Inside Asian Gaming

INSIDE ASIAN GAMING | September 2009 27 (33) Theodore “Teddy” Cheng Chee Tock Chairman, C Y Foundation C Y Foundation has been at the forefront of serving the demand for non-casino online games in the Mainland China market. Internet use is exploding in China. There were 338 million users as of June this year (up 13.4% in six months), according to the government-funded China Internet Network Information Center (CNNIC). It’s safe to assume that figure is already out of date. By June, the number of mobile Internet users had reached 155 million, accounting at that time for 46% of all Internet users and representing a 32.1% increase within six months. More than two-thirds of China’s Internet users are under 30, according to CNNIC. Teddy Cheng and his management team spotted early on that role playing and casual games played on a subscription basis offered not only huge potential in the China market, but were also less likely to attract the sort of hostile regulatory action typically associated with online casino games, where search engines and Internet censors often block sites and providers. The number of Chinese Internet users shopping online rose to 87.88 million in the six months to June 2009, an increase of nearly 14million fromDecember 2008, while the use of online payment increased by 4.8%. The CNNIC survey suggested only 30% of Internet users believe online transactions are safe from fraud. C Y Foundation’s business model is to a large extent protected from the online fraud issue because much of its business is conducted face-to-face with customers via Internet cafés, rather than via card payment online. C Y Foundation says it is the only company dedicated to organising and running player-to-player (P2P) tournaments for prizes in Internet cafés throughout the Mainland. In August, C Y Foundation announced that it was taking an effective 20% stake in Paradise Entertainment, a casino gaming supplier andoperator of livedealer electronic table gaming terminals and progressive jackpots in the Asia Pacific region. The share deal involves C Y Foundation injecting HK$40 million (US$5.1 million) in working capital into Paradise Entertainment. Mr Cheng is a renowned entrepreneur in Mainland China. He has acted as chief representative or principal consultant in Mainland China to foreign firms including AT&T, Unisys, Honeywell, Hewlett Packard and IBM. Both Mr Cheng and his wife are scions of prominent families that have active links to the very top of China’s political hierarchy. Mr Cheng has also acted in an advisory capacity to several provincial and municipal governments in China. 24 26 (34) Angela Leong On-kei Director, Sociedade de Jogos de Macau Ms Leong is best known as the fourth official consort of Macau’s former gaming monopolist Stanley Ho, and is mother of his five youngest children. Whether she would have become a director of STDM—parent company of SJM, which operates Dr Ho’s casino interests in Macau—without her strong domestic CV is a moot point. Ms Leong’s profile in Asian gaming is likely to be consolidated over the years as the children she has borne Dr Stanley Ho mature and stake their own claim to a position in the family business. Ms Leong is reputed to be a savvy businesswoman and fierce dealmaker and is often at the forefront of campaigning for the gaming industry in general, and the interests of her company in particular. Ms Leong is also a Macau legislator and leader of the Macau Development Alliance party. She was elected to the Legislative Assembly in 2005 as one of those candidates selected by direct ballot rather than the complex hybrid scheme of nomination also used to select lawmakers in the territory. Also on the party ticket was Dr Ho’s long-time lieutenant Dr Ambrose So, though he failed to retain his seat. Ms Leong is seeking re-election to the Legislative Assembly on 20th September and is likely to maintain a significant profile in Macau public life. 28 (29) Subhash Chandra Non-Executive Chairman, Essel Group Subhash Chandra, a former rice trader turned mass media entrepreneur, returns to the Asian Gaming 50 – 2009 as the founder of Playwin, India’s first online lottery business. Although only a fraction of India’s 1.1 billion-plus people have access to the Internet, low-income adults can play electronic lottery games by visiting terminals located in shops. The lottery is promoted in cyberspace as myplaywin.com . It has a reputation among players as fair in a country where paper lotteries are widely regarded with suspicion as corrupt. Playwin and traditional paper lotteries are licensed on a state by state rather than a national basis. Playwin was floated on the Indian stock market in November 2001, initially winning online lottery franchises for the governments of Sikkim, Karnataka and Maharashtra. Market research about online gaming in India is limited. But a report by the Internet & Mobile Association of India in 2008 estimated that the sector, including casual and role-playing games as well as lotteries, would be worth US$200 million by 2010. Playwin products certainly appear to have captured the public imagination. In a country where according to the World Bank half the population earn less than one US dollar per day, Playwin’s record lottery prize (theproductofarolloverfrompreviousdraws without any top prize winner) amounted to a staggering US$3.5 million won by a resident