Gaming execs: Competition could spur creativity in Las Vegas

By Amanda Finnegan

Wednesday, Nov. 17, 2010 | 2:05 p.m.

Gone are the days when Las Vegas was about the only place to play a hand of blackjack or a game of poker. The city now has to compete with splintering regional markets that are introducing table games in growing numbers and the industry’s newest and most profitable market: Asia.

But industry veterans during Wednesday’s discussion at the Global Gaming Expo said they don’t see markets like Macau or Singapore replacing Las Vegas. They see it as an extension of the market.

American Gaming Association President and Chief Executive Frank Fahrenkopf said he remembers in the 1970s when Las Vegas casino owners feared developments in Atlantic City would take business from Vegas. He said that wasn’t the case -- and he sees the same happening with Asia.

“I think what will happen with Macau, Singapore and the Philippines is people will continue to come to Las Vegas because it is a very unique product,” Fahrenkopf said.

Former New Jersey Casino Commission Chairman Steven Perskie said if anything, Asia will push Las Vegas to reinvent itself once again.

“What Atlantic City wound up doing was helping Las Vegas to improve itself. A lot of what was going on in Las Vegas in the late 1970s and early 1980s was in response to what was going on in Atlantic City. Everyone was saying ‘Las Vegas isn’t concerned about Atlantic City, but Caesars is putting an ocean in.’ It pushed the industry to be creative,” Perskie said.

Casino executives could be forced to get creative once again as their customers continue to rein in spending. Gaming veterans said during Wednesday’s panel that if the casino industry wants to weather the economic storm, it needs to return to its roots as a value-oriented business.

And even in the midst of heavy financial burdens, casinos and manufacturers need to remember their job is to entertain guests, leaders said.

“We are changing directions. For a long time here, we forgot that Las Vegas was built on the theory of the best for less. More revenue was coming from rooms and food and beverage than it was from gaming. I think now they’ve awaken to the fact that it’s got to be a blend between the two,” MGM Resorts International Director Burton Cohen said.

Ironically, Cohen sits on the board of a company that created the $8.5 billion CityCenter project, a resort destination catering to high-end guests.

Perskie reiterated Cohen’s thoughts on value. New Jersey’s gaming destination, Atlantic City, has been hit particularly hard because of the recession and competition from neighboring markets like Pennsylvania, Delaware and New York.

"The industry needs to get back to the basics. What made it strong was the recognition of particular markets," Perskie said. "The invention of convenience gaming needs to be looked separately from destination resorts."

Chuck Mathewson, the former chairman of International Game Technology, said the company he once lead continues to produce relevant entertainment. This week, IGT is premiering its “The Hangover” and “Dark Knight” slots on the G2E exhibit floor. Last year, its big debut was its “Sex and the City” slot game.

“We try to latch on to what's going on today. They seem to attract people. They have fun with them,” Mathewson said.

Earlier during Wednesday’s keynote discussion, the American Gaming Association posthumously inducted former Shuffle Master Chief Executive Tim Parrott, who died in May. Fahrenkopf said the 20-year veteran “was someone everyone in the industry could and did look up to.” Parrott joins 60 other inductees in the AGA Hall of Fame, including Sam Boyd, Jackie Gaughan and Bill Harrah.