Inside Asian Gaming

27 considering a dealer gets between US$60- 100 in that area). It’s a pure supply and demand market. On one side you have about 8-9 Junket Agents bringing in ever increasing numbers of players from Ho Chin Minh, and enjoying nice profits. On the other, you have six casi- nos with more coming online soon. You have a fast growing gaming industry perched on one side of the border servicing a market where there is a penchant for gaming in a country where there are restrictions on the opportunity to play. Sound like Macau? The growth in the number of casino op- erators is restricted only by land availabil- ity and the demand for gaming. Junket op- erators are free to come and go, their profit driven by their direct costs and the amount of credit extended to their customers and underwritten by the casinos. Competition is very keen, each of the junket agents repre- sented in all the casinos. Customers usually pick one agent over another because they have been given extra incentives such as bonuses when certain ‘rolling targets’ have been achieved. The most amazing outcome of this free- for-all competition is that all the action on the main gaming floor is ‘rolling’ action. Everybody’s rolling There was not a single cash player in any of Bavet’s six casinos. Not one. Every cus- tomer there played for either a percentage rebate on the rolling commission, and/or for complimentaries. So intense was the compe- tition for customers that the ratio of players to junket ‘rolling staff’was almost one to one. My companion and I sat down to a game,and a ‘roller’ was immediately behind us to swap our cash chips for ‘rolling’ chips each time we ran out of ‘rolling’ chips. The Junket Agent explained that they used to put their customers into designat- ed VIP Rooms, but when the casino tight- ened the terms, they moved them out to the main floor. So what do the players get out of all this? For starters, if they play on credit, they get no commission, but F&B and perhaps a free room. However if they are cash players, they get up to 1-1.2% plus the freebies, depend- ing on their rolling. We are already seeing some signs of this new trend in Macau. Most of theMacau casinos offer their Jun- ket Agents 1.2 to 1.3%, but nothing on the main floor. To compete against the superior attraction of the big new halls, a few of the smaller casinos have been offering 1.0-1.2% direct to players with extras like F&B and fer- ry tickets. Fortuna, President, Louvre, Arabian Nights, Diamond at Holiday Inn, and Golden Dragon have all been utilizing this tool. As the bigger casino operators continue expanding the number of tables across the board, the only effective method for the smaller guys to compete is to commoditise both the VIP and main hall business. These little guys are not able to compete on ser- vice because all the good staff have been lured to the big operators. They don’t have expensive attractions such as dancing foun- tains, Swarosvki baubles galore, canals and frescos, or mammoth aquariums (coming), but what they do have are lower overheads and greater flexibility in terms of re-engi- neering their product. At the moment, this practice of intro- ducing rolling commission to the average punter is limited to a handful of the smaller casinos, but with the recent reports of losses due to surging table capacity and squeezed margins, we will probably see a downgrad- ing of certain properties accompanied by the increased introduction of rolling action in the main halls. Already, some agents have surfaced to facilitate these transactions on the main floor, whereby they will buy or ‘roll’ the chips with the Promotional Chip desks, exchange them with the players with whom they have extended credit, and resell the freebies, such as ferry tickets (plenty of touts hanging around the Macau ferry terminal selling the tickets for a HK$10-20 discount) and F&B coupons (you can buy these buf- fet coupons for as low as a third of their ac- tual value) to give them extra profit (Grand Emperor’s buffet voucher of HK$150 can be bought for HK$50 on the ground floor). We have also already seen some casino shareholdings change hands—e.g. Waldo, President. The latest I’ve heard is that the recently opened Grand Waldo is on the market. Obviously, its main hall is unable to draw sufficient customers. Grand Waldo has reportedly been paying HK$1,000 per bus- load of low-end mainland tourists in order to render the casino less empty, when per- haps it should be looking at offering com- mission on the main floor. Some of the smaller and unprofitable ca- sinos may even go the same way as the ca- sinos in Bavet—i.e. leave the efforts to bring players into the main hall to the agents, a complete circle, as the history of the evolu- tion of the Macau Junket concept originated from this unique arrangement. So does Bavet portend the future of Macau? With the number of gaming tables set to increase exponentially, and the number of customers growing by a much smaller per- The Las Vegas Sun in Bavet and Sands Macau: Different as day and night