Inside Asian Gaming

June 2008 | INSIDE ASIAN GAMING 63 Briefs Ariawill houseaCirqueduSoleiltheaterthatwillhostaproduction show based on the music of Elvis Presley. The hotel will also display portions of CityCenter’s planned $40 million public arts program.The development will also include Crystals, a 500,000-square-foot retail, dining and entertainment complex. Wynn’s Alternative to Nevada Casino Tax Hike Eager to avoid the imposition of higher casino tax rates, Steve Wynn and other Nevada casino operators have devised an alternate plan to raise taxes on hotel rooms. The Nevada State Education Association, the union that represents teachers, has been circulating a petition that calls for an increase in the tax rate on gross casino gambling revenue from its current 6.75% to 9.75%, generating an additional US$250 million annually. The casino industry has fought the issue strenuously, both in court and politically.The alternative proposal to raise the room tax would generate tens of millions, but probably not approach the sum that would be raised by an increase in the casino tax rate. While there are strong signs the education initiative raising the casino tax rate would pass if voted on by a public ballot, there are several large obstacles in the way of the proposal becoming law because it would require a constitutional amendment. Even if the bill were to earn a ballot spot, it would need to pass the general election this fall, and then again in 2010 to become permanent law. In the meantime, casino lawyers continue to file appeals to get the petition dismissed. Nevada’s state casino tax is the lowest in the US. Some US states have rates as high as 50%, while Macau’s rate is 39% (35% as direct tax, and 3-4% as mandatory social and welfare contributions). Gas Prices Could Fuel Online Gaming A report by Gambling911.com highlights how soaring gas prices and a looming recession are taking their toll on Las Vegas casino operators and driving gamblers to online casinos. “Individuals are now cutting back on their travels both by air and by car,” according to the article. “Carlos Bueno and his wife, Mayra, serve as perfect examples of how escalating gas prices are now beginning to hurt the Vegas economy and other gambling dependent regions, proving that gambling is not ‘recession proof’ as previously believed.” In an interview with USA Today , the couple said they drove three times last year from their home in Houston to a casino in Lake Charles, La., but they won’t be making the two-hour drive this summer. “Gas prices are the main reason,” says the 32-year-old father of three children who works for a utility company and also is cancelling the family’s annual vacation to the Dominican Republic. “The economy is harsh right now, and the little money saved for vacation will have to be spent on fuel for our vehicle.” Thomas Jensen of Point-Spreads.com ,a website devoted to online betting odds news, speculates that a harsh economy is good for the online gaming sector. “People are looking to make a quick buck so they are joining online casinos and more specifically, online jackpot websites,” he stated. While casino revenues in Atlantic City and Las Vegas have declined in recent months, affiliate gambling revenues in the Internet casino arena have exploded, according to anecdotal reports from online operators. Rank Sales Drop Eases Rank Group Plc,owner of the UK’s second-largest bingo-hall chain and Grosvenor Casinos, said a sales decline eased after managers took steps to counter a decline in customer numbers caused by a ban on indoor smoking. According to a Bloomberg report, the company’s revenue fell 8% at outlets open at least a year in 2008’s first 17 weeks. That was less than the 10% slide in the first eight weeks. Cost-savings have strengthened the company’s“profit performance,”the company said in a statement. Rank opened sheltered outdoor gaming areas and installed electronic gear that permits remote play at its bingo halls to counter a fall in sales after England barred indoor smoking in public places in July last year. The company is vulnerable to prohibitions on tobacco use because about half of bingo players smoke—twice the rate of the general populace, according to executives. “Wehaveachievedadegreeof success inadjusting to the smoking ban and the new gaming regulations and have taken timely action to protect profits,”Rank said.“Nevertheless we are conscious that the difficult consumer climate is likely to make 2008 a challenging year for the gaming sector.” Rank,the owner of Mecca bingo halls and Grosvenor Casinos,had to remove some higher-jackpot electronic gamingmachines because of changes to gambling laws.The company also owns Spanish bingo clubs, Belgian casinos and the Blue Square betting Web site. Profit doubled to 311.5 million pounds in Rank’s last fiscal year on a gain from selling the Hard Rock restaurant, hotel and casino unit. The disposal capped asset sales that sharpened the company’s focus on gaming. James Packer Leaves Scientology Behind Scientology has lost one of it’smost prominentmembers—casino mogul James Packer. Mr Packer, who had ranked as Scientology’s wealthiest member, believes he no longer needs the religion he was introduced to by high profile Scientologist and friend Tom Cruise. Some suggest James Packer’s expanding casino empire has presented issues difficult to reconcile with Scientologist beliefs. Scientology’s founder, science fiction author L. Ron Hubbard, denounced gambling. James Parker, who is currently Australia’s second richest man, is the son of the late billionaire media mogul Kerry Packer. James Packer is the Executive Chairman of Publishing and Broadcasting Limited (PBL), and after taking over from his father, has focused on expanding the company’s gambling businesses around the world, while reducing its media interests.