Newly expanded firm banks on nontraditional gaming

By Liz Benston (contact)

Monday, Sept. 20, 2004 | 10:41 a.m.

A startup company has moved into larger offices in Las Vegas in anticipation of new gambling device sales. But those devices won't have anything to do with traditional slot machines, nor will they be sold anywhere in Nevada.

Gaming & Entertainment Group, a Las Vegas-based company with offices in Australia and London, began in Sydney in 1995 and opened a small office in Las Vegas last year. The company is now leasing 7,100 square feet at the Spencer Airport Center near some of the most well-known slot machine companies in the world.

The company makes software systems used by Internet gambling sites in countries where Internet gambling is legal. It also is developing several low-stakes gambling machines for the United Kingdom market as well as electronic bingo games for tribal casinos in the United States and Canada.

Those games are different from traditional slots such as those in Nevada because the outcome of the game is determined by a central computer chip rather than by a computer chip implanted into each game terminal. By downloading games from a central system, casinos can change out games more quickly and economically than replacing the game terminals themselves and game makers can receive a recurring source of revenue from the terminals rather than recording a one-time sale for a game, proponents say.

"Downloadable gaming is really the future of gaming," Gaming & Entertainment President Gregory Hrncir said. "It will take some time. It will not be a seamless transition and it's not a quick transition. But I think the gaming industry will embrace the technology ... given the technological benefits."

The technology isn't yet allowed in Nevada and some other commercial gambling markets in the United States, where regulators are used to tracking machine activity by examining individual computer chips.

The 20-person company, which hasn't made a profit, is testing some games in the United Kingdom and plans to begin selling a variety of games over the next year, said Hrncir, a former securities attorney in Los Angeles. The company was founded in 1995 and went public in January. Its shares are traded over the counter.

The company's chief cxecutive, Sydney-based Tibor Vertes, was formerly an attorney in private practice in Australia.