Turmoil at Revel, Trump; DFS to try self-regulation

Atlantic City civic gadfly Glenn Straub is at it again. In addition to trying to wrest electrical power from Stockton University by way of the Showboat (Stockton is contesting the validity of the quid pro quo in court), he’s threatening to sue the city if it doesn’t Straublet him develop Bader Field. In the course of pursuing his latest fascination, Straub appears to have taken his eye off the ball regarding Revel, the original reason he came to the Boardwalk. Reports The Press of Atlantic City, “The city began fining Straub this month for leaving the shuttered casino hotel a firetrap and failing to have competent engineers oversee the property’s alarms and other emergency equipment, city officials said.”

City Council President Frank Gilliam cut to the chase, telling Straub,  Continue reading

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Seminole resolution in sight?; Murren called on the carpet

Florida‘s Seminole Tribe is pursuing a two-track policy in the court of public opinion. On the one hand, it has announced rick-scott“significant progress” in its talks with lawmakers and Gov. Rick Scott (R, left). On the other hand, it is taking legal measures to keep its table games operational after their Oct. 29 expiration date. The latter argument leans heavily on the Indian Gaming Regulatory Act, pointing out that private-sector casinos in Florida will be allowed to continue operating electronic blackjack at Sunshine State parimutuels, putting the Seminoles at a competitive disadvantage. In an attempt to placate the state, the tribe would continue revenue-sharing payments despite being under no obligation to do so.

The Seminoles issued a statement saying ” the Tribe remains hopeful that a positive outcome will result,” but Continue reading

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Caesars: (Almost) everything must go; More angst in Macao

Well, it had to happen eventually. In order to escape bankruptcy, Caesars Entertainment is putting Caesars Entertainment IMG-20130507-00006Operating Co. on the market. There are some who are calling this a bluff and others who can’t afford to get in on the once-in-a-lifetime offer. Everybody else, get out your charge card and prepare to drain your revolving line of credit to the dregs. Offers like this don’t come along every day, let alone any year.

According to Caesars spokesman Gary Thompson, the contents of CEOC are “Caesars Palace [minus the Octavius Tower — that could be awkward], Continue reading

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Illinois to act on DFS

Today, a bill is anticipated to be put in the hopper of the Illinois Legislature to regulate daily fantasy sports. The brainchild of Rep. ZalewskiMike Zalewski (D), “it would create standards for auditing daily fantasy companies that want to do business in the state and prohibit their employees from playing in contests on other sites, among other restrictions,” according to the Wall Street Journal. “There’s a lack of clarity on whether [DFS] is gambling or game of skill and from what I can tell it’s its own thing,” Zalewski told the paper.

The DFS industry has been hewing to a party line that it’s open to regulation and the reaction to Zalewski’s bill was Continue reading

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Quote of the Day

“Has the world come to this? Can’t a man OD in a brothel anymore without getting bad press?” — Topless Vegas author Arnold Snyder on the Lamar Odom caper.

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Japan: Keep moving, nothing to see here; Crisis at Studio City

Despite much chumming of the waters by Union Gaming Securities Asia‘s Grant Govertson, it’s the same old same-old in Japan, where casino legalization has been delayed yet again and probably should Shinzo Abebe under a news blackout until substantial progress is achieved. Ineffectual Prime Minister Shinzo Abe doesn’t even have the support of all of his narrow governing coalition, so the issue is as good as dead until there is a major political shakeup. Govertson tries to suggest an increase in Chinese tourists by 83% last year and 117% this year will put wind in the casino bill’s sails. One could just as easily argue that Japan’s already getting the tourism so why does it need the casinos? Besides, Abe has blown any chance of getting them open in time for the 2020 Olympics, so the whole business has taken on the character of a farce.

* Bankruptcy notwithstanding, Caesars Entertainment continues to update some of its older properties. Latest in line for a beauty treatment is Continue reading

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Bad week for DFS

“What it’s doing is calling fantasy sports what it is. Do you pay money to get into the contest, and do you get money back when you southpoint-picwin? And if so, that’s gambling.” So says South Point attorney Barry Leibermann of Nevada‘s recent ruling on daily fantasy sports. Although DFS may seem like a logical extension of casino sports book offerings, to say the industry is approaching it with an abundance of caution is understatement of some magnitude.

A few reasons are suggested. For one, while Silver State regulators may smile on DFS as a casino game, regulators in other states might NFLreconsider casino licenses if the parent companies go into DFS. Even to add the requisite software might mean getting in bed with gray-market DFS entrepreneurs, so there’s that. Also, “When you parse it all out state by state, you dwindle the pool so much that it’s not attractive to the players,” says Internet gaming authority Sue Schneider. Per capita, the number of DFS players in Nevada must be pretty small beer — and besides the money is being won by a tiny handful of participants, most of whom seem to work for FanDuel and DraftKings.

Global Gaming Business has an excellent piece on the ups and downs (mostly downs) of DFS, from which I will glean some of the highlights. Between the inefficacy of the “game of skill” argument — fat lot of good it did online poker — and Draft Kings’ founder Jason Robins‘ hapless reference to DFS as “a casino,” the industry’s future looks bleak, or at least partly cloudy with a high probability of regulation. Georgia is the latest state to pile on, with the Peachtree State informing DFS operators that the lottery is the only form of gambling permitted therein. Add Georgia to Illinois, Colorado, Delaware, California, Ohio, Michigan, Massachusetts, New York and Mississippi, which are all investigating the pastime, and you have DFS under a lot of governmental microscopes.

DFS could have a really hard time in Florida, where it’s illegal for Joe Blow to play to win Joe Schmoe’s money, not even in a game of skill. Yahoo has already fled the Sunshine State, followed by Chaffetzseveral smaller sites. The greatest abundance of caution is being shown by Amaya‘s StarsDraft, which has pulled back to a handful of states — New Jersey, Massachusetts, Kansas and Maryland — in which it feels reasonably secure. (Kansas, for instance, has explicitly legalized DFS.) Legislation in progress to permit Internet gambling in Pennsylvania could be amended to restrict DFS to Keystone State casinos.

As an indicator of just how bleak the DFS picture is, normal adversaries Rep. Jason Chaffetz (R, above) and Rep. Frank Pallone (D) and Sen. Robert Menendez (D) are all calling for hearings on DFS. To put that in perspective, Chaffetz wants to outlaw Internet gambling in Pallone and Menendez’s home state of New Jersey. DFS makes strange bedfellows.

 

Posted in Atlantic City, California, Colorado, Delaware, Florida, Georgia, Illinois, Internet gambling, Kansas, Maryland, Massachusetts, Michael Gaughan, Mississippi, New York, Ohio, Politics, Technology | Comments Off on Bad week for DFS

Quote of the Day

“The [casino] bubble burst a long time ago. Now it’s just day-to-day business. We have to be looking at trends, interests and how people are spending ancillary dollars. If mudbogging becomes really popular, then we’ll have to make a mud hole.” — Saginaw Chippewa Indian Tribe spokesman Frank Cloutier on the Michigan public sector’s dependency upon casino revenue-sharing.

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Texas lottery gives guv Grief; The Incredible Shrinking Casino

Those cowpokes who run the Texas Lottery Commission have gotten a bit off the ranch. Of a proverbial fact-finding mission to the Delaware lottery, Executive Director Gary Grief said, “We were Abbottparticularly interested to learn about your sports betting, Internet wagering and casino games … that I know will be very helpful as our state begins to consider other forms of lottery games in the future.”

Such consideration came as fresh and unpleasant news to Gov. Greg Abbott (right) and to Lt. Gov. Dan Patrick, who said, “I expect the Lottery Commission to leave it to the Legislature before expanding.” The commission, backpedaling a bit, issued a statement that it was “always considering new games,” specifically of the draw and scratch variety. However, that doesn’t seem to Continue reading

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Quote of the Day

sheldon-adelson-25“We have a belief our gaming license is a privilege and not a right. We have always been respectful of the Macao government’s desires. We were the pioneer of the integrated-resort business model. That’s what the government wants. We will continue to do that.” — Sheldon Adelson, striking a different tone from Steve Wynn in re Chinese regulatory policies.

Posted in Macau, Regulation, Sheldon Adelson, Steve Wynn | 1 Comment

Caesars: New wine in old bottle; The house that poker built

Starting Jan. 1 (What? No New Year’s Eve bookings?), guests at Caesars Palace will have the chance to stay in the new Julius caesars-palaceTower. Except that it’s not really new: It’s the old Roman Tower, given a dramatic, $75 million rejuvenation. “Bursts of freesia yellow and Aegean blue stand out among the neutral color palette and textured fabric décor,” enthuses the Caesars Entertainment blog. Amenities will include a “stone shower with glass enclosure” and a 55-inch (above-average for Las Vegas) HDTV set in the bedroom. All this and more can be yours for a $149 ADR (plus resort fees, etc.).

It’s all part of a rolling makeover of the property which has already yielded Nobu Hotel and Searsucker restaurant, among other Continue reading

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Boyd: What’s not to like?; Poker cheat gets flushed

Try as it might, Boyd Gaming just doesn’t feel any warm fuzzies from Wall Street. J.P. Morgan analyst Joseph Greff Wall-streetcalled the most recent quarter “very impressive,” with 3% revenue growth and huge increases in cash flow. Still, Greff wrote, “we’d wait for a better entry point … We remain Neutral at current levels and continue to prefer [Penn National Gaming] within the U.S. regional gaming sector given its robust development pipeline, solid free cash flow generation … and better balance sheet.” Greff adjusted his full-year cash flow expectation for Boyd significantly upward, though.

Contributory factors to Boyd’s exceptional 3Q15 were 5% greater net revenue in the Las Vegas locals market and lower costs of Continue reading

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Adelson crashes MGM’s party; More trouble for DFS

Sheldon Adelson has a genius for sucking the air out of whatever room he enters. After MGM Resorts International laid the groundwork for a casino debate in Georgia, offering to invest $1 Sheldon_Adelson dye jobbillion in an Atlanta pleasure palace, Adelson has come along and upped the ante to $2 billion. That’ll make an impression. Adelson also has Peachtree State allies, like Newt Gingrich and former Las Vegas Sands COO Michael Leven, who has returned to the Georgia Aquarium, from which Adelson had plucked him. “He’s controversial for sure. He’s dynamic and aggressive. But he makes enormous contributions to every community he’s been in,” Leven told the Atlanta Journal-Constitution. “He’s never going to get left behind. He makes sure he knows what’s going on and where it’s going. He knows every detail,” added political consultant Randy Evans.

Penn National Gaming and Boyd Gaming have been reported as having interest in Georgia, but nobody’s Continue reading

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All’s well at Penn; Mulroy’s misdeed; Discomfort at Studio City

Penn National Gaming pleasantly surprised Wall Street, reporting third-quarter revenue of $739 million and $210 million in cash flow, exceeding projections by $8 million and $11 million, respectively. It Penn logopaid out $109 million in rent to Gaming & Leisure Properties Inc. Penn announced that $266 million Plainridge Park, in Massachusetts, and its two newest racinos in Ohio were all pulling in a 20% return on investment. At the former, Penn has signed up 130,000 members already for its loyalty program. “We think this should assuage investors’ recent concerns about a moderating recent revenue performance at Plainridge,” wrote J.P. Morgan analyst Joseph Greff of the slot parlor’s performance.

Out West, Penn is focused on improving the restaurant options and slot product at the Tropicana Las Vegas, while construction of Continue reading

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Pennsylvania edges toward ‘Net bets; The forbidden dance

There’s nothing like a budget crisis and a partial government shutdown to focus lawmakers’ minds on gaming expansion. That’s Reed-2014the case in Pennsylvania, where House Majority Leader Dave Reed (R, right) says, “We need to come to a conclusion on liquor reform. We need to address cost drivers like our pension system. We need to look at gaming options.” [emphasis added] And by “gaming options,” Reed means Internet gambling, OTB slot parlors and airport slots. The House rejected Gov. Tom Wolf‘s $2.4 billion tax increase like a hanging curve ball, putting “gaming options” onto the front burner.

“Before we look at increasing taxes on working families, we have a responsibility to look at every other possible revenue source out there, and expanded gaming is Continue reading

Posted in Election, Idaho, Pennsylvania, Politics, Regulation, Sheldon Adelson, Taxes, Tribal | 1 Comment

Quote of the Day

“Probably the [New Jersey] in me, but this should not be allowed to happen. Makes regulators look like their [sic] tools of casinos.” — Global Gaming Business Editor Roger Gros on Pat Mulroy‘s sudden move from the Nevada Gaming Commission to the board of Wynn Resorts, sans cooling-off period.

Posted in Regulation, Steve Wynn | 1 Comment

Macao rebukes Wynn

Steve Wynn‘s criticism of Macao governmental policy toward casinos as “outrageous and ridiculous … the single most counterintuitive and irrational decision that was ever made” went over like a lead balloon in China. Casino executives, including Wynn Macau President Gamal Aziz, were called on the carpet. Present to read the riot act was

Continue reading

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Penn bullish on Trop; DraftKings can’t help itself

J.P. Morgan analyst Joseph Greff met with Penn National Gaming executives and found them very upbeat on the Tropicana Las Vegas, even though it grosses less than $54 million a year. “Of trop-picthe three million Marquee Rewards members, Penn estimates 20-25% visit Las Vegas at least once per year and believes capturing just 15% of that user base’s average gaming spend would deem the property successful,” Greff wrote.

As for renovation, Greff doesn’t think we’ll see anything on that front (ditto new construction) until Continue reading

Posted in Internet gambling, Marketing, Penn National, Regulation, The Strip, Wall Street | 2 Comments

Quote of the Day

“It’s a shot in the arm. But it’s not the silver bullet that’s going to solve our financial woes.” — Binghamton Mayor Richard David, whose city ranked dead last in civic optimism, on the selection of nearby Tioga Downs for a full-service casino.

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James Packer thinks big; DFS’ self-inflicted wound

One scarcely thinks of Crown Resorts as anything but an upmarket brand. However, as it contemplates debuting in Las PackerVegas and pines after Japan, Crown is developing a new, luxury brand. The unlikely template will be a $1.1 billion, 90-story hotel/apartment complex in Melbourne. Said Crown exec Todd Nisbet, “the idea of being able to come up with a new resort proposition and potentially a new resort brand, we think is a good thing for Crown holistically and where we want to position ourselves over the next 10 years.”

The hotel tower is being built across the street from Crown’s Melbourne casino, so gaming will presumably monetize James Packer‘s billion-dollar real estate play. There’s still no word Continue reading

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