Inside Asian Gaming

IAG OCT 2020年10月 亞博匯 40 IN FOCUS M acau’s VIP glory days are long gone,” says Alidad Tash, Managing Director of Hong Kong-based gaming consultancy firm 2NT8 Ltd. Once the kings of the castle when it came to Macau’s soaring casino industry, VIP operators today find themselves facing challenges they could never have dreamed of just a few short years ago. From a contribution to Macau’s gross gaming revenue of 72.9% in 2011 – previously as high as 77.2% in 2002 – and an all-time record in actual GGR of US$29.33 billion in 2013, the VIP segment kicked in a more subdued 38.7% contribution in 2019, with GGR of US$14.0 billion – less than half that of its halcyon days (Note: These are based on figures reported by operators, as opposed to those published by the DICJ, which suggest a 46.1% contribution last year). “VIP doesn’t run the show anymore,” Tash continues. “There was a time when junkets could basically ask for whatever they wanted from operators, but the balance of power has shifted and it is now the operators squeezing the junkets by demanding that they prove their value.” China’s ongoing efforts to curb capital flow, the slowing of China’s economic growth and tighter regulations governing junket operations have all impacted the VIP segment, and junkets in particular. Yet what some are calling the slow death of the VIP sector might better be described as an evolution of sorts, highlighted by a pattern of consolidation within the junket industry over the past seven years and diversification into new revenue streams by the strongest of the survivors. At its peak in 2013, Macau’s gaming regulator – the Gaming Inspection and Coordination Bureau (DICJ) – licensed 235 different junket operators but that number has fallen in all but one year since, dropping to a low of 95 in 2020. Conversely, the “Big 3” junkets – Suncity Group, Guangdong Group and Tak Chun Group – have gotten “