Every few years, brows are knitted earnestly in discussion of whether this will finally be the year in which Japan legalizes casino gambling. I’ve been hearing versions of this debate regularly since 2005, so you’ll pardon me if I suppress a yawn. Yes, billions of dollars — to say nothing of various Asian currencies — are flowing into Macao and Singapore. But this is hardly new or shocking intelligence. One’s skepticism is only fed by the hype of brokerages such as CLSA which predicts Japan could gross $10 billion/year … more than Las Vegas or Singapore … on the strength of two ‘integrated resorts.’ But wait! Wasn’t Manila supposed to be “the next Las Vegas”?
This time around, the theoretical appeal of Nipponese casinos is predicated upon a lower tax rate than China‘s 39% — and proximity to the Peking and Shanghai markets. But if even the need to raise 
revenue in the wake of wake of recent naturals disaster wasn’t enough to get gambling expansion through parliament, what will be different this time? Meanwhile, the three nominal front runners — Las Vegas Sands, MGM Resorts International and Wynn Resorts — are all facing a tough sell in Canada, to a large extent because of how they’ve done business in China. And while Japan might have seemed like a walkover for MGM or Sands in previous years, now they have to deal with upstarts like Melco Crown Entertainment and Genting Group, as well as local favorites, such as Fuji Media and Sega Sammy Holdings. Wynn, of course, can expect a not-so-friendly welcome from former buddy and now rival Kazuo Okada, who’s got at least $1.9 billion he can put into repelling Wynn from Japanese soil.
Mind you, I do not share the kind of skepticism peddled by Ken Adams, premised on sentimental assertions that “Las Vegas is the gold standard of casino gambling.” That may be, but it hasn’t caused us to be dwarfed by Macao or to have Singapore yapping at our hindquarters. It’s certainly a weak argument to make against the new threat (?) from Japan. One would be better off citing the Japanese political disinclination to do anything, as well as bad habit casino proponents have of exaggerating revenues, often as much as 40% or more. Anyway, I’ll believe this when it happens and not a day sooner.
On the subject of predictions, I would have thought the PokerStars acquisition of Colony Capital’s Atlantic Club Hotel was pretty much of a done deal, opposition is hardening. To call the company’s 
record “spotty” might be generous and the worst of its delinquencies — resulting in a $731 million Department of Justice fine — makes some of Boardwalk’s old-time, mobbed-up casino owners look like underachievers. And, at every corner, there’s someone echoing then-Gov. Brendan Byrne‘s message to mafiosi, “Keep your filthy hands off Atlantic City.” It’s practically becoming a refrain. Another way of solving the problem would be for the State of New Jersey to buy up some of the oldest, least-redeemable casinos in the market — say, the Atlantic Club (above), Resorts Atlantic City and perhaps disputed Trump Plaza — and tear them down in favor of green space. That’s one way to take PokerStars out of the picture and it would cost a lot less than Gov. Chris Christie (R) was prepared to spot Revel to help it get going. Anyway, I’m now prepared to bet (albeit lightly) against approval of the PokerStars deal; the negative political fallout will be much too great.
