Research Library

The China Syndrome: Why the PRC’s impact on gaming throughout Asia is dependent upon many issues

The People’s Republic of China (PRC) continues to emerge as an economic and political superpower in the world, and its actions have a direct influence on the gaming market in Asia. This goes
well beyond the borders of Macau, SAR (Special Administrative Region) that nearly 20 years ago opened up for the first time to foreign casino operators beyond Stanley Ho’s monopoly.

The reach of the PRC permeates both economically and politically into key emerging markets such as the Philippines, Cambodia, Vietnam, South Korea, and other markets throughout the Far East (including Northeast and Southeast Asia).

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Research Brief: State Legislative Update on U.S. Sports Betting & Online Gaming March 2020

In the coming weeks in the sports betting world, the focus will be on college basketball with the conference tournaments and NCAA Tournament that are upon us. However, there is an incredible amount of activity in state legislatures as they either launch their efforts prior to the tip-off or try to get legislation passed before the final buzzer. A host of states have legislative sessions that are ending in March, while others are just reaching the second half of their session. Many of these efforts may result in a buzzer beater as stakeholders move towards compromises while other states may miss and have to wait for the next legislative session to start their discussion.

As we look at the current state of play in sports betting across the country, mobile wagering continues to be a dominant factor and a revenue driver for states. Nevada for the first time has started to report the percentage of mobile wagers, showing that nearly fifty percent of sports wagers in the state were placed through a mobile device. Pennsylvania saw the highest share of mobile wagering, as nearly 90 percent of their revenue came from mobile devices. Revenue continues to grow across the country as these markets mature with mobile options allowing for further growth opportunities.d.

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Research Brief: State Legislative Update on U.S. Sports Betting & Online Gaming February 2020

As we are coming off one of the most heavily watched sporting events and one of the most gambled-on events, we are just entering the proverbial Super Bowl of legislative activity. Numerous states are in the thick of their legislative sessions with numerous hearings and pieces of legislation surfacing as states work through sports betting, online gaming, brick-and-mortar casinos, and how to deal with the illegal/gray market.

As we look at states this month, there are four real groups to consider. In keeping with the football theme at the close of the 2019 season, we will classify these groups of states as “Professional Players”, “Draftees”, “College Players”, and “Signees”. Professional Players are those states that have already legalized sports betting and are up and running. Draftees are those jurisdictions that have legalized but have yet to launch in the market. College Players are those states that appear ready to launch and are in active debate to take it to the next level. Finally, in light of National Signing Day this week for future college football players, Signees are the states that are just starting their journey down the path of sports betting.

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Social Safeguards: How Singapore set a new standard in addressing responsible gambling

As Singapore continues to serve as the model for IR development, it has also become one of the current models to address the promotion of responsible gaming measures and casino exclusion policies for its two integrated resorts.

At the time of inception, these cutting-edge initiatives allowed for a different model for individuals to be excluded from the casino, limited the floor size of the facilities, created a publicentity to promote responsible gaming efforts, and created partnerships with operators to work with the government in creating an environment of responsible gaming. It also introduced a casino levy for locals with the option of a daily or yearly fee.

The two operators in the market, Las Vegas Sands (Marina Bay Sands) and Genting Singapore (Resorts World Sentosa), initially had to develop internal responsible gaming education and training programs. These initiatives have continued to evolve over the course of time as more research has become available and the market has matured. The programs include an initial and annual training that offers employees the ability to understand the signs of problem gambling, as well as how to respond and support a guest. It also includes support in the form of high level specialists that offer a higher level of knowledge on responsible gaming measures and how best to handle a guest that may need further assistance.

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The Evolving Casino Marketing Landscape

Twenty years ago, there was much talk in the gaming industry of how to engage GenXers, and the potential value of this segment. As GenX is only now becoming a meaningful contributor to the industry, this conversation has now evolved into the current hype around millennials.

What allowed GenXers to become gamers is simple: they began to acquire the two key items that people need to gamble—time and money. As millennials age, we will see them gravitate toward casinos gaming as well. While the demographics of casino participation have been little changed for a generation, there have been material changes in products, channels and, importantly, methods of engaging with casino patrons.

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Bouncing POGOS

Online gaming has been on the radar of mainland Chinese authorities over the last six months, as they seek to stop online operations in Asia. They are particularly focused on online gaming markets in Cambodia and the Philippines, which are suspected of targeting Chinese nationals.

In response to several compliance issues and concerns raised by Beijing, Cambodia has effectively shut down its online gaming operations. However, the Philippines and President Rodrigo Duterte, even after meeting with the Chinese President Xi Jinping, decided to keep its online gaming operations open. The market is thriving throughout the Philippines and looks to continue to grow under the regulatory structure of the Philippine Amusement and Gaming Corp. (PAGCOR).

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Rising Sun: Japan begins to enter the homestretch in 2020

Like the cherry blossoms in the spring in Japan, integrated resort developments will begin to emerge into full bloom starting in January 2020. The coming year will see significant progress at the central government level that will then launch the RFP process at the prefecture level.

If the level of activity in the second half of 2019 is any indication, 2020 will prove to be a very robust year. However, there is still a lot of work to do before Japan awards up to three of the coveted IR licenses established through the IR Promotion and IR Implementation Acts.

Since the market began to emerge some 20 years ago, Japan appears to be in the homestretch for the initial round of development of integrated resorts. The movements not only by operators but also by interested prefectures will continue to evolve in the coming weeks and months.

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Rethinking the Premium Players Lounge

Premium player lounges have become a fixture in many casinos in North America. These lounges provide higher worth players with a place to take a break from the gaming floor, catch up on text messages, and sit in a relaxed, non-gaming environment. They also offer hosts a place to connect with their customers. At some properties, the lounge may provide players with some form of food offering, yet rarely, if ever have they been considered part of a casino’s food & beverage strategy. In fact, in most player lounges food is treated as an afterthought, usually comprised of packaged snack foods or some items from the central kitchen that, after sitting out for a couple of hours, have lost their gastronomic appeal.

What is rarely recognized is that the premium players’ lounge, properly designed and maintained, can help the casino property provide its best customers with precisely the kinds of dining that they prefer for their everyday gaming experiences while reducing comp expense and the time gamblers spend off the gaming floor.

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Research Brief: Japan IR Timeline Update

Late last month, many stakeholders following the Japan Integrated Resort process believed they were thrown a curve ball, following reports stating that the process would be delayed by a year without the appointment of the Casino Management Commission and other cabinet and ministerial positions. However, the delay will likely not be as long as initially thought but would only be a minor delay in the marathon for integrated resorts in Japan.

First and foremost, this process is still in its infancy. While stalwarts of the process have been trying to get legislation passed for over twenty years, the race continues to move at a moderate pace as the government begins its official process to form the Commission and the 300-plus items that still need to be officially decided. It was thought that the Commission would likely be appointed before the end of the current regular session of the Diet. However, this part of the process has been delayed because of the upcoming elections that have been planned for the Upper House of the Diet. While it has not been confirmed that a double election would occur in July 2019, there is also the potential that a snap election in the Lower House could be held at the same time.

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Research Brief: Wire Act New Hampshire Case Ruling

On the afternoon of June 4th, a ruling was issued by United States District Judge Paul Barbadoro in the case between the New Hampshire Lottery Commission and Neopollard, a lottery vendor, against the U.S. Department of Justice (“DOJ”) regarding the Interstate Wire Act of 1961. The suit was brought by New Hampshire in response to the memorandum issued by the DOJ’s Office of Legal Counsel (“OLC”) on November 2, 2018 (the “2018 Memo”), which stated that the Wire Act applied to all forms of gaming and not just sports betting, reversing a previous opinion issued in 2011 (the “2011 Memo”). The 60-page ruling in the New Hampshire case confirmed the 2011 Memo, stating that the Wire Act applies only to sports betting and setting aside the 2018 Memo. The result in the New Hampshire case represents a shot across the bow of the authors of the 2018 Memo and others, in the DOJ and elsewhere, who have pushed this agenda for the last several years.

The case was one that many throughout the gaming and lottery industries had been watching since the 2018 Memo was released earlier this year. After the 2018 Memo was released, the DOJ offered a 90-day window before enforcement of the Memo would go into effect, which meant that enforcement should have commenced on April 15, 2019. The DOJ extended that deadline another 60 days earlier this spring, pushing the end of the non-prosecution period to June 14, 2019.

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