Inside Asian Gaming

July 2008 | INSIDE ASIAN GAMING 13 10 Hajime Satomi Chairman and CEO, SEGA Corporation & Sammy Corporation 11 Efraim Genuino Chairman and CEO, PAGCOR in revenue every year. Pachinko is played on a vertical pinball- like machine into which players inserts steel ball bearings and watch them tumble down, deflected this way and that by dozens of metal pins. When some balls disappear into “winning” holes in the playing board, new balls appear at the bottom and can be played or redeemed for gifts, since cash payouts are illegal. However, the gifts can in turn be exchanged for cash at illicit kankin (prize exchange) booths located outside the pachinko parlours. The alliance between Sammy and Sega was a godsend for the ailing Sega Corporation, which withdrew from video game console manufacturing following the failure of its Dreamcast console.Sega’s once- dominant mascot Sonic the Hedgehog even suffered a blow to its popularity in the video game arena. Now a major force in the arcade industry, Sega is experiencing new success in software sales under Mr Satomi’s leadership. As a group, though, Sega Sammy’s greatest success is in its core pachinko manufacturing business. In his drive to make Sega Sammy one of the largest entertainment providers in the world, Mr Satomi has created a conglomerate that owns movie and animation studios, golf courses, arcade centres and amusement parks. has a long history of offering the widest range of legal gaming options in Asia, with regulated casinos, slot machine clubs, horse racing, bingo halls, poker rooms, sports betting, lottery, cock fighting and internet café online casinos. On top of this broad spectrum of gaming sits the Philippine Amusement and Gaming Corporation (PAGCOR), which is effectively a government-owned and controlled organisation established to regulate all games of chance in the country. Efraim Genuino took over as Chairman and CEO in 2001 and has turned PAGCOR into one of the top three most profitable corporations in the Philippines. There were initially objections to including an official from PAGCOR, which is technically a government body,on the Asian Gaming 50.Upon deliberation,however,our panellists decided that PAGCOR was akin to the Hong Kong Jockey Club and Japan Racing Association, with activities that go far beyond mere regulation. Therefore, it was decided Mr Genuino warrants inclusion in the rankings. PAGCOR recently had its charter renewed by the government for another 25 years and has been focused on adjusting tax rates and other regulatory details in order to attract major gaming groups to its long-envisioned 3,000 hectare Bagong Nayon Pilipino Manila Bay Tourism City project—commonly referred to as PAGCOR City. The project, to be developed on reclaimed land in the prime Manila Bay area, is Mr Genuino’s brainchild, and in addition to casinos, will boast a bevy of Vegas-style entertainment offerings including arcades, wellness spas, malls, hotels, cultural centres, sports arenas, residential villages, a state- of-the-art monorail system and theme parks, forming an integrated recreation and leisure complex. During his period of tenure, Mr Genuino has grown top and bottom line revenues significantly in spite of an often volatile political climate and lack of public investment in infrastructure and transport connections—for example, a newly completed airport has sat dormant for four years due to a legal dispute between the Philippines Government and the airport contractor. Thus, many international investors and operator partners are looking for improved tourism facilitation, safety and infrastructure before committing themselves fully to Manila Bay. Founder of Sammy Corporation, Japan’s largest slot and pachinko machine manufacturer, Hajime Satomi cemented his position as an Asian gaming mogul when he purchased video game maker Sega Corporation in 2004.The Sega Sammy Group is now the leading manufacturer of pachinko and pachislot machines—an enormously popular game among Japanese Although pachinko is not officially regarded as gambling in Japan (where casinos and slot machines are outlawed), it is widely understood that many Japanese flock to the game to indulge in what amounts to a form of quasi-gambling that generates hundreds of billions of US dollars Although the Philippines is not widely perceived as a gambling mecca,the country Asian Gaming 50