inside asian gaming INSIGHTS Sands China’s Messinger on Entertainment’s Value may 2015 30 MOP G2E ASIA 2015 A Showcase of Solutions for These Trying Times FEATURE SEGA SAMMY CREATION Draws a New Crowd Cambodia’s Rising Stars From glitzy NagaWorld to the gritty frontier casinos www.asgam.com COVER STORY CONTENTS MAY 2015 Cover Photo Konstik | Dreamstime.com INSIGHTS 42 The Best is Yet to Come As Sands China’s Scott Messinger explains, the company’s entertainment strategy is based on staging events that generate standalone value. FEATURES Putting Cambodia 38 Drawing a New Crowd on the Map The attention-grabbing products of SEGA SAMMY 12 CREATION could lure a new breed of players onto casino floors. Among dozens of casinos in Cambodia, NagaWorld in Phnom Penh—celebrating 52 Point of Contact its 20th anniversary this month—has Innovative Technology’s cash handling products already enjoy a leading position in European markets. done the most to raise the kingdom’s The company now has its sights set firmly on expansion regional profile. in Asia. 58 Fallen Out of Favor Sri Lanka’s casinos are operating in a decidedly hostile environment under the new administration of President Mithripala Sirisena. GAMBLING AND THE LAW 54 Internet Gambling? No Problems Prof. I Nelson Rose examines the regulatory challenges faced by the US online gaming industry. BRIEFS Regional Briefs 24 Rough Around the Edges 90 Ready or not, Donaco International’s purchase of Star Vegas Casino in 92 International Briefs Poipet puts Cambodia’s border casinos in the spotlight. 94 Events Calendar CONTENTS G2E ASIA 2015 SHOWcase OF SOLUTIONS Best Acceptance 60 Adversity presents a very real 77 CPI’s comprehensive portfolio of opportunity for the companies automated payment systems. exhibiting their wares at this year’s show. Stellar Standalones 78 Ainsworth has a strong lineup of Pursuit of Perfection new premium bilingual titles. 62 GPI makes casino currency safer, stronger and better looking. Branching Out 79 In addition to testing and certification, Home-Field Advantage GLI does so much more. 63 Weike shows off an engaging lineup of new jackpots and Enhanced Portfolio standalones. 80 JCM promises operators deeper connections with their customers. Asserting Dominance 66 Aristocrat reaffirms its position as Currency Revaluation Asia’s pre-eminent slot-maker. 81 Abbiati showcases new designs for its secure casino currency. Igniting Expansion 68 NOVOMATIC ’s new products fuel its Fortune’s Favored accelerating regional growth. 82 Konami launches an array of new games designed for Asia. Stronger Together 69 Scientific Games ’ portfolio is Quality Matters unmatched for its breadth and 84 Giesecke & Devrient’s cash sophistication. processing systems reign supreme. Off to the Races Strength in Unity 72 Alfastreet pushes the envelope 86 IGT’s expansive exhibit is developed with its eye-catching e-tables. specifically for Asian players. Gaining Ground Ramping Up 74 DLV ’s new cabinet and multigame 88 Aruze’s new games provide fresh package have clear regional appeal. impetus for its regional growth. Floor Filler Putting on the Ritz L75 T Game ’s products will be prominent 89 Interblock’s e-tables have an at the next wave of Cotai resorts. unmistakable emphasis on luxury. Upgrades All Around 76 Matsui Asia’s all-new series of innovative gaming chips. 4 INSIDE ASIAN GAMING MAY 2015 MAY 2015 INSIDE ASIAN GAMING 5 6 INSIDE ASIAN GAMING MAY 2015 MAY 2015 INSIDE ASIAN GAMING 7 EDITORIAL Gazing Into the Abyss And when you gaze long into an abyss, the abyss also gazes into you. — Friedrich Nietzsche S the stocks of Macau’s six casino operators—all still traded on the Hong Kong Stock Exchange—languish near their 52-week lows, investors are wondering when the sector will hit bottom. Las Vegas Sands Corp Chairman and CEO Sheldon Adelson commented on the uncertain Aoutlook for Macau during an earnings call last month: “We are sailing in uncharted waters, and I hope we don’t sink like that boat off in the Mediterranean.” Wynn Resorts’ Steve Wynn agreed during his own earnings call that “there’s no question that uncertainty is the plaguing word of the day in Macau.” There’s a perception that local authorities are adding to the uncertainty by allowing the decision on allocation of gaming tables for soon-to-open Cotai resorts—including Phase 2 of Galaxy Macau, scheduled for a 27th May unveiling—to go down to the wire, not to mention floating the suggestion of Publisher capping the number of visitors allowed into the tiny city, which is straining under the load of well over Kareem Jalal 2 million arrivals a month. “Hopefully, our government in Macau will calm that down and put some certainty back into the picture,” said Mr Wynn. Director João Costeira Varela In reality, table allocations and the mooted limit on visitor numbers are mere distractions from the well-documented causes of Macau’s current malaise, including Beijing’s ongoing corruption Editor At Large crackdown, the weakening China economy and tightening of illicit fund flows out of the country, along Muhammad Cohen with Macau’s total smoking ban on main-floor gaming areas since October. Another important factor is the evolving tastes of China’s middle class, and particularly the sophisticated younger cohort within it, Contributors Paul Doocey, John Grochowski, James Hodl, who are increasingly drawn to more exotic and experience-rich holiday destinations, and, it seems, like Matt Pollins, I. Nelson Rose their counterparts in America, are not as interested in gambling as the generation that preceded them. Macau’s table cap—originally intended as a means to rein in the overheating gaming market— Graphic Designer has become somewhat irrelevant following the precipitous drop in demand that has left hundreds of Rui Gomes gaming tables idle around the city. Shuffling tables out of existing properties into new ones is looking Administrative Assistant increasingly like the best way for operators to manage capacity. The latest consensus view is that Latte Iao Galaxy Macau Phase 2 will be granted 150 new-to-market tables, allowing it to open with approximately 200 total, though the company had said previously the property has capacity for 500 tables and 1,000 Photography EGMs. Clearly one result is a major opportunity for EGM suppliers to fill the gaps where tables should Ike, Gary Wong, James Leong, Wong Kei Cheong have been. As for the suggestion of capping visitors, “The chances of that happening are [the same as] I wake up tomorrow morning and all my hair will be grown back,” said Mr Adelson. He added: “I have been told that it is not a decision by the government. It’s only a suggestion by one of the ministers with very Inside Asian Gaming good intentions, but it hadn’t been thought out.” After all, a visitor cap would seriously hinder the is published by hoped-for diversification of the local economy. Mr Adelson offered an example of how it would affect Must Read Publications Ltd the vaunted MICE—meetings, incentives, conferences and exhibitions—industry: “I would never, as an 5A FIT Center organizer, book an event in Macau if I knew there was a possibility that the guy who came through the Avenida Comercial de Macau [border] before me was the last guy [who would be allowed in].” Macau Tel: (853) 8294 6755 For bargain hunters, the big question is: When is the appropriate time to go bottom-fishing for Macau casino stocks? It’s still too early to say when revenue might rebound, but the bearish tide could For subscription enquiries, please email be turning. Renowned Swiss investor Marc Faber, one of the world’s most noted market contrarians, [email protected] whose negative views earned him the moniker “Dr Doom,” is uncharacteristically optimistic about Macau’s prospects, recently saying on his blog: “In the next six months, I would accumulate some For advertising enquiries, please email [email protected] Macau-related gambling shares.” or call: (853) 6680 9419 The landscape for Macau’s operators has been utterly transformed. Gone are the days when players crowded three deep around tables within hastily converted office buildings as gaming capacity www.asgam.com struggled to keep pace with demand. The real growth now will have to come from the city’s non-gaming ISSN 2070-7681 offerings. It’s what Beijing, the local government and China’s new generation of consumers is looking for. And it’s fortunately what the upcoming wave of Cotai resorts promises to deliver. Dr Doom’s recent bullish call on Macau has merit. If Chinese demand could propel Macau’s Inside Asian Gaming gaming revenue to many times that of the Las Vegas Strip, surely it could do the same for its hotel, is an official media partner of: entertainment, MICE and F&B revenues as well. The question the operators now face as they gaze into the abyss is whether they have the mettle to compete on a world stage for Chinese consumers’ non- gaming dollars. Kareem Jalal We crave your feedback. Please email your comments to [email protected] www.gamingstandards.com 8 INSIDE ASIAN GAMING MAY 2015 10 INSIDE ASIAN GAMING MAY 2015 MAY 2015 INSIDE ASIAN GAMING 11 Cover Story PUtting CambodiaON the Map AMBODIA doesn’t often appear on regional leader boards, but it tops Southeast Asia when it comes to Among dozens of casinos in number of casinos. The kingdom hosts some 60 of them, most of which are small operations along its Cambodia, NagaWorld in Phnom borders, but Cambodia also has ambitious operators traded on major exchanges poised to fuel further growth, including Penh has done the most to raise CNagaCorp, a top performer on Hong Kong’s Hang Seng Index the kingdom’s regional profile since its 2006 listing, NASDAQ-listed Entertainment Gaming Asia, controlled by Lawrence Ho’s Melco International, and most recently Australia-listed Donaco International, which is finalizing its purchase of Star Vegas, reputed to be the best performer By Muhammad Cohen among Cambodia’s border casinos.