Inside Asian Gaming

lmmml - War Isn't Imminent The South China Morning Post erroneously reported that Sands Macau raised commissions paid to local gambling­ junket operators to as high as 1.3 percent, from its previous cap of l .l percent. The Hong Kong-based English-language daily then went on to quote former monopoly casino operator Stanley Ho - who offers commissions between 0.5 and 1.1 percent - as saying such a move would amount to "war." The stakes are high. The junket operators, who funnel high-roll­ ers to the city's VIP gambling rooms, generate 70 percent of local gambling revenue. The Post report is wrong, but the article still gives Mr. Ho more concrete grounds to launch an offensive than Tony Las Vegas Sands adds appetite appeal to Singapore bid Las Vegas Sands, one of 12 parties vying to build the two resorts in Singapore's Marina Bay, said late in August that it is roping in fine-dining chefs to strengthen its bid for the project, according to a story in the Straits Times. Sands's Las Vegas property The Venetian has recruited some stars in the culinary world, including as Wolfgang Puck and Luciano Pellegrini, and said it will also bring ce­ lebrity chefs to Singapore. If the company is successful in its Singapore bid, it will also invite local restaurants to join them. The Venetian president Rob Goldstein is quoted as say­ ing, "The restaurants have got to be wonderful tourist at­ tractions that complement the local market." He and his two Vegas rivals - Harrah's Entertainment and Wynn Resorts, have agreed that it is likely the Marina Bay and Sentosa resorts will be run on a scale bigger than anything seen yet in Singapore. The 22 restaurants and bars in Wynn Las Vegas, for exam­ ple, feed an estimated 20,000 people per day, as compared to Singapore-based Raffles Hotel's establishments, which reportedly attract about 4,000 customers per day. Harrah's has predicted that Singapore will become the next fine din­ ing destination in the world. 30 Inside Asian Gaming September 2005 Blair got with that weapons of mass destrnction report. The Inside Asian Gaming staff aren't donning their flak jackets just yet, however. That "war" quote came from an article printed in June last year in Macau Business maga­ zine. Even if Sands does raise its commission rate, it will likely fail to attract most of the larger junket operators cur­ rently using Mr. Ho's establishments, because unlike Mr.Ho, Sands does not offer profit (and loss)-sharing arrangements to larger junket operators. Mr. Ho's Sociedade de Jogos de Macau (SJM) offers larger junket operators a share of between 20 and 40 percent of gross table winnings, or losses, from the high-rollers they bring in. Profit-sharing is only done with larger operators, and it's just as well, since smaller operators, working on very low margins and unable to spread risk, could be sunk by one or a handful of lucky clients. The rumor mill chums on regardless, and extra details are being tacked onto the faulty Post report. A junket operator told Inside Asian Gaming that what the Post report failed to mention was that the "1.1-1.3 supposed to have been offered by Sands also comes with a huge condition: an enormous target to achieve; the commission structure is 2 tiered - if the operator does not meet their target, they get a lower fee of around 0.8 total (including expenses).I believe the men­ tioned existing 1.0- l .l is if the operators exceed their bud­ get." He adds: ''Since the smaller operators have no hope of reaching those sort of targets, they are thus unlikely to move to Sands. That's why Sands only has 4 operators currently." It seems then that the Post report, even if true, wouldn't be enough justification for a war. Still, if US foreign policy is anything to go by, it wouldn't hurt to keep those flak jackets handy. Singapore plans to modify casino rules The Singapore government has announced it will modify some of its rules for its first integrated ca­ sino resorts after consulting with bidders including Harrah's Enter­ tainment and Las Vegas Sands. In June, the government delayed the deadline for the release of its request for proposals detailing the guidelines for the casino resorts for the dozen bidders from the second quarter of this year to the third quarter. In June the city-state delayed to the third quarter from the second releasing its request for proposals, which would spell out guidelines for its casino-resorts for the dozen bid­ ders, which include Kerzner International Ltd. and Genting Bhd. The two casino resorts are expected to bring in US$3 bil­ lion worth ofinvestments and create 35,000 jobs on the re­ sort island of Sentosa and in the city's downtown Marina Bayfront. Potential investors are waiting with bated breath to see what changes the government has made.