nearly 125,000. 

For 48 years until 2006, the landmark Stardust resort and 

casino operated at the site. Owner Boyd Gaming Corp imploded the 

Stardust in 2007 and started work on its replacement development 

Echelon, which the global financial collapse halted in 2008. In 2013 

Boyd sold the site to Genting for US$350 million. 

Las Vegas’ gaming revenue fell 3.6% last year to US$6.3 billion, 

44 


INTERNATIONAL 

BRIEFS 

shops of its own, Paddy Power Betfair will have a much smaller 

bricks-and-mortar operation, and lower revenues to boot. Yet while 

both Ladbrokes and Gala Coral have struggled with the internet, 

around 80% of the new Paddy Power Betfair’s revenue will be from 

online business. Higher margins online and internet gambling’s 

greater potential for growth mean the Paddy Power Betfair deal is 

valued at over three times the total €2.83 billion Euros the markets 

are giving the Ladbrokes Coral merger. 

MGM raises controversy 

with Vegas parking fees 

and is still off its 2007 peak of $6.83 billion. Entry into the world’s 

most competitive casino market might seem risky for an Asian 

company in such a climate. Yet Genting Group is perhaps the best 

qualified to go up against American heavyweights on their home 

turf. In addition to casinos in Malaysia, Genting Americas’ parent 

runs highly succesful resorts in the Philippines and Singapore, is 

the largest casino operator in the UK, and since 2011 has been 

operating the first and only legal casino in metropolitan New 

York, although all gaming in the property is electronically based. 

Crucially, Genting also has a deep capability in marketing to 

Chinese gamblers, who now make up one of the most important 

segments of the global market. 

iGaming mega-mergers 

Ireland’s Competition and Consumer Protection Commission has 

approved the merger of Irish bookmaker Paddy Power and the 

world’s largest online betting exchange, the UK-based Betfair. 

Headquartered in Dublin with its main listing on the London 

Stock Exchange, the newly created Paddy Power Betfair will have a 

market capitalization of about €9.4 billion and annual revenue of 

about €2 billion. It will own and operate online betting businesses in 

Europe, the US and Australia, serving over four million customers 

from more than 100 countries. 

Also in February, UK bookmakers Ladbrokes and Gala Coral 

are expected to complete their planned merger, creating a new 

company in possession of nearly 4,000 betting shops, or about 

45% of the British total. With only around 600 land-based betting 

In a move seen as signaling a fundamental transformation of the 

Las Vegas economy, MGM Resorts International has announced 

it will start charging for parking in the city, the first major casino 

operator to do so. 

MGM Resorts has 35,310 hotel rooms and 37,000 parking spots 

around the city’s main drag, known as “the Strip”, which are in high 

demand during major events. The charges, which the operator says 

will be up to US$10 for overnight self-parking, will be introduced at 

most of its casinos and attached hotels, although some parking at 

one MGM hotel and casino, and two of its shopping centers will 

remain free. Customers in MGM’s loyalty program will also be able 

to earn free parking rewards. 

Parking fees would not make headlines elsewhere. But in Las 

Vegas they are important for marking the city’s shift away from 

reliance on gambling and towards non-gaming income from 

attractions such as conventions and performances. 

In 1990, for example, 61% of revenues came from gambling, 

which subsidized many other goods and services supplied to visitors; 

from $20 hotel rooms to free drinks on the casino floor. The cost 

of supplying them at a loss was more than offset by the benefits of 

making it easier for the visitors to gamble. These days, however, many 

tourists visit Las Vegas without gambling. Non-gaming revenues 

overtook money earned from gaming in 1999 and stand at 64% of 

the total today. That makes it harder to justify the subsidies. 

70% of MGM’s revenue in Las Vegas now comes from nongaming 

attractions such as high-end shops, celebrity restaurants, 

shows and nightclubs. The reaction to the move to charge for 

parking has been vocal, with some customers responding to the 

new charges by vowing on social media to take their business 

elsewhere. Analysts, however, are predicting that other operators 

will eventually follow MGM, and introduce parking fees themselves. 


Events 

Calendar 

22|24 February 2016 

World Game Protection Conference 

M Resort Spa Casino, Las Vegas, USA 

The World Game Protection Conference (WGPC) is an 

annual 3-day international conference and expo focused 

entirely on casino game protection. Experts and industry 

leaders are on hand to discuss the latest casino scams and 

surveillance technology, as well as game protection and 

surveillance best practices. 

www.worldgameprotection.com 

21|23 March 2016 

iGaming Asia Congress 

Grand Hyatt, Macau 

iGaming Asia Congress conference and exhibition will attract 

over 250 of Asia’s leading sports betting, online casino, 

lottery, social and mobile gaming executives to learn about 

the latest developments in industry, incoming regulations 

and disruptions, and strategies to stay ahead of the curve 

in Asia. It is a must attend industry event for all iGaming 

operators in Asia and the world. 

www.igamingasiacongress.com 

5|7 April 2016 

iGaming North America 2016 

Planet Hollywood Resort & Casino, Las Vegas, USA 

The iGaming North America conference is a unique 

networking and educational event designed to facilitate 

and cultivate the convergence of the land-based and online 

gambling industries in North America. Our aim is to 

provide a cost-effective networking environment that helps 

foster understanding regarding the impacts of existing 

and potential regulated internet gambling in the U.S. and 

Canada and provides critical information regarding the 

players, resources, legislative framework and topics that are 

important to all of the parties that comprise the important 

commercial gaming segment. With the surge in activity 

at both the state/provincial as well as federal levels, we 

welcome all of the operators, consultants, vendors and 

suppliers focused on the North American audience. 

www.igamingnorthamerica.com 

27|29 April 2016 

Global iGaming Summit & Expo 

Hyatt Regency San Francisco, San Francisco, USA 

Established as the leading event focused on the future 

of iGaming in North America, GiGse attracts over 700 

delegates to examine legislative progress, commercial 

strategies and partnership opportunities for all the key 

stakeholders to enter iGaming and achieve first-mover 

advantage in this lucrative market currently undergoing a 

significant regulatory change on a state-by-state basis. 

www.gigse.com 

17|19 May 2016 

Global Gaming Expo Asia 

The Venetian Macao, Macau 

G2EAsia is the premier Asian trade event and the largest 

regional sourcing platform for global gaming and 

entertainment products. G2E Asia services suppliers by 

enabling them to showcase new products, meet qualified 

buyers and establish new contacts. Annually, more than 

95% of top Asian casino operators are at the show. Held in 

Macau — the heart of Asian gaming and one of the fastest 

growing gaming markets in the world, G2E Asia is the hub 

where professionals network and conduct business. 

www.g2easia.com 

46 

inside asian gaming FEBRUARY 2016 

www.asgam.com

IAG FEBRUARY 2016

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