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G2E panel: Gamblers will dictate change

16 November 2006

By Howard Stutz





LAS VEGAS, Nevada -- Gaming equipment companies are developing a plethora of new technologies for the casino market, such as hand-held or wireless gaming devices, radio frequency identification chips, server-based or downloadable slot machines and electronic table games.

But Mark Yoseloff, the chairman of Las Vegas-based Shuffle Master, one of the industry's leading manufacturers, told an audience at the Global Gaming Expo on Wednesday that not every product will survive on the casino floor.

Ultimately, the gambling customer will make the final choice, Yoseloff said after participating in an hour-long round-table discussion with other gaming company chief executive officers.

"As much as we think we can predict, we always can't predict correctly," Yoseloff said. "My company is investing in a number of initiatives. Obviously, we're hopeful they can all be successful. Realistically, some will be more successful than others. But if you don't venture and make the investment, certainly nothing new will come to market."

Yoseloff was a last-minute addition to the panel, replacing an absent Harrah's Entertainment Chairman Gary Loveman. That left MGM Mirage Chairman Terry Lanni as the lone casino operator participating in the discussion, joined by the chairman of two slot machine makers, TJ Matthews of International Game Technology and Paul Oneile of Aristocrat Technologies, and Peter Dean, chairman of the Gaming Board for Great Britain.

Much of the round-table discussion, moderated by American Gaming Association President Frank Fahrenkopf Jr., turned toward international gaming opportunities.

Lanni, whose company operates 10 Strip casinos and is building the $7 billion Project CityCenter on the Strip, said international opportunities could become a big part of the MGM Mirage portfolio in the coming years.

"We're currently building a casino in Macau (China) and we're exploring second or third sites in the market," Lanni said. "If Peter is good enough to select us, maybe we will be in Great Britain."

Dean told the audience Britain is planning to a license one large Las Vegas-style casino sometime next year. Major operators such as MGM Mirage, Harrah's Entertainment and Las Vegas Sands Corp. are expected to bid on the project.

Yoseloff said some of the casino equipment innovations being proposed for the American market, such as electronic multiplayer table games that don't use a dealer, are already being introduced in Australia, Asia and other international markets.

Yoseloff said Shuffle Master hopes to gain as the number of table games on the market increase, mostly due to expansion in Macau, China and other international jurisdictions. He said Macau could be home to 8,000 more gaming tables by the next decade. That opens the door, he said, for electronic table games that don't require the use of a dealer.

"The expansion in Macau is going to require the hiring of 25,000 more dealers," Yoseloff said. "There is going to be a labor shortage over there. We think this will be a tremendous market for electronic tables."

Slot makers, too, hope to capitalize in Macau. More than 90 percent of the revenue now generated from the Asian casino market comes from table games, the panelists said.

Matthews said IGT has opened an office in Macau and now employs a staff of 40. The question will be what particular slot machine will gain popularity in Asia.

Advances in gaming technology, however, are traditionally slow to be accepted. It took Shuffle Master four years to place just 500 automated card shuffling devices into casinos. Today, 14 years later, the company has more than 21,000 of the card shuffling machines in casinos.

Matthews said server-based gaming, slot machines that conceivably would allow customers and casino operators to easily change of out game content on particular machines, has the most-widely discussed innovation at the past few G2Es. IGT, along with other equipment manufacturers, displayed prototypes of server-based slot machines in their trade-show-floor booths.

"This has been an ongoing question," Matthews said. "Casinos have been asking for new products, but ultimately, the question is what do they do for the player. The casino customer is going to make the final decision."

He said IGT had to deal with customer acceptance with the introduction of multidenominational slot games and wide-area progressive jackpot products.

Added Yoseloff, "At the end of the day, it's a very democratic process. The player votes with their money."


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Howard Stutz
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