Nothing but blue skies ….

Nick Hardy pops the big question to the industry’s movers and shakers ?

In the classic 1970’s car chase movie ‘The Driver’, the hard-nosed cop played by Bruce Dern is constantly trying to catch out the elusive getaway driver played by Ryan O’Neal. At one point during one of their many superbly written verbal exchanges, the cop summarizes his views on the press. “I always read the newspaper backwards,” he says, “starting with the sports pages. That’s where the truth is, what happened and how it happened, nothing more. ” It is a work of fiction, but he may be correct. However, it is always interesting to speculate and exchange opinions. As we all enjoy the annual spectacle that is the world’s largest international gaming and amusement exhibition, the combined ICE and ATEI, we are bombarded with hard facts.

New products and what is happening in our professional world right   now. But where is it all leading us?  By way of something of an antidote to what feels like an unstoppable flow of hard news information, we thought it would be interesting to engage in a little speculation. We can all see what is going on today, but what do some of our so-called ‘Blue Sky ’ thinkers believe might be happening tomorrow?  Or even the day after tomorrow…?


In my dictionary, a cliché is defined as ‘a word or expression that has lost much of its force through overexposure. ’  So, to describe a phrase as ‘as chiche’ is generally accepted as a negative. However, my old school Headmaster used to somewhat contradict that negative perception by stating that that ‘cliches only become clichés by being true. ’  Now you may be wondering where this line of thought is heading, and what possible relevance it might have to a feature article within a serous gaming industry publication..?

In preparing what is intended as a forward-looking ‘Crystal Ball’ exercise for the international gaming sector and inviting contributors to offer a personal insight into what must be the single greatest cliché that can be applied to this business, and that is that the casino gaming industry is poised for massive change. ’  This is a phrase that has been on the tip of everybody’s tongue for what feels like forever, so much so that as the dictionary says, it has definitely lost much of its force through overexposure. Maybe it has always been said because that is what people want to believe?  Or, maybe because it is what some people have long been afraid of?  Either way, apart from the normal ‘changes ’ that have effected every aspect of daily life  through the years, primarily as a result of universal advances in technology, the gaming industry has largely remained fundamentally unchanged for as long as it is possible to remember. I am sorry Mr. Headmaster, but your theory is incorrect, because this particular cliché has not yet proved itself to be true. So where exactly is this long anticipated ‘Blue sky …?


The answer is that it is breaking through the clouds right this moment, and it is going to be with us sooner than many might like to believe. “The casino industry is poised for massive change. ” You may not have read it here first, but this may be the first time you have read it and realized that it really is the truth.

      All around the world, the previously semi-closed environment of the gaming industry is opening up and becoming a product for the ‘masses ’, as positive minded operators wake up to the reality that a large numbers of diverse customers offer more potential than a small number of specific ones. The bottom line of so-called ‘Blue Sky ’ thinking is that the sector we all operate in is the wide world of ‘leisure’ and ‘entertainment ’ and not the discreet little exclusive club that is ‘casino gambling’. Once operators realized that thousands of people spending modest amounts can generate more atmosphere, entertainment value, social acceptability and long-term revenue than small numbers of hardcore devotees, then the inevitable momentum for real change was underway. A tiny snowball was pushed off the top of the high mountain and now it is rolling at great speed, gathering power and growing in size. So much so that it is becoming an unstoppable force.


The cultural crossroads of Macau occupies only 10 square miles, spread over a tiny mainland peninsula in China’s Guangdong province and the two islands of Coloane and Taipa. Despite what may best be described as a ‘colourful’ history, Macau is now capitalizing on its unique Portuguese cultural heritage and tires with China to come out of the shadow of its more famous cousin, Hong Kong, and become one of the world’s fastest growing tourist destinations.

      Following the 2002 ending of a 40-year gaming monopoly, it began to become clear that a new breed of casino location would be at the heart of this transformation. And the new face of Macau is represented by companies such as melco International Development Ltd, headed by 28-year old Lawrence Ho. Melco’s planned City of Dreams, a $1.3bn joint venture project with Australia publishing and Broadcasting Ltd (PBL), will be a first class fully integrated entertainment resort, with the world’s first underwater casino. The City of Dreams will float above a crystal lake and in addition to tropical marine life, will feature 450 gaming tables, 3,000 gaming machines, a performance hall, serviced time-share apartments, fine dining options, a nightclub and three hotels offering 2000 rooms. The opening is scheduled for late 2008. Also under construction from Melco is Macau’s first and only six-star hotel and VIP casino, the Crown Macau. This project is Mr. Ho’s first contribution to the Macau government’s objective of creating a ‘multi-dimensional family destination. ’  It is this diversity of thinking and ambition that characterizes the new breed of entrepreneurs, and illustrates the clear direction in which the casino sector of the future is heading.

 “The old guard still believes in converting an old commercial building and calling it a casino,”  observes Lawrence Ho. “The new guard is putting money, time and investment into things because we think we can actually add value and make something of the product. We aim to build something that will last 30 or 40 years, not just three or four. ” These mega-projects will not be the first time that Lawrence Ho, sone of the legendary Dr. Stanley Ho, has surprised so-called industry experts by approaching a traditional gaming market from a fresh angle. He has already created a highly successful chain of fashionable slot machine coffee houses, called Mocha Slots. Designed as a fusion of the Starbucks-style coffee shop and the Australian slot club, these modern poker gaming lounges have attracted a younger clientele and secured around 35 per cent of the region’s coffee house sector.


David Chow is another at the sharp end of the ‘Blue Sky ’ thought process in Macau. A proven entrepreneur, member of Macau’s legislative Assembly and founder of the Association for the Promotion and Development of Macau, 54-year old Mr. Chow is a legendary local figure. Having spent over a decade learning the casino business in the US, he returned to Macau and applied this knowledge and his own visionary thinking to the modernization of the island’s leisure and gaming sectors. In 1997, he opened The Landmark, a one million square foot office and serviced apartment complex, include within which is The Legend Club and Pharaoh’s Palace Casino, a VIP destination with a level of luxury that has to be seen to be believed. Next on the agenda is Fisherman’s Wharf, a $300m entertainment complex including restaurants and bars, children’s attractions, hotels, offices, shops, a Convention Centre and, in its second phase, a casino. “The idea behind the whole project is to attract families to Macau,” says mr Chow,” as previously there were few venues where children and parents could go together to enjoy themselves. ”


Christophe Leparoux is International Sales and Marketing Manager with Gaming Partners International (GPI), and a supplier who understands and embraces this atmosphere of change. “The casino industry is an area that has so far been considered by many to be conservative and old-fashioned. This comes from the iconic status of traditional table gaming. But today, the industry is experiencing some of its most dramatic evolutions for years. The advent of Macau came as a revelation to many, convinced that there were no other markets with the potential of the US. It is now clear that gaming revenues from Macau already surpass those Las Vegas …with 20 times fewer casinos..!  Only in Asia could such a huge change have happened in such a short space of time. ”

      Mr. Leparoux is also not the first to observe a shift in emphasis back towards table gaming. However, this is not only traditional table gaming, but table gaming with technology. “In Europe, and the US, slots generate the major share of revenues. In Macau, they account for only a tiny percentage. Games such as Baccarat, Fan Tan and Tai Sai dominate. Basically, if everything goes according to plan in Macau, the biggest gaming market in the world will be driven by table gaming, and not slots,”  said Mr. Leparoux. Who would ever have forecast that table games would be the future of the casino industry?  However, this must also be largely driven by the technological revolution that is taking place within the tale gaming sector. Progressive and bonus games, and the likes of electronic roulette and blackjack have changed the complexion. “The next major move is definitely what is happening with RFID (Radio Frequency Identification) technology,” states mr. Leparoux. “Being able to secure your chip bank while easing the chip inventory and tracking players is a genuine dream come true for table game managers. It took a decade to develop, but now it is here, available and working. The future lies in technology, and the influence of Asia. So go east, Gawailo, but the prepared or a new focus on the both culture and technology. ”