Archive for the news about gambling Category

Prohibition not the right answer for online gaming in Las Vegas Review-Journal

This morning, the Las Vegas Review-Journal published an op-ed piece I wrote about the ultimate futility of online gaming prohibition:

The nation faces a dangerously seductive form of gambling, as cross-border, high tech telecommunications networks threaten to siphon money out of homes across the country. The problem is getting worse, and the states, with the constitutional mandate to regulate gambling within their borders, are indifferent or worse. The only solution is for Congress to act now.It took years, but Congress eventually did — in 1907

via Prohibition not the right answer for online gaming | Las Vegas Review-Journal.

I’d like the chance to write about this some more–it’s nice to draw on the research I did for Cutting the Wire.

Me @ G2E: Social media insights

A little while ago I received an invitation to participate in G2E‘s conference track. Here are the details:

9:15AM – 10:15AM (Wednesday, October 05, 2011)

Social Media Insights, Part III: ROI

Although it officially costs nothing to tweet, the hard costs associated with staffing and content development are undeniable. This session will examine how casinos are using Facebook, Twitter and other avenues to produce a quantifiable return on investment. Experts will present statistics from casinos using social media to various degrees of success and discuss why approaches based on market size, target customers and similar factors may prove most effective.

Key Takeaways:

# Creating a quantifiable return on social media investment

# How to measure the real costs

# Finding the correct approach for your market

via All Sessions – Education & Conference Programs – Global Gaming Expo.

As soon as I get the names of the speakers, I’ll share them with you. Looks like I’ll be doing another Casino Twitter Study between now and then.

Wynn & China on Two Way Hard Three

In case you missed it, I posted a piece yesterday on Two Way Hard Three talking about Wynn Resorts and China:

In today’s flurry of email headlines (which continue whether I’m in the office or not) I read a blurb saying that Wynn Resorts “has become”; a Chinese company. Certainly this is no surprise to Wynn. I remember him saying that as far back as 2005, though then it was more along the lines of, “One day Wynn Resorts will be a Chinese company.”

Of course, this is getting press now since it’s being coupled with his criticisms of the Obama administration, but looking at the numbers, it’s clear that Wynn Resorts has been a predominantly Chinese company for quite some time.

via Wynn’s a Chinese company, now more than ever | Two Way Hard Three | Las Vegas Casino & Design Blog | from ratevegas.com.

Check it out, if only for the neat little charts. I managed to cut out one step in producing those charts, so I’m pretty excited about them.

Updated 2004-2011 poker study up

While answering questions about the impact of the Black Friday indictments on Nevada poker, I thought I’d take a look at what impact previous interdiction attempts (the passage of UIGEA, the implementation of UIGEA) had on Nevada poker. So I compiled a month-by-month summary of Nevada’s poker results for the past seven years. Because I didn’t want to keep all of the fun to myself, I turned my table into a little Center for Gaming Research report that you can now enjoy:

From 2003-06, Nevada poker saw an unprecedented boom, with revenues nearly tripling. From roughly the summer of 2006 to the summer of 2007, revenues then stabilized, showing continued small increases. Following a major jump in June 2007 (coinciding with an earlier start for the World Series of Poker), revenues then declined steadily. Since July 2007, poker revenues have increased year-to-year only five months out of forty-three.
In general, poker has, since 2006, become steadily less profitable for Nevada casinos. The win per table has fallen dramatically to early 1990s levels. The large number of tables, however, indicates that it is still an amenity that many choose to provide, though it does not produce significant revenues on its own.

Nevada Poker, 2004-2011

If you want to read my analysis based on the report, check out this Two Way Hard Three post.

Six-month NV gaming analysis

Each month, there’s a lot of sound and fury about what the results released by the Gaming Control Board really mean. And each month, when asked what I thought, I used to look at the numbers, compare them with the previous year’s, and speak.

Last year I decided to shift perspective a little by adding more historical depth. With monthly reports from 2004 onward freely available, I figured it was lazy not to use them. So I started comparing the recently released number for February 2011 with not just February 2010, but every February from 2004 to 2011.

This let me see the overall pattern a lot better, and even though it involves some work, I think it’s worth it, because it provides some more context for the numbers.

I think this is important because both investors and industry leaders make decisions partially based on the numbers, and I think that the more people understand about them, the better decisions they’ll make. It might not be able to predict the future, but the historical perspective will undoubtedly give people a much better grasp on the present.

For a while now, I’ve been playing around with another way to contextualize the numbers. Around the third quarter of last year I started putting out a “Year to Date” report that including data from the start of the calendar year. But early in the year, that’s not much value, and late in the year it’s just too much data that’s good for guessing what the year-end totals will be, but not necessarily telling you which direction the industry’s heading in at the moment.

So to provide that, I’ve put together a new report: Nevada Gaming Statistics: The Last Six Months. Here’s the explanation and the executive summary for the inaugural edition:

Continue reading Six-month NV gaming analysis

Feb. Nevada number comparison

I’ve got the Nevada gaming revenue comparison and analysis for February up. Here’s the executive summary:

For Nevada’s gaming revenues, February 2011 had little to celebrate, though in some ways the numbers aren’t as dire as they seem at first glance. Comparatively, the Strip continues to outperform much of the state, but it is still reading water. As of today, the 3Q 2010 “baccarat recovery” is over.
Statewide, slot handle declined by 3.3%; higher hold percentage kept the drop in win to 0.49%. Table play cooled off considerably, with a 14.81% decline from the previous February, which had the benefit of a higher than average baccarat hold. The decline in baccarat revenue almost exactly matched the drop in hold percentage, as the amount played on the game remained nearly constant This small bump, centered on the Strip, wasn’t enough to compensate for the general torpor of the market, though table handle as a whole rose slightly.
On the Las Vegas Strip, slot handle fell, but a 9.08% jump in hold percentage meant that slot revenues actually increased slightly (3.17%). This speaks to the continuing weakness of the broader gambling market in Las Vegas. Table revenues declined by what appears to be an alarming 17.10%, but the return of baccarat hold to a normal level (11.71% vs. 17.04%) was largely responsible. Table handle overall increased by 3.86%, indicating a moderate increase in demand. Interestingly, the number of baccarat tables decline for the first time since at least 2004, indicating that the “baccarat recovery” of late 2010 may have been short‐lived.
Downtown Las Vegas continues its slide, with declines in every category save one—table hold increased slightly. Since February 2004, Downtown revenues have shrunk by 31.04%. It’s clear that this is a market in dire need of a turnaround.
The Boulder Strip, a weathervane for local Las Vegas play, also saw declines, though not as severe as the Downtown area. Cheeringly, slot handle increased by 2.09%, and it may be that the fall in slot hold percentages to under 5%, if sustained, will help draw slot customers back.
Washoe County remains a market in decline: overall revenues fell by 8.55% from February 2010, and have fallen 31.04% since February 2004. The decline in table revenue (‐14.85% year to year and ‐45.13% since 2004) is particularly troublesome.

Nevada Gaming Statistics: February Comparison

I’m working on a commentary piece about the numbers for Two Way Hard Three, as well.

More about the “Friday Effect”

In my analysis of the January Nevada gaming numbers, I made reference to slot win from December being rolled over into January, something I dubbed the “Friday Effect” because I couldn’t think of a better description. I got a few emails asking for more details about it, so here’s the explanation that GCB Senior Research Analyst Michael Lawton gave me via email, shared with his permission:

December ended on a Friday so as a result of operators not dropping and counting on weekends we had December slot revenue roll into January. This also generally happens every Dec/Jan as operators don’t like to disrupt the slot floor during the holiday when there are such heavy volumes. The other factor is that the handle is reported in the actual month that it occurred because the meters are read electronically by on-line systems. As a result our stats get distorted because operators report on a cash basis and report the drop in the following month. I would estimate that approximately $58 million rolled into January from December for the State and of that $41 million was from the Strip.

One of the side effects of the difference between reporting the drop and win is that the handle estimates in my monthly reports are usually a bit different from the official coin-in numbers, but they’re still close enough to get the general gist of what’s happening. In slots, for example, the bottom line is that play has consistently fallen across the state.

Looking at past results and the December/January swing, I’d guesstimate that for most markets January slot hold was 0.4% to 0.5% higher than it should have been.

Nevada January gaming revenues: not encouraging

The January numbers are out, and while they appear to be merely ho-hum (a 0.67% Statewide revenue decrease), they are actually quite troubling. Here’s the executive summary of the report:

January 2011 continued what has been a trend: a persistent, moderate decline in the state’s gaming revenues. This is the third consecutive month in which state gaming revenues declined.

Statewide, slot revenue from the previous January, but this may not be all it appears. Because December ended on a Friday and many operators did not want to disrupt weekend operations by collecting slot win, December’s slot revenues were artificially lower than they should have been, while January’s are higher. The Gaming Control Board estimates that about $58 million of slot revenues were rolled into January from December. Therefore, there was likely a decline in slot win. Both table win and handle declined
Table revenue decreased by 11.44% year to year, and handle slipped 13.19%–not signs of a revival at all.

On the Las Vegas Strip, slot revenue appeared to gain because of the Friday Effect, but the roll-over of December revenues into January produced a historically-high 8.67% slot hold percentage (January 2008’s 8.57% was the previous record holder). Baccarat play slumped precipitously (29.16% year-to-year decline), a sign that perhaps the “baccarat recovery” has fizzled. Continued weakness in slot (-2.44%) and, more troubling, table handle (-15.10%) point to continuing difficulties on the Strip.

Downtown Las Vegas saw a year-to-year gain, but with both slot (-1.58%) and table (-10.27%) handle falling, it continues to be a market with problems. Since 2004, total revenues have fallen 23.81%, with 33.11% and 39.45% declines in table and slot handle, respectively.

The Boulder Strip, a weathervane for local Las Vegas play, saw a 10.93% jump in revenues, but this is partially offset by an abnormally-low table hold percentage in January 2010 and an 11.40% jump in slot hold caused by the Friday Effect.

Washoe County saw a continued decline, with revenues falling by 4.93%. Handle and win both declined, nothing new for a market that has shrunk 22.19% since January 2004. Over the past 8 years, table revenues have declined faster than slots, but clearly this is a market in decline.

Nevada Gaming Statistics: January Comparison (pdf) – more reports

Back in September of 2009, I warned job-seekers about waiting for casinos to save them:

This time, the casino cavalry won’t be coming over the hill. It’s time to look to another — more balanced — solution.

In March 2011, that’s even more true when applied to the state’s budgetary fix. There’s no sign of a sustained turnaround in the gaming industry, which has traditionally shouldered much of the tax burden for the state, is in a prolonged slump that clearly isn’t over.

Let’s look the tax implications of the revenue decline. Since 2007, annual gaming revenues for Nevada have fallen by 19.02%. Here’s the budgetary impact:

Roughly estimating a 7% tax on the state’s total gaming revenues (it’s 6.75%, but adding in fees makes it closer to 7%), we see:

2007: total revenues $12.8 billion, total tax approximately $889 million

2010: total revenues $10.4 billion, total tax approximately $728 million

That’s $161 million in direct tax revenue lost, which, when added with the sales and other taxes that have also slumped because of visitors spending less on everything, makes the state’s current budget situation understandable.

Diversification is really the only way forward.

Details about the Cosmopolitan’s new sports book

Like I admitted on Twitter, I take lousy photos, so I promised that I’d share some of the PR stills of the Cosmopolitan’s new sports book. I’m also throwing in the press release–if you read any media accounts that sounds suspiciously like this, it just means someone’s taking it easy on the word-smithing front:

Las Vegas, March 8, 2011 – The Cosmopolitan of Las Vegas and Cantor Gaming, an affiliate of global financial services firm, Cantor Fitzgerald, L.P., debut The Cosmopolitan Race & Sports by Cantor.

“The new Race and Sports Book by Cantor, with the latest in betting technology, spectacular design and prime sports watching location adds yet another unique and dynamic element to the already exciting scene at The Cosmopolitan,” says John Unwin, CEO of The Cosmopolitan of Las Vegas.

The new sports book, located on the second floor, situated adjacent to Marquee Nightclub, welcomes patrons with two outside betting windows. Inside, guests are greeted into the intimate space by metallic red, grey and dark wood interiors. Wagering is available at fixed betting, or individual ‘trading’ stations within the book, as well as on Cantor’s proprietary mobile tablets which can be used at both the race and sports book and Book & Stage on the casino floor. Two additional betting stations at Book & Stage also are available for placing bets.

Forty-three ‘trading’ stations each feature plush seating, viewing screens and are equipped with Cantor’s proprietary In-Running ‘sports trading’ technology. In the same way that prices in the financial markets change from moment to moment, Cantor’s lines and spreads change continuously as the action of a sporting event unfolds.

Lee Amaitis, President and CEO of Cantor Gaming, said: “The Cosmopolitan is the most exciting new property on The Strip. Its vision to bring a fresh, sophisticated and modern experience to Las Vegas in a world class venue, reflects our own mission to transform sports wagering through our ground-breaking technology. The same innovation in technology that we have brought to Las Vegas has changed the way we live our lives in sectors as diverse as finance, travel and retail. The Cosmopolitan is a tremendous stage on which to continue to build our ‘sports trading’ franchise.”
Cantor Gaming now operates four race and sports books in Nevada.

Here is the entrance and a smidge of the horse-racing area:
R&S Entrance

And this is the sports book area:

R&S Trading Stations Close

It’s pretty small, but the Cantor folks are hoping to do a lot of business on their eDeck mobile devices, and, when they get GCB approval, smart phones and tablets.

If you want to learn more about where Cantor wants to take sports betting–or “sports trading” as they call it–I strongly suggest you listen to the Lee Amaitis UNLV Gaming Podcast.

Casino crime in the LVBP

In this week’s Las Vegas Business Press, I look a little more closely at what the two-incident “epidemic” of strong-arm casino chip robberies means”

Strong-arm robberies aren’t exactly rare in the United States. According to Federal Bureau of Investigation statistics, there were almost 409,000 robberies in 2009, the last year for which data is available. Often, these robberies don’t even make the local news. Yet when a robbery involves a Las Vegas casino and its gambling chips, it has been national news.

This is mainly because casinos have an aura of invulnerability around them: many assume that because surveillance cameras are so ubiquitous around casinos, committing a crime is impossible there.

Committing the crime isn’t always the hard part. Getting away with it might be

via Las Vegas Business Press :: David G. Schwartz : Casinos’ open layouts invite all, even thieves.

It’s definitely an interesting idea to think about…just how safe are casinos? A honest polling of the incident reports generated in Strip casinos would probably say, “Not as safe as you think,” and in some ways it’s encouraging that these kind of strong-arm robberies are so rare.

In the end, there’s really no way to defend against this kind of thing, short of metal detectors and perimeter checkpoints. The best prevention is a good deterrent, which is linked to a high clearance rate for these sorts of things, which suggests that casino security and Metro have been doing their jobs pretty well.