Inside Asian Gaming

INSIDE ASIAN GAMING MAY 2018 32 it’s likely pachinko will remain a quotidian pastime with casinos potentially an occasional indulgence. “The pachinko market will shrink with or without casinos in Japan,” PwC Consulting Integrated Resort Team Senior Manager Masahiro Terada says. Nevertheless, despite official efforts to differentiate tourism-oriented, cosmopolitan, fastidiously regulated IRs from seedy, parochial, gray-market pachinko and likely prohibition of pachi within casinos, the two sectors are converging in numerous ways. EXPERIENCE COUNTS Pachinko companies see Japanese IRs as a natural extension of their business and several have invested to gain relevant experience. In 2012, Sega Sammy bought Phoenix Seagia Resort on the coast of southern island Kyushu, declaring that it hoped to add a casino there someday. It took a 45% stake in US$1.7 billion Paradise City, opened last year in Incheon outside Seoul in partnership with Paradise Group – South Korea’s largest foreigner casino operator – and has dispatched 50 employees there. Universal Entertainment owns and operates Okada Manila, named for ousted chairman Kazuo Okada. The gaming machine maker reportedly sought to sell the partially completed US$2 billion IR, however a US$2.6 billion cash infusion from Wynn Resorts in March to settle claims over seized shares could help Universal finish the Philippine project and boost its credibility as a potential Japan IR partner. Japan’s number two pachinko parlor owner Dynam invested US$85 million in Macau Legend Development, running casinos under SJM’s license, and unsuccessfully attempted to bring pachinko to Macau. Experts believe pachinko parlor operators will face greater hurdles than machine manufacturers for approval as Japan IR partners. Regardless of investor status, pachinko machine makers will undoubtedly influence products on Japan IR gaming floors, as they’re already doing globally. FEATURE IN FOCUS Pachinko companies see Japanese IRs as a natural extension of their business and several have invested to gain relevant experience. “The game play of pachinko is rich and vivid, full of imagination with high entertainment value associated with animation and sounds together,” TGG CEO and co-founder Raymond Chan explains. “The electronic gaming segment is looking for this type of product to spice things up, to bring the fun of winning to customers who are familiar with this type of product.” Chan says his company is working with Japan gaming developers to incorporate pachinko elements into casino products. So is Aruze Gaming, spun out of Universal Entertainment. “Aruze believes there are many features and elements of Japanese gaming that can and will play a role in our development and game features,” Global Chief Operating Officer Eric Persson says. This quarter, Aruze is scheduled to unveil its Activ-Play features that echo elements of control found in pachi, such as choosing when to stop reels. “I’m also a big fan of the physical features of many pachinko and pachislots. It helps us push our hardware to be more distinctive and engaging,” Persson adds. The advent of IRs in Japan promises further convergence. “The global market will keep expanding and will soon arrive in Japan,” says Chan. “At that time, who will know better than the Japanese for the Japanese market?”