Andrew Klebanow

The Quiet Casino Boomtown

Posted on May 17, 2018

As the gaming industry’s collective attention is focused on what casino development might look like in Japan, a small seaside resort town on the coast of Cambodia is quietly emerging as the
world’s fastest-growing gaming jurisdiction. The town is called Sihanoukville.

Sihanoukville is a port city and down-market vacation destination on the Gulf of Thailand in southwest Cambodia. It has long appealed to backpackers
for its pristine beaches and low-priced accommodations. It also has served as a gambling and vacation destination for Thais and Chinese.

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If PASPA is Repealed, Then What?

Posted on May 16, 2018

Much has been written about the Professional and Amateur Sports Protection Act (PASPA) and its possible repeal. To summarize, there are three possible outcomes. The first is that the Supreme Court of the United States (SCOTUS) rules PASPA is unconstitutional. In that case, it will be up to individual states to decide whether to allow sports betting and the various forms it might take. The second scenario is that SCOTUS lets PASPA stand in its current form. In this scenario it would be up to Congress to decide if it wants to repeal or amend PASPA. Given the current political climate in Washington D.C., passage of such a bill might take some time. The third scenario is that SCOTUS takes a completely different route, either issuing a partial repeal or
potentially invalidating the four state exemption that currently exists.

Should the Supreme Court rule in New Jersey’s favor, one can expect sports betting to be available in a number of jurisdictions in fairly short order. Five states, outside of the four that
already had legislation in place prior to the passage of PASPA in 1992, have already passed legislation authorizing sports betting, and approximately fifteen others are considering enabling legislation or studying the issue. The question now becomes, should PASPA be repealed, what are the challenges that America’s tribes face in creating sports betting products that are competitive with what various states with commercial casinos and lotteries will ultimately offer.

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Cash Back to Free Play

Posted on April 16, 2018

Non-negotiable slot credits, or what is more commonly known as “free play,” has emerged as the most often-used tool in the casino marketing arsenal. It has supplanted cash prizes, complimentary dining and invitations to special events as the primary incentive for rewarding player loyalty.

Its use, along with its occasional over-use, has had a profound effect on the slot-machine gaming experience, and while free play certainly has a wealth of benefits, both to casino operators and players, its prolific use has had unintended and often deleterious effects on both parties.

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Deep Dive: The Future of Sports Betting in the United States

Posted on February 16, 2018

As the nation awaits the upcoming decision by the Supreme Court of the United States (SCOTUS) in Christie v. NCAA, various stakeholders are evaluating their next steps, and how to maximize the revenue potential from legalized sports betting.

Today, a federal law known as the Professional and Amateur Sports Protection Act (PASPA) limits most legal sports betting to Nevada and three other states. This article examines the critical success factors for sports wagering in the United States and the operators that will be best positioned to provide the products and services that sports wagering customers will seek.

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Strategies to Grow International Tourism into Las Vegas and Stimulate Economic Activity

Posted on November 16, 2015

Few would argue that sustained growth in air passenger volume into Las Vegas is a critical factor in the health and vibrancy of the Southern Nevada tourism industry. While McCarran International Airport (“LAS”) continues to enjoy steady growth in domestic passenger volume, growth in international traffic has experienced a far higher rate in the last five years, fueled by the opening of the new international terminal and marketing initiatives by the Clark County Department of Aviation. International visitation grew from 14% of total visitor volume in 2009 to 20% in 2013.1 International tourism continues to represent the greatest opportunity for new market growth, particularly visitors from Asian countries.

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Urban Alliances: The unique challenges of building casinos in a city

Posted on May 25, 2015

Casinos located in cities have long had an uneasy alliance with their host communities.

Local municipalities have enjoyed the tax revenues and jobs that casinos brought and civic leaders have recognized the charitable contributions casino leadership have made to their communities, as well as their greater economic contributions. Yet, cities have long treated casinos with a certain degree of disdain, relegating them to locations that would be unappealing to any hotel developer.

At the same time, many city governments have showered developers of sports venues, hotels and convention centers with a wealth of benefits including tax abatements, generous land leases, municipal bond funding and sales tax rebates in the hope that those developments would somehow lead to a revitalization of their urban cores.

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Casinos and the City – A White Paper

Posted on April 16, 2015

Casinos and the places where they can be found have increased dramatically over the last twenty five years. Where at one time there were only a few places on the planet where one could go to participate in legal gambling activities, today casinos are a fairly common enterprise. In the United States alone, there are over 900 commercial and Indian gaming establishments. Casinos can be found not only in North America but also throughout Europe, Central and South America, Oceana and Asia.

Since the passage of the Casino Control Act in 1976, legalizing casino gaming in Atlantic City, NJ, casinos have been narrowly viewed as a tool for urban redevelopment, providing tax revenues to state and local governments and jobs to its citizens. Their success in providing those benefits cannot be disputed. Collectively, the casinos in Atlantic City, the riverboat and barge casinos in the Midwest and southeast United States, Indian casinos, and the land-based commercial casinos in a number of US cities as well as those on the Macau Peninsula and Singapore have contributed billions of dollars to government coffers and created hundreds of thousands of jobs. However, their success as a tool for stimulating commercial activity within the neighborhoods that they are located in has produced less dramatic results.

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New Kid in Town: Can Vietnam emerge as an international gaming-resort destination?

Posted on January 13, 2015

Despite the recent downturn in gaming revenue in Macau, Asia remains the region of the world with the greatest opportunities for casino development. While Japan and Taiwan remain the most enticing markets, if only enabling legislation were to be passed, other markets are attracting the interest of casino developers. Unfortunately, most of those opportunities are in markets that are loosely regulated, difficult to get to, surrounded by poor infrastructure or require border crossings that can best be described as challenging.

One market that continues to interest investors is Vietnam. With 92 million citizens, a burgeoning middle class, good airport infrastructure and airlift to a number of nearby countries, Vietnam appears poised to emerge as a regional gaming market that is capable of producing a prodigious amount of gaming revenue. Nevertheless, a number of issues must be resolved before the country can live up to its potential.

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The Tipping Point: Rising slot hold percentages are driving players away, and revenue down

Posted on October 23, 2014

Gaming revenues, and in particular slot revenues, continue to decline in most U.S. gaming jurisdictions. This pattern of decline began at the onset of the recession and has continued even as the economy improved.

Casino operators often cite increases in gaming supply in adjacent states and a slow economic recovery in their markets as reasons for this decline. While the recession certainly affected discretionary spending during the height of the recession, hitting casino gambling hard, the U.S. economy has largely recovered. Gaming revenues, though, have not.

Key macro-economic indexes have returned to pre-recession levels. Two indexes, employment and consumer confidence, have long served as bellwethers for gaming revenue forecasts. In August 2013 the U.S. unemployment rate stood at 7.5 percent, down from 8.2 percent for the prior-year period. By August 2014, the unemployment rate dropped to 6.4 percent. In August 2013, the consumer confidence index stood at 80.3, up from 75.3 in 2012. By August 2014 it rose to 82.0.

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So, Have You Been to Poipet?

Posted on April 25, 2014

When examining the major casino markets of Asia, Macau and Singapore most often come to mind. Most gaming executives are familiar with these markets, and their prodigious gaming revenue performance continues to attract the interest of the media and financial analysts.

The extraordinary performance of these markets has caused casino developers to look more closely at other regional Asia markets such as South Korea, Vietnam and Japan as they look for that next great opportunity.

What are often overlooked are other regional Asian markets that are already established yet are somewhat removed from major Asian cities. These gaming markets generate prodigious amounts of gaming revenue and serve as convenience-based gaming destinations to regional populations.

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