Inside Asian Gaming

INSIDE ASIAN GAMING | April 2012 14 is slated to join the link this month. IGT has enjoyed three straight quarters of revenue increases from its MegaJackpot brands, and it’s largely been markets outside North America driving them. Gaming Operations internationally, the division that includes WAPs and other participation and recurring-revenue games, was up 13% last year. In the most recent quarter, which ended 31 December, typically the slowest time of the year for slot manufacturers, Operations was up 29%. Across all its businesses, international revenues grew 24% in the quarter, while North America revenues decreased by 8%. Sales of new and replacement machines, which dipped 8% internationally in 2011, rebounded in the quarter to the tune of 31%. Obviously, the company wants that to continue and is taking steps to ensure that it does. “Internationally, we are making meaningful progress by positioning our sales teams closer to our customers and by equipping them with localized content,” CEO Patti Hart told analysts at the time the IGT quarterly results were announced. “After posting several years of declining ship share, IGT is on track to record its first year of market share gains on game sales in over eight years,” Todd Eilers of Roth Capital Partners noted at a recent forum for investors. In fact, analysts are casting 2012 as a comeback year for IGT, which may sound strange on the face of it. The company still dominates North America with better than half the continent’s installed base of machines. But competition for floor share is never less than intense, and advantages, both actual and potential, can easily slip away. Outside North America, “cautiously optimistic” was the official watchword at the close of 2011, but that brightened considerably after the results from the first quarter were in. The company now expects the trendof thefirst 12weeks tobe sustained, with international business growing by double digits in 2012, and Macau, and Asia as a whole, playing a prominent role. “Our Macau customers are looking to generate increased slot revenues,” President Eric Berg stated at the time, “and we are helping them with creative and disruptive solutions.” How disruptive the effort will prove remains to be seen. As for creativity, if the Megabucks deal with Sands China can be taken as a reliable jumping-off point, it is well in evidence already. Growth in the Macau mass market continues to outpace VIP growth, and with a weighted share of 34% of the sector, according to recent research by Union Gaming Group Macau, Sands China is the mass-market leader. Michalko, a 35-year industry veteran who helped launch the California Lottery and served as its first executive director, has worked extensively in Asia, notably as a pioneer of the lottery industry in the Philippines. “Macau is an interesting place,” he says, “because you have a vast array of segments of the market, depending on what location you’re going into.” IGT’s goal, he says, is to figure what works for all of them. “It’s very difficult to do in a particular machine or even two or three, but across a range of product offerings, we can hit every segment of the market. At least that’s our objective.” “One of the things that I’m trying to do is establish that type of relationship where we can bring operators in while we’re still in the development phase. And I think that’s good for us and certainly good for them as well. We will then bring products to the market that are much more attuned, not just to the general market here but to their particular properties and the player base that they have.” As you might expect with IGT, the portfolio of themes available for showing in Macau is extensive, about 100 currently, according to Michalko. Not that anyone at Asia headquarters is resting on it. The Stand-out display—Four Great Chinese Beauties, featured on the bluechip Neo cabinet, will be showcased at next month’s G2 Asia Life-changing link—Megabucks machines at The Venetian Macao