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Monthly news from Australia & Asia
05 November 1999 , InterGaming
Asian Gaming Update

Communist North Korean boasts new casino
The Rajin economic free zone now offers a US$180 million four star casino and hotel, aimed at the northern Chinese market. Hong Kong investor the Emperor Group opened the Seaview Casino Hotel in August, complete with gaming tables and slots, three restaurants, karaoke, sauna rooms and a swimming pool. North Koreans are prohibited from patronising the casino, and visa restrictions limit visits to Chinese. Rajin is a four houre drive from Yanji in China's Jilin province, the closest means of air travel from the capital of Beijing.


New casino a tossup for Hong Kong
The Hong Kong government is considering a proposal to discuss the possibility of building an enteraiment complex with casino in Hong Kong, as part of a recreational facility for both adults and children to revive the tourism industry since its reversion to Chinese rule in 1997.
Financial Secretary Sir Donald Tsang Yam-kuen visited Las Vegas during the World Gaming Congress and Expo in mid-September to look at how Las Vegas had grown to become a tourist destination through its conference, gaming and recreational facilities.
It is thought that the government is considering a Disney-style themed park, in addition to a new world-class racecourse with a view to attracting more tourists.
Casino tycoon Stanley Ho, has unsurprisngly attacked the tentative speculation to open a competitive gambling in Hong Kong, on the basis that it will undermine Macau's future.
"Most importantly, it will prove a big obstacle to the successful implementation of the principle of 'one country, two systems', he told the South China Morning Post in no unclear terms.
This implies China's promise to preserve Hong Kong's capitalist system for 50 years following its handover to China - meaning that Macau will be the only place in China where legalised gambling is allowed.
According to Mr Ho, more than 60 per cent of Macau's tax revenue last year came from the gaming industry and it employed one-quarter of the population. Casino ships departing from Hong Kong which offer gambling beyond Hong Kong waters have impacted the enclave's gross casino takings by around 10 per cent in the first half of 1999.
Obviously, any moves to set up a gambling industry in Hong Kong would damage the Portuguese enclave's fragile pre-handover stability.
"I hope that any mention of planning to set up a casino in Hong Kong is mere speculation," Mr Ho said to the international press, which was reinforced by Sir Donald prior to his Vegas trip.
Hong Kong currently forbids casino gambling, although betting on horses reaps HK$10 billion turnover per race season from a population of 6.8 million, and the Mark Six Lottery contributes to the colony's 5 per cent of government revenue through betting taxes.
Mr Ho and his partners in Socidade de Turismo a Diversoes de Macau (STDM) control Macau's gambling industry with a monopoly of its 10 casinos until the year 2005. Despite an escalation gang warfare from the Triad, the industry continues to thrive under Mr Ho's directives.


Cambodian casinos clamp down
Travellers seeking to cross into Cambodia via Thailand's Klong Luek are now required to carry a passport or border pass due to the opening of two casinos in Poipet. Cambodian authorities have subsequently set up a visa office on the border in order for gamblers and tourists to quickly gain access into Sa Kaew, the Cambodian province offering the two casinos.


Battle over Asian debts
Casino hostess Laura Choi is involved in a legal battle with Mirage Resorts over collecting debts from Korean high rollers.
She was arrested back in July 1997 for failing to seek the Ministry of Finance and Economy's permission to collect gambling debts from South Korean high rollers, reported the Indonesian Observer.
After serving a prison sentence and a US$534,000 fine, she now alleges that Mirage ordered her to recover the gambling debts with full knowledge that she was breaking the law by carrying more than US$10,000 over the South Korean border.
Mirage, in response, have filed a suit against Choi in the Nevada district court claiming she broke the law without the company's knowledge, and have also claimed embezzlement and fraud for the unaccounted missing funds . The company also claims that she offered confidential information to their competitor, flamboyant Atlantic City property owner Donald Trump.

Australian casino news


Adelaide Casino for sale
South Australia's adelaide casino is on the market again, following a 22% profit increase for the fiscal year ended 1999. EBITDA totalled A$21.2 million, with gaming revenue at $77.8 million. Three years ago the direction of the business was changed to focus on the domestic South Australian market, providing a wider range of entertainment appeal.


New casino opening in New Zealand
The South Island's boutique-style Dunedin casino, opened for business the second week in October. This is the island's second casino, hoping to follow Christchurch casino's successful track record since it opened in 1994. Analysts believe, however that there will be no impact on Christchurch due to the opening of a competitive casino, as both cater to their respective local markets.
Christchurch recently received approval for a 1000 square metre extension to its premises, which will include a four-level car park over its existing open-air car park and additional restaurant facilities.


Crown retains casino monopoly in Victoria
The Victorian Government has ruled out a second casino despite the expiry of Crown's exclusivity rights in November. Premier Jeff Kennett also publicly issued a statement recently stating that the cap on poker machines would remain at 27,500 for clubs and pubs until the year 2010.
The Melbourne casinos's exclusivity beyond 150 kilometres expires on November 30, 1999. Although there have been a number of submissions from parties wishing to develop a second casino, the Government reiterated that country Victorian residents are against further gaming expansion.
In other moves, the Government has announced that advertising would be abolished that promotes gaming machines or table games, require clocks to be visible in gaming venues, and extend restrictions on ATM's and Eftpos facilities.


Casino Canberra's poke hopes slashed
Boutique property Casino Canberra, owned and operated by Casinos Austria, have had another setback in their six-year dream to install poker machines. It is the only casino in Australia prohibited to install poker machines under the Casino Control Act, but almost got around the ruling by allowing a licensed club to operate on casino-owned premises.
Unfortunately the Canberra Raiders Sporting Club is not likely to pursue its gaming machine license, which would have offered casino patrons an easy location to play pokies close to the casino's other gaming facilities.


High rollers deal Star City a bad hand
Star City Holdings profits dived 40 per cent in the first half of 1999 due to an inflated forecast of international table players.
Earnings of A$400,000 were way below the forecast of$65 million in additional revenue, when first announced last year.
This was largely responsible for the 40 per cent fall in net profit, from $5 million in the previous corresponding period to $3 million for the first half of fiscal year 1999.
Nevertheless, during July internatioanl business reaped $14 million in net revenues. According to CEO Neil Gamble, this positive trend is set to continue for the remainder of 1999.
On the grind side, Star City currently boasts the highest win per gaming machine per day, averaging $292.
Star City is currently the subject of a takeover bid by Victoria's Tabcorp Holdings, conditional on the approval of the NSW casino Control Authority.


Reef finally receives $70m rescue package
Investors in Reef Casino Trust have given the go-ahead for an A$70 million rescue package for the ailing Cairns Casino.
The recapitalisation deal will be financed by Casinos Austria and hotelier Accor, subject to probity approvals.
Assuming the deal goes ahead, Accor receives the management contract for the 128-room five-star hotel property, which it will brand as Sofitel.


Australian gaming news


California dreaming for Aristocrat
Aristocrat Leisure's pursuit of the North American gaming market could be worth more than just its push into the Nevada market.
If native Americans win the battle to legalise casinos in the State, California could rival Las Vegas and Atlantic City as a new gaming destination.
Aristocrat's video poker machines would well suit the California market, according to local analysts.
Deutsche Bank gaming analyst Lily Kwong believes Aristocrat could be a big winner in the potential 110,000 machine market in California, based on the measure of 292 persons per one machine.
Aristocrat expects to be granted a gaming license in Nevada in the next twelve months - a market with 170,000 machines and around a 75% replacement over the next few years.
The company lifted net profit by a stunning 83 per cent to A$51.7 million in the year to June 30, up from $28.2 million last year. Revenue rose over a third to $546 million, with domestic sales up 29 per cent and international sales up 65 per cent.
It also just launched a Salvagnini production system in September which slashed the time it takes to assemble gaming machine cabinets from four days to just under six minutes.


Lotto balls-up on national TV
Tattersall's, one of the largest private organisations in Australia and duopoly operator of some 13,000 gaming machines in Victoria, recently had a botched live draw of their lotto draw on national television.
The fifth ball became stuck in the machine chute during the telecast of Tattslotto super draw, halting broadcast. The second machine used to complete the A$15 million draw was conducted off-air, with the first four numbers from the initial draw counted in the second draw.
The second draw on video-tape and screened later disqualified the fifth ball from the original screening, causing much angst from players who believed that they had a right to claim a prize.
Lottery draws have traditionally been held live to reassure the public that there is no tampering. The draw is supervised by both Tattersall's officials and Government representatives.


Tabcorp's computer system crashes
Victorian gaming machine and wagering operator Tabcorp Holdings, currently in a takeover bid for Sydney's Star City Casino, encountered a glitch with the collapse of their Bravo racing system, leaving punters unable to collect their winnings.
The new A$12 million system crashed at midday through a software "bug", costing Tabcorp hundreds of thousands of dollars in turnover in its four thoroughbred meetings.
Apart from operating some 13,000 gaming machines in the state of Victoria, Tabcorp operates some 100,000 phone accounts and 618 TAB outlets throughout the state.


Bet on the Academy Awards
Queensland's new fixed-price sportsbetting system kicked off in early September, offering punters the ability to know the exact odds of their betting options. Following its popularity in Britain and the United States, QTAB will soon offer Sportsbet live wagers via the phone and internet for punters to bet on sports games and even their favourite actor in the lead-up to the Academy Awards - knowing in advance the exact return on winnings.


Gambling report incorrect and misleading
Gaming industry heavies Star City, Crown, Jupiters, Tattersall's, Tabcorp and AGMMA have all independently disputed the results of Australia's most far-reaching gambling impact study.
The national Productivity Commission released its 1000-page draft findings on Australia's gambling industries at the end of June, amidst must media frenzy and criticism of the industry.
The report effectively outlines that the social impact of gambling outweighs its positive effects, and cites numerous case studies and data to support their biased results against the industry's responsible attitude toward gambling.
One of the report's claim, questioned by leading industry players, cites that problem gamblers contribute a massive 35% of Australia's overall gambling revenue. Another statistic with no reference quotes that Australia hosts 21 per cent of the world's poker machines. In reality this is more in the vicinity of 2.6 per cent - or 6.6 per cent if the Japanese patchinko machines are included in the calculation.

Australian Internet news

Christchurch GETs virtual [ Phil - use pic from ANZ May report on GET and Christchurch}
New Zealand's Christchurch casino have licensed GET Interactive, through publicly-listed TransGlobal Interactive, to supply technology for their online casino.
Operated by British group Aspinall, Christchurch has been offering a play site for more than a year. The live site for real wagers is expected to operate under Norfolk Island regulations, where the tax rate is more attractive that other Commonwealth of Australia states and territories.
Trans Global Interactive has already licensed is software to Ed Fishman's Online casino and the Federal Group of Tasmania, who own and operate the Wrest Point Casino and Country Club. Wrest Point's online version is expected to go live in December.
In addition, the company will supply interactive technology for a new U.S. online celebrity game show channel to be launched next year, featuring Hollywood celebrities as hosts. Games such as Wheel of Fortune, Sale of the Century and chess will allow viewers with digital TV to use a smart card or credit card to log on to the show, answer questions and win prizes including cash and holidays.
Trans Global will receive royalty fees of 5-10 per cent for online casinos, and revenue for the game show will be reaped from celebrity endorsements, merchandising, sponsorships, corporate brand advertising and pay-to-play tournaments.


New PlayCheck technology offers player peace of mind
Internet gaming company MicroGaming Systems have just released an add-on component to their gaming software that allows players to track their historical game play data in real time - on line or off-line.
PlayCheck combats fraudulent elements possible through internet gambling by transferring the control of information from the virtual casino to the player. Its paramount security system allows players to access a log of every transaction. Both players and operators of the sites receive a detailed report of each game play, actions and results, as well as the exact time and day that each transaction occurred.
"Players can review every card during a blackjack game played in the last 48 hours, or every slot result and symbols played," said Microgaming's Australian agent Michael Toohey from Australasian Gaming Specialists. "In four years of working with internet gaming systems, I haven't seen anything comparable to PlayCheck. The high security and player verification offered by this technology is unmatched."

Aussie company develops new high roller software
Twenty-Twice, a Melbourne company, has received rave reviews for its new state-of-the-art technology that allows VIP casino players to wager in real time in the privacy of their own homes.
The system, nicknamed JACK, uses ISDN conference call technology to allow high rollers and premium players to place bets through a large conference screen using touch screen and smart cards to transfer the card's stored value to the casino.
Security includes fingerprint and voice identification technology to prevent unauthorised access, while allowing secure and bank-guaranteed funds transfer.
London-based bank HSBC facilitates money transfers for the system.
According to Mr Ian Donald, head of development for the Twenty-Twice smartcard system in Australia, the technology enables both players and operators to work in a secure environment. Next year in Australia, new mobile phones will be equipped with a new smart card facility to enable money transfers. This enhancement will make telephone betting easier, especially as a player can connect directly to the internet without operator intervention.


Korean internet licensing agreement for Omicron
Omicron Technologies have finalised a strategic alliance with fairwind Technologies Ltd, a Korean-based developer of gaming software, to offer a multi-player interactive internet gaming platform for gaming operators. Fairwind will receive US$375,000 as an up-front fee for Omicron's rights to use their interactive casino games and multi-player private chat rooms where participants can schedule to play against each other.
Players can choose unique representative characters with different facial expressions to pay in a variety of games. Live beta testing of the customised interactive casino software begins in November, with the a live wagering release date set for January 2000.