Global Gaming Business, September 2020 by Global Gaming Business

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GGB Global Gaming Business Magazine

GaMInG In CaMBOdIa SKILLS & THrILLS PrOTECTInG PrIVaCY MOnKEY KnIFE FIGHT

September 2020 • Vol. 19 • no. 9 • $10

DOING

DIVERSITY

How a diverse workforce and customer base contribute to a healthy company

Gambling on Esports How casinos can use esports to enhance their bottom lines

Brand

awareness

How to tie together corporate culture, social consciousness and other aspects of your company’s identity

Association of Gaming Equipment Manufacturers

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CONTENTS

Vol. 19 • No. 9

september

Global Gaming Business Magazine

18 COVER STORY

COLUMNS

Toward Diversity

10 AGA All Together Now

Gaming companies have spent decades promoting the value of a diverse and inclusive workplace, yet there still is widespread evidence of systemic discrimination in the industry, particularly in high-level management positions. Here’s a look at the ongoing challenge from several industry professionals.

Bill Miller

12 Fantini’s Finance Pandemic Plus Frank Fantini

28 Making My Point Wasteland or Opportunity? Roger Snow

By Marjorie Preston

34 Legal Privacy Matters Anthony Cabot

FEATURES

DEPARTMENTS

36 Skill Plays

Skill-influenced games in arcade-style formats are a growing style of gaming machine that has a built-in demographic of enthusiastic fans.

The Agenda

By the Numbers

5 Questions

By Dave Bontempo

14 The Esports Game An increasing number of casino operators are looking at esports not only as an attraction, but as new wagering fodder for sports betting operations.

38 Frankly Speaking 44 Emerging Leaders

By John English and Kit Szybala

40 Cambodia Rising

24 Building the Brand A brand is much more than a name and a logo—your brand reflects how you communicate your company’s culture to the outside world. By Julia Carcamo and Meera Rosser

30 The Cashless Marker Ellis Island Casino and Konami Gaming are field-testing a patented cash-free marker system for slot machines that could not be more timely.

Cambodia has the potential to be become Asia’s next big gaming and tourism destination, if stakeholders and government can put together a few key elements. By Michael Zhu

13 AGEM

With Incredible Technologies’ Guillermo Ramirez, Eilers & Krejcik Gaming’s Phil Bernard, and Fox Rothschild’s Harry Jackson

46 New Game Review 48 Goods & Services 53 People 54 Casino Communications With Joe Lupo, President and CEO, Hard Rock Atlantic City

By Frank Legato SEPTEMBER 2020 www.ggbmagazine.com

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THE AGENDA

Convenience Gambling By Roger Gros, Publisher

ecently I’ve seen pictures of several racetracks that existed at one time in Las Vegas. One, the Joe E. Browne Racetrack, was located on the site that today’s Westgate occupies, next to the first convention center in town. In another picture, I was reminded of a second track that operated behind Caesars Palace in the ’60s, complete with a parking lot on the infield. All this time, I thought the only racetrack that ever existed in Las Vegas was way out in Henderson, where there’s still a street called Racetrack Road. It was far from the Strip, especially in those days of no superhighways in Vegas, so it’s not surprising that it failed. But failure, unfortunately, is the story of horse racing in the U.S. and around the world. For a variety of reasons, this beautiful sport has slowly faded away. When I was a kid in the 1950s, the decline had already begun, as racetracks began to close around New York City, where I grew up. In newsreels from the 1920s and ’30s, the same tracks were packed, with thousands of people ready to wager meager earnings on their nag of choice. The movie (and even better book) “Seabiscuit” is amazing, and part of a genre of horse racing movies I love. But if you haven’t seen “Phar Lap,” an Australian movie about the same Depression era, you’re missing a gem. There are a dozen other great racing movies that testify to the emotional connection we all have to horses—particularly ones with big hearts. At the core of horse racing, of course, is gambling. In many places, horse racing was the only legal gambling available at the time. Gambling on a horse race is a bad bet. The takeout on the prizes is astronomical—although not nearly as bad as a wager on a lottery ticket. Even though the bet is very unfavorable, I have to admire the faithful horse players who can eke out a profit against all odds. Their attention to detail and analytical minds are more like a poker player’s than any other kind of gambler. Atlantic City Race Course today stands empty and lifeless. It once was vibrant and exciting, with the likes Frank Sinatra and Princess Grace attending. There are hundreds of tracks across the country that have similarly fallen to the public’s fickle desires. Yes, some tracks survive. Most do so by depending on casino gaming, part of the “racino” community that is itself slowly slipping away. Dog

tracks have become almost nonexistent, but the casinos built to support them live on. Most horse racing meets are short, six weeks or less, and the “crowds” that come to see them are minimal, made up mostly of inveterate horse gamblers, a breed unto themselves. Yes, it’s sad to see the decline of horse racing. The Sport of Kings has failed to keep up with the times, and even worse, has often been accused of abusing the very animals it depends upon for survival. If you can’t keep your star product safe, you really don’t deserve to prosper. So what lessons can casinos learn from the demise of horse racing? The first is to keep the hits coming. The 10 to 20 minutes between races is a killer for the gambler. That’s when the “historic horse racing machines” were born, which are now just replicas of our favorite slot machines. Yes, casinos offer more bets more quickly with a better payout than betting on real races. Casinos added amenities that racetracks could never offer. Yes, there was a “turf club” or some other high-end restaurant at most tracks, but there were rarely hotel rooms, spas, meeting space, pools or any of the amenities commonplace in today’s casino resort. The challenge for casinos, particularly in the Covid-19 era, is convenience. The reluctance of people to go out in public to enjoy their chosen form of entertainment, whatever it may be, is palpable. Online gaming in New Jersey and Pennsylvania soared during the initial lockdown and have continued apace now that casinos have reopened—albeit in a severely truncated manner. How are these massive casino resorts going to rejigger their business models when people are uncomfortable being within 6 feet of other people? Can showrooms return to full form? Will attendees at meetings and conventions get over their aversion to crowds, or even be able to convince their companies to allow them to travel again? And how will the casino floor be redesigned in a way that’s appealing and welcoming without shut-down slot machines and Plexiglas between the customer and employee? Casinos have a challenge not unequal to the one that the horse racing industry failed to navigate. It’s going to take the most brilliant minds to find solutions. Let us know your ideas, and we’ll spread them far and wide.

Global Gaming Business SEPTEMBER 2020

Vol. 19 • No. 9 • SEPTEMBER 2020 Roger Gros, Publisher | rgros@ggbmagazine.com twitter: @GlobalGamingBiz Frank Legato, Editor | flegato@ggbmagazine.com twitter: @FranklySpeakn Marjorie Preston, Managing Editor mpreston@ggbmagazine.com Monica Cooley, Art Director mcooley@ggbmagazine.com Terri Brady, Sales & Marketing Director tbrady@ggbmagazine.com Becky Kingman-Gros, Chief Operating Officer bkingros@ggbmagazine.com Jessica Walker, Operations Manager jwalker@ggbmagazine.com Lisa Johnson, Communications Advisor lisa@lisajohnsoncommunications.com twitter: @LisaJohnsonPR Columnists Anthony Cabot | Frank Fantini Bill Miller | Roger Snow Contributing Editors Dave Bontempo twitter: @bontempomedia Julia Carcamo twitter: @jccarcamo | John English Meera Rosser | Bill Sokolic twitter: @downbeachfilm Kit Szybala | Michael Zhu __________________

EDITORIAL ADVISORY BOARD Rino Armeni, President, Armeni Enterprises

•

Mark A. Birtha, Senior Vice President & General Manager, Hard Rock International

• Julie Brinkerhoff-Jacobs, President, Lifescapes International

• Nicholas Casiello Jr., Shareholder, Fox Rothschild

• Jeffrey Compton, Publisher, CDC E-Reports twitter: @CDCNewswire

• Dean Macomber, President, Macomber International, Inc.

• Stephen Martino, Vice President & Chief Compliance Officer, MGM Resorts International, twitter: @stephenmartino

• Jim Rafferty, President, Rafferty & Associates

• Thomas Reilly, Vice President Systems Sales, Scientific Games

• Michael Soll, President, The Innovation Group

• Katherine Spilde, Executive Director, Sycuan Gaming Institute, San Diego State University, twitter: @kspilde

• Ernie Stevens, Jr., Chairman, National Indian Gaming Association twitter: @NIGA1985

• Roy Student, President, Applied Management Strategies

• David D. Waddell, Partner Regulatory Management Counselors PC Casino Connection International LLC. 1000 Nevada Way • Suite 204 • Boulder City, NV 89005 702-248-1565 • 702-248-1567 (fax) www.ggbmagazine.com The views and opinions expressed by the writers and columnists of GLOBAL GAMING BUSINESS are not necessarily the views of the publisher or editor. Copyright 2020 Global Gaming Business LLC. Boulder City, NV 89005 GLOBAL GAMING BUSINESS is published monthly by Casino Connection International, LLC. Printed in Nevada, USA. Postmaster: Send Change of Address forms to: 1000 Nevada Way, Suite 204, Boulder City, NV 89005

Official Publication

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BY THE

NUMBERS

CovId & RG T

Climbing Back Up

he Covid-19 lockdown would seem to have been a good thing for people suffering from forms of problem gambling. With virtually nothing to bet on and nowhere to bet, you would think there would be fewer problem gamblers. Researchers at the University of Sydney in Australia set out to find out just what the impact of the lockdown was on problem gamblers. Chief investigator Sally Gainsbury, co-investigator Alex Blaszczynski and their team surveyed 764 Australian adults (85 percent male, aged 18-82 years) who had gambled in the past 12 months. The study was conducted in May 2020 and showed that nearly three in four participants reported gambling less frequently during the shutdown, and most did not increase their online gambling frequency. Individuals at moderate risk of gambling harms were more likely to report increases in gambling frequency, and higher problem gambling severity was associated with increases in gambling expenditure. However, gamblers afflicted with either moderate or severe problem gambling risks were more likely to increase their spend during the lockdown. To obtain a copy of the report, contact Vivienne Reiner at vivienne.reiner@sydney.edu.au.

Global Gaming Business

n its first report since casinos began reopening in June, the Eilers-Fantini Central Game Performance Database (GPD) resumed its coverage of slots in the gaming industry. The chart below shows the market share of the slot suppliers. Since few casinos are planning to invest capital in slot machines this year, this chart will probably not change much until 2021. The second chart shows the percentage of owned slots versus leased and wide-area progressives. The question now is whether casinos will look to lease more slots than own, given a possible reluctance to invest capital in gaming devices. The GPD includes slots from Canada (13 percent), tribal gaming (34 percent) and U.S. commercial casinos (53 percent). To obtain a copy of the GPD, email Rick Eckert with Eilers & Krejcik Gaming at reckert@ekgamingllc.com.

SEPTEMBER 2020

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NUTSHELL

“They

5Questions

“Obviously the local financial ecosystem is suffering, but in the end companies with serious and gritty management will be able to recover. I believe in the end, most companies will survive.”

Bill Asher Founder and CEO, Monkey Knife Fight

ill Asher, founder and CEO of daily fantasy sports provider Monkey Knife Fight, says the DFS model Bisticians, originated by his predecessors, FanDuel and DraftKings, is less for the average-Joe sports fan than statand “stacks the deck against the casual player ever winning.” With the motto “It ain’t rocket science,” Monkey Knife Fight targets those casual players, who are just as passionate and reportedly outnumber traditional DFS players 10 to one. The approach has clearly worked; before the industry shutdown in March, MKF saw its user base explode, increasing 400 percent year-on-year. The upstart company is also building a roster of team partners, doing brand deals with the San Diego Padres and Milwaukee Brewers, among others. According to a news release, the moves “reinforce MKF’s belief that there is a large appetite among these baseball fan communities to play fantasy sports games that allow them to focus on their local hometown teams and favorite players.” In July, GGB spoke to Asher about his plans for MKF, and how he’ll reach the goal line in the Covid era.

—Carlos Cid Alvares, Vice Chairman and CEO, Macau bank Banco Nacional Ultramarino

CALENDAR EDITOR’S NOTE: Every conference and trade show set for this year has either been canceled, rescheduled or modified. Below are their new dates and/or status. CANCELED September 11-12: NCLGS Summer Meeting 2020, Intercontinental Magnificent Mile, Chicago. Produced by the National Council of Legislators From Gaming States. For more information, visit NCLGS.org. REIMAGINED September 15: 21st Conference on Gambling and Addiction. Gaming Taxes and State Responsible Gambling Appropriations: Where Does the Money Go? Virtual event. Produced by the International Center for Responsible Gaming. For more information, visit ICRG.org.

GGB: When you launched Monkey Knife Fight, at the dawn of legal sports betting in the U.S., what void were you looking to fill? What did you dislike about the model familiarized by FanDuel and DraftKings? Bill Asher: Out of the millions of people who play fantasy sports, only a slim number have the time to

CANCELED September 22-23: ASEAN Gaming Summit 2020, Shangri La BGC, Manila. Produced by Asia Gaming Brief. For more information, visit aseangaming.com.

dedicate to knowing every player in the league and every matchup variable, and also stay on top of injuries and breaking news. The model in the market was essentially a math test where you lost money. What’s fun about that? Monkey Knife Fight puts the fan experience back in fantasy sports.

REIMAGINED September 29: 21st Conference on Gambling and Addiction. Recognizing Stigma Embedded in Diagnostic Criteria for Substance Use Disorders. Virtual event. Produced by the International Center for Responsible Gaming. For more information, visit ICRG.org.

1 2 3 4 5

What was your first thought when Covid-19 shut down March Madness, and then all majorleague sports?

It happened so quickly, it really was a shock to everyone in the industry. Our first and foremost concern was (and is) the safety and health of our employees and their families. While I knew it would affect our revenue with no sports, I made a commitment that everyone would keep their jobs, however long the shutdown lasted. There was enough uncertainty all around us, I didn’t want my team to worry about their jobs. And what was your second thought?

After we reassured everyone that we were retaining our original staff, we started thinking, “How can we maximize this time?” The answer was obvious to me. Everyone else went into a wait-and-see mode, effectively dialing back their work. Monkey Knife Fight did the opposite. We throttled forward aggressively in every area, made updates to our product, went after opportunities for new partnerships and grew our team by hiring talented people who became available from other companies. Can you share a few details of your expansion strategy, including getting your DFS product out in front in states like California, where sports betting isn’t yet legal?

Right now, we’re focused on dominating fantasy sports. We do it well and we’ve seen an incredibly positive response to our easy and fun fantasy sports contests. That brand recognition could prove very helpful in a more gambling-focused future. Where will Monkey Knife Fight be in three to five years?

While we’re focused on fantasy sports right now, most of America and Canada are a couple of years away from legalizing online gambling. As sports betting laws open up around the country, we’ll have the ability to offer our gambling products alongside our fantasy sports. With a large base of loyal fantasy sports customers, many will naturally bet with us as well, and MKF will be able to generate substantial gambling revenues almost overnight in each state as they legalize sports betting.

Said It”

Global Gaming Business SEPTEMBER 2020

CANCELED October 5-8: Global Gaming Expo, Sands Expo Center, Las Vegas. Produced by American Gaming Association and Reed Exhibitions. For more information, visit GlobalGamingExpo.com. REIMAGINED October 21: 21st Conference on Gambling and Addiction. Addictive Behavior Relapse: Challenges in the Treatment of Gambling Disorder and How Mindfulness May be Helpful in Breaking the Relapse Cycle. Virtual event. Produced by the International Center for Responsible Gaming. For more information, visit ICRG.org. RESCHEDULED October 26-27: East Coast Gaming Congress, Harrah’s Resort, Atlantic City. Produced by Spectrum Gaming, Cooper Levenson, the Friedmutter Group and Sysco. For more information, visit EastCoastGamingCongress.com. November 9-11: Sports Betting USA & Investment Summit, New York City. Produced by Clarion Gaming. For more information, visit SportsBettingUSAConference.com. REIMAGINED December 1-3: Betting on Sports America, Meadowlands Exposition Center, East Rutherford, New Jersey. Produced by Sports Betting Community. For more information, visit SBCEvents.com. CANCELED December 1-3: G2E Asia 2020, Venetian Macao. Produced by Reed Exhibitions and the American Gaming Association. For more information, visit G2EAsiaMacau.com.

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AMERICAN GAMING ASSOCIATION

All Together Now The pandemic has impacted every corner of the gaming industry, but we’re well-positioned to recover By Bill Miller

Editor’s note: This column was written at the beginning of August. For updates on the AGA’s most recent efforts, visit AmericanGaming.org.

s companies and communities search for ways to work, shop, dine and live safely amid Covid19, gaming provides a leading model for how a high-touch, customer-facing business can reengineer operations to protect public health and fuel economic recovery. Across the country, casino gaming properties have implemented rigorous health and safety plans to help manage the difficulties posed by Covid-19. In fact, 85 percent of casinos in the U.S. are now open, most with limited capacity or reduced amenities available. While every industry faces complex operational challenges in the Covid-19 era, our industry is particularly well-positioned to lead. Gaming’s deep-rooted culture of regulatory compliance, our strong commitment to guest service, and our close ties to local communities have enabled casinos to quickly adapt to the new operating environment. Gaming is one of our nation’s most highly regulated industries, so gaming leaders and employees are accustomed to working with regulators and government agencies to meet detailed operational requirements. As a result, casinos have been able to quickly establish and efficiently implement comprehensive Covid-19 health and safety plans, vetted and approved by state regulators, that meet or exceed local laws and public health requirements. This includes protocols for every area of operations, from food service and physical spacing to enhanced cleaning and health screening. Putting these robust measures in place takes hard work and dedicated employees who apply these rigorous protocols to ensure customer safety. Casinos are screening and, in some cases, regularly testing employees for Covid-19, with robust response plans in the event of positive results. They are proactively

working with public health authorities on tracing protocols to ensure the broader health of local communities. Team members have also been trained to remind guests of physical distancing and mask requirements and ensure guidelines are followed. The pre-pandemic gaming industry was already evolving towards a more tech-enabled experience; now, new innovations are emerging in response to new challenges. For example, MGM Resorts has implemented contactless mobile check-ins, so guests can avoid lines. The Hard

“

Our industry is making significant investments in new equipment, technologies, protocols and training because we know it is critical that gaming reopens and stays open—not just for our businesses, but for our communities.

”

Rock Tampa disinfects and purifies air with a special technology designed to kill virus particles. Scientific Games is introducing new technology to alert staff when a player finishes on a slot machine for cleaning needs, allowing the next customer to see the time of last sanitization. Several casinos are using advanced thermal cameras to effectively scan guests for elevated temperatures. And the industry is working closely with state regulators to implement digital payment technologies to reduce physical interaction and cash handling on casino floors. This is just the beginning. As we move forward, gaming will continue to refine safety measures, develop new solutions and share best practices. These ongoing efforts will protect employees and

Global Gaming Business SEPTEMBER 2020

customers and, importantly, play a part in supporting local efforts to reduce disease spread. Our industry is making significant investments in new equipment, technologies, protocols and training because we know it is critical that gaming reopens and stays open—not just for our businesses, but for our communities. In every gaming state, casinos are economic engines driving local economies, supporting workers, small businesses and local governments. Gaming’s more than two-month shutdown cost states $2 billion-plus in lost gaming taxes alone. Detroit lost $600,000 in gaming taxes per day during the shutdown, leading to a massive hole in the city’s budget and significant cuts to city services. Maryland lost $209 million in gaming taxes between March and June compared to the same period last year, while Pennsylvania lost $323 million in gaming tax revenues during the same time frame. This means we all have a stake in gaming’s recovery. It’s going to take everyone doing their part by wearing masks and following social distancing measures as public health efforts continue to ramp up testing and tracing. Our success represents a critical path forward for local economies, which urgently need customer-facing businesses like gaming to help restore jobs, tax revenues and economic activity. I couldn’t be prouder to be a part of this remarkable industry. The American Gaming Association has helped lead the gaming industry through many challenges for 25 years—and will do so again. We recognize the scale of the challenge we face, but gaming has proven to be resilient through natural disasters, economic recessions, personal tragedies and more. As we continue to learn and adapt to the Covid-19 challenge, we will show the way forward for other critical industries and responsibly contribute to the recovery of local communities and the American economy. Bill Miller is president and CEO of the American Gaming Association.

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FANTINI’S FINANCE

Pandemic Plus Not all is a disaster as the gaming industry explores growth and opportunities in the wake of the lockdown By Frank Fantini

he second quarter turned out better than many had anticipated. Casino companies have learned to operate at limited capacity. Gamblers have showed up to play. And the outlooks given by CEOs have been sober, but confident. The current state of gaming business and outlook look something like this: • Online gambling companies prospered while their brick-and-mortar cousins were closed. The question becomes, how much of this windfall will stick once casinos fully reopen and customers become comfortable traveling? • Sports betting companies have seen their businesses suffer, but are bouncing back as eager gamblers jump all over major sports leagues resuming play. Looking into next year, sports will fully return, and U.S. states will continue to legalize betting. So this is a growth industry, as clearly as riverboats were in the 1990s. • Regional and locals casinos are living up to expectations that their business is recovering sooner and to a greater extent than destination markets. More importantly, cost reductions have considerably offset the effects of lower revenues, and it appears executives are committed to permanently reducing money-losing or marginal amenities. Bye-bye, buffets. • Destination markets, also as expected, are in difficulty. They likely will stay that way as long as Singapore air travel is restricted, Macau feeder markets essentially shut down travel, air traffic into Las Vegas remains minimal, and conventions continue to cancel. • Liquidity is no longer an urgent issue. Gaming companies largely have done an excellent job of cutting expenses and arranging to have cash, or access to it. They are not facing imminent crises. There are other encouraging signs. Airline passenger traffic at Las Vegas, McCarran International Airport nearly tripled from May

to June, and was almost seven times that of April, showing that airlines will provide capacity if consumers provide demand. The overall economy continues to outperform expectations, and the Fed and Congress are intent on providing whatever aid is needed to keep it going. There are longer-term concerns. What happens when the inevitable flattening or decline of economic activity occurs and as more jobs and businesses disappear? Then there is the eventual impact on inflation from all the debt piling up. However, the near-term avoidance of economic catastrophe gives some reason for optimism that those waters can be navigated safely.

OPPORTUNITIES RISE Financial crises are times of opportunity as well as difficulty. For every old-line brick-and-mortar business that files bankruptcy, new companies like Zoom arise to capitalize on the changed environment. Covid-19 has presented investors with what some call the stay-at-home plays, like Netflix prospering as theaters remain dark, Peloton inspiring at-home exercise while gyms struggle, or Grubhub delivering restaurant-made meals while the restaurants themselves suffer. And it accelerated the digitalization of the economy, including Amazon’s ever greater dominance. Gaming has its own set of stay-at-home winners in the iGaming stocks and those brick-andmortar companies that are seen as adapting to the new business models, such as Penn National, with its stake in BarStool sports media company. PENN stock is now 10 times its mid-March low. Hard to argue with a 1,000 percent appreciation in four months.

machines and equipment to casinos. The gaming company of the future will be an amalgam of businesses. On the supplier side, look at Scientific Games and IGT. They have lotteries, slot machines, casino management systems, social and iGaming and sports betting platforms. Aristocrat is as much a social gamer as a slot supplier. Casinos still have slots, table games and hotel rooms, but they also have retail, convention space, iGaming operations and sports betting. That convergence will continue.

THE REIT IRONY But brick-and-mortar opportunities remain. Perhaps the best examples of this are the gaming REITs: Gaming and Leisure Properties, MGM Growth Properties and VICI Properties. Just a few months ago, many REIT investors avoided gaming REITs because their tenant bases are not diverse. They’re only casinos. Further, their tenant bases are concentrated. Each REIT has one primary tenant, the company from which it was spun off: Penn National, MGM Resorts and Caesars Entertainment. Today, while non-gaming REIT stocks have been hammered as tenants such as restaurants and shopping malls stopped paying rent, gaming REITs are happily collecting full rents from their casino tenants. At some point, gaming REITs will diversify. Diversification obviously is wise in almost every economic environment. But the point is that investors can still benefit from old-fashioned investments. And in today’s low-interest rate world, with dividend yields ranging from over 5 percent to more than 7 percent, gaming REITs are the kinds of stalwart investments that can benefit even the trendiest stay-at-home and techy portfolio.

LET’S GET TOGETHER The Penn National purchase is indicative of another trend—convergence. The gaming company of the past either ran a casino or sold slot

Global Gaming Business SEPTEMBER 2020

Frank Fantini is the editor and publisher of Fantini’s Gaming Report. For a free 30-day trial subscription email subscriptions@fantiniresearch.com.

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AGEMupdate AGEM MEMBER PROFILE

The Posiflex Groupâ&#x20AC;&#x201D;a synergy of world-leading

POS, kiosk and industrial computing technologiesâ&#x20AC;&#x201D; designs, engineers and manufactures class-leading IoT solutions for enterprise deployments. Posiflex systems possess the advantages of open architectures and crossplatform integration. The full range of product lines includes self-serve kiosks, integrated POS systems, and other relevant peripheral accessory products. The diverse applications of the products have allowed them to be widely used in various domains, including gaming, hospitality, retail, self-service, ticketing, entertainment venues, access control and logistics. Posiflex kiosk solutions are designed to enhance and reinvent the customer experience by providing fully integrated and modularized self-service kiosks and peripherals. Posiflex has recently introduced the Mercury EK Series, a modular kiosk with a stylish and functional design that will blend seamlessly in any environment. The Mercury EK Series can serve as an ordering/ queue kiosk/information terminal to interact with customers and simultaneously help to drive more demand and business. Available with choices of floor-standing or countertop, the EK series is suitable for any self-service location. The Mercury EK Series kiosk joins the established Paragon TK-3200 Series and Stellar TK-2100 Series; these kiosks can be deployed in many kinds of configurations, and are available in Windows or Android for a wide range of self-service applications. Posiflex kiosk solutions are at the forefront of self service to streamline daily operations and interact with customers in a more personalized, flexible, and connected way. (For more information, visit http://posiflex.com/englobal/product/index/Kiosk.) In addition to POS and kiosk solutions, Posiflex has recently released a remote management system (RMS), Canopy. Posiflex, headquartered in Taiwan, is marketed worldwide as one of the leading brands in the industry, and has established subsidiaries and offices in various nations (e.g., the United States, Germany, Japan, India, China, Singapore and Malaysia) to provide local and prompt services. (For more information, visit http://posiflex.com/en-global.) For more information contact Brad Chou at +886 2 2268 5577 or email marketing@posiflex.com.tw.

AGEM Board of Directors Actions for August 2020 â&#x20AC;˘ A second special session of the Nevada legislature was held recently covering a wide variety of urgent pandemic-related matters, and in particular Senate Bill 4 that includes limited liability bill provisions for AGEM, its Nevada-based members and other business that will be protected from COVID-related claims. SB4, which also covers concerns from the Culinary Union, was signed by Governor Steve Sisolak on August 11 and provides limited liability coverage for companies as long as they are in compliance with mandatory guidelines and controlling health requirements that have been set out by the governorâ&#x20AC;&#x2122;s office or CDC. â&#x20AC;˘ AGEM members were informed at the August meeting that Las Vegas-based attorney Ogonna Brown has been appointed to the Nevada Gaming Commission by Governor Steve Sisolak following the recent resignation of Tony Alamo. Brown brings close to 20 years of legal experience to her role, primarily in the areas of complex business litigation and bankruptcy focusing on creditorsâ&#x20AC;&#x2122; rights. Also, longtime Nevada Gaming Commissioner John Moran Jr. has been named chairman of the commission. He has been serving as acting chairman since the resignation of Alamo in April. â&#x20AC;˘ AGEMâ&#x20AC;&#x2122;s Mexico Committee has been working closely with regulatory agency SEGOB and other industry partners to defeat a proposed â&#x20AC;&#x153;NOM,â&#x20AC;? or federal rule, that would force an additional level of certifications for gaming machines coming into the country. However, despite these efforts, the Ministry of the Economy that is overseeing the proposed changes announced plans at a recent working group meeting to push ahead. A new draft document was presented, proposing, among other things, that every game should be recertified annually that would be highly costly and open to potential issues in collecting fees. The existing certification process has worked well for many years and so AGEM is now asking the independent testing labs to join in speaking out against unnecessary new regulations. â&#x20AC;˘ The Michigan Gaming Control Board (MGCB) recently began the rule-making process for online and sports betting in Michigan. The AGEM Compliance Committee has provided comments that were included in published draft rules and these have now been posted in a Regulatory Impact Statement that had to be submitted by August 15. AGEM plans to take part in the next stage of hearings that are due to commence in September. â&#x20AC;˘ Nevada Industry Excellence (NIE) continues to provide its much-needed resource in supporting gaming employees who have been laid off to find new employment in other industries through its website www.NevadaWorksTogether.com. The NIE has been working hard to obtain federal funding for vital retraining programs and this initiative has been achieved and will go live on August 31. The National Associ ation of Manufacturers (NAM), of which AGEM is a member, has also launched an important resource that runs at a national level at www.TheManufacturingInstitute.org. â&#x20AC;˘ AGEM welcomed KPMG LLP as a new Associate member at the August meeting. The company pro vides audit, tax and advisory services occupying a meaningful space in the gaming industry, representing a large number of operators and many major gaming suppliers. This brings the total number of AGEM members globally to 183 companies.

Forthcoming Events â&#x20AC;˘ Nominations for the AGEM Memorial Awards honoring Jens Halle and Peter Mead concluded on August 15. The winners are usually announced at G2E, but due to the event being canceled this year the winners will be revealed in October at a time to be announced.

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The AGEM Index increased by 13.55 points in July 2020 to 420.86 points, a 3.3 percent gain from June 2020. Six of the 13 AGEM Index companies reported stock price increases amid the ongoing global economic impacts due to the COVID-19 pandemic. The stock price for Aristocrat Leisure Limited (ASX: ALL) increased by 2.7 percent, account ing for a 12.43-point improvement in the AGEM Index, while Games Corporation a Scientific (SGMS) experienced stock jump that led contribution points. three major 13.7 percent price to an index of 3.79 All U.S. stock indices in creased as the Dow Jones Industrial Average grew by 2.4 percent and the S&P 500 grew by 5.5 percent. Meanwhile, compared the NASDAQ grew by 6.8 percent to June 2020.

SEPTEMBER 2020 www.ggbmagazine.com

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A Sporting Chance Can gaming bridge the esports gap and harness the revenue opportunity? By John English and Kit Szybala

sports has grabbed the attention of more than just the gaming industry, and for good reason. The industry’s rapid rise has benefited from numerous omnichannel platforms that allow for unprecedented viewership and engagement from a diverse audience. With the “new abnormal” defined by Covid-19, esports has proven that media consumption is not just about what people can watch on the major networks. Instead, people are turning to streaming platforms like Twitch and YouTube for competitive-based content. Today, more than 1.5 billion people are aware of esports, while approximately 500 million people make up its audience. By 2023, this figure is expected to grow to more than 650 million. In terms of viewership, major esports events are gaining ground against professional sporting events produced by the NBA, NHL, Formula 1, NASCAR and NFL. Starting in March, esports gained the attention of these leagues (which were largely shut down for months) and numerous others as it consistently gained new followers and partnerships despite the pandemic. Esports encompasses organized video game-based competitions. Players can compete via several platforms, but the PC remains the preferred choice of hardcore gamers. PCs utilized by these players rely on multiple processors and robust graphic capabilities. Hardware companies like Alienware and DWave continue to focus on this area of investment to provide these players with high-level products. Alternatively, consoles such as Sony’s PlayStation products, Microsoft’s Xbox, and Nintendo’s products offer simple, yet advanced platforms for gaming. These consoles are inclusive of almost everything needed for advanced gaming, including items and add-ons such as virtual reality headsets and haptic controllers. Players also can participate via mobile gaming applications including 14

Global Gaming Business SEPTEMBER 2020

those offered by Google and Apple. While this is the fastest-growing segment for the casual gamer base, it’s still limited in terms of screen real estate, processing power and controls. Regardless, it provides one-device access to entertainment on the go and has proven to be popular for certain games such as “Call of Duty: Mobile” and “Mobile Legends.” With streaming applications like AirPlay and SmartCast, players are also given the ability to play and consume content via their phone and TV. This has further enhanced the gaming experience and engaged the player base.

Viewership Platforms and Growth People of all backgrounds enjoy having on-demand access to watch professional gamers compete. This audience is wide-ranging and includes casual fans, enthusiasts and professionals. Video streaming, which continues to grow in popularity and is the main way enthusiasts view their favorite games and events, is provided by two primary sources: Twitch and YouTube. Platforms such as Twitch (Amazon) have as many as 1.4 million daily active viewers. According to TwitchTracker, more than 650 billion minutes of content was streamed in 2019, with more than 55,000 live streaming channels available to viewers at any time. This included an av-

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erage of 13,000 games streamed weekly. So far in 2020, more than 590 billion minutes of content has been streamed, representing 54 percent growth over this time last year. A sporting opportunity like this hasn’t presented itself to the world in quite some time, and this time it’s not limited to a specific game. Instead, esports covers multiple games and genres that rely on diverse skill sets, allowing the industry to continuously evolve and grow. Esports genres include multi-player online battle arena, first-person shooter, card game battle, role-playing, battle royale, real-time strategy, turn-based strategy and sports. Today, “League of Legends,” “Just Chatting,” “Fortnite,” “Grand Theft Auto V” and “Call of Duty: Modern Warfare” are some of the biggest game titles in esports in terms of viewership, but these names continuously shift as new games are developed and existing games adapt.

As a result, the world has seen a rise of esports leagues focused on specific games. Some of the more prominent and established leagues include the LPL (League of Legends Pro League), LEC (League of Legends European Championship), LCS (League of Legends Championship Series), OWL (Overwatch League) and KPL (King Pro League). As more leagues become established, more opportunities arise for sponsorships and live event hosting. Additionally, these leagues continuously add to a new era of celebrity athletes that include names like Faker (League of Legends), Rookie (League of Legends) Xyp9x (CSGO), MatumbaMan (DOTA 2) and Gesture (Overwatch), all of whom are bringing in impressive earnings, are represented by agents, and have mass followings and enormous influencing power. Additionally, esports has begun to offer amateur-level opportunities to players, including scholarships to colleges and universities. Ohio State was one of the latest Power 5 conference schools to embrace esports by creating a program comprised of a number of initiatives across academics, research and student engagement, including the operation of a select number of esports teams that compete against other universities. Additionally, until it was postponed, Intel was planning to host the Intel World Open (sanctioned by the International Olympic Committee) ahead of the Olympic Games in Tokyo. We may soon see an NBA-style bubble created for esports athletes, allowing for arena events to occur again. Regardless, these competitors are able to play remotely, and fans are accustomed to viewing these events remotely as well.

yielded spectacular results. Most pundits agree that the increase in viewership and engagement is in its infancy, and that the market is a long way away from saturation. The following graphic produced by Newzoo illustrates the rapid audience growth the market is expected to experience through 2023.

ESPORTS AUDIENCE GROWTH GLOBAL | FOR 2018, 2019, 2020, 2023

The esports market is well established in North America, China, Japan and throughout Europe. According to Newzoo, as a result of its prevalence in these major markets, global esports revenue reached nearly $1.1 billion in 2019 and is expected to reach upwards of $1.5 billion in 2020 and nearly $2.6 billion in 2023. It’s estimated that approximately 40 percent of this revenue was driven by North American patrons alone, with most of that revenue generated through sponsorships. However, esports provide multiple options for investors seeking brand exposure, as well as other opportunities for the gaming industry specifically, namely wagering. Industry stakeholders benefit from a diverse array of revenue streams, including media rights, sponsorships, branding, content licensing, game publisher fees, ticket sales, merchandising, entry fees, arcade time, viewership, advertising, in-game purchasing and digital economies. As a result, there’s been no shortage of partnerships and acquisitions in the space so far, with Tencent (the world’s largest video game company) detailing a $15 billion esports-centric investment plan for the next five years. The following graphic displays the diversity of the revenue streams associated with esports. In 2019, Newzoo estimated that the industry grew by 26.7 percent year over year, with the largest portions of revenue stemming from sponsorship and media rights (which saw 34.3 percent and 41.8 percent year-over-year growth, respectively).

2019 ESPORTS REVENUE STREAMS|GLOBAL INCLUDING YEAR-ON-YEAR GROWTH

Generating Revenue Streams Stakeholders in the esports industry garner a massive amount of revenue through multiple avenues. So far, various industries have realized the potential value of this massive audience. Branding, advertising, marketing and sponsorships have largely benefited from this growing audience and have SEPTEMBER 2020 www.ggbmagazine.com

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Several publishers and studios focus on financing the design, development, marketing and distribution of video game content, with a desire to capture large segments of this growing market. Well-known publishers with mass distribution include Tencent, Sony, Electronic Arts, Microsoft, Capcom, Sega, Konami, Activision Blizzard, Bandai Namco and Ubisoft. But the revenue opportunity isn’t limited to these developers. In fact, the industry’s revenue has flowed to a wide variety of parties, including but not limited to game publishers, design studios, in-game purchases, broadcast viewership, streaming platforms, team ownership, wagering platforms, regulation and testing labs, cybersecurity, hardware and video, data feed providers, advertising/sponsoring/ branding, tournament/events/venues, professional esports athletes, coaching staffs, education/scholarships, merchandising, influencers/marketing and unification/sanctioning. So far, investors in the space have included groups like venture capital firms, traditional sports leagues, corporate investors, influencers/affluent celebrity investors, media and broadcast companies, telecoms, individual investors/friends and family investors, casino and gaming operators and IPO/ICO offerings. These groups have included major companies, entities, and individual investors like Disney, Microsoft, Apple, Tencent, Red Bull, the New York Yankees, Mark Cuban, Coca-Cola, Intel, IBM, Verizon, Rick Fox, Drake, Imagine Dragons, Adidas, Monster, Jerry Jones, the Philadelphia 76ers and even city municipalities.

Regulated Gaming’s Opportunity Esports presents the largest new wagering opportunity for the gaming industry, with a wide variety of new bets that can be offered for the numerous leagues, games and events. Wagering on esports is the same as it is for any other sport. Data feeds from multiple suppliers provide fixed odds-style money lines or betting on the spread. Wagers can be placed on the same types of bets, including win, lose, or tie, over/under, propositions, parlays and in-game wagering options. Algorithms and artificial intelligence can play a large role in the bookmaking back office, with an appropriate amount of human oversight, providing operators with an opportunity to reduce risk and improve their revenue. Additionally, the parimutuel avenue (or the rake model) is a good alternative option for wagering. Regardless, liquidity will be required to succeed in esports wagering, much like with poker or horse racing. Game titles that focus on sports, such as “Madden,” “NBA 2K” and “NHL,” as well as first-person shooter/battle royale games like “Call of Duty,” “CSGO,” “Apex Legends” and “Fortnite” are somewhat easier to book and have mass appeal. The wagering opportunities for some of these big titles and others, including “DOTA” and “League of Legends,” is immense. Currently, there are Twitch integrations directly on in-game betting sites in regulated jurisdictions around the world, offering the convenience of viewing and betting on the same screen, which has improved the overall in-game wagering experience. As the global market continues to evolve, certain jurisdictions, particularly in Europe, have begun to figure out how to regulate and monetize the market from both an event and wagering perspective. There was a slow acceptance of esports wagering globally prior to Covid-19, but now it seems to be gaining, or at least maintaining well, in all areas of the online sector. The lull was largely due to illegal underground betting and peer-to-peer wagering that occurs worldwide, as well as issues regarding the integrity of games and players, as is experienced with most sports. There are a number of issues that must be combated with proper regulation for the full wagering opportunity to be realized, including publisher cooperation (as they create and usually own the game content). 16

Global Gaming Business SEPTEMBER 2020

Other issues include items such as skin gaming, loot boxes, hacking/software manipulation (bots/rats/deep fakes), lab testing and timeframes, virtual referees, playbacks and reporting (AML, IRS, etc.), official league sanctioning such as ESL (Electronic Sports League) with competent regulatory infrastructure, doping/cash fixing, quantum computing/blockchain, payment processing and cryptocurrency. Responsible gaming and other addiction issues are a concern for publishers, operators, regulators and other interested parties. They should be aware of their consumers’ habits, offer protections and monitor for irregular patterns when designing or allowing wagering on their content. In the U.S., regulations surrounding esports wagering are being put into place, with select markets now allowing legal esports betting. This regulatory process has accelerated during Covid-19. But this initially started in states like Nevada during the 2017 legislative session, when “Other Events” were added to the regulatory makeup in the state. This bill was sponsored by then State Senator Becky Harris, who later became the first chairwoman of the Nevada Gaming Control Board. It’s since been adopted by other states including New Jersey, Indiana and Colorado. Globally, legal esports wagers are accepted in numerous jurisdictions. From a wagering perspective, for this market to grow at an exponential rate (as has been experienced with traditional sports leagues), all stakeholders need to come together to establish a broader sense of oversight, overarching regulations and internal controls which is a common theme among existing gaming regulators. Money is growing and flowing in many different areas of the market. It offers exciting new options for entertainment. The statistics clearly show the rapid growth of the market, the big names that are involved and the high probability of continued growth for the future. Within the coming years, it will be vital for large brands to find ways to tap into this lucrative market and become a part of the entertainment experience that this large pool of consumers enjoys. For the gaming industry, there are options to get involved in the market through the sponsorship of teams and tournaments, buying a team partner with influencers in the industry to have them promote brands and review products, investing in data and artificial intelligence or finding ways to capitalize on the growing wagering opportunity. Regardless of the opportunity pursued, it’s time for the gaming industry to take advantage of this multibillion-dollar wave of opportunity. Kit L. Szybala is a partner and the executive director of operations at Global Market Advisors (GMA). John English is a partner and managing director of sports betting and technology at GMA.

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Diversity & Inclusion: A Little Less Talk, A Little More Action

Global Gaming Business SEPTEMBER 2020

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Despite widespread efforts at maintaining a diverse workforce in the gaming industry, systemic discrimination is still a challenge By Marjorie Preston

casino manager looking to advance her career was happy to find a workplace mentor, until the mentor made advances of his own. When she spurned his overtures, he was no longer interested in a professional relationship. That woman, speaking to GGB on condition of anonymity, listed numerous episodes of what she calls “systemic discrimination” in an industry that ostensibly makes a guiding principle of equality. “I’ve watched less qualified men get professional opportunities over women, seen women castigated in meetings for raising a contrary point when men are rewarded for doing the same, and even had male colleagues make personally insulting remarks about me under the guise of humor,” she says. “I’ve heard them make disparaging remarks about female coworkers’ age, dress, demeanor and competency.” A second woman, also speaking anonymously, expressed her impatience with “manels,” or conference panels made up mostly of men. “It can be a panel of really fantastic speakers, but the visual alone demonstrates the lack of diversity. More than once, I’ve been asked to sit on a panel because I’m a woman. That’s great, but it’s not what qualifies me. It’s my expertise in the area.” When women do hold visible roles, says a third woman, many times they’re relegated to “pink-collar” roles in human resources or marketing or added to high-profile boards, then held up as proof of an egalitarian culture. “Executives can check off the equality box, while perpetuating the myth that there are only a handful of qualified women and there’s no need to look beyond them. “It’s as if the male executives say, ‘We need a woman in this role. Who does so-and-so have as ‘their woman?’ Get her.” Inequality in the workplace is an old story, in and out of gaming. According to these women, it’s not history. Yet.

Why D&I? Most corporations today have diversity and inclusion initiatives, which even have earned their own pithy acronym: D&I. But the women above say many organizations remain stubbornly resistant to women in leadership. “Look at the websites of gaming company management teams,” says one. “The pictures tell a thousand words”—in other words, they are clearly tipped in favor of men.

Jan Jones Blackhurst, longtime executive vice president for government relations and corporate responsibility for Caesars Entertainment and a former mayor of Las Vegas, says diversity isn’t about kindness, fairness or even, in fact, diversity itself. It’s about building strong, resilient, responsive, successful corporations. “If you want the highest and best performing companies, you need diverse viewpoints; you simply do,” she says. “When everybody is looking for solutions to problems through the same lens, you’ll get the same answers over and over.” According to a study cited in 2019 by the Harvard Business Review, women “add to the diversity of life experiences among a top management team’s members,” and therefore may offer “additional insight into important strategic questions, especially those that relate to female consumers, employees and trading partners.” The study added that gender diversity leads to increased productiveness only in cultures where such diversity is “normatively” accepted, or considered important. Other studies come out unequivocally on the side of D&I. Recent research from the Boston Consulting Group found that “increasing the diversity of leadership teams leads to more and better innovation and improved financial performance.” Looking at 1,700 companies in eight countries, the group found that companies with more diverse management teams had 19 percent higher revenue, due to innovation. According to Forbes, the researchers said “the CEO’s vision coupled with policies such as equal pay (and) a culture of openness and inclusion help companies create a diverse and well-rounded environment.”

“When everybody is looking for solutions to problems through the same lens, you’ll get the same answers, over and over.” —Jan Jones Blackhurst, Executive Vice President for Government Relations and Corporate Responsibility, Caesars Entertainment

SEPTEMBER 2020 www.ggbmagazine.com

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“Employees have an expectation that people who look like them hold critical positions in a company. When they don’t see that, a lot of organizations are seeing their black talent saying, ‘Gotta go, see ya.’” —Rose McKinney-James, Member, Board of Directors, MGM Resorts International

‘Admiring the Problem’ It’s the rare systemic flaw that is solved quickly, especially in a bureaucracy. Invariably, a lot of time is spent defining the problem, agreeing it’s a problem, and then lamenting the problem: “Yes, it’s regrettable that we don’t have more (fill-in-the-blanks: minorities, women, LGBTQ people)—in the executive ranks.” That initial recognition is often followed by exploratory committees and initiatives that are touted far and wide in news releases. Maybe a feelgood slogan is attached, and the principles are added to a list of corporate commitments. But if nothing happens beyond that, the company has simply “admired the problem,” equating talk to action, and analysis to implementation. Blackhurst says true and lasting change takes follow-through, “a strategy that puts measurable targets against a proclaimed goal. Because what isn’t measured won’t matter.” In 2017, Caesars Entertainment announced its “50/50 by 2025” program, pledging that, by that year, half of leadership roles would be held by women. At the time, Blackhurst said, “We’re the best operator, the most in touch. If anyone can do it, it’s us.” With Caesars now merged with Eldorado Resorts, creating the world’s largest gaming company, that outcome could be industry-changing. Blackhurst said the company chose management consulting firm McKinsey and Co. to run its program, “because they speak corporate,” and could make the case that hiring and promoting more women is just good business. According to McKinsey and LeanIn.org, from 2015 to 2019 more women rose to the top levels of companies—particularly in the C-suite, where their numbers increased from 17 percent to 21 percent. “Although this is a step in the right direction, parity remains out of reach,” the report stated. “Women—and particularly women of color—are underrepresented at every level.” The study said women can rise to a certain level, but then are impeded by a “broken rung,” typically at the managerial level. “For every 100 men promoted and hired to manager, only 72 women are promoted and hired. This broken rung results in more women getting stuck at the entry level, and fewer women

Global Gaming Business SEPTEMBER 2020

becoming managers. Not surprisingly, men end up holding 62 percent of manager-level positions, while women hold just 38 percent.” “That’s the game they play,” says Blackhurst. “As women start moving up, those (promotions) fall off precipitously.”

Hidden Talents In a 2017 study, four Harvard researchers determined there have been few great strides in hiring equity in the years since 1990. Looking at 54,000 job applications submitted over a 25-year-plus period, they observed “significantly greater callbacks” for white applicants over black and Latino applicants with identical resumes. “Without callbacks for interviews, these black and Latino candidates don’t get a chance to introduce themselves, share their education and experience or describe their potential contributions,” the study said. “The door of opportunity never opened for them.” The study further stated that most white Americans “remain convinced that race is no longer central to one’s opportunities in life,” and believe instances of discrimination “represent the actions of a few bad apples and aren’t in sync with the larger trend toward systemic racial equality.” Such unconscious bias is not necessarily malevolent, but, as researchers indicated, “When hiring, you tend to hire yourself.” One of the most famous examples of unconscious bias was seen in the orchestral field, where for many years women musicians were almost non-existent. Then some orchestras started “blind” auditions, in which auditioning musicians were separated from the selection committee by screens. As a result, the percentage of female musicians in the five highest-ranked U.S. orchestras

“If you and I are running a race, I’ve got to run faster or I’ll never catch you. It’s not your fault that you’re ahead. That’s history. But we’ll never catch up if we keep running at the same pace.” —Ondra Berry, Adjutant General, State of Nevada

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rose from just 6 percent in 1970 to 21 percent in 1993. Rose McKinney-James, a board member at MGM Resorts International, is chairwoman of the firm’s Corporate Social Responsibility Committee. She finds it “maddening” when gaming executives say they can’t find qualified applicants for upper-tier jobs among women and minority groups. “My answer to that is, ‘You’re not looking hard enough.’ “You have to take steps to make sure you reflect your customer base and the communities where you conduct business, and be actively engaged and invested in both the people and the economic empowerment that goes along with a diversity platform,” says McKinney-James, who also originated the diversity program at Mandalay Bay, and was a pioneer in expanding gaming in Mississippi, which went the extra mile to identify qualified job candidates in that area. “The first thing we did was establish relationships with leadership on the ground, connecting with state legislators and historically active civil rights and civic organizations. We were committed to including people from the community, not just importing talent, but bringing in jobs and growing together.” McKinney-James says she may been viewed as a “twofer,” a black woman in a high-profile leadership role who, in effect, checks two diversity boxes at once. “It’s not the way you want to be perceived,” she says. “It immediately questions your qualifications and your ability to contribute at the same level as your contemporaries. I recognize I’m part of a very small cohort of black corporate directors across the country. Those numbers aren’t what they should be.”

ing, ‘Gotta go, see ya.’ It used to be folks would suffer through, swallow hard and stay on. I’m now seeing a trend where they shrug their shoulders and say, ‘I’ll find it someplace else.’ “Let us not forget that the level of external pressure has increased ex-

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The Discomfort Zone MGM has pledged to hire and promote across the spectrum—women, minorities, people with disabilities, LGBTQ, veterans. McKinneyJames says it’s more important than ever that multiple populations be represented, or talented professionals may look elsewhere for opportunity. “Employees have an expectation that people who look like them are holding critical positions” in a company, McKinney-James says. “It’s crucial to creating a sense of belonging and opportunity. When they don’t see that, a lot of organizations are seeing their black talent say-

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‘Paying It Forward’ Melonie Johnson President, Borgata Hotel Casino & Spa, Atlantic City

n June, Melonie Johnson was appointed president of the Borgata Hotel Casino & Spa in Atlantic City, following more than two years as president and chief operating officer at MGM National Harbor. With her arrival in Atlantic City, Johnson made history in more ways than one—not only as the first black woman to run a casino in the shore resort, but as the first Borgata president to grapple with the extraordinary challenges of a four-month shutdown and partial reopening. Johnson broke into gaming in 1993, when she was hired as an accounting manager at Harrah’s in her home state of Louisiana. She rose to become director of finance. She has also worked for Penn National Gaming, and her career has taken her all around the U.S., including Illinois, West Virginia, Mississippi and Maryland. Johnson has said she had no “playbook” to guide her ascent in gaming. But she’s certainly helping to write the playbook for future generations. She spoke with GGB Publisher Roger Gros in August. Here are some excerpts from that interview: GGB: Your success speaks to the success of efforts to bring diversity to the executive ranks. Is there still a lot of disparity to be addressed? Melonie Johnson: There are opportunities on both sides, but it’s still a work in progress. It’s

everyone’s responsibility in management. It’s mine. It’s my job to develop young talent. It’s my job to recruit individuals who are female and African American. Has the company done a good job? Yes. But there’s always room for improvement. Why is it so important to have diversity in upper management and the C-suite?

Upper management teams should reflect the workforce. You want to look at leadership and see people who look like you, who understand your culture, your thoughts and your vision. By looking at them, you know you have an opportunity to be promoted to that level. Do you see yourself as a role model, not just for women and minorities, but for anyone in the rank and file who aspires to a leadership role?

I’m going to say mentor-slash-role model. I mentor quite a lot of people—not just women, not just black people. When I think about my legacy, I don’t want to be remembered for personal accomplishments. I want to be remembered for getting upand-coming talent to the next level. But I do have an ask for them. I ask them to do it for someone else. That’s the gift that keeps on giving. Pay it forward.

Global Gaming Business SEPTEMBER 2020

ponentially,” she adds. “The wise and prudent leader is not going to ignore this issue. It’s not going away.” Reggie Burton, former director of communications for MGM and now head of Las Vegas-based RB Group Public Relations, is concerned the Covid-19 outbreak could cause diversity in the workplace to fall out of balance, or even off the radar. Because the lower ranks of employees tend to be the most diverse, they may be more affected by the recent wave of furloughs and layoffs. “We cannot afford to lose any of the progress and the gains we’ve made over the years,” says Burton. He emphasizes that it’s just as important to hire and retain a diverse group of vendors. “A lot of times, it comes down to who you know. If you need a lawyer right now, you’re not going to the Yellow Pages in search of women and minorities.” How do companies expand that vendor pool beyond their usual go-to’s? Burton says, “Intentionality. You have to say, ‘You know what? I need to meet more women and minority attorneys. Where do I go to meet them?’ You need to add to your list of women and minority PR firms, contractors and architects. You need to be intentional.” Ondra Berry, former senior vice president of talent and performance for MGM and now major general in charge of the Nevada Army and Air National Guard, agrees. “If I’m responsible for bringing in vendors or contractors and I’m not looking at diversity, that’s a huge miss. I have to look at my partnerships, my philanthropy and my volunteerism.” Creating parity at all levels in the workplace will require some “courageous conversations,” says Berry. How, for instance, would he respond to resistance among groups of people who are perceived to have an edge in the job market, but who also want to advance, and who also may have the right stuff? “If you and I are running a race, I’ve got to run faster or I’ll never catch you,” Berry says. “That’s what affirmative action is all about. It’s not your fault that you’re ahead. That’s history. But we’ll never catch up if we keep running at the same pace. Leaders have to be comfortable talking about those hard issues. You don’t want to be on the wrong side of history on this one.” Blackhurst adds, “It took me a long time to convince some of the up-and-coming white men at Caesars that we were not taking their jobs. We were filling a job. Nobody is trying to change the meritocracy, but the talent pool is much greater than that.”

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“You have to say, ‘I need to meet more women and minority attorneys. Where do I meet them?’ You need to add to your list of women and minority PR firms, contractors and architects. You need to be intentional.” —Reggie Burton, RB Group Public Relations

Making the Grade One of the women who spoke to GGB on condition of anonymity said history will be made when companies “read their own mission statement, commit to the mission statement and live the mission statement. Diversity needs to be more than a public relations topic. It needs to be a real topic with real goals and real accountability for failure.” Another said, “It’s especially annoying when you look at company websites and see their pledges to diversity. Women have to, it seems, walk a tightrope between asserting themselves and risking being considered bitchy and handling unfair treatment with good humor.” McKinney-James sees opportunity in the making. “I don’t think any of us has seen anything so extraordinarily devastating to our employees and to the companies who depend on them” as the current economic and social upheaval. “Companies are being forced to deal with liquidity and survival, which has put so many people out of work. “Ironically, this crisis also presents an opportunity for organizations to rethink their structures. Given the recent events, with the Black Lives Matter conversation, companies are doing more strategic outreach. I don’t think they realized how exposed they’ve been. “It’s far from a silver lining,” she says. “Just call it an interesting opportunity.” Asked how she would grade the gaming industry overall in terms of diversity and inclusion, Blackhurst says, “C-minus.” “We’ve been having this conversation for the last four decades. I’m not saying it’s not hard, but you have to be committed. You have to want this to happen and take steps to make it happen. This problem is fixable, so let’s fix it.”

SEPTEMBER 2020 www.ggbmagazine.com

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The Culture of

BRaND

Whether your brand is disruptive, socially conscious, service-oriented, innovative, value-based, performance-driven, luxury or experiential, it is your company’s unique identity By Julia Carcamo and Meera Rosser

very casino has a company culture and brand. Most take great care to document and support both. Still, a conundrum emerges when leaders, employees, guests and stakeholders are challenged to define the emotional elements that form the foundation and to understand whether or not the culture and brand are aligned. (Hint: they should be tightly aligned, reflecting the emotional connection that tips the scale when a guest decides whether to visit you or your competition.) As we begin to emerge from our home cocoons, friction continues to grow as the basic needs for health and safety are met with the need to return to work and to adapt to a new normal. We find ourselves needing to not only renegotiate but commit to a new way of operating.

Two Peas in a Pod Although inextricably linked, culture and brand should be examined individually, then together, as the dynamic duo that mutually defines your business. Culture refers to what team members believe, how they act, the limitations and license they have and their attitudes about the business, work and contributions. Traditionally, business leaders have captured the culture in mission or values statements, but cultures tend to arise out of the operation, and how leaders unknowingly act and behave. In successful cases, these are the same. Brand refers to how a company is perceived and experienced by stakeholders: guests, team members, vendors and investors. Beyond surface manifestations (logo and advertising), the brand is supported by all the systems and protocols leaders put into place. It’s everything below the surface.

Culture Club Every casino company is facing a culture crisis in the wake of Covid-19. Company mission statements and vision boards may lack the insight and empathy to truly engage team members and deliver on their brand promises.

Global Gaming Business SEPTEMBER 2020

Today, operations have become paramount as companies struggle to pay bills, make payroll and refine policies to meet regulatory and evolving safety requirements. Leadership is challenged to create a safe and entertaining environment for team members and guests, plus keep all constituencies informed of ongoing changes. When we speak of creating a company culture, many operators immediately opt to offer generous team member benefits, including reward programs, work-from-home opportunities, wellness perks and free beer/T-shirt Fridays. People often think of company culture as “what you do” versus defining “who you are.” While offering incentives may generate a thankyou today, it’s similar to giving away free play and hosting promotions. It creates a bottomless pit that yields short-term gains versus long-term profitability. Perks become entitlements, which can easily be copied by your nearest competitor. Who you are becomes dwarfed by what are you offer. But what makes your casino unique? What do your team members believe you stand for, and what do they promote? Answering these questions will reveal your culture and brand-messaging strategies. Despite the influences, circumstances and situations that are beyond our control, casinos today have a prime opportunity to redefine their cultures and brands and help unify team members and guests toward a common purpose. When casinos think and operate in unique ways internally, they can produce the unique identity and image they desire externally. Now more than ever, it’s imperative that casinos have team members who understand and embrace the distinct ways you create value for guests, the points that differentiate your brand from the competition and the unique personality that your company/casino uses to express itself. Most importantly, your team members must be empowered and have the tools necessary to interpret and reinforce these values. To believe in leadership, they must see leaders practicing and embodying the tenets of brand and culture. Through example and belief come emulation. And ultimately, your guests and target customers will accept and support your casino.

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Brand Basics

What makes your casino unique? What do your team members believe you stand for, and what do they promote? All Eyes On Brand and Culture Answering these questions As companies, we spend a great deal of will reveal your culture and time developing our external brands. We research, test and re-test until we brand-messaging strategies. feel everything is perfect. It’s not un-

Many casinos rely on products to define their brands—i.e., most generous slots, best entertainment, most extensive food variety. Great leaders ponder what differentiates their brand, and if the brand indeed relates to the company culture. For example, if a casino’s culture endorses efficiency and productivity internally, yet externally the brand preaches the company’s commitment to guest satisfaction, the conflicting messages are apt to create employee and guest confusion. Team members may be reprimanded for lengthy conversations with guests, which creates long wait times for slot service, ultimately resulting in frustrated guests (versus those who are satisfied). This is but one example of the brand culture conundrum. This type of misalignment has a way of showing up in unexpected places, like your call centers and players’ club booths. Recently, as casinos reopened, comfortable locations and familiar faces (albeit behind masks) brought back guests longing for “normalcy,” and visitation based on the brand promise that was previously reinforced. Yet the pandemic fallout prevails. As casinos operate in businessrecovery mode, each one is fighting for competitive advantage. Generous offers (or buying the business) may propel top-line growth, but we know from experience that it’s not a bottom-line driver. Additionally, “We’re Open” strategies, along with a commitment to cleanliness, will never be brand differentiators. It is the brand that goes beyond image. It is the genuine, authentic personality of your company, which you want guests to believe and trust. Whether your brand is categorized as disruptive, socially conscious, service-oriented, innovative, value-based, performance-driven, luxury or experiential, it is your unique identity. When this brand message is crafted to support the company’s culture, it’s a win-win. Guests and team members share a common understanding of what the company stands for and delivers.

usual for even the smallest regional operator to invest deeply in developing the right logos and taglines. The fact is, you can spend a ton of money developing your external brand and supporting marketing. Still, in today’s connected world, the reflection of what’s going on inside your company is what ends up being your brand story. Today’s internal comings and goings no longer live behind closed doors. While we have been witness to a plethora of corporate wrongdoings in the media, these issues start small, but always online. Posts to sites such as Glassdoor have opened the kimono to company cultures. Ensuring your team members are as connected to your culture and your brand requires that they understand the primary reason your company exists and the part they play in the company’s continued growth.

HR & Marketing: The Modern Power Couple Casino culture-building is traditionally housed in human resources, as it has the prime responsibility for the team members, people processes, procedures and performance. Brand-building has been reserved for marketing departments and agencies, which are primarily responsible for the creation and execution of programs, products and promotions (guests). When the culture and brand unite with shared values and a single vision, the case for integrating internal and external marketing resources becomes apparent. A unique voice that communicates the passion for the culture and brand becomes the perfect match for enlightened casino operators. What if your casino employed a human marketing ambassador, a brand culture creator, or perhaps a culture competency communicator? When Ignite Medical Resorts set out to create a culture to differentiate SEPTEMBER 2020 www.ggbmagazine.com

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A quick look at HR trends shows inspiring titles such as “chief people and change management officer,” “chief hear officer,” “chief collaboration officer” and “SVP of strategy and culture.” It’s not about the title, but the commitment to building and growing a positive culture that will bring long-term benefits.

it in the health care industry, it refocused the human resources function and created the position of chief culture officer. A quick look at HR trends shows inspiring titles such as “chief people and change management officer,” “chief hear officer,” “chief collaboration officer” and “SVP of strategy and culture.” It’s not about the title, but the commitment to building and growing a positive culture that will bring long-term benefits to the company.

Transform Your Culture Here are a few simple things you can do today to start your culture shift: • Refine the vision. Mission and vision statements tend to get lost in the wave to modernize our companies. Often written at the founding of the company, leaders feel these honored statements should not be altered. Conversely, there may have been a bold statement written at a time of industry change. For these statements to add value, they must be reviewed and sometimes rewritten to serve the current environment. • Ask team members what they think of the culture and brand. A simple first word that comes to mind will be enlightening. Ensure you get input from the front-line team members up to the highest leadership. Don’t forget non-guest contact positions. Pay particular attention to supervisors. They support the day-to-day relationship with many team members; therefore, their thoughts and actions can carry enormous weight. • Work together to find where your desired and deliverable culture intersects with your desired brand and then lean into it. • Reward/recognize culture in action.

Leadership Commitment Cultural shifts require top-down reinforcement, not just approval of a memo. And middle managers can carry even more weight than the CEO. Understand who the unsung leaders are in your organization. To integrate your brand and culture, start by clearly identifying and articulating your casino’s brand aspirations. Do you want to be known for delivering superior performance and dependability? Or is your intent to challenge the existing way of doing things and position your brand as an

Global Gaming Business SEPTEMBER 2020

innovator? Perhaps your brand is about making a positive social or environmental impact. Once you know the brand you’re aiming for, identify the values that your organization embraces. In the case of a performance brand, you might work on cultivating a culture of achievement, excellence and consistency inside your organization. A strong sense of purpose, commitment and shared values is critical for a socially or environmentally responsible brand. When you have clarity on the values that support your desired brand, you can use it to educate and inspire other cultural efforts, including leadership development, policies, procedures and employee experiences. How you operate on the inside must be inextricably linked to how you want to be perceived on the outside. When your casino leadership mandates that everyone walks the walk, talks the talk, and, most importantly, believes in the culture and the brand, a unified workforce evolves. This unity will solve the conundrum, generate team trust, create employee and customer longevity and aspire profits from the inside out. Culture-building is a powerful antidote to the unprecedented threats most organizations face today, especially as the pandemic persists. As the stakes for operating any casino rise, a clearly articulated company culture becomes critical to the operation. Cultivating talent and reinforcing the brand are competitive advantages; casinos need to pivot from traditional models. Rejecting common culture myths and deliberately defining a culture that aligns with your brand, both internally and externally, is the key to preparing your organization for what lies ahead. Julia Carcamo is president and chief brand strategist at J Carcamo & Associates. She writes on a variety of casino and general marketing topics, including the new book “Reel Marketing,” and established the Casino Marketing Boot Camp. Reach her at Julia@jcarcamoassociates.com. Meera Rosser is a casino marketing veteran committed to creating cultures, building brands and establishing service standards and communications solutions to enhance the guest and employee experience. Reach her at meerarosser@gmail.com.

Strength in Numbers

More than 170 member companies from 22 countries Nearly $21 billion in direct revenue • 61,700 employees 13 publicly traded companies • ONE POWERFUL VOICE Address worldwide industry regulatory and legislative issues • Discounts on major trade show booth space Promote responsible gaming initiatives • Updates from influential global industry leaders Advertising discounts in leading industry publications • Educational partnerships benefiting students and members Visibility in AGEM’s print advertisements • Exposure for publicly traded companies in the monthly AGEM Index Join AGEM today and work together with the world’s leading gaming suppliers. Marcus Prater, Executive Director +1 702 812 6932 • marcus.prater@agem.org Tracy Cohen, Director of Europe + 44 (0) 7970 833 543 • tracy.cohen@agem-europe.com Connie Jones, Director of Responsible Gaming +1 702 528 4374 • connie.jones@agem.org Design & photo-illustration by Jeff Farrell.com • AGEM and charter ESP member since 2007.

AGEM.org

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MAKING MY POINT

Wasteland or Opportunity? When you see a place where no competition looms, it could be the right place after all

epending on how you read it, Wee Willie Keeler, a turn-of-the-century—no, the century before that—baseball player had the worst nickname in the history of sports. Wee Willie Keeler or Wee-Willie Keeler? There’s a difference. But he also had the hands-down, all-time best explanation for why he was so good at what he was so good at. When a beat reporter in 1894 asked the 5-foot-4-inch outfielder the secret of his success—success quantified that year alone with a .371 average, 22 triples and 94 RBI—the biggest little man in the history of the game summed it up like this: “I hit ‘em where they ain’t.” Duh. Now why didn’t anyone else think of that? Don’t try to hit ‘em through ‘em; rather, hit ‘em over and around ‘em. Same could be said for hockey or soccer, where strikers or skaters may rip a shot with all the force they can muster, but it hits the goalie right in the chest and falls harmlessly back into play. What’s the point? Finding the openings, you see. That’s the key: a grounder between short and third, a penalty kick headed for the top corner, the backhander through the five-hole, a progressive jackpot for baccarat, a scoreboard for craps, a progressive for poker rooms. Wait. What? That’s right. In our world, the world of table games, these segments are as greenfield as the drag-bunt, no-man’s land between the pitcher’s mound and where the second baseman plays. And you’d best believe, with the content clogging up the rest of the pits, fertile turf like this is about to be seeded and sown. Here’s a rundown of the crops coming your way: Crapping In. There’s an old saw about two salesmen trying to peddle their shoes in some faraway land. The first one comes back and tells the boss that nobody wears shoes over there, so there’s no market. The other one tells the boss that no one wears shoes over there, so there’s an unlimited market.

By Roger Snow

this: Royal 9 assigns different card combinations to each seat, while FDL uses the actual seat number to determine which player wins the jackpot. With casinos looking to increase yields (baccarat is a notorious low-holding game), you can expect to see more of those products mentioned above, as well as more new content hitting the market. Hmmm. That sounds like a teaser. Something having to do with a bet that’s already on the table, perhaps? Relax. All good things to those who wait. Poker Room Progressive. Sometimes, it’s just in the cards. Brick-and-mortar casinos are being forced to limit occupancy on their poker tables, in many cases dealing them three- and fourhanded. Well, by an amazing stroke of fate, the most popular form of poker online is a three-handed sit-and-go Finding the openings, you see. tournament that has—wait for That’s the key: a grounder between it—a random prize pool. Here’s short and third, a penalty kick headed the skinny: for the top corner, the backhander Let’s say three players buy in through the five-hole, a progressive for $25 each. Instead of the jackpot for baccarat, a scoreboard for winner collecting $75, which would be a free-odds tournacraps, a progressive for poker rooms. ment, or $70, which would give the casino a decent cut, he or she could walk with ther means the potential for such products is either $100. Or $500. Or $1,000. Or a progressive jacknon-existent or near-infinite. Just depends on your pot of $248,862.29. point of view. Of course, the player could also take home Baccarat Crystal Ball. Of the 14,000 baccarat $50 or $60. That’s the random side of it. You tables in the world, about 200 have progressives. plunk down your entry fee and some RNG—digiThe two most successful titles—remember, we’re tal or analog—determines the prize pool. Imagine. grading on a curve—are Royal 9 and EZ Baccarat What would it feel like to be able to win 100 times Progressive. And this is not a new endeavor: several your buy-in and only have to beat two other playcompanies, and at least one operator, have tried ers to get it, in a tournament that takes maybe over the years to get a progressive to stick with eight or nine minutes? players, but it just hasn’t panned out. Well, you’re going to find out soon enough. One problem with progressives on baccarat is This version of tournament poker was made for what’s known, at least for the last three seconds, as the post-Covid world, and it should have appeal to the bingo effect. You know what happens there: the survive post-post-Covid. caller yells out “B11” and half the crowd yells “Bingo!,” raising their arms and knocking over Roger Snow is a senior vice president with Scientific their trove of trolls in the process. Then the pot Games. The views and opinions expressed in this gets whacked up nine ways and by the time you tip article are those of the author and do not necessarily the runner, you have enough left over to buy a cup reflect the views and opinions of Scientific Games of hot water. Corporation or its affiliates. Royal 9 (along with Fu Dao Le) gets around Same deal with craps. There are maybe 1,000 tables around the world, mostly in the U.S., and not a single one of them has a progressive jackpot, something that’s on a quarter of all casino card games. The same amount—nix, zip, diddly, bupkis—have a historical trend board, which makes craps the only common-outcome game (e.g., roulette, baccarat, sic bo) that doesn’t post past results. Seems like it would be fun to play a craps game and see what numbers are hot (or not), to see what the longest roll of the day has been. Maybe the hardways are hopping and the hop bets are hard... or vice versa. Wrap this into a progressive, and it seems you’d have a winner. So, like our two shoe salesmen above, that ei-

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Reimagining the Marker Marker Trax offers a timely solution for cashless wagering, while bringing the marker to the slot floor in a way that keeps credit money from walking out the door By Frank Legato

redit markers have always been one of the most important tools in a casino’s money-making arsenal. Operators have always known that the longer players play, the more likely the inherent house edge will convert those wagers into house win. Casinos issue markers to keep their best players in the game, and players appreciate the convenience and security involved in getting credit approved and chips issued without leaving a table. Markers, though, have always carried an inherent risk—that of players simply cashing in markers and walking out the door, the money never used for its intended purpose of funding wagers on the casino floor. Gary Ellis, owner of Ellis Island Casino, Hotel & Brewery in Las Vegas, was quite familiar with the problem. “I was sitting in our casino one day, and we had a customer who (got a marker), drew that line of credit from the cage, and walked out the door,”

Global Gaming Business SEPTEMBER 2020

Ellis recalls. “Of course, that’s not what a marker is intended for; they are gaming lines of credit.” The problem also has existed for years on the slot floor, not only in terms of credit lines, but in the cost of marketing to slot players. “Years ago, when promotional checks came along, we were target-marketing in a shotgun approach to customers,” Ellis says. “We’d send out an offer to a ZIP code for $5 or $10. A customer would come in and go to the cage, and we would literally give them a $5 bill or $10 bill, and that customer would hopefully stay in our place and play, and enjoy their time with us. “Fifty percent of those people would walk out the door with the money, and we’d never see them again.” Even with more modern methods like free play that requires the player to run through the promotional wagers, promotional money still walks out the door, he says.

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“Marker Trax takes the risks out of issuing funds. The player can apply through our app or through the casino website, and through a simple three-minute process they can apply for a line of credit.” —Charlie Skinner, Chief Operating Officer, Marker Trax LLC

As it turns out, Ellis found a solution to these problems: He invented a cashless marker system for the slot floor. Conceived and patented by Ellis, the Marker Trax system can approve a slot credit line literally in minutes, after which the player can simply insert a player’s card and tap the credit line to download funds to the credit meter of any slot machine. After play, accounts are adjusted automatically. Winnings go first to pay back the credit line, and a TITO cash-out ticket is dispensed to pay winnings over the credit line—or, if interfaced to a casino management system that employs an electronic wallet, the entire process can be accomplished with a smartphone—customers having to touch nothing but their phones and the actual game. Konami Gaming, Inc. has such a cashless feature, delivered through a combination of its Money Klip cashless wagering and SynkConnect player mobile app—both part of its Synkros casino management system. Konami, in fact, was the first to display Marker Trax, at the 2018 Global Gaming Expo. In July, Marker Trax—produced by a new supplier of the same name, founded by Ellis—debuted at Ellis Island in a field trial hosted by Ellis and Konami. “Marker Trax takes the risks out of issuing funds,” says Charlie Skinner, chief operating officer of Marker Trax LLC. “The player can apply through our app or through the casino website, and through a simple threeminute process they can apply for a line of credit. That line is then input into the Synkros system, and once it is input, the player can download credits at the slot machine and begin gaming. “The whole process, start to finish, takes less than five minutes—which is really efficient and beneficial not just for the casino, but for the player as well.” The system is designed to conquer the problem of players walking out with credit. “When the player hits the cash-out button, if the player has any overage above and beyond his marker balance, it will dispense in the form of a TITO ticket. However, if the player has a surplus on the account and he pulls his card, all of those monies will go to pay back the outstanding balance of the marker, and

then the overage will sit in a depository that we call Surplus Funds, so they can then download again at any time.” Konami worked with Ellis to integrate Marker Trax into the Konami Synkros system. “Gary came to see me back in late 2017 to talk about his patent,” recalls Thomas Jingoli, Konami’s executive vice president and chief operating officer. “Anybody who knows Las Vegas knows that Gary and his wife Cindy are ingrained in the fabric of Las Vegas; there are very few charitable organizations that they are not involved in. He’s been doing business in Vegas since the ’60s, so I was honored he would even talk to us about this. “Tom Soukup, who is our senior VP and chief product officer in systems—I like to refer to him as our ‘mad scientist’—is the brains behind our Synkros casino management system, and he really liked the concept and the technology.” According to Jingoli, Soukup’s team added an interface to Marker Trax into Money Klip, the Synkros cashless wagering portal. “If the player attempts to cash out those credits, Money Klip will pay back the slot credit line, so the player can’t just walk out with the money,” he says. “Similarly, if the player wins a taxable jackpot, Synkros will fund the marker back and then pay the overages to the patron. “The version we have operating right now with Gary is in the process of evolving, but we were really excited to partner with them, and the feedback we’ve gotten so far has been great. We view this as another benefit we can provide to our existing Synkros customers.”

“I think when Covid’s gone, nothing changes. It just continues along this cashless path for many reasons—from labor to the count process, it ends up really making things more efficient.” —Gary Ellis, Owner, Ellis Island Casino, Hotel & Brewery

SEPTEMBER 2020 www.ggbmagazine.com

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“The feedback we’ve gotten so far has been great. We view this as another benefit we can provide to our existing Synkros customers.” —Thomas Jingoli, Executive Vice President and Chief Operating Officer, Konami Gaming

The Cashless Play The fact that Marker Trax is a cashless credit system, of course, makes the timing of the launch particularly good, as more and more casinos seek to minimize cash handling on the floor to fight the spread of the Covid-19 virus and ensure safe operations amid the pandemic. “We had been talking to a lot of operators around the country, and business was really good, pre-Covid,” Skinner says. “When Covid hit, operators around the country started calling us and Tom’s group at Konami and other manufacturers, saying, ‘How do we get cashless? What kind of technology is needed?’ From my perspective, Covid-19 has definitely increased the interest in not only Marker Trax, but other cashless solutions as well.” “Cashless was coming and is coming, and there is no stopping it,” says Ellis. “This (pandemic) propelled our product and others like the Money Klip. I think when Covid’s gone, nothing changes. It just continues along this cashless path for many reasons—from labor to the count process, it ends up really making things more efficient.” Jingoli says Konami had been getting great feedback on the cashless features of the Synkros system before the Covid-19 crisis hit, and post-Covid, those features become even more important. For instance, Synkros and the Money Klip feature employ near-field communications (NFC) to allow players—where regulations permit—to go through the entire process of funding play, and cashing out, using only their smartphones, when delivered through Synkros’ SynkConnect mobile app. “Using NFC, there are several different ways cash can be distributed to the customer,” Jingoli says. “It could be a key fob to the gaming device, it could be a hand-held device, or ultimately it could be your phone, which would download a QR code which would show up on our Synkros casino management system. It’s very similar to the technology you’ve seen with a lot of the restaurants. You would log in through a QR code on the slot machine, and any excess balance could be transferred into your cashless wagering account on your iPhone or Android.” Ellis adds that Marker Trax is system-agnostic; it can interface with the proprietary e-wallet function of any casino management system. “Tom (Jingoli) was the first to recognize the benefits,” he says, “and with his regulatory background (Jingoli was with the New Jersey Division of Gaming Enforcement in the early 1990s), he saw it as having a lot of benefits. So Konami stepped up and built it first.”

Great Start According to Ellis, the field trial at Ellis Island has so far been an unqualified success. “Unsolicited, we’ve had such a tremendous response,” he says. “This 32

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has been tremendously exciting, because people really like it. And it’s kind of obvious why—it works. For the customer experience, the Konami system has just been fantastic. There have been no glitches. Of course, with any technology, you’re always polishing it, but we couldn’t be happier with how it works on the floor.” Jingoli says Konami’s other Synkros customers have returned similar glowing reviews. “The interest has been fantastic, dating all the way back to G2E 2018,” he says, adding that he expects that interest to spike now that the product has been proven on the floor. “That’s the one thing that takes a little bit of time—everybody’s interested, everybody wants it, but everyone wants to see results,” he says. “So, people are going to adopt it now for sure, because we’re starting to get results in. And with the results we’re going to get, this is one of those products that is really going to sell itself.” Skinner says the technology will continually evolve. He says since the Ellis intellectual property covers table game solutions as well as slots, a table game version is being developed. “For the short term, we’re just focused on the slot players and slot floors with casinos, but we anticipate rolling that out in 2021 on table games as well,” he says. Meanwhile, Jingoli says Marker Trax is one of the products sure to accelerate the move toward cashless casino play. “Our Synkros system has been operating with Norwegian Cruise Lines in a totally cashless environment for years, so we have had a lot of interest not only in Marker Trax, but in cashless in general,” he says. “If you think about where we are as an industry and where the country is with the pandemic, it makes so much sense. It seems when the casinos reopened, they weren’t pushing a lot of the technology; they were just letting people come back in and have a good time. But this is going to be something that will keep evolving, for sure. “When you look at restaurants and gas stations, retail outlets, movie theaters, theme parks, even churches, they’ve all gone to cashless options. So, on a casino floor, where cash is the focal point, whether it’s cash or chips, there has to be some kind of migration to at least offer cashless options to customers.” Jingoli likens Marker Trax to what ticket-in/ticket-out systems did for both players and operators. “TITO benefits everyone,” he says. “The customer doesn’t have to worry about coins. For the operator, there’s labor cost savings, and it certainly benefits the manufacturer not having to deal with coin equipment. I look at Marker Trax as that same type of cachet, where it benefits the entire industry. It benefits the players, it benefits the operators, and certainly benefits the manufacturers.”

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LEGAL

Privacy Matters When harvesting biometric or articificial intelligence data, what is the responsibility of the casino? By Anthony Cabot

s new biometric and artificial intelligence technologies migrate into the casino environment, regulators or lawmakers may have to address the privacy rights of patrons. The public increasingly believes their privacy is under attack. A Pew Research study revealed that 79 percent of Americans are concerned about the way that companies and the government (64 percent) are using their data. Further, three-quarters of Americans believe that the data being collected is less secure than it was just five years ago. These fears accrue as technology improves ways in which businesses collect customers’ personal data, including their locations, who they associate with, and their purchasing and other proclivities. Personal data collection has been a staple of casino operations for many years. The value of casino hosts largely depended on the quality of their customer lists. Moreover, casinos have collected personally identifiable information, including name, date of birth, home address, email address, gender, and driver’s license for the casino’s loyalty programs since the 1990s. These efforts, however, are on an opt-in basis where the patron agrees to share the information in exchange for comps or loyalty program benefits. Biometrics and artificial intelligence, however, are rapidly developing technologies that change how business markets to consumers. Biometrics, including facial recognition, allow the casino to identify and collect data from anyone who enters the casino. Artificial intelligence permits the casino to analyze the data for a myriad of purposes, including safety, security, responsible gaming, anti-money laundering, and marketing. Unlike loyalty programs, businesses, which are not subject to existing privacy laws or regulations, can collect, use and store this data without the customer’s permission or knowledge.

The collection and use of data derived from biometrics and the use of AI may have regulatory implications. All regulation is a balance between risk, cost and reward. The government permits casino gaming to achieve public goals such as revenue generation, creating jobs and promoting economic development. Most governments, however, balance these goals against player protection objectives such as assuring the honesty of games, promoting responsible gaming, and preventing underage gambling. Regulators historically have emphasized protecting patron data from exposure to criminals and other third parties that may want to exploit that information for crimes or other unintended purposes. As early as 2010, the Nevada regulators warned casino licensees that failing to secure patron data is a regulatory violation. But, as biometrics and AI become ubiquitous, the public reaction to privacy concerns is more pronounced. The public, including casino patrons, looks at privacy as a fundamental right. While their privacy expectations change in different settings, the overuse of biometrics and AI in the casino setting could have a significant backlash that impacts government goals such as public trust in the integrity of gaming, gaming revenues, job creation and economic development. The use of biometrics and AI in casinos is, however, nuanced. Biometrics and AI fit into the casino industry in five separate categories. A blanket rule covering all five categories would leave to unintended consequences that would frustrate public policy goals. These categories are reviewed below. The first is security, where facial recognition and other tools can identify security threats such as known terrorists or criminals and, when coupled with AI, reveal persons with firearms and other known risks at casino entry points. This protects patron safety, which serves the interest of the players, casinos and the government. When we look at security, the risk is obvious. The

October 1, 2017 mass shooting in Las Vegas showed that things could go wrong, and the consequences are terrible regarding human life and suffering as well as financial impact. In this case, the patrons probably have minimal privacy concerns when the casino is using facial recognition and AI to detect others who may be a threat to their safety. They likely understand that the casinos will surveil them and use all appropriate tools to keep them safe. Virtually any controls on the casinos’ ability to leverage biometrics and AI to secure the lives and safety of guests and employees should be scrutinized. The second is surveillance, which is asset protection, that promotes revenue generation. The argument for the use of biometrics and AI in surveillance also has support. Patrons likely understand that casinos have used personal observation since the earliest casinos and CCTV for decades to protect the games from thieves and cheats. While estimates of casino and tax losses based on theft are scarce, the Association of Certified Fraud Examiners thinks the thievery from an average business is about 5 percent of gross revenue. Whatever the exact number in the casino industry, theft is common, and the consequences are loss of income, employment and capital investment that impact government goals. The third is promoting responsible gaming and attenuating the impacts of problem gaming that supports player protection goals. Two uses should have little controversy, using facial recognition to identify underage players. Facial recognition technology is in place in Europe to assist grocery stores in identifying minors attempting to make alcohol and tobacco purchases at self-serve kiosks by review. Likewise, using facial recognition to identify persons on self-exclusion lists should not be contentious where the patron asks to be self-excluded and provides a verified photograph. Biometrics to enforce persons placed on exclusion lists by family members raises other issues unrelated to the technology. Japan plans to require

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casinos and other gaming venues to use facial recognition to prevent problem gamblers from wagering. Another, perhaps more controversial, use of biometrics would be to enforce time or play restrictions. Here, facial recognition available on every game in conjunction with player tracking systems could track and record all player interactions. If the player exceeds a maximum number of hours or amounts wagered or lost, no new play would be permitted for that period. Governments and casinos also could use biometrics, player tracking systems and artificial intelligence to disclose problem gambling patterns. This could require the casino to intervene and either provide problem gambling information to the player or terminate play. The fourth is for anti-money laundering and other uses promoted for government goals implemented across all businesses. For example, a casino could identify each cash player by facial recognition and track every cash transaction. This would increase the reliability of cash transaction reporting, and introducing AI would increase the ability to detect suspicious activities for reporting purposes. The fifth is to use biometrics and AI to increase gaming revenue through more efficient marketing.

AI would use biometric and other player data to analyze behavior and target the patron with individual incentives designed to increase or prolong play. Here the opt-in customer relinquishes expectations of privacy because they agreed to be part of the marketing program. But what about patrons whose data is collected and used in marketing promotions? Persons using popular search engines are already inundated with targeted marketing based on their internet habits. Is this now an accepted fact of living in the digital age or could it bring a public backlash? Should regulators limit the casinos’ use of anonymous data? For example, should a casino be allowed to track a person using biometrics only long enough to determine if they are a good customer and if they want to opt into a player’s club? Moreover, can the casino use third-party services that compare images of otherwise anonymous players captured at the casino to databases of photos often scrapped from social media to identify the patron by name? Should the casinos be able to use biometric and other data to push offers to targeted patrons at gaming devices that stimulate more gaming? Two other areas worthy of regulatory considerations are protection and ownership of the patron

data. Protection requires consideration of how the data should be securely stored, who can access the data either internally or by unlicensed third parties, when data must be erased, and mandating use of encryption. Ownership issues include what happens to the data on transfers of the casino ownership and whether the casino can sell or license the data to third parties. Finally, a question arises as to whether privacy concerns are even within the purview of gaming regulators. The issue of companies collecting and using personal data extends across all businesses, media and communications and needs to be addressed globally. California, as an example, has a robust privacy law passed in 2018 that allows customers to learn what data companies have collected about them, who they share the data with, and to delete or cease sharing it. This question shifts to whether the casino industry has peculiar characteristics that call out for specialized treatment. Anthony Cabot is one of the premier legal experts in land-based and online gaming. He was named Distinguished Fellow in Gaming Law at UNLV’s William S. Boyd School of Law following a long career with Lewis Roca Rothgerber Christie LLP.

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Thrills & Skills Skill games take the appeal of arcades and add the challenge and chance of winning. They have a built-in demographic of avid fans. By Dave Bontempo

aming has presented loyalty points, real-value coins and its own version of bells and whistles to a generation raised on arcade magic. Graphic enrichment, rewards for driving ability and the thrill of a video character’s midair leaps forge an emotional bond with baby boomers. Then there’s the demographic that followed, when the likes of Frogger, Ms. Pac-Man and several driving games found their way to computers, tablets and television screens. With these games, patrons barely know they’re gambling. They’re just playing around, with the added chance to test their skills, and to win.

Joy of the Jackpot Synergy Blue has been committed to the skill-game concept since the company’s inception in 2013. It started by developing small bonus games with plans for bigger ones to come. Skill games have a built-in demographic: players who once mastered joysticks and the arcade-driven likes of baseball and racing games. “The burgeoning demographic of casino gamblers spans those who grew up playing in arcades to console fans to the first generation of mobile players,” says Synergy Blue CEO Georg Washington. “Today’s gamblers are used to doing more than pushing a button. And while traditional casino games will always have their place on the floor, we have to evolve to remain competitive. “In a chance-based world, players want gaming qualities that are interactive and make them feel like they have some control: the ability to think, make choices and get better at a game over time. These elements not only increase the fun factor, but they add to the very powerful perception that the odds are shifting in favor of the player, which further increases interest and engagement. We believe that bringing the modern gaming experience into gambling is the key to bringing in new gamblers.” Synergy Blue’s Joyride Jackpot is the latest and most advanced representation of what Washington calls “Fun You Can Bet On,” and the emerging 36

Global Gaming Business SEPTEMBER 2020

class of skill-influenced (or interactive) games. Built on the new 2600XL driving cabinet, it creates a next-generation gambling experience by combining the thrill of wagering with video game quality and the engagement levels that today’s players have come to expect. With the latest gaming technology built into its core, the game is designed to enhance player engagement, attract new demographics with familiar arcade-style hardware and increase net revenue by supplementing traditional gambling games with a brand new type of game play—while also providing flexibility for operators through a library of math variants. “Joyride Jackpot is one of my favorites, and it’s been a big hit with operators as well,” Washington says. “We introduced an early demo of it last year

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“In a chance-based world, players want gaming qualities that are interactive and make them feel like they have some control: the ability to think, make choices and get better at a game over time.” —Georg Washington, CEO, Synergy Blue

at G2E and also featured it at ICE 2020, where I’m proud to say it won a Golden Dice Award from European casinos. Our team has put so much effort and expertise into this game. “Each element—from the cabinet hardware to the multiplayer function to the graphics and even the sound effects—is layered with detail to create a truly unique and engaging experience. It’s a wild, thrilling and super-realistic race to the jackpot.” Washington says the game delivers an arcade driving experience players can win money on. “We’ve combined the fun of an arcade with the excitement of Las Vegas to ensure high-quality, interactive and seamless game play while also meeting industry regulations,” he says. “Joyride Jackpot is the latest example of how we accomplish that.” At the beginning of each game, a player chooses the car, the track and a wager. Coins are scattered throughout the racetrack, and every time the player drives over a coin, he’s placing a bet—it’s just like pushing the button on a traditional slot machine. Bonus rounds can earn a higher return depending on the player’s driving skills, or how well he placed in the race. The better the player drives, the higher the potential for winning big in the bonus round. One thing that sets this game apart is the multiplayer function. Players can race solo or with friends through five different courses, each with easy, medium and hard levels. “In multiplayer function, your wagers are still your own,” Washington points out. “You’re not betting against your neighbor, so it’s not tournamentstyle, but more like a traditional multiplayer racing game.” Washington also touts the cabinets. Inspired by the original Atari console and Atari founder Nolan Bushnell himself, the 2600XL arcade driving cabinet comes complete with steering wheel, foot pedals and bucket racing seat. A unique draw for new casino demographics, it’s reinforced with Blue Safe Touch, the company’s patent-pending germ-repelling technology to ensure personal safety. Blue Safe Touch involves patent-pending antimicrobial particles embedded in paint and plastic surfaces, antiviral/antibacterial touch surfaces and UVC air filtration, all of which meet the rigorous standards of the U.S. Environmental Protection Agency, the EU’s Biocidal Products Regulation, the International Organization of Standards and Japanese Industrial Standards. With a variety of cabinet configurations—arcade driver, joystick, buttons and more—the 2600 series is UL/CE/FCC-certified and compatible with in-

dustry standard peripheral devices. The interactive EGMs come in a 40-inch wide-set 2600XL, a 28-inch standard width 2600ST or a bar-top option, the 2600BT. Nostalgic design and unique accent lighting draw both gamers and gamblers, while video content complements the personal experience invoked by the arcade-style cabinet. The 2600 cabinet series is built on the company’s HAWG platform. It supports an entire library of skill and chance-based game titles, which can be easily interchanged, depending on the cabinet style—and even the style can be configured to support different themes and hardware. For instance, the 2600 cabinet series can be configured as a touch screen or with a joystick, buttons or trackball. Depending on peripherals, the XL version can be seamlessly configured to an arcade shooter or arcade driver, complete with realistic steering wheel and foot pedals, creating a variety of truly immersive arcade-style casino gaming experiences.

Brave New Fortune IGT, always at the forefront of innovation, launches another product at the skill-game market. Fortunes of the Brave has been approved in Nevada and will undergo the traditional 30-day field trial before entering the market, officials say. “IGT is looking forward to launching Chill Gaming’s Fortunes of the Brave in Nevada in 2020, the innovative product from our ‘skill-plus-chance’ portfolio that leverages a traditional video gaming-type controller,” says Michael Brennan, IGT’s vice president of product management. “We’ve demonstrated Fortunes of the Brave at trade shows around the world, and it’s proven to deliver a unique brand of casino entertainment.” The target is low-denomination players who are fans of skill-based casino games and other interactive experiences. Fortunes of the Brave combines the traditional slot game with an interactive, skill-based video game feature.

SEPTEMBER 2020 www.ggbmagazine.com

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“We’ve been working closely with Next Gaming to introduce skill-based video slot machines, and are even more excited to extend the experience to the mobile esports platform.” —Tetsu Yamada, President, Taito Corp. Set in a thrilling fantasy world, players create a character that can be customized with armor, weapons and stylization options. Additional items can be unlocked throughout game play. As the reels spin, “rune fragments” appear as overlay symbols. As runes are collected, they’re counted in meters at the bottom of the screen and can be used to purchase items for the character. Blue runes can be used at the armory to purchase more pieces, while the gold runes award unique armor skills and other items. Green runes can be used at the card table to purchase health potions and spell cards. Once 80 runes of any color are collected, players have the option to hone their skills and earn additional runes in a one-minute training feature. When three or more scatter symbols appear, the skill-based videogame feature is triggered. Players are launched into a four-minute battle where they use a console-style controller to defeat enemy forces. Each environment has different battle features and enemies to beat; the player’s skill level in this feature determines the final score and outcome. During the battle, the player can use the weapons, potions or cards that have been collected throughout the game play to defeat oncoming enemies. Once the skill video game feature has been completed, the player’s score and prize pool are displayed on the top screen. Multiple prize pools unlock as players reach higher scores. The skill-based video game feature gives players influence over their final score and monetary win. Its non-monetary rewards also deliver more positive experiences to the player, more often. When players complete their session, they can store their character’s progress on a unique RFID Game Card issued by the machine. As players return, those cards can be inserted to restore the process. “Our customers are always seeking new and exciting ways to expand their player base, whether it be through games that incorporate skill, electronic table games, sports betting, licensed slots or even non-gaming amenities,” Brennan says. “Currently, the greatest demand from our customers in the ‘skill-plus-chance’ category remains IGT’s player-favorite video poker content. Although video poker is not often associated with the skill game genre, video poker is very much a ‘skill-plus-chance’ game, as skilled players have the opportunity for better outcomes than less-skilled players.”

Just Bust A Move AITO Corp., a pioneer in the video game industry, famous for producing “Space Invaders,” “Bubble Bobble” and “Arkanoid,” is entering the mobile esports arena through a partnership between Taito, Next Gaming and Celer Network’s mobile esports platform, CelerX.

Global Gaming Business SEPTEMBER 2020

Bust-A-Move Real Money Tournament is the first mobile esports title from this joint collaboration, introducing the original bubble-shooter game, “Bust-A-Move” (also known as “Puzzle Bobble”), as a 100 percent skill-based, real-money competition for mobile devices. In 1994, Taito defined the bubble-shooter game genre by introducing Bust-A-Move to the arcade scene. Following the massive global success of the arcade release, many versions of the game were introduced on various consoles. Recently, Next Gaming reimagined Bust-A-Move in a skill-based, video slot machine format that stars Bub and Bob (the twin dragon co-stars), which can soon be found in U.S. casinos this year. With mobile-game revenue expected to surpass the $100 billion mark this year, Next Gaming CEO Michael Darley says, “We wanted to bring a version of our game and others to follow to a larger audience by tapping into CelerX’s expertise in game distribution, network, compliance and security. The benefits of running on a layer-2 blockchain game platform provides an extra level of security and peace of mind for our players, especially when playing for real money in the iGaming and esports markets.” Taito, Next Gaming and the team at CelerX worked jointly to introduce a version of Bust-A-Move that’s 100 percent skill-based and integrated it with the CelerX SDK, enabling fans of the Bust-A-Move franchise to wager real money to test their skills against others. The game comes complete with leaderboards, regular tournaments and the ability to directly challenge other players in a head-to-head competition. The collaborative team is working on a series of mobile esports games based on Taito’s game titles, which are loved by generations around the globe. “On its 25th anniversary, we’re honored to bring Bust-A-Move Real Money Tournament to the fans where they can test their skills in a realmoney competition directly from their personal mobile devices,” says Mo Dong, co-founder of the Celer Network. “We’re excited to see that Celer’s advanced layer-2 blockchain scaling solution is powering this initiative. Additional games are expected to be released in the second half of 2020.” “We’ve been working closely with Next Gaming to introduce skill-based video slot machines, and are even more excited to extend the experience to the mobile esports platform on the Celer Network,” adds Tetsu Yamada, president and representative director of Taito Corp. The iOS version of Bust-A-Move Real Money Tournament is now available within the Arcade Win mobile app and as a single-title game release using real money and free in-game tokens within 37 U.S. states and Canada. Additional markets are to be announced.

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Cambodia Conundrum The burgeoning kingdom of gaming and hospitality in Southeast Asia has all the ingredients to become an important tourism destination. It just has to put those ingredients together. By Michael Zhu

ocated in Southeast Asia, the Kingdom of Cambodia has a population of 16.3 million and a territory of more than 181,000 square kilometers (70,000 square miles), with 2,530 kilometers of land boundaries and 443 kilometers of coastline. It borders the Gulf of Thailand to the southwest, Thailand to the northwest, Laos to the north and Vietnam to the east. The terrain is dominated by low, flat land largely created by the Mekong River, with highlands in the north and southwest. The Cambodian economy has grown steadily over the past several years. In 2019 U.S. dollars, the country’s gross domestic product (GDP) per capita increased to more than $1,600 and total GDP reached approximately $27 billion, representing a compound annual growth rate of 9.8 percent for the period spanning 2013-2019, and a consistent double-digit growth rate since 2016. Tourism and hospitality have become the country’s second largest source of income after the textile industry. Various factors contribute to the unique Cambodian culture, including that of the lowland ethnic majority and some 20 culturally distinct hill tribes. International visitor arrivals to Cambodia in 2019 exceeded 6.6 million, representing a tenfold increase since the beginning of the 21st century. The major attractions for foreign tourists include the capital region of Phnom Penh, the Angkor Wat historical park in Siem Reap Province, the tropical beaches in Sihanoukville in the southwest, the old towns in Battambang in the northwest, and the country’s some 120 gaming facilities (up from around just 50 in 2014).

Casino Gaming in Cambodia Gambling for Cambodian citizens is officially illegal in the country under the 1996 Law on Suppression of Gambling, which outlaws unauthorized gambling for citizens but permits government-sponsored gaming forms, including five privately run national lotteries. Nevertheless, gambling as a pastime is so ingrained in the Cambodian culture that illegal gambling is actually widespread in the society. Extra-legal 40

Global Gaming Business SEPTEMBER 2020

activities range from cockfights and card rooms to sportsbooks and unauthorized lotteries. Casino gaming for foreigners was established in the Phnom Penh capital region in 1994. Effective in 1998, gaming within 200 kilometers of the capital was banned with the exception of NagaWorld, the only casino resort facility in the capital city. In practice, the Cambodian government doesn’t strictly regulate or impede access to and from casinos, and the regulations have been ambiguous in some aspects. In July 2020, according to the Phnom Penh Post, Cambodia’s cabinet passed the long-awaited draft gaming legislation to “focus on ensuring integrated commercial gambling that contributes to economic growth, tourism promotion, job creation and revenue generation” with strict casino sector management and measures to offer more social benefits and further protect against money laundering and terrorism financing. Compared to the major Asian gaming markets, remarkably, Cambodia’s gaming tax regime has typically been in the form of fixed monthly casino license fees, effectively in lieu of corporate income taxes. The gaming tax rate has remained significantly competitive and consistently auspicious for casino operations over the past two decades or so. Although the newly passed draft legislation seems to impose an increase from the current gaming tax rate, it’s reported that the primary aim of the draft legislation is to attract large investments to the country’s integrated resorts (IRs) through competitive tax rates. The new tax rates will be at 7 percent of all gross gaming revenue (GGR) for current operators; however, for properties that meet the requirements to convert into IRs, the tax rate will be at 7 percent of mass GGR and 4 percent of VIP GGR. While the detailed requirements to qualify for an IR remain to be seen, the new tax regime will remain strongly competitive in the Asia-Pacific region. Typical town-center casinos such as those in Poipet and Bavet are within walking distance of border crossings on the Cambodia-Thailand border and the Cambodia-Vietnam border, respectively. Special border-crossing arrangements are usually in place that allow Thai and Vietnamese citizens to

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Gamblers at NagaWorld, Cambodia’s largest casino resort, located in the capital city of Phnom Penh

enter the country for gaming without burdensome immigration procedures, while additional security measures are also implemented that prevent them from going deeper into the country without due procedure. Similar to the lenient casino entry controls, there are no official statistics or reports regarding the performance of casinos in the country, except for those owned and operated by public companies such as the DNA Star Vegas, owned by Australia-listed Donaco International Ltd., and NagaWorld, owned by NagaCorp Ltd., a public company listed on the Hong Kong Stock Exchange. Moreover, Cambodia has a large number of casinos in high-traffic tourist areas, such as Sihanoukville. In addition to land-based casinos that leverage the seaside location, the coastal resort saw a rapid boom in online (video streaming) gaming establishments over the past few years until the ban on online gaming at the beginning of 2020. The iGaming establishments were once very popular with the Chinese population, and were kicked off a large number of casino construction projects that popped up across Sihanoukville in recent years. While no publicly available data on the Sihanoukville casino market is available, it’s reported that the city is home to up to 80 casinos. With a few exceptions, most of these are small operations, and the offerings available onsite, such as gaming units, hotel room count and food and beverage amenities, are quite limited.

Diversification and Stronger Tourist Destinations When a nationwide iGaming ban became effective on January 1, many places in Cambodia (especially those known as hubs for Chinese-backed investment, such as Sihanoukville) saw their economies substantially affected. The Cambodian Department of Immigration reported that more than 200,000 Chinese left the country in the lead-up to the ban, and approximately 25,000 to 30,000 local people were left unemployed after more than three dozen casinos suspended operations and another 20 to 25 gaming properties simply shut down.

According to some real estate research, the land values in Sihanoukville fell 25 percent to 30 percent in the wake of the online gaming ban. Looking at the bright side, however, the shakeup is actually paving the way for a new master plan for the city, which the government is planning to transform into a special economic zone (SEZ) invigorated by diversified economies and industries such as technology, manufacturing, trades and tourism/hospitality services. In May 2019, the Cambodian government commissioned the Urban Planning and Design Institute of Shenzhen, China to draft a master development plan for the coastal city. Its goal is to turn Sihanoukville into an international resort destination supported by enhanced entertainment, leisure and hospitality offerings, as well as a large manufacturing hub that serves as a vital base for exports, all benefiting from proximity to the country’s largest seaport. Officials at the Cambodian Ministry of Economy and Finance said the master plan could turn Sihanoukville into “a special economic zone which looks like China’s Shenzhen City.” With these new strategic goals, a number of large infrastructure improvement projects are under way including an upgrade of existing roadways, a new four-lane highway that links the capital region and Sihanoukville, better access to the resort areas, and modernization of the city’s sewage and drainage systems. The kingdom’s aviation authority approved an expansion plan for Sihanoukville International Airport that includes extension of runways, new taxiways and aircraft stands and new passenger terminals that are poised to expand the passenger capacity ultimately to more than 10 million a year; that project is due to start sometime in 2020. Setting aside Covid-19 impacts, the airport operates routine flights to major gateway cities in Asia—in particular, more than 30 flights a day from mainland China, with penetration into many second-tier and even third-tier Chinese

Cambodia’s competitive gaming tax regime will enable gaming establishments to allocate more financial resources to customer acquisition and/or capital improvements, spurring greater prospective revenues.

SEPTEMBER 2020 www.ggbmagazine.com

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The coastal resort of Sihanoukville may be home to as many as 80 casinos

Queenco Hotel & Casino

Jin Bei Casino & Hotel

The New MGM, a Chinese casino in Sihanoukville

cities, boding well for a prospective resort destination for the region’s increasingly wealthy middleclass tourist.

Competitive Advantages Gaming Tax Regime. Gaming tax rates and

With its scenic beauty, unique historical and cultural heritages and tourism-driving natural environment, Cambodia is equipped to be even more prosperous with improved infrastructure.

structure have a significant impact on the potential success of IR developments. Implementing a tax structure that attracts optimal capital investment while still deriving adequate revenue through taxes and providing ample funding for tourism promotion, regulatory oversight and other associated social needs is critical. Cambodia’s competitive gaming tax regime, even after the new legislation takes effect, will remain advantageous to allow gaming establishments to allocate more financial resources towards customer acquisition and/or capital improvements to help spur greater prospective revenue growth. Skilled Workforce, Reasonable Labor Cost. The once-booming on-

line gaming industry has left the kingdom with a sizable, skilled, experienced gaming workforce which also has the passion to work in entertainment settings. Meanwhile, labor costs in Cambodia remain among the most competitive in the ASEAN countries and even in the Asia-Pacific region. This certainly works to Cambodia’s advantage in terms of attracting foreign investment and setting up new operations in the country. Attraction Factors, Improving Infrastructure. The already rapidly

growing outbound tourism in the region is led by Chinese tourists who desire unique and personalized experiences and are anticipated to comprise a large portion of nearly all of the market segments for Cambodia. With its attractive scenic beauty, unique historical and cultural heritages and tourism-driving natural environment, the country is equipped to be even more prosperous with improved infrastructure. Encouragement by Chinese Leadership. Since 2013, the Silk Road

Economic Belt and the 21st Century Maritime Silk Road Initiative, also known as the One Belt and One Road Initiative, has become one of China’s most profound state development strategies, focusing on connectivity and cooperation. The goal of this initiative is to realize the massive trade potential and boost economic development among countries through Central Asia to the Middle East, as well as those along the maritime route 42

Global Gaming Business SEPTEMBER 2020

through Southeast Asia, the Persian Gulf and the Horn of Africa. With Cambodia in the heartland of the initiative, it will work well for traveling and tourism industries in the country. The refurbishment of routes and easy access on the routes is likely to attract more tourists.

Potential Concerns

Concerns regarding the growth and stability of the Cambodian gaming market are based on political risks and the geopolitics between key feeder markets/countries. It’s important to note that for the IR industry, the political risks imply political viability to pass legislation of casino gaming, and political volatility where the political winds may change dramatically and thus impact the IR’s ability to do business. Taiwan and most states in India are illustrative examples of low political viability for gaming development. Some smaller jurisdictions in the region, such as Laos, Myanmar and even Vietnam to some degree, represent the case of high political volatility that could jeopardize the IR market and suffocate potential growth. For today’s large-scale international IRs, other factors that have become increasingly important are the key feeder markets and the associated geopolitics. Geopolitical instability will affect global business with decidedly negative implications for performance. Additionally, international tourism can be subjective to macroeconomic conditions and a political climate in feeder nations that the IR host country may not be able to affect or improve.

Sustainable Growth in the Future The Cambodia gaming market’s major business drivers and competitive advantages will continue to have profound influences on its long-term outcome, which will empower the industry to keep growing in a sustainable manner, capitalizing on the booming and increasingly wealthy middle class in the region and better stimulating tourism and related economic impacts that benefit the country. We believe these impacts and implications will continue to shape up and strengthen the industry in the kingdom and in the Asia-Pacific region.

Michael Zhu is senior vice president, international operations, planning and analysis for The Innovation Group.

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EMERGING LEADERS Legal Eagle (& Pinball Wizard) Harry Jackson Senior Associate, Fox Rothschild LLP arry Jackson III sure plays a mean pinball. In fact, he says, the International Flipper Pinball Association considers him world-ranked in the competitive arena. So no surprise that in Jackson’s day job, he provides legal services for a gaming industry centered on slot machines, sometimes from companies that began as pinball manufacturers. Companies like WMS Gaming and Bally Technologies, now Scientific Games. An Upper Deerfield, New Jersey resident, Jackson graduated from Rutgers University law school in 2012, and in the summer after his second year, worked at the Fox Rothschild law firm. That led to a job in the litigation department. “About two weeks in, the chair of the gaming practice group asked if I could assist with a few matters, as the department was busy,” Jackson says. “It’s now eight years later, and we still haven’t slowed down.” Jackson helps clients meet gaming regulatory and compliance requirements, and also assists with alcoholic beverage licensing and sweepstakes and promotional campaigns. “I enjoy helping our clients bring their projects to fruition, whether it’s a slot machine manufacturer rolling out a new product, a new sportsbook launch, an internet gaming operator going live or even opening up a new casino resort.” Covid-19 has slammed the casino industry and the legal advice end, too. “We’ve adapted,” says Jackson, who now renders assistance to online gaming operations, which have seen a surge in growth during the turbulent period. A member of the Nanticoke Lenni Lenape Tribal Nation, Jackson serves as secretary of the tribal council. Interestingly, his tribe has a law barring operation of any business that profits from “vice”—including casino gaming. “My job and my heritage could not be further apart,” he says. That doesn’t mean his business can’t intersect with tribal casinos. “I assist with reaching out to the tribal regulatory agencies, and I’m interested in taking a more active role in legal matters involving Indian Country.” As a new lawyer, Jackson had to overcome his feeling that the legal profession resembled a social

“I assist with reaching out to the tribal regulatory agencies, and I’m interested in taking a more active role in legal matters involving Indian Country.” club, “one where everyone has known everyone for decades, and you weren’t invited to the party.” But with the introduction of sports betting and esports, a younger generation has made its mark. “That’s very exciting to me.” Jackson’s mentors from the ranks of Fox Rothschild include partner Christopher Fallon, counsel Prince Thomas, and Nicholas Casiello, Jr. and Marie Jiacopello Jones, co-chairs of the gaming group. “I also need to mention Patrick Madamba, Jr., who was a partner with Fox before becoming senior vice president and legal counsel with MGM Resorts International. He was never afraid to share whatever was on his mind.” Jackson’s parents, Linda and Harry, Jr., sacrificed a lot to help him become the first attorney in the family. “They’re always there to give advice or lend an ear.” As for his own advice, Jackson says: Research. Read. Review. “Try to stay on top of the news and evolve along with the industry.” In his off hours, Jackson still relaxes at pinball. “I’d love to see WMS go back into pinball manufacturing,” he says. “They made some of the best machines.” —Bill Sokolic

Global Gaming Business SEPTEMBER 2020

Building Fun Guillermo Ramirez Mechanical Engineer, Incredible Technologies uillermo Ramirez grew up in a family of tinkerers. “My grandfather, Jesus Ramirez Cerda, liked to design, create and build all kinds of things,” says Ramirez, a native of San Luis Potosi in central Mexico. “Even my father, Guillermo Ramirez Cortes, who had an accounting degree, loved to work with cars and mechanics.” Ramirez followed both paths. At 22, he opened a metal shop with his grandfather, but within six months, the economy doomed that enterprise. Then he studied mechanical engineering at Autonomous University in San Luis Potosi. After graduating in 2014, he moved to Chicago. It wasn’t easy, relocating to a different country with a different language and culture. “But once you settle down and adapt, you start to overcome challenges,” he says. While searching for an engineering position, Ramirez put his handyman skills to good use. He worked all kinds of jobs—construction, roofing, carpentry—before joining Incredible Technologies, Inc., designer and developer of entertainment products for the gaming industry, as a mechanical engineer. His primary function

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From Mickey Mouse to Market Maven Phil Bernard Vice President, Gaming Equipment, Eilers & Krejcik Gaming there is to “create, improve, test and develop new and existing products.” The coronavirus pandemic has been transformative both for the business and the process of doing business, says Ramirez, who went from getting up early to drive into the office to working from home, with no colleagues close at hand to help with troubleshooting. “The social impact plays an essential role in job performance,” he says. “Keeping a positive mindset is one of the practices that I continuously implement to succeed, not only at work but also in life.” Ramirez cites a number of mentors who helped him cope with challenges along the way, including Cervando Marin, quality control supervisor at Surewaytool & Engineering. “He taught me the importance of having a very organized process, as well as discipline and focus.” Gary Strahinic, director of product development and engineering at Entropy International, “challenged me in every single way by giving me the most important projects and allowing me to lead them.” Tim Sickel, senior director of hardware engineering at Aristocrat, worked on several projects with Ramirez. “I observed and absorbed his leadership style and his organization. He was always there to guide me into the gaming industry.” At Incredible Technologies, Bryan McVey, Omar Torres and Tom Costanzo have proven influential to Ramirez’ professional life. McVey, vice president of mechanical engineering, offered a unique management style. Torres, director of mechanical engineering, brought perfectionist and technical skills. Costanzo, senior mechanical engineer, added his vast experience. For those who aspire to careers in gaming, Ramirez says, “Listen to your elders, to the experienced people, and be eager to learn from them, as there is valuable knowledge they hold. Be humble and stay grounded, because it doesn’t matter how many degrees you have, how much money you make or what position you have.” He adds, “Perseverance and determination helped me climb up in this industry.” —Bill Sokolic

ovid-19 was unsettling for Phil Bernard, vice president of research firm Eilers & Krejcik Gaming LLC. The situation called for more efficient forms of communications, an athome setup, re-purposing the dining room table and all-new routines. It required daily command decisions, “like deciding when to change out of sleepwear, so you don’t feel like a slob,” he says. On a more serious note, the crisis created challenges that could affect the industry for years, and possibly change it forever. “The short answer is no one knows, but you do your best to learn on a daily basis and apply that to your perspective on the market,” says Bernard. “Every nugget of news about casino closings, job losses and the severity of social restrictions gives you another indication as to what could happen.” At Eilers & Krejcik, Bernard produces recurring market research reports as well as company earnings reports for the gaming and lottery industries. He gathers information, synthesizes it and extrapolates meaning. “Sometimes it’s simply providing a summary. Most of the time we try to provide some more in-depth analysis to help our readers better understand the results and better inform them on what may lie ahead.” Bernard joined Eilers & Krejcik in 2014, following a stint at Disney that began as a workstudy program during his undergrad years. “The experience there was amazing,” he says. “Disney gave me the opportunity to earn a paycheck while working for an industry-leading company. It opened up doors to unique leadership opportunities not often provided to people at a relatively young age.” After a series of promotions, Disney selected Bernard for the company’s rotational management training program. But Bernard had a competing interest in financing—he majored in both finance and marketing at Cal State. His years of operational experience made it difficult to break into another field, so he began pursuing an MBA “with a focus on strategy and finance to help support the career pivot.” Then a career counselor saw a job listing for

“What works for one person may not be effective for another. From my perspective, the market research and consulting gig involves being able to pull three broad skills together: effective research, financial analysis and the ability to synthesize this information to create meaning.” a gaming research firm. Bernard got the job and learned from the godfather of slot market research, Todd Eilers, founder of Eilers & Krejcik Gaming. “He took a flier on a guy with no financial market or gambling industry experience,” says Bernard. “He’s done a great job of providing guidance. He’s still providing valuable feedback and direction today.” Bernard also credits his parents for guiding his growth. His father Bill Bednarski, from a blue-collar family in Detroit, worked his way to a full ride at Harvard. “He’s been a great source of professional advice and a great model for the benefits of lifelong determination. And my mom, Lynne Bernard, is also an inspiring figure. As a dietician, she taught me the value of taking care of yourself.” Bernard doesn’t believe in giving advice to aspiring researchers. “What works for one person may not be effective for another,” he says. “From my perspective, the market research and consulting gig involves being able to pull three broad skills together: effective research, financial analysis and the ability to synthesize this information to create meaning.” —Bill Sokolic

SEPTEMBER 2020 www.ggbmagazine.com

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FRANKLY SPEAKING by Frank Legato

History and Baseball

’ve been looking through a lot of casino blogs lately on news sites in regional casino markets that are not really familiar with casinos. There are a lot that give advice on how to win at slot machines, a few offering misinformation, like those “guaranteed” scam slot methods in the old days. One news site offered the “History of Slots.” It defined slot machines as “gaming devices that are operated by inserting tokens, coins or an electronic card.” That was my first clue that a novice wrote the article. Umm... Bill acceptors? Tickets? Outside of nostalgia areas like at the D Las Vegas, I haven’t seen a coin or token put in a slot machine in 20 years. And an “electronic card?” Either he’s from the future, or he mistook player’s loyalty cards for debit cards. Some of the stuff was accurate, like the fact slot machines “require little or no gaming knowledge and allow virtually anyone to play the game—including chimpanzees, who really enjoy gaming.” OK, I added the bit about the chimps, but they really do enjoy banging on slot buttons. Just ask any university gambling researcher. (Rats love the slots, too. They tend to prefer video poker, though.) Anyway, the blog goes on to say how slot machines have come a long way “since their inception in 1887.” I’m wondering where he got that factoid. Before the late 1890s, the only “slot machines” were mechanical poker machines on bartops in San Francisco that used 50-card decks. It was the mechanical three-reel machine invented by Charles Fey that was the first to be identified with the term “slot machine,” short for “nickel-in-theslot machine” (short for “put-five-nickels-in-the-slot-to-win-one nickel machine.”) The article did get it right about Fey inventing the slot machine in the mid 1890s, although it states he was a car mechanic, which is not correct—he worked with electrical equipment and telephones, when he wasn’t inventing the slot machine. The next part of the slot story, right after Fey, is “The Rise of the Internet and Mobile Gaming.” Wait. Did he leave out a few other things? I’m pretty sure some stuff related to slot machines occurred between 1895 and the early 2000s. I seem to remember something about New York Mayor Fiorello La Guardia dumping slot machines into the East River in the 1930s, and something about Las Vegas. 46

Global Gaming Business SEPTEMBER 2020

Maybe I’m mis-remembering. Moving on, it’s come out that the St. Louis Cardinals players who tested positive for Covid19 got the virus from an asymptomatic person who had entered their clubhouse in Milwaukee’s Miller Park when they were playing the Brewers—not from going to the Potawatomi Casino, like some nitwit broadcaster rumormongered on Twitter. Everyone had been up in arms after the tweet, assuming it was true, because hey, casinos are where you get Covid-19, right? It couldn’t be that someone got infected and then went about their job, which, as we all know, includes not only hitting, catching and throwing baseballs, but a lot of spitting. In fact, there’s more spitting in Major League Baseball than any of that other stuff. Players spit through their teeth at the plate, spit in the dugout, spit at the bases... spit, spit, spit. The rules set up to allow baseball to return, as I recall, said players were to refrain from spitting. Yet, there they are on TV, hocking loogies left and right. Sportsbooks should have prop bets on spitting distances. In the old days, it was much worse. Anyone my age remembers when ballplayers went to the plate with their cheek bulging from a big chaw of tobacco. I even remember that Bill Mazeroski’s baseball card showed him with his cheek swollen from a big tobacco wad. In little league, we used to stuff our faces with “Big League Chew” bubble gum so we could look like our heroes. Needless to say, ballplayer spitting in those days was much more gross. When I was in my mid-20s, I landed a freelance story for a local Pittsburgh paper that had me interview Elroy Face, the legendary Pirates relief pitcher, who was a coach at that time. I got a dugout pass to do the story, and I sat there in the dugout at Three Rivers Stadium during batting practice, trying to do my job while watching guys spit. On artificial turf. It was positively grisly. But I digress... The Potawotami Casino was easily able to quash the rumor that Cardinals players had visited the property. At the time, reservations were required to visit the casino, so they checked. No Redbirds. They would have gotten thrown out anyway. No spitting in casinos.

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CUTTING EDGE by Frank Legato

Simple Book PRODUCT: ActionBook MANUFACTURER: Novomatic Americas

he Novomatic ActionBook sports betting kiosks offer the variety of wagering options that customers have come to expect. It has both pre- and in-game options, including parlays and proposition bets. With simple navigation in the betting menu, as well as live odds and live feeds from the games, the kiosks satisfy all customers’ sports wagering needs. Novomatic Americas has met the demand of the rapidly expanding casino customer base—and according to the company, ActionBook is rapidly becoming the kiosk of choice for bettors. Paired with world-class, premium software, the entirely automated self-service betting kiosks offer the full-suite of wagering options. ActionBook kiosks provide an intuitive user experience with simple navigation. “Convenience, speed and choice make this one popular kiosk,” says a Novomatic official. “This automated betting kiosk processes more bets per hour with a myriad of betting options. Importantly, they are inviting and friendly to the new sports bettor and familiar to the experienced player.” ActionBook is a turnkey, proven, ergonomic hardware solu-

tion with outstanding graphic capabilities, and when partnered with the world’s best sports betting software, it is an unbeatable combination. The kiosk is quick and easy to install and supports operators with intuitive maintenance routines, and reliable hardware technology. Its securityconscious design provides a reliable barrier against theft. Operators have praised the kiosk’s touch-screen interface, and short learning curve for players and their install teams. When incorporating premium software of choice, on the ActionBook, it makes the integration seamless. The Novomatic ActionBook provides a premium entertainment experience using a bettor-friendly design. It relies on years of expertise gathered in the Novomatic Group’s proprietary sports betting operations across Europe. Novomatic had approximately 713 kiosks in or scheduled to be installed across North America through July and August, and those numbers continue to rise. For more information, visit novomaticamericas.com.

Presented by The Innovation Group and Global lobal Gaming Business

The Emerging Leaders Leadders of Gaming (ELG (ELG) G) program helps sha shape pe strategies, technolog technologies, ies, and employees, tur turning rning young professiona professionals als into tomorrow’ tomorrow’ss indus industry try leaders, and giving them t that extra advantage ge in today’s today’s gaming, eentertainment, leisure, and hospitality secto sectors. rs. launch, career Since its 2012 launc ch ELG has providedd networking and care ch, eer opportunities executives future advancement opport tunities that bring exe ecutives closer to futu ure senior positions. senior-level and senio or management positio ons. Visit page of thein theinnovationgroup.com V isit the Emerging Leaders L nnovationgroup.com for f including announcement more details, includin ng the upcoming annou ncement of the Class ELG 40 Under 40 Cl ass of 2021. 2021.

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NEW GAME REVIEW by Frank Legato

Lunar Celebration Bluberi Gaming

his entry in Bluberi’s growing game library is themed around an important Asian holiday, the Lunar New Year. The theme is communicated through glowing colors, firecrackers, red lanterns, dragon masks and other icons of the holiday’s festive atmosphere—enhanced by 4K graphics on the Novus Series b49 cabinet, with its 49-inch flat-screen monitor. The base game is a five-reel, nine-line video slot, with a fixed bet of nine credits. In the primary game, five scattered coin symbols trigger a Scatter Bonus of up to 500 times the denomination. At the top of the display is a bonus wheel, around which a rocket flies until landing on a wheel slice. The bonus wheel is featured in one of the two main bonus rounds. Triggered by three or more bonus symbols on a payline, the wheel awards credits of up to 1,500 times the denomination. Three or more consecutive free-spin symbols on an active

line award a bonus up to 25 times the denomination, and trigger three free spins. All free spins are guaranteed wins. Five yellow lion symbols on an active line trigger the top jackpot of 4,000 credits times the denomination. Manufacturer: Bluberi Gaming Platform: Novus Series b49 Format: Five-reel, nine-line video slot Denomination: .05, .10, .15, .20, .25, .50, 1.00, 2.00, 5.00, 10.00 Max Bet: 9 Top Award: 4,000 credits times denomination Hit Frequency: 34.85% Theoretical Hold: 3%-10%

Jeopardy! Megatower IGT

GT reprises another classic game show slot—the series based on the famous trivia game show Jeopardy!—on its 11-foot-tall Megatower Universal cabinet, which a few years ago was used to reprise an even bigger game-show slot, Wheel of Fortune. This game, like Wheel of Fortune, is a classic three-reel, high-denomination stepper, enhanced with Megatower’s giant 6.5-inch reels and 50-inch video monitor, which features a bonus event taken directly from the famous blue answer board on the TV show, complete with question categories at the top. Megatower games also feature dual bash buttons to promote play by couples. The base game is the classic Triple Double Diamond multiplyingwild symbol slot, in a nine-line configuration. A multi-level bonus feature mimics the session levels on the show, such as Double Jeopardy!, Final Jeopardy!, and Daily Double rewards. The Jeopardy! Bonus round is triggered when three bonus symbols appear on a payline, triggering five free spins. If three bonus symbols land on a payline during the free spins, the player advances to Double Jeopardy! Once the player runs out of free spins in either Jeopardy! or Double Jeopardy!, the game advances to Final Jeopardy!—where players can keep what they’ve won or risk it all with one

Global Gaming Business SEPTEMBER 2020

wager. The Jeopardy! board comes into play, with board spaces opening to reveal credit amounts and jackpot designations—in the dollar denomination, a $100 Mini, a $400 Major, or the top $4,000 Grand jackpot. In addition to the Megatower, the game is available on IGT’s CrystalDual+ Stepper cabinet. Manufacturer: IGT Platform: Megatower Universal, CrystalDual+ Stepper Format: Three-reel, nine-line stepper Denomination: .25-100.00 Max Bet: 20 Top Award: 4,000 credits Hit Frequency: Approximately 30% Theoretical Hold: 5%-15%

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Prize Pool Cactus Cash Incredible Technologies

his Southwest-themed video slot, presented on IT’s huge Infinity V55 cabinet, with its 55-inch 4K flat-screen monitor, features a unique instant bonus mystery feature. The base game is a 40-line video slot on a fiveby-four reel array (five reels, four rows per reel). Above the reels on the giant monitor is a prize pool grid of 20 credit amounts, mirroring the 20 spaces on the reel array. A sister game titled Fierce Dragon has the same features. In the primary game, gold “Prize Pool” scatter symbols on the reels increase the credit amounts on the corresponding prize-pool spots. Prizes remain in place and continue to grow as the scatter symbols land. If the player lands four Prize Pool scatters of any color, the corresponding amounts on the grid are instantly awarded. Three bonus symbols trigger 10 free spins. During the free-game round, when wild symbols

land, they substitute for Prize Pool scatters, boosting the corresponding spots on the grid above. As in the base game, four Prize Pool symbols on a spin award all the corresponding credit amounts. Two or more Free Spin scatters trigger another 10 free spins. Manufacturer: Incredible Technologies Platform: Infinity V55 Format: Five-reel, 40-line video slot Denomination: .01, .02, .05, .10 Max Bet: 300 Top Award: 150,000 Hit Frequency: Approximately 50% Theoretical Hold: 5.86%-14.87%

Cai Fu Yun Dragon Aruze Gaming

his new game on Aruze’s Muso Triple-27 cabinet employs a frequent wheel bonus that adds multipliers, wilds and free games, the awards streaming from a bonus wheel in the top monitor down to the reel array on the main screen. The base game is a five-reel, 243-ways-to-win video slot with a four-level progressive jackpot. Wheel symbols on the second, third and fourth reels trigger the Bonus Wheel, which contains multipliers from 2X to 18X, a Free Games slice and a Wild slice. When the wheel lands on a multiplier, it is applied to the result on the triggering spin. The Wild slice triggers a separate wheel with slices indicating a number of wild symbols to be applied to the triggering spin. The Free Games slice triggers another separate wheel, with slices indicating the number of free spins, from six up to 25 spins. During the free games if the wheel bonus symbol appears on all three middle reels, it triggers another spin of the Free Games wheel to continue the bonus round. The reel array on the free games contains only high-paying symbols and wild symbols. On any primary-game spin one or more of the bonus symbols on the middle reels can trigger the Jackpot Wheel, which contains the four progressives. The player spins the wheel for a guaranteed progressive. Jackpot amounts reset at $10 (Mini), $25 (Minor), $800 (Major) and $10,000 (Grand).

The progressives can link to any game in the Cai Fu Yun series (Cai Fu Yun Lion, Cai Fu Yun Dragon, Cai Fu Yun Fortune) or the Wheel of Prosperity Series (Wheel of Prosperity Tiger, Wheel of Prosperity Dragon, Wheel of Prosperity Phoenix, Wheel of Prosperity Serpent). Manufacturer: Aruze Gaming Platform: Muso Triple-27 Format: Five-reel, 243-ways-to-win video slot Denomination: .01 Max Bet: 880 Top Award: Progressive; $10,000 reset Hit Frequency: Approximately 50% Theoretical Hold: 3.94%-15%

SEPTEMBER 2020 www.ggbmagazine.com

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GOODS&SERVICES

gression of Dragon Link,” said Jon Hanlin, senior vice president of commercial strategy and business analytics for Aristocrat. “At Aristocrat, we continue to invest in the games our players know and love, to provide new gaming experiences they’ll enjoy.” Now offering mid- and high-denomination sets ranging from 10 cents to $25, this highvolatility version of Dragon Link also offers players a larger linked or stand-alone jackpot ranging from $50,000 to $500,000.

tions from both the games and fintech segments, said Everi. “We achieved better-than-expected results in the second quarter, including a return to positive adjusted EBITDA more quickly than we anticipated at the beginning of the quarter,” said Everi CEO Michael Rumbolz, in a statement accompanying the earnings release. He said a variety of “swift actions” to reduce costs and preserve liquidity resulted in the positive EBITDA. “In addition, as our customers began to reopen faster than previously expected, we benefited from our prior investments in technology innovations and game development through the strong performance of our fintech solutions and installed base of recurring-revenue games,” Rumbolz said.

EVERI RESULTS AFFECTED BY COVID-19, BUT TOP ESTIMATES

CIRCA CHOOSES ACS PLAYON CASHLESS GAMING SOLUTION

IGT REPORTS REVENUE DROP, COST SAVINGS

nternational Game Technology, Plc. reported revenues of $637 million for the second quarter, down some 48 percent from Q2 2019’s $1.24 billion, with its CEO citing the Covid-19 shutdown as the reason. Gaming equipment and interactive sales fell 65 percent, with revenues from slots and gaming equipment down 57 percent. However, in an earnings call, IGT CEO Marco Sala said the results were better than expected, due mainly to international lottery sales and an aggressive program of cost-cutting. “Our second-quarter results reflect the intense impact of global lockdowns caused by the pandemic,” Sala said. “Thanks to strong North America lottery performance and our swift adoption of cost-saving and avoidance measures, we delivered better cash flow than we expected back in May.” The North American lottery performance was down by only 12 percent, although international lottery took a 56 percent hit. The overall net loss for the company was $282 million, compared to net income of $39 million for the same quarter last year. The company says cost savings will be a focus for the remainder of 2020. “We have the resources we need to navigate the impact Covid-19 is having on our business, and we are making important, strategic decisions to enhance our operational flexibility,” said CFO Max Chiara on the call. “This includes over $200 million in structural and discretionary cost savings compared to pre-pandemic levels.”

ARISTOCRAT’S DRAGON LINK DEBUTS IN TAMPA

ristocrat Technologies marked the world premiere of the newest evolution of a fan favorite, the Dragon Link progressive slot product at Seminole Hard Rock Hotel & Casino Tampa. The property is the first to receive the newest iteration of the game, which offers high- and mid-denomination bets and a larger linked or stand-alone jackpot. “We’re excited to partner with Seminole Hard Rock Hotel & Casino Tampa to debut this pro-

aming supplier Everi Holdings Inc. posted a second-quarter net loss of $68.5 million compared to net income of $5.5 million in the same period last year, and a net loss of $13.5 million in the first quarter of 2020. However, the company’s CEO had better news in a positive pre-tax earnings report, thanks to cost-cutting measures. The loss was caused by casino closures in Everi’s key markets due to the Covid-19 pandemic, the company reported. The net loss included $14.8 million in pre-tax charges associated with asset write-offs and writedowns, severance, facility consolidation and business restructuring costs to streamline operations and improve the group’s cost structure, Everi said in a press release. Revenue for the reporting period was $38.7 million compared to $129.7 million a year ago. “The closing of casinos due to the Covid-19 pandemic resulted in revenues declining to essentially zero until the casinos began to slowly reopen in May with the pace steadily ramping through June,” the company said in the release. Adjusted earnings before interest, taxation, depreciation and amortization (EBITDA) was $3.3 million for the three months to June 30, compared to $64.1 million in the prior-year period. The result was driven by positive contribu-

Global Gaming Business SEPTEMBER 2020

utomated Cashless Systems’ PlayOn Cashless Table Game Solutions, already in place at Derek Stevens’ D Las Vegas property, will also be utilized at Stevens’ new Circa Resort & Casino, slated to open in Downtown Las Vegas by the end of the year. PlayOn is a cashless payment solution that allows players to purchase casino chips using their debit cards. PlayOn eliminates having to leave the game in order to use an ATM machine or search out a cashier cage. “Derek will be providing a new and unique gaming experience to his patrons in historic Downtown Las Vegas, and we’re thrilled that PlayOn will be a part of that offering,” said Steve Warner, founder and COO of ACS PlayOn. “We’re now seeing significant demand for PlayOn across the state, especially with the concerns surrounding currency and Covid-19. PlayOn is safe, secure and convenient.” “When we began developing the casino space at Circa, we knew we wanted to deliver an unrivaled experience to eager players,” said Stevens, founder and CEO of Circa. “Introducing ACS PlayOn into the mix will allow us to offer convenient game play for locals and visitors alike, and enhance overall customer service.”

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MONARCH TAPS GLOBAL PAYMENTS FOR iGAMING

n August, Global Payments Gaming Solutions announced that Monarch Casino & Resort has selected its iGaming solutions to power the casino’s sports betting applications in Colorado and Nevada. The iGaming solutions connect the online and brick-and-mortar gaming experiences and simplify the process of account funding with Global Payment Gaming Solution’s VIP LightSpeed platform. Combined with the VIP Preferred e-check network, it empowers guests to effortlessly access funds from their checking accounts in a seamless, frictionless manner. Monarch Casino Resort in Black Hawk, Colorado was one of the first to go live with online sports betting in Colorado. Implementing Global Payments’ iGaming solutions will allow Monarch to take a multi-channel approach to online sports betting as well as online casino, mobile gaming, fantasy gaming and more.

JCM PARTNERS WITH CASH PROCESSING SOLUTIONS

experience and integrating our technology portfolios together benefits JCM’s customers, allowing them to capitalize on the combined strengths of JCM and CPS to save time, save money and gain greater insights into their overall cash management operations.”

VGT LAUNCHES ‘HUNT FOR NEPTUNE’S GOLD’ LOUNGE IN TULSA

ideo Gaming Technologies Class II Innovations from Aristocrat recently announced the launch of the first-ever The Hunt for Neptune’s Gold lounge at Osage Casino Hotel in Tulsa, Oklahoma. A Class II fan favorite, the all-new gaming destination offers a themed game experience for players all in one space. The 1,100-square-foot gaming space is adjacent to the hotel lobby and offers 32 Neptune’s Gold games on the Helix XT cabinet. This intimate lounge setting offers a VIP feeling for players, themed as an entertaining underwater adventure. The refreshed version of this underwater quest will stay true to the original game.

GAMECO WINS NEW JERSEY LICENSE, LAUNCHES iGAMING DIVISION

n late July, GameCo, a pioneer of Video Game Gambling machines (VGMs) and casino experiences designed to attract and monetize the millennial and Gen X demographics, announced its approval by the New Jersey Division of Gaming Enforcement for a Casino Service Industry Enterprise License in the state. The approval allows the company to bring its diverse portfolio of esports betting, skill-based iGaming and Video Game Gambling products to New Jersey casinos and sportsbooks. GameCo also launched its first skill-based iGaming games, bringing the company’s games to the largest digital casino market in North America. Featuring GameCo’s patent-pending GamersEdge technology, these new online games provide a skill-based gaming experience for the next generation of online players. GameCo will soon release its Multiplayer Arena, the first esports solution for land-based casinos. Multiplayer Arena allows players to compete head-to-head or in esports-style tournaments directly on the casino floor, providing casinos with a solution to monetize the esports phenomenon.

ash-processing equipment manufacturer JCM Global has selected Cash Processing Solutions (CPS) as its partner of choice “in a move that will bring further efficiencies and business intelligence to its customers,” according to company statement.

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JCM and CPS executed a master distributor agreement that enables JCM to supply high-speed count and sort equipment and cash management software in North America. JCM will represent CPS’s software solution, ECM Edge, as well as its count-sort machines, including the 7000i Edge, V Edge, and X Edge. Combining CPS products with JCM’s ICB Intelligent Cash Box and FUZION systems offers customers “a complete count-room solution for more visibility over the operation, increased efficiency, and enhanced security,” JCM said. “Combined, JCM and CPS have more than 125 years of experience in cash management,” said Dave Kubajak, JCM’s senior vice president of operations, sales and marketing. “Bringing this level of

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PEOPLE MGM: HORNBUCKLE NO LONGER ‘ACTING’

he board of directors of MGM Resorts International announced July 29 that William J. (Bill) Hornbuckle has been elected as the company’s president and CEO, Bill Hornbuckle with immediate effect. Hornbuckle had served as acting CEO and president since March 2020, when former Chairman and CEO Jim Murren stepped down. Hornbuckle was also appointed to serve on the company’s board. He issued a statement saying, “I am honored to lead this company as we look toward long-term recovery, future growth and opportunity. In doing so, I am especially mindful of the thousands of MGM Resorts employees who have been profoundly impacted by the current circumstances. Their dedication to the company’s mission and safety allows guests from around the world to experience moments of happiness and hospitality amid uncertain times. I am here today presented with this leadership role due to the tremendous accomplishments, passion and courage of our people.” A gaming industry veteran, Hornbuckle was most recently executive director and board chairman of MGM China Holdings, with operations and resorts in Macau. He was previously chief marketing officer for MGM Resorts, serving from 2009 until 2012. Before that, he spent four years as president and chief operating officer of Mandalay Bay Resort & Casino. He previously had served as president and COO of MGM Resorts International-Europe, where he worked on the development of the company’s gaming operations in the U.K. He also served as president and COO of MGM Grand Las Vegas from 1998 to 2001. Hornbuckle’s early experience includes a term as president and COO of Caesars Palace in Las Vegas. He spent the majority of his career with Mirage Resorts in various senior management positions, including president and COO of the Golden Nugget Laughlin, executive vice president and COO of Treasure Island and vice president of hotel operations for the Mirage, opening the hotel in 1989.

MOHEGAN PROMOTES RAY PINEAULT TO COO

ohegan Sun President and General Manager Ray Pineault has been promoted to Mohegan Gaming & Entertainment’s (MGE) chief operating officer. He will replace Michael Silberling, who left the job in July.

Pineault started at Mohegan Sun eight months ago, assuming the title regional president in charge of Mohegan Sun in Connecticut, Mohegan Sun Pocono in Pennsylvania and Paragon Ray Pineault Casino Resort in Louisiana. Now he will oversee all MGE properties in the U.K. and Canada, as well as the Inspire project, now in development in Incheon, South Korea. He will also oversee MGE’s regional presidents. Mohegan President and CEO Mario Kontomerkos praised Pineault, saying, “From the beginning, it has been our mission to build the best executive team in the industry, and I believe we are on our way to achieving that status with a veteran like Ray at the helm.” Pineault, a tribal member, has been in the gaming business with the tribe for nearly two decades. Before serving as president and general manager of Mohegan Sun, he was senior staff attorney, managing legal issues pertaining to commercial transactions.

MORAN NAMED NGC CHAIRMAN

ongtime Nevada Gaming Commissioner John Moran Jr. was recently named chairman of the commission. First appointed to the commission by Governor Kenny Guinn in 2004, then reappointed to successive fourJohn Moran Jr. year terms by Governor Jim Gibbons and Governor Brian Sandoval, Moran has been acting chairman since the resignation of Tony Alamo in April. Alamo left to devote more time to his medical practice as the coronavirus spread. Moran is the son of late Clark County Sheriff John Moran Sr., and served with what was then the Clark County Sheriff’s Department as a deputy sheriff beginning in 1969. He was admitted to practice law in Nevada in 1975 and is the founding senior member of the Moran Law Firm in Las Vegas. Prior to joining the gaming commission, Moran served on the Colorado River Commission and the Nevada Board of Wildlife Commissioners. Governor Steve Sisolak also appointed Las Vegas attorney Ogonna Brown to fill a commission vacancy. A partner at Lewis Roca Rothgerber Christie, Brown has nearly 20 years of legal experience and expertise in business litigation and bankruptcy focusing on creditors’ rights. She was a judicial law clerk to Judge Johnnie B. Rawlinson in the U.S. Court of Appeals, Ninth Circuit in 2001 and 2002, and was a lawyer representative to the Ninth Circuit Court of Appeals from 2014 to 2016.

CORDISH NAMES BILLHIMER PA CHIEF

altimore’s Cordish Companies announced two executive appointments in July. Gaming industry veteran Joseph Billhimer was Joseph Billhimer named executive vice president of Cordish Gaming Group, responsible for leading the company’s expansion into Pennsylvania with the development of two new Live! Casino properties in Pittsburgh and Philadelphia. Bill Mikus was named vice president of human resources. Billhimer brings more than 25 years of experience in the gaming and hospitality industries to his new position, most recently serving as chief operating officer of Eldorado Resorts, Inc. in Reno, Nevada. He also served as president of MTR Gaming, based in Wexford, Pennsylvania. Billhimer served as chief executive officer of Premier Entertainment, where he was named Executive of the Year for his efforts in developing and redeveloping the Hard Rock Hotel and Casino Biloxi after its destruction by Hurricane Katrina. Billhimer also has held leadership positions at the Foundation Gaming Group, Caesars Entertainment’s Grand Casino Resort in Gulfport, Mississippi and Casino Magic Bay in Bay St. Louis, Mississippi. In a separate release, Cordish announced the appointment of Mikus to head human resources. He will lead recruitment efforts to fill thousands of new jobs generated by Live!’s expansion into Pennsylvania.

GGB

September 2020 Index of Advertisers

AGEM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27 AGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2 Aristocrat . . . . . . . . . . . . . . . . . . . . . . . . . . . .55 Analog Way . . . . . . . . . . . . . . . . . . . . . . . . . .35 Casino Player Media . . . . . . . . . . . . . . . . . . . .33 Casino Style . . . . . . . . . . . . . . . . . . . . . . . . . .39 Dickinson Wright PLLC . . . . . . . . . . . . . . . . . .21 Emerging Leaders . . . . . . . . . . . . . . . . . . . . . .47 Everi . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5 Fantini Research . . . . . . . . . . . . . . . . . . . . . . .51 GGB News . . . . . . . . . . . . . . . . . . . . . . . . . . .52 GLI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7 IGT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9 Incredible Technologies . . . . . . . . . . . . . . . . .11 J Carcamo & Associates . . . . . . . . . . . . . . . . .43 Kambi . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17 Konami Gaming . . . . . . . . . . . . . . . . . . . . . . .56 Pacific Sportswear & Emblem Company . . . . .23 UNLV Division of Philanthropy & Alumni Engagement . . . . . . . . . . . . . . . . . .29

SEPTEMBER 2020 www.ggbmagazine.com

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CASINO COMMUNICATIONS

Joe Lupo President and CEO, Hard Rock Atlantic City

n 2018, when Joe Lupo took over as president of Hard Rock Atlantic City, he had just finished a stint in the same position at Hard Rock Tampa, one of the most successful casinos in the U.S. Due to his many years as an executive at Atlantic City’s Borgata, Lupo was able to grow revenues, increase loyalty and capitalize on a market he knows like the back of his hand. When Atlantic City reopened, casinos scrambled due to a prohibition on indoor dining that was announced just before customers returned. But according to Lupo, the properties are making it work. Lupo spoke with GGB Publisher Roger Gros over the phone for an Atlantic City executive panel to be published in the September edition of Gaming Law Review. A full podcast of this interview is available on GGBMagazine.com.

GGB: You’ve had a tough time in Atlantic City over the last few months. Why don’t you fill us in on how it’s been going since it opened up in early July? Joe Lupo: We’ve been making the best of the hand

that we had dealt to us. People are pleased with what we’ve been able to provide. It was important for us to be transparent, specifically about what we could not provide. I think that’s been really helpful, to set that expectation. Here at Hard Rock, we have some great outdoor balconies that look over the ocean, and we’ve set up some great dining for our customers to sit outside. We’ve tried to do the best job we can. We’ve got probably as much Plexiglas around the property as anyone, if not more. We were quick to jump on that. It’s been important that we really impress this—our “Safe and Sound” protocols with the help of our Hard Rock corporate protocols. It’s been really important that we set that tone, that we’re safe, we do have a clean property, we’re enforcing the wearing of masks. As far as playing, you can play safely and have a nice experience here at the Jersey Shore. Let’s go back to the beginning of the shutdown. How much guidance did you get from the regula54

Global Gaming Business SEPTEMBER 2020

tors when the order was given?

We heard a lot of things from the regulators and the governor. Obviously, we were working closely with everyone. We started having meetings the week before, and I got the management staff around the table to anticipate what might happen. When we did get that notification—I think it was on a Monday morning—we literally were shut down by 2 o’clock that day. It was a tough issue for everybody, but we had good guidance, and we’ve been working well with the New Jersey Division of Gaming Enforcement. The governor’s office has been communicative as well. What was your strategy to stay in touch with your customers throughout the lockdown?

That was really important. We kept on some of our player development staff, and we were in touch with a lot of our customers. Obviously, it wasn’t about promoting the business, it was just making sure they were OK and asking if they needed anything. You develop some strong relationships in a high-frequency market like Atlantic City, where many customers know how many kids I have, their names, and saw them being raised over the years. You really develop friendships. Hard Rock has one of the best online casinos in the state. Did you direct people to that if they still wanted to stay active in gambling?

We did if they were interested. We weren’t pushing it too much. Obviously, a lot of people were out of work and going through some tough times. Here in New Jersey, when it started out, New Jersey’s (online gaming) numbers were through the roof. We wanted to be sensitive to the issues that people were going through. The online team did increase their spending on advertising, on TV and some other advertising mechanisms. But I didn’t think it was the time to push too hard. It was more about how people were doing, concern over friends and family that we’ve known for years here in Atlantic City.

Another group you wanted to stay closely in touch with was your employees. How did you stay engaged with them through this period?

They’re the backbone, aren’t they? We heard from them a lot. I kept on a few human resources individuals. We really went over and above to try and communicate with them, both through email and direct mail, and we set up some phone systems so they would have direct access to ask us questions. We wanted to hear their feedback and see how they were doing. We heard a lot of feedback, and we could not be more thankful to our owners showing their support. They wanted to make sure our employees had food on their tables. We gave away over a $1 million in ShopRite (grocery) gift cards over a few different periods. Everyone wore masks, and they drove through the porte-cochère, and we would hand those out. I’m telling you, it was dramatic. People were just in tears and thankful and could not have been more happy. How much of a curveball were the dining restrictions, which were announced just prior to opening?

We just took a very aggressive approach towards trying to be ready. Cleanliness was not an issue. Our rooms were clean. The real scramble was for outdoor dining. I believe we didn’t get that notice until Monday, and we opened on Thursday. At that time, we believed we were going to have 25 percent indoor dining. That was a little bit of a scramble to come up with. We currently have three outdoor balconies where we can serve food. Our food and beverage team had our toughest challenge, but they came through and worked hard. Then it was more about hotel rooms. How many should we book? How many can we feed? What’s the experience going to be like? What about the promotions? People cannot stand on line. They cannot congregate. So what kind of promotions can we do? We didn’t have a lot of notice—just over a week, but we were able to get the job done. I really could not be more proud of the team for doing so.

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Global Gaming Business, September 2020

Articles inside

The Esports Game

Skill Plays

Building the Brand

The Cashless Marker