Inside Asian Gaming

September 2014 inside asian gaming 15 reminiscent of Bellagio, but distinct in their own right, incorporating terraced gardens, floats, sculptures of various shapes and sizes, some as large as 12 meters across. “Our resorts have always had a special public entertainment piece,” he has said. Accordingly, the lake at the entrance will be bordered by restaurants and enlivened with fire and lights—also reminiscent of Bellagio, a bit like Wynn Macau, too—but on a more elaborate scale. An amusement ride is envisioned as the centerpiece: an aerial tram with gondolas in the shape of dragons that breathe smoke as they ferry visitors over the lake from the light rail station that will adjoin the complex. “Even when we came to Macau, we resisted the temptation to build a quickie, smaller place, to get in on it fast,” he has said. “We waited and we took our time. I think that that is exactly the way to go forward in China—very thoughtfully, very patiently, with great attention to detail.” So Steve Wynn continues to play it coy. He always does that in the run-up to his latest extravaganza, it’s the showman in him. Investors don’t mind. Keep us guessing, they seem to say. Heightens the anticipation. Ambrose So Executive Director and CEO SJM Holdings Chairman Sociedade de Jogos de Macau As a boom town the problems Macau faces are those of every boom town whose finite human and physical resources have been overwhelmed and costs are soaring, for everything, housing and labor in particular; and while these are not SJM Holdings’ problems alone, they present SJM and its chief executive, Ambrose So, with challenges the company’s founder, and Mr So’s mentor, the legendary Stanley Ho, never had to contend with. When thousands of front-line casino workers took to the streets this summer—better pay and benefits and more transparent promotions policies topping their list of demands—it splattered unwanted headlines all over what was to have been the smooth re- election of Fernando Chui Sai On as head of government. SJM, the “home team,” as it were, the successor to the monopoly that used to be Stanley Ho’s and the operator with the deepest roots in Macau, found itself uncomfortably in the spotlight, the target of the first coordinated job action by croupiers in the city’s history. Worse, the discontent appears to have caught the company unawares. Mr So had gone on record in support of scrapping current government policy prohibiting the employment of foreign workers as dealers. That was back in February at the groundbreaking for the HK$30 billion Lisboa Palace, SJM’smuch-anticipated foray onto Cotai, and only a month after the board of directors approved 5% across- the-board salary hikes and bonuses. Of course, he was alluding to the obvious solution to a labor shortage that is already acute and will only get worse when the first of the six megaresorts under construction on Cotai open their doors next year. But it struck at the heart of the job protection issue, the most socially and politically sensitive of labor’s concerns, and on the eve of Mr Chui’s re-election he had to backtrack. “Regarding the policy of reserving dealer positions for residents only, I would support it,” he announced late last month after a key meeting between Mr Chui and the committee of local elites that would return him to office. “In each territory, the government is responsible for overseeing the job opportunities of its residents; and just now the chief executive said some job types should be prioritised for local residents.” It’s a measure of Mr So’s stature and influence that he is a member of that committee. He also sits on the National Committee of the Chinese People’s Political Consultative Committee and is a consultant to the Beijing Municipal Committee of the CPCC on relations with Macau, Hong Kong and Taiwan. His relationship with Stanley Ho dates back to the mid-1970s, when he joined SJM’s predecessor, STDM, three years out of university. He was a long- time director of Mr Ho’s Shun Tak conglomerate and has been a director and senior manager at SJM since its founding at the end of the monopoly era. He was named an executive director in 2006, and since then the responsibility for overall management and strategic execution has been his, which means that as SJM’s labor costs inevitably rise with the rest of the industry’s, rationalizing the impact on margins is going to be one of his most difficult tasks. Deutsche Bank, for one, forecasts those costs will be soaring market-wide by 10-15% a year through 2017. That’s not considering the wider fallout should things get really ugly and relatively mild job actions morph into full-blown strikes.