Asian Gaming Intelligence is hearing a few grumbles from the supply side of the industry amidst the general cheering for Singapore’s new casino resorts.
They concern the hot potato of operators that take slots or multi-players on more or less permanent ‘trial’, long after the numbers prove the equipment is clearly performing well in that market. Such practices, extended over many machines and many months, can significantly erode the manufacturer’s return on invested capital by limiting the amount of revenue the supplier can gain either from outright sales or management deals.
Genting, the majority owner of Resorts World at Sentosa—or at least its on-site management—has been named specifically as occasionally being a little ‘cheeky’ in this regard.
Of course, it’s a casino operator’s right to drive the best possible bargain on behalf of that operator’s management and shareholders.
There is, though, an implicit partnership between the gaming operators and their suppliers. The operators take the risk at the consumer end, and the suppliers take the risk at the technology and development end. For the industry to work well and for the industry to maximise its potential to add value for players, operators, suppliers and market investors, there needs to be a fair balance between rewarding the efforts of suppliers and acknowledging the competitive challenges faced by operators.
Here endeth the lesson.
To finish on a more upbeat note, the recent history of Macau has shown that opportunities arise for suppliers post-opening as operators tweak their offer in the light of hard experience on the front line of the casino floor.
One senior Macau gaming executive, who preferred not be be identified told Inside Asian Gaming: “I’ve been in the industry 20 years and I still get surprised by what works and what doesn’t work. A floor is a constantly evolving environment. Although common sense and experience teaches you the broad principles of what will work and what won’t work, you learn never to discount new ideas out of hand.”
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