By ggbmagazine.com
As always, with the coming of the New Year comes new challenges for operators, suppliers and the gaming industry at large. The gaming business is approaching a crossroads in any number of areas, from the spread of online gaming to the creation of new types of experiences on the casino floor.
How soon will the era of eSports blossom? When will online gaming spread beyond its todays frontiers? With help from our editorial board and experts on each of the trends emerging in gaming, here is our view of the top 10 trends to follow in 2017.
10 Casino Trends for 2017:
1. The Era of eSports is Upon Us
At the eSports and Casino Resorts conference in Las Vegas in October, the gaming industry finally got down to the nuts and bolts about how eSports can become a niche for gaming operators that will create revenue and excitement, as well as attracting the elusive millennial demographic.
It’s a wholly different approach, but one that has paid some early dividends for the few casinos having eSports corners is willing to take the plunge and cater to eSports fans.
One thing was evident at the eSports conference. It’s an issue that is only going to increase in interest as more and more casino executives strive to find the bridge to the millennial generation.
2. Betting on Sports Betting
The American Gaming Association has pointed out that $90 billion will be bet on sports during the 2016-17 season of professional and college football. Unfortunately for gaming, $88 billion of that total will be bet illegally.
The people appetite for sports betting has never been greater.
Sports betting legalization has been a topic in the gaming industry for the last 10 years.
3. Fading Furor: ‘Off-rez’ Gaming in Decline
American Indian casino growth is slowing to a crawl, a trend tribal advocates believe will help end public and congressional criticism of Department of the Interior policy on placing land in trust for tribal governments.
Tribes in 2015 operated 474 gambling facilities generating $29.9 billion, according to the National Indian Gaming Commission (NIGC). The previous year, tribes operated 459 facilities generating $28.5 billion, the NIGC says.
4. Stagnating iGaming
Over the past five years, legal regulated online gambling has been spreading across the globe. But as 2017 approaches, we’re still waiting for the inevitable. Continued legalization among the countries has proven problematic, with efforts slowing to a snail’s pace.
Land-based casino companies are realizing the many opportunities online gambling can provide to grow and expand their business.
With the land-based casinos companies largely on board, the task has turned to educating lawmakers that legalizing and regulating online gambling is the right thing to do: for the state, for the gaming industry, and for the customer.
Online gaming activity will continue in 2017, and it seems inevitable that several more states will legalize online gambling within the next one to two years, for the following reasons:
• Online gambling is no longer an abstract idea—between DFS, lottery, poker and casino, legislatures across the country are growing more familiar and confident with the idea of legal online gaming, and the ability to provide robust regulatory oversight.
• More states are turning to gambling to raise revenue, and on that front online is one of the last frontiers, and an option that has proven to be beneficial, not cannibalistic to land-based casinos.
• Increased awareness of the existing black markets and the amount of money that is leaving the countries via these channels, coupled with the need for consumer protections, has become a leading driver for regulation.
5. Two of a Kind: Legalized Gaming in Brazil & Japan
Brazil and Japan have little in common. They are on opposite sides of the world, on opposite hemispheres, with climates that are vastly different. Their economies are completely different. Their cultures have no commonalities.
Yet to the gaming industry, Brazil and Japan have one important thing in common: They are countries with very large populations with a propensity to gamble, and two countries where traditional casino gaming is not legal. And more importantly, lawmakers in Brazil and Japan have made significant strides in the past year toward legalization.
Although there isn’t much public enthusiasm for casinos, some believe that an education campaign would change opinions.
6. Managing Revenue
Big Data. The words denote industrial-strength analysis, a prolific improved presence to the gaming, hotel and resort spectrum.
As casinos expand their vision by building special palaces—from state-of-the-art entertainment venues to upscale restaurants and convention areas—they relish the assessment prowess of Big Data.
This tool serves as advanced information, with two characteristics. It is available to those willing to pay for it, and most useful to those who can discern it. Big Data targets optimal hotel-room price-points, the appropriate range for comps or a snapshot of a gambler’s loyalty tier. It removes or reduces guesswork in a time-crunched industry. Millions of dollars can ride on making the right deal to the right audience mere seconds ahead of a rival.
7. Skill Wave
In early November, New York-based startup slot manufacturer GameCo, Inc. at Harrah’s Atlantic City cut the ribbon on GameCo’s Danger Arena, the first slot machine in a U.S. casino on which the return-to-player (RTP) is variable based on the skill of the player.
Danger Arena is on GameCo’s patent-pending Video Game Gambling Machine (VGM), which looks more like an arcade game than a slot machine.
GameCo’s VGM, is the first example of a practical solution to the challenge presented two years ago to the industry’s slot suppliers—to produce new types of slot games, including skill games that will appeal to the millennial and Gen-X customer that is the future of the industry.
One element all the new skill games have in common is a carefully engineered and tested combination of skill and chance—a formula that rewards players with greater skill while maintaining a minimum RTP for the less-skilled players.
In the coming year, the industry will watch the skill trend play out, and slot suppliers will learn, by doing, the most effective ways to solve the math puzzle of skill-based gaming—and which games will result in incremental revenue gains and new players for casinos.
8. Doing the Numbers: Lotteries & Technology
When big lottery jackpots come up for grabs—like the record-shattering $1.6 billion Powerball prize awarded last January—even non-gamblers line up for a chance to strike it rich. Who hasn’t daydreamed about bagging the big prize, holding the giant check, winning millions of bucks and hundreds of new-found friends?
There are concerns about player protection and online security (or insecurity), as well as fears that too-easy access to gambling will cause some people to literally bet the farm.
Another problem for online lottery may be the sheer success of retail sales—the old “if it ain’t broke” mentality.
One of the great appeals of lottery is its “simplicity. So the scratch-off ticket, in all its immediacy and simplicity, seems to fundamentally capture the imagination of players.
As lotteries move toward a more digital environment, providers are adding free apps and free-to-play games to goose the games and build up player rolls ahead of online lottery regulation.
This is where the lottery is heading: a use of in-store and mobile technology to surround the product, making it more exciting and more convenient to play.
The industry is also testing cashless sales, which may require a major upfront investment but would pay off later. And digital in-store sales technologies—dedicated channels available to consumers on mobile devices only inside the store—could also be in the offing.
9. Getting Better All the Time: The Future of the Financial Crimes Enforcement Network
In US the Financial Crimes Enforcement Network (FinCEN) had five enforcement actions in 2016 to date, three came against casinos. This followed four FinCEN enforcement actions against casinos in 2015. So what will 2017 bring to the casino industry with respect to Bank Secrecy Act (BSA)/anti-money laundering (AML) enforcement?
There is no question that casinos are very much front and center of FinCEN’s enforcement agenda. But will the BSA/AML enforcement trend against the casino industry continue in 2017?
10. Back in the Black: Macau Rebound
The world’s No. 1 gaming mecca is back in business.
Following an unprecedented two-year slump—some analysts called it a recession—China’s only legal gaming jurisdiction seems to be pulling out of a graveyard spiral. The uptick started in August, when gross gaming revenues turned positive for the first time in 26 months. The numbers for September continued the positive trend. October beat expectations and landed the city squarely in the black.
The good news coincided with the openings of two new mega-resorts on the city’s glittering Cotai Strip, Macau’s answer to the iconic Strip in Vegas.
And there’s more to come: a new $3 billion casino resort from MGM China will open next year, and SJM Holdings’ $3.9 billion Grand Lisboa Palace will round out the Cotai offerings in 2018.
Macau’s historic downturn began in mid-2014, when Chinese President Xi Jinping ordered a crackdown on corruption, graft and money laundering in the city. That campaign sent VIP players and junket operators heading for other jurisdictions. At the same time, Xi ordered the city to diversify its economy beyond gaming. So, Studio City has a Hollywood theme and includes family-friendly entertainment like a Batman virtual reality ride and so on.
Tourism to Macau broke records during the October Golden Week holiday, which drew more than 190,000 visitors a day. It all adds up to a big plus and renewed optimism in the jurisdiction. The slow and steady improvements in mass market traffic and the gradual return of VIPs could mean sustained buoyancy for Macau.
