Inside Asian Gaming

August 2008 | INSIDE ASIAN GAMING 29 It’s one thing to fill a casino with poker players during a big money tournament, but more of a marketing challenge to keep a dedicated poker room full and profitable the rest of the year in a strong baccarat market such as Macau. Aside from the need to educate local players about poker, some casino operators may also take some persuading to hand over precious floor space and table allocation to poker rather than baccarat. Poker games aren’t typically played at the same speed as baccarat, nor do they deliver the same levels of cash turnover per hour. Full time poker rooms are, however, of commercial interest to some Macau casino operators and their investors precisely because of poker’s apparent ability to bring in a new type of customer and because the poker revenue model may offer the prospect of a hedge against the volatility of baccarat returns. Galaxy Entertainment Group has been a leader in recognising the potential of poker in the Macau market, providing venues for both the APPT at the GrandWaldo Hotel and for the APT at StarWorld. “Galaxy had the vision to bring poker into Macau ahead of other casinos,” says Chris Parker, Chief Executive of the APT. “StarWorld is a great hotel and a great location for us.They believe in our vision and want to see the APT grow.” Value Bet Poker’s business model could give Macau’s hard-pressed casino operators a welcome edge Product mix Moving Macau away from a baccarat monoculture may have practical benefits for an operator’s bottom line in the long run. Macau’s current dependence on baccarat in its VIP and mass-market form can lead to significant swings in casino profitability. As Inside Asian Gaming reported in our story ‘The Big Squeeze’ in the May edition, the 2.52% theoretical house edge inVIP baccarat can easily be gobbled up by a heavy winning streak from one or two high stakes players. In the third quarter of 2007, Las Vegas Sands Corp (LVS) posted a US$48.5 million net loss that it attributed in part to high stakes baccarat players getting lucky in Macau.