Inside Asian Gaming

13 12 hand, an entire medium-sized slot hall with up to two hundred machines requires just one technician on duty to handle tech- nical problems. Dealers inMacau are currently paid about 14,000 patacas (US$ 1,750) a month, putting the annual labour cost of running each table at 1.68 million patacas (US$ 210,000). The basic salary of dealers rose considerably fol- lowing the end of SJM’s 40-year monopoly because dealers are now no longer allowed to exhort gamblers to give them tips – as was common practice at Stanley Ho’s casinos during the monopoly era. This, along with limited supply driving up wages, is making electronic gaming an increasingly cost-effec- tive alternative. Another innovation is electronic table games that use human dealers in conjunc- tion with automation to speed play and cut staffing requirements. Rapid Roulette and Rapid Sic Bo, developed by Australian video gaming company Stargames, have been in- troduced at Galaxy Entertainment Group’s new casino, Grand Waldo, and SJM has also put in orders for the machines.The dealer an- nounces the games’ countdown and results, while bets are taken and payouts made by computers. Bonus Attractions Machines can offer more bonus features to players than table games. Among the most popular games at Emperor’s slot hall is Golden Blackjack, produced by Japanese manufacturer Ohira Giken Industry. Golden Blackjack is unlike computer blackjack in that it deals real cards to players rather than of- fering animated simulations. Golden Black- jack also features a progressive jackpot as an added attraction for players.Mr. Lam tells of a Chinese lady who walked away with a 90,000 pataca (US$11,250) jackpot in May. Machines also facilitate tracking custom- ers’ behaviour and preferences, and allow the awarding of redemption points which are becoming a must-have to retain loyalty as competition for players intensifies. All of Macau’s slot halls offer loyalty programs,with players accumulating points that can be re- deemed for prizes. Patrick Lam estimates that 60% of players at his slot hall hold loyalty cards. “It helps. A lot of clients like the system we run because, for example, within our group we have got a lot of different businesses:our entertainment, jewellery and watches.BeforeValentine’s Day, there were guys coming in with lots of points on their cards.” Macau Sets Machine Trends Slot manufacturers claim that Macau is becoming a launching pad for the latest gaming technologies. Patrick Hogan, re- gional general manager of RGB (Macau), says “I think Macau is becoming the leader as far as gaming opportunities and tech- nologies are concerned. I would have to say that probably Macau is now evolv- ing to become more about multi-termi- nal games. In Western casinos, you don’t get the variety of games you can find here. Macau is dynamic. It’s adventurous.” According toMr.Lam,the Emperor Palace Ca- sino was the first place in the world to intro- duce Golden Blackjack.“Macau is very lucky. All of the operators are new, so they bring in the best machines from around the world.” Ted Chan predicts multi-terminals will spread to other Asian gaming jurisdictions where the market for gaming machines is in its infancy, serving as a transitional product from tables to slots. To capture emerging machine gam- ing opportunities in Asia, Melco’s technol- ogy arm, Elixir, recently entered a gaming technology alliance with Shuffle Master, the parent company of Stargames. The al- liance plans to “develop localized gaming technologies for legalized gaming jurisdic- tions in Asia” and to build “a world-class manufacturing base” in mainland China. Ted Chan points out that the existing major slot manufacturers do fully not address the Asian market.“Over the past 20 years, Asian players have contributed too little to the slot market. Most slot games are developed by US and Australian slot makers for their own markets. Unfortunately, we have to choose from what is available. The products are not customized for our market. Now what I hope is to have some big [Asian] slot operators to negotiate with the slot manufacturers or to cooperate with them to develop new games and then re-export them to the US.” Mr. Chan suggests manufacturers develop more highly volatile games to appeal to Chinese gamblers, as well as games with Chinese-language interfaces (some manu- facturers are only willing to translate thema- chines’ buttons and displays to perfunctori- ly satisfy their clients) and Chinese-themes. Even the popular electronic baccarat ma- chines are not properly customised for the Macau market. The established practice in Macau is for the house to take a five per cent commission on winning banker bets,where- as manufacturers only offer electronic bac- carat machines run according to the practice in Las Vegas, where there is no commission but the house takes half the bet if the banker has a six. This can, of course, confuse players in Macau unfamiliar with Vegas rules. “We are forced to take it. Fortunately, it is still very popular in Macau,” explains Mr. Chan. The alliance between Shuffle Master and Elixir will compliment the Mocha Slot outlets by providing games more in tune with the Asian market.“We will put our experience into the design [of Elixir’s prod- ucts]. These games hopefully will be the most popular games in Asia,” says Mr. Chan. He adds: “Mocha is a very important plat- form. Without this platform it is very hard to know what the market wants exactly.” Macau is regarded as a potential goldmine by slot machine manufacturers. Many in- ternational manufacturers, including Aris- tocrat Technologies, Bally Gaming and Sys- tems, IGT, TCSJohnHuxley and RGB have set up marketing offices in the city in order to get closer to local clients. At the moment, however, the Macau gaming machine mar- ket is still relatively insignificant – IGT, for example, sold 91,400 machines worldwide in 2005, equivalent to almost 22 times the entire installed slot machine base in Macau. That is perhaps the main reason why the big manufacturers have been so slow to devel- op customised offerings for the local mar- ket. This provides an opportunity for Asian manufacturers such as Elixir and Taiwan’s Jumbo Technology Co – developer of the sic bo machine – to stake their position in the emerging market. Drawing a New Crowd Slots in Macau are attracting a new demo- graphic of gambler seeking to while away a few hours without staking table minimums starting at 100 patacas (US$12.5) in the city. “Our prediction is that the market will shift to the middle class players. Gradually, slots will become very popular in Macau,” pre- dicts Mr. Chan. Slots are also drawing in lo- cals, and half or more of customers at both Mocha Slot and Emperor’s slot hall are Ma- cau residents. The coming years will see more middle- class mainland Chinese coming to Macau, raising demand for slots relative to the 1,000 pataca minimum baccarat tables favoured by big-spending mainlanders that currently contribute the bulk of the city’s gaming rev- enue in VIP gaming rooms. It was only in the 1980s that slot ma- chines took the lead from table games in the Las Vegas mass market. Analysts look to Las Vegas’ history to predict where Macau is headed. It appeared that Macau could go down a slightly divergent path given the initial popularity of multi-terminal games, but with traditional slots having taken the lead in the gaming machine market comes further confirmation that Macau is moving towards the Vegas model at an accelerated pace. Thus, like the foreign casino operators arriving in Macau, slot manufacturers fo- cused on the city also look set to enjoy ac- celerated earnings. Machines also facilitate tracking customers’ behaviour and preferences, and allow the awarding of redemption points which are becoming a must-have to retain loyalty as competition for players intensifies Emperor Palace Casino’s slot hall