Case 2

• Casino industry


  Global industry worth $150 billion a year
• The U.S. has been leading the global casino industry, accounting for nearly half the global gambling revenues as recently as 2010
• Las Vegas and Atlantic City have accounted for a large portion of the total revenues generated by all forms of casinos throughout the United States
• Over the past decade


  Las Vegas and Atlantic City have had to deal with increased competition from other locales as casinos have opened all across the U.S.
• Over a dozen states now generate substantial revenue from their casinos, many of which have opened on waterfronts such as rivers and lakes
• When combined with Native American casinos, gambling revenues in other parts of the U.S. now exceed those generated by casinos in Las Vegas and Atlantic City
• Casinos in Las Vegas and Atlantic City


  • They are able to rely upon gamblers who come from all over the world, as far away as China
  • They offer more than two dozen large casinos on their strips that have spent lavishly to differentiate themselves from all others
• Casinos have spread to other locations across the Asia-Pacific region, including Singapore, the Philippines, and Japan
• Revenues from gaming have dipped considerably in locations like Macau and Atlantic City over the last three years, while they are still recovering in Las Vegas
• Casino owners are trying to figure out how to draw in more gamblers by creating more interest among the younger generation
• Legalization of gaming in Nevada

  1931
• New Jersey passed laws to allow gambling in Atlantic City


  1976
• Since 1988, more and more states have begun to legalize the operation of casinos because of the tax revenues that they can generate
• A large part of the growth in casino revenues has come from slot machines, which typically account for almost two-thirds of all casino gaming revenues
• Slot machines are more popular because it is easier for prospective gamblers to feed a slot machine than to master the nuances of various table games
• Macau has grown from a tiny backwater territory to a booming center of gambling, with casinos generating over $40 billion, more than six times that of the Las Vegas strip
• Macau's dramatic rise in the casino business owes much to a collision of geography and history, as the Chinese love to gamble but the leaders in Beijing have long forbidden casinos on the mainland
• Nearly 20 million people, or one in five Chinese who ventured outside mainland China last year, came to Macau to gamble
• High rollers from as far away as Beijing have clearly played an important role in fueling Macau's growth, spending as much as $10 million on gambling in a single trip and accounting for up to 65 percent of the revenues for the larger casinos
• Analysts forecast that gambling revenue from Macau casinos could easily reach $80 billion by 2018, driven by an increase in visitors from mainland China due to rising affluence and improved transportation
• The growth of gambling revenues in Macau has led countries across the Asia-Pacific to abandon their hostilities to gambling and to encourage the development of casinos
• Even as Macau has shown remarkable growth over the last decade, its prospects for the future remain quite bright
• Gambling revenue from Macau casinos could easily reach $80 billion by 2018
• Factors driving the rise in Macau's gambling revenue


  • Increase in visitors from mainland China due to rising affluence and improved transportation
  • Better access for visitors from all over the world due to a series of bridges connecting Macau with Hong Kong's international airport
• Singapore's two new upmarket casinos earn more than $6 billion annually, almost as much as all of the casinos on the Las Vegas strip
• The Philippines looks like it is poised to claim a substantial share of global casino revenues
• Efforts are underway to boost gambling in Japan by getting the government to lift its ban on casinos
• The new Chinese leadership's crackdown on official corruption and flaunting of wealth will drive clients to other locations besides Macau
• Solaire, recently opened in Manila, is willing to send a private jet to pick up big spenders from all across China
• Las Vegas has moved beyond gambling to offer visitors many choices for fine dining, great shopping, and top-notch entertainment
• At MGM Mirage, revenue from non-gaming activities has typically accounted for almost 60 percent of net revenue in recent years
• Atlantic City has never been able to develop itself as a beach resort and the failure to develop other forms of entertainment has led to the closing of several big casinos
• Macau has also been trying to reduce its dependence on gaming, as gambling revenues have begun to decline due to China's economic slowdown and crackdown on corruption
• The newer casinos are trying to offer more non-gambling activities by including restaurants, shops, cinemas, spas, and even concert arenas
• Macau is now trying to overcome its small land area by expanding business on the thinly populated island of Hengqin
• Las Vegas and Atlantic City continue fighting for visitors to come for various forms of entertainment as well as gambling
• Genting, the Malaysian gaming group, has recently taken over the site of the Echelon in Las Vegas and intends to develop a stronger presence in the U.S. market
• Eight new casino complexes, all of which will offer many forms of entertainment, are being added in Macau, promising to almost double the supply of hotel rooms on the strip
• As casinos' emphasis shifts from older high-stakes gamblers to younger customers who enjoy gambling but are interested in dining, drinking, shopping, and taking in shows, casinos are also eager to embrace new types of gaming experiences that will attract Millennials
• Although casinos have operated for a long a growing tendency to regard casino gambling as an accept-time in Europe and the Caribbean, no single location was able form of entertainment for a night out.