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10 February 2000
, InterGaming
Macau handover
With only 430,000 people, it's well known that macau's economy is fuelled by its ten casinos. Portugal handed back this tiny gambling haven after almost 450 years of rule to communist China at midnight December 19.
Like Hong Kong, Macau is now a "special administrative region" of China. To reduce dependence on Hong Kong and increase the role of Macau as a gateway to China, Macau has invested billions to attract new service industries. Some of these incentives include a new international airport, new bridges and water treatment plants.
Casinos are the mainstay of the economy, with almost $1 billion in annual gambling taxes supplying the bulk of government revenue.
Chinese tourists are whisked by jetfoil ferries across the Pearl River, or arrive from the mainland by bus.
And there's still gangland competition for the takings from the high-stakes tables, with 37 deaths in the past year alone.
The ten properties are all owned by Stanley Ho's STDM, although his monopoly expires in a little over a year. Nevertheless, Mr Ho has expressed confidence that the new Government will grant him a license extension of three to five years.
The return of the colonial enclave, which registers as a speck on the map of China, has been seen as an opportunity to raise national pride as a step in the reunification of the motherland.
The principle of "one nation, two systems," by which capitalism and socialism coexist in the same nation, will be applied to Macau. For 50 years after the handover, the current social and economic systems, as well as the lifestyle, will be maintained on Macau.
The next and final step is the recovery of the island of Taiwan.
Aussie Casino to finally receive Pokies
It appears that Australia's only casino without poker machines may finally win the battle to offer players machines to add to their 40-odd table game operation.
The ACT Government has supported a Bill to allow the introduction of poker machines into Casino Canberra subject to an A$10 million premium and a 30% tax on gaming machine revenue.
"There has been growing demand for the introduction of poker machines at the casino and there is little justification for continuing the restriction," said ACT Treasurer, Mr Gary Humphries.
"In 1998 the Allen Report into gaming concluded that the restriction was anti-competitive. It's time we addressed that situation."
The original casino license was granted on the basis that they would not be able to operate poker machines. If the Government's Legislative Assembly allows gaming machines the casino premium will pay a premium of $10 million which will go into a dedicated fund for community projects.
"In addition to the premium, I have informed the casino that a tax rate of 30% of gross gaming machine revenue will be payable" Mr Humphries said.
Representatives of Casino Canberra have also given the Treasurer an undertaking that they will continue their community contributions as well as expand their work in the area of problem gambling.
Norwegian company talks with Singapore cruise outfit
Norwegian cruise company NCL Holding ASA, the world's fourth largest cruise operator, is in discussions with Singapore's Star Cruises after a hostile takeover for NCL by U.S. Carnival Corp.
Carnival, the biggest cruise operator, bid 30 crowns per share, which was rejected as too low by NCL.
Apart from Star Cruises, which is 26.8% owned by Genting, it is believed that a few other cruise companies had expressed interest in NCL.
Company secures exclusive Cambodian internet betting license
Global Net Entertainment Corporation has entered into an agreement with the Royal Group and Gamex Inc to operate an internet lottery in Cambodia.
Global Net, who will provide around half a million dollars in start-up funds, will receive a monthly fee of US$20,000 and 70% of net profits for the first two years, followed by US$25,000 a month and 62.4% of net profits.
The Royal Group is a licensed lottery operator based in Phnom Penh, and has authorised the new venture for the life of the license or 22 years, whichever is the greatest.
Internet gaming company Plus Lotto tried their luck with the "Mega Bucks" online lottery in 1998 but the operation closed a short time later.
Conference review Internet Gaming vs Traditional gaming: Adversaries or Allies? In the not-too-distant future, many experts see a convergence of the traditional and internet gaming industries. Bally's and Harrah's may battle Starnet and Inland Entertainment for the internet gaming market. The coming shakeout in the industry will be won by those companies best prepared for it.
The recent two-day conference held at London's Mayfair Hotel at the end of last year specifically covered the interaction between internet and traditional gaming.
Gaming leaders and delegates from over 28 countries attended the Third Annual International Symposium on Internet Gambling Law and Management to find out the latest information on marketing, legal and regulatory issues, technology and financial topics.
Keynote speakers included Peter Dean, Chairman of the British Gaming Board, Graeme Levin from gambling.com, Meldon Ellis from Starnet Communications International, Fred Gushin from Spectrum Gaming Group, and Michael Toohey from Australasian Gaming Specialists.
Potential online gaming operators would have been interested to hear from Mickey Charles, CEO of the Sports Network as he discussed entry into the online gaming market. He specifically addressed the question "Are there any seats left?"
"There are always seats left," said Mr Charles. "There is room for more participants and there are enough players to go around...many times."
For instance, first there was Playboy, then along came Penthouse. Hertz began, and soon it was Avis and a host of others.
"Being first means precisely that, being first. It does not exclude the others that have dreams of going the same route, with different vehicles or simply better ones," he explained.
Mr Charles explained that licensing programming software or creating your own proprietary software is a matter of some debate. "There are believers in out-sourcing and dependency upon those who can deliver the tools to them, and there are others like ourselves," he said. The Sports network, for instance have an in-house product that is changed and enhanced as necessary. "Actually, the only two pivotal and compelling considerations are cost and effectiveness.
He also spoke about advertising and marketing, the importance of person-to-person contact as well as offering online wagering, immediate payment schedules and banking infrastructure where the system must be recogniseable around the world.
*** According to Chris Cherrington from Frost & Sullivan, a few basic influences are driving the internet gambling market: 1. Sheer demand
2. Continued growth of the internet
3. Cultural acceptance of gambling
4. Difficulty in enforcing prohibition laws
5. Enhanced 3D graphics and sound The main problems include US prohibition, bandwidth constraints, lack of non-English sites, security fears and possible fraud.
In terms of future developments, although China is still an untapped region, it is expected to become of the biggest player markets for internet gambling. There will also be opportunities for mobile gambling through such facilities as mobile phones with internet access, and enhancements as the gambling products converge with the games industry. World revenue forecasts
Software and operations revenues
Year US$millions Growth rate
1999 1,559.5
2000 2,617.0 67.8%
2001 3,968.4 51.6%
2002 5,588.4 40.8%
2003 7,395.3 32.3%
Source: Frost & Sullivan, World Online Gambling report
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