Las Vegas Trends … 2009 Executive Satisfaction Survey
Total Page：16
File Type：pdf, Size：1020Kb
VOLUME 14, NO.15, SEPTEMBER 28, 2009 Midweek p. 4 room rates sag, A SPECTRUM GAMING GROUP PUBLICATION The most recent regulatory action involved the dumping drunken customers in the casino unat- Las Vegas trends … Prive nightclub and the Living Room ultralounge at tended, drug use that was ignored or tolerated, the Planet Hollywood resort. The Nevada Gaming employees and customers beating up and sexually CLUBS THAT FLOUT RULES Commission in July levied a $500,000 fine against assaulting other patrons, and admitting minors and COULD GET CLUBBED Planet Hollywood for a nine-count complaint filed allowing them to drink. BY REGULATORS by the Gaming Control Board, with an additional One count cited a citation from Clark County $250,000 fine if the Board issues another complaint allowing topless and lewd activity while others dealt evada gaming regulators have begun cracking involving a Planet Hollywood nightspot before the with a significant increase in fire/rescue and police calls Ndown on casino operators that fail to ade- end of July 2011. linked to the clubs, an increase in prostitution-related quately supervise their clubs and lounges, following Planet Hollywood admitted that it knew or should activity in and around the club and allowing the clubs years of warnings about and investigations of illegal have known about the activities cited in the com- to employ workers with significant criminal records. and unsavory activities in the Las Vegas nightspots. plaint. The counts cited the clubs’ employees for see LAS VEGAS on page 3 Operational trends ... Executive decisions: These gaming destinations have a bright future 70% 60% SMOKEFREE GAMING SPREADS 2002 2003 THROUGH STATES, COUNTRIES; 50% 56% 2004 58.4% 57.5% POOR ECONOMY TEMPERS TREND 53% 54.6% 2005 54.1% 50% 50% 49% 40% 49% 46% 2006 46% 47.8% 43% 46.7% 41% 2007 45.0% Editor’s note: The following analysis is by Karen 30% 39.9% 2008 40.0% Blumenfeld, Executive Director of Global Advisors on 2009 20% 32.5% 30.2% Smokefree Policy, and the group’s Associate Director, 25% 22% 22% 22% 24.4% 7.5% 10% 21.9% Ruth Boorujy. GASP, as the group is known, advocates 16% 20.1% smoke-free workplaces but is not opposed to gaming. 0% Las Vegas Atlantic City California Native-American lmost a decade ago, Las Vegas took the first Casinos Astep in smokefree gaming. Sin City casinos voluntarily created smokefree poker rooms, brought 2009 Executive window on a rainy day and assuming that it will rain on by consumer demand. This poker trend travelled Satisfaction Survey tomorrow, next week and throughout 2012. quickly to Atlantic City and spread rapidly, meeting That pessimism-breeds-pessimism view — prob- little resistance. PROSPECTS ARE DIMMER, ably cultivated by reduced or flat compensation, Fast forward to 2009. Smokefree gaming — and BUT EXECUTIVES STILL SEEK while seeing others receive pink slips — is apparent not just for poker — is an established trend, albeit WARMER CLIMATES in the ninth annual Bristol Associates/Gaming tempered by the poor economy. In the United States, Industry Observer Executive Satisfaction Survey. As 18 states along with Puerto Rico and the District of wo truisms about the mindset of gaming the accompanying chart on p. 5 shows, the pessi- Columbia require smokefree gaming venues, and Texecutives have emerged since we began mism about future prospects has even seeped into Wisconsin starts on July 5, 2010. studying their attitudes nearly a decade ago: views about California gaming and Native-American Eleven states require smokefree gaming venues: • Casino executives tend to view future scenarios casinos, albeit not as bad as in mid-2007 when bad California, Colorado, Delaware, Florida, Illinois, through the prism of the present day. In other words, times first spilled forth. Maine, Maryland, Minnesota, Montana, Nebraska, they are optimistic about the future when times are While pessimism was rampant in the 2007 survey, New York and Washington State. good, and vice versa. it was not universal. Las Vegas still held out hope of Seven more states, along with the District of • They are resigned to the fact that, Hey, you a bright future. Many months of bad numbers later, Columbia, that only offer bingo require the venues to gotta live somewhere. however, have fostered what can be described as a be smokefree: Arizona, Hawaii, Idaho, Ohio, The first phenomenon is particularly interesting, culture of pessimism. Right now, the view is that the see SMOKEFREE on page 7 and particularly puzzling. It is akin to looking out the see SURVEY on page 5 1 GAMING INDUSTRY OBSERVER/SEPTEMBER 28, 2009 The Deal ... will provide Harrah’s — which is lobbying Congress were the major downfalls, economically, of those to overturn the online-gambling prohibition — with particular casinos.” WHEN GAMBLING EXPANDS, its Dragonfish business-to-business service for sup- HOW MUCH IS TOO MUCH? port and payment software. DEPT. OF Haste MAKES Waste: ILLINOISANS MAY HAVE AN ANSWER 888 investors no doubt were excited by the OHIO racinos Face HEADWINDS prospect of cracking the U.S. market, which could Ohio is feeling the pain of rushing to implement s more states look to legalize or expand open in the foreseeable future (see last issue, p. racetrack VLTs on an ASAP basis. Acasino-style gaming in the chase for 1). We believe, however, there is more than the First, Governor Ted Strickland bowed to pres- untapped gambling dollars or gambling dollars that direct profit opportunity at play in the 888 stock sure and increased the minimum gaming age to 21 are crossing state lines, people are increasingly — bump. from 18 (see last issue, p. 2). and reasonably — asking, “So, what happens when The quality of online gambling regulation is Second, only two of seven racetracks had sub- gambling is everywhere?” largely unknown due to the lack of transparency, and mitted the required $13 million non-refundable first The obvious answer is that market forces will its havens in places such as Antigua, Gibraltar payment with their application, subjecting them to a determine how much gambling is too much. (where 888 calls home) and Malta help to relegate late fee of $100,000 per day. The tracks’ investors Gambling, however, is unique among leisure it to third-world status within the community of or lenders were uncomfortable making a $13 million activities because its spread is tied to societal mores, respected gaming regulators. commitment, fearing successful legal challenges to and in that regard sometimes the people — and not By partnering with Harrah’s — which is the the VLT measure or fearing that Issue 3 — which necessarily economic forces — say that enough is world’s largest gaming company and which is tightly would authorize four full-service casinos — would enough. regulated by nine U.S. states, among other jurisdic- pass in November. Such a scenario could be unfolding in Illinois. tions — 888 has received a major infusion of credi- The Lottery Director, Kathleen Burke, has the The state has a $1.5 billion casino industry and is bility. If 888 passes muster with regulatory discretion to modify or waive the late fees, and there almost surrounded by other gambling-rich states authorities in the United States, it could become a are indications that both she and Strickland recog- including Indiana, Missouri, Iowa and Wisconsin. provider of choice for other land-based gaming com- nize the racetracks’ predicament. Whether that actu- Yet in a Chicago Tribune/WGN statewide poll this panies that will, inevitably, make the leap into the ally leads to a deadline extension remains to be seen. month, Illinoisans said by a margin of 58 percent to online sector. Then came the biggie: The Ohio Supreme Court 34 percent that they would vote to ban retail video ruled by 6-1 that approval of racetrack slots must be lottery terminals — up to 45,000 which were autho- WHEN BIG MONEY IS NOT ENOUGH: through voter referendum, not gubernatorial rized by legislation last summer at bars, restaurants States CONTEND WITH INDUSTRY directive. As a result, the earliest it can get on the and social clubs. They are legion these days: Casino critics, legis- ballot is May 2010. The poll did not ask respondents why they lators, reporters and others who wonder why any Ohio could have avoided these clearly foreseeable opposed the expanded gambling. For sure, retail state would want to legalize gaming in light of the situations by giving more careful deliberation to the VLTs are often less palatable than casinos poor results in many jurisdictions across the gaming measure and not taking what was essentially because of the in-your-face aspect, but it could be country. unilateral action. that Illinoisans simply believe that their state has One reporter’s question this month to Massachu- its fill of slot machines or casino-like gambling setts House Speaker Robert DeLeo was perfectly AnalYst’S Corner: Wells Fargo’S locations. sophomoric in that regard. Noting the poor results Farrell LIKES REGIONAL casinos This underscores a point that we have made in and financial condition of some casinos in Connect- Dennis Farrell, a high-yield senior analyst at Wells this space before: Public officials should consider the icut, Rhode Island and Atlantic City, the reporter Fargo Securities, believes that regional casino operators pulse of the people before authorizing gambling in asked: “What does Massachusetts know to make a are better positioned than those in Las Vegas. the name of a quick budget fix. Illinois Governor casino work for the state that the others who have “Regional gaming demand remains the most Pat Quinn signed the VLT measure in July as part tried and failed?” resilient segment of the domestic gaming industry, of a $31 billion public works bill.