November infinity gaming magazine

HEADLINES

HEADLINES

HEADLINES

Atlantic Club files for bankruptcy protection

Pennsylvania to keep out of online gambling for the moment

China moving closer to online gambling

InfinityGaming

www.gaming-awards.com | ISSUE NOVEMBER 2013

JAPAN

Big Casino Plans

MGM

No to online poker in Nevada

EXCLUSIVE INTERVIEWS

MACAU

October breaks records

GAMBLING COMMISSION

Latest Survey

Lawrence Ho & Jim Ryan

contents InfinityGaming

EDITOR’S LETTER

03 Interview Lawrence 04 Ho EDITORS LETTER

Welcome to the Nov edition

04

Exclusive with the Co-CEO of Melco

Interview 12 Exclusive Jim Ryan is Back!

Bitcoin opportunity or 16 red herring Christina Thakor-Rankin

19 Bomb Iran

Sheldon Adelson on politics

FEATURES

21 Japan’s Big Casino Plan 24 Casino Competition Affiliate Relationship 28 32 Betting Forums The Ireland Question 36 40 A Tale of two Cities 47 Online Operators Gambling 53UKCommission survey Martin R. Baird

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Ellen Learmonth

Wayne Opneshaw

JJ Woods

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Prof. I Nelson Rose

02 2

Filing their returns

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EDITOR’S LETTER Lana Thompson - Chief Editor

by

InfinityGaming

Welcome to the November edition of the Infinity Gaming Magazine. I do not know what happened to this year, it is just flown by.

We are all thinking of Christmas and some of us already shopping for gifts and decoration.

Well, not long to go now, so do not forget to send your wish list to Santa if you have been a good girl or boy this year.

One more thing we are excited about - it’s the International Gaming Awards of course! We will be raffling an item from Tiffany’s at the Savoy in support of Care. I know you are all waiting for results from our Judges, but we do not have many tables left, so please book early as we do not want you to miss it.

In this issue we have some insightful interviews with most successful CEO’s in the industry, it is Lawrence Ho and Jim Ryan

As you know Jim was CEO of partygaming and then Co-CEO of bwin.party and now in this edition we find out where Jim is now and what Pala Interactive is all about. And of course Lawrence Ho, a real gentleman and Co-CEO of Melco Crown Entertainment, we speak to Lawrence on Melco’s plans on expansion in Japan and Manila.

Not only do we have those superb interviews but as always the best features writers covering both online and land based gambling issues along with all the very latest news and opinions. I would like to thank you our industry experts contributing to Infinity Gaming Magazine with their knowledge and opinions.

Huge thank you to Martin R Baird, Ellen Learmonth, JJ Woods, Wayne Openshaw and Professor I Nelson Rose.

Enjoy the magazine and see you all in December

Enjoy

Lana x

Opinion Disclaimer: The views and opinions expressed in all external articles are those of the authors and do not necessarily reflect the official policy or position of The Infinity Gaming Magazine Any content provided by our feature writers or authors are of their opinion, and are not intended to malign any religion, ethic group, club, organization, company, individual or anyone or anything.

CONTACT US Clever Duck Media Suite 105 Park Plaza Point South Hayes Way Cannock WS12 2DB UK Tel: +44(0)1543 578 689 claire@cleverduckmedia.com PRODUCTION Clever Duck Media Suite 105 Park Plaza Point South Hayes Way Cannock WS12 2DB UK PUBLISHING Infinity Gaming Magazine is operated by © Clever Duck Media Ltd ® Company Reg. No. 687 1018 (Registered in England) ADVERTISING: Sponsorship Opportunities Colin@gaming-awards.com Business Partnerships Svetlana@gaming-awards.com

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BUSINESSMAG • ISSUE NOVEMBER 2013

EDITORS NOTES

CONTRIBUTING WRITERS Christina Thakor-Rankin Martin R. Baird Rohin Malhotra Ellen Learmonth J.J. Woods

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EXCLUSIVE INTERVIEW

Interview with Lawrence Ho Co-Chairman & CEO of Melco Crown Entertainment

Macau continues to beat all records and the Infinity Gaming Magazine speaks to one of the biggest names in Macau, Lawrence Ho and we talk about the expansion Melco Crown Entertainment has for Japan and Manila

Q

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: Lawrence thank you for speaking to us today.

We know you are a very busy man at present, so to start the interview can we start with telling our international readers more about MCE?

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LH: Melco Crown Entertainment (MCE) is the venture business between my company Melco International Development Limited and James Packer’s Crown Limited since 2004. MCE then went to public and successfully listed on NASDAQ in 2006 and began its dual listing on HKEx in 2011. With less than a decade, I am pleased to see MCE has soon become a leading developer and owner of integrated entertainment casino resorts in Asia.

MCE has positioned itself as a leader in casino gaming and provider of unique entertainment since its establishment. We established our first casino property – Altira Macau in 2007, a luxurious and contemporary hotel and casino delivering a world-class experience to high roller gaming patrons. To date, Altira Macau is the 4-time winner of Forbes 5-Star Hotel and Spa between 2010 to 2013. The next property of MCE is City of Dreams, the

flagship integrated entertainment resort, in 2009. It is home to Crown Towers, the only Forbes 5-Star Hotel in Cotai.

Positioned as a leader in unique entertainment as I have mentioned earlier, City of Dreams provides its visitors extraordinary entertainment experience through its two flagship entertainment brands, namely The House of Dancing Water, world’s largest water extravaganza and a must-see experience for all visitors to Macau, as well as TABOO, the only cabaret show in Asia and exclusively shown in Macau within City of Dreams. These two astounding shows redefined the entire entertainment landscape in Macau. The overwhelming favourable critics and comments received in past years demonstrate our capability to create novel entertainment experiences to amaze the public. On top of our two flagship entertainment brands, we also offer a wide array of innovative entertainment performances.

With Macau’s economy growing continuously, we are optimistic towards the future of the gaming and -

Exclusive interview with Lawrence Ho

MCE has been actively looking at opportunities outside Macau in order to fulfil our corporate vision of extending footprints in the Asian region. Our first step is to develop and operate a new integrated casino entertainment resort in the Philippines. In October this year, we announced that the new resort will be named City of Dreams Manila, marking the formal entry of MCE into the fast-growing and dynamic tourism industry in the Philippines.

All in all, I am really pleased to see the prosperous growth of MCE with continuous record-breaking results in less than a decade’s time since its establishment. The ranking of MCE on Forbes Asia’s Fab 50 List is a sufficient proof of our success.

Q: How long have you been CEO of the company?

LH: My leadership in MCE should date back to the days when I was the Managing Director of Melco International Development Limited in 2001. I have been the Co-Chairman & CEO since MCE has been founded in 2004.

Q: You also have a very famous father. Could you please tell us more about him?

LH: It is true that I have a famous father who is also one of the legendary figures in the Macau gaming

industry. His history and reputation speaks for itself and I am respectful of my father’s achievements.

Despite so, I have never been in any of his companies because it’s always my keen advocate to create my own business.

Q: Has there been any difficulties with you running MCE and your family as a competitor, or do you see them as competitors?

LH: Thanks to the leadership excellence of Macau Government as they always foster policies to ensure healthy competition and longterm sustainability of the gaming industry as well as the city. I believe different operators have their unique positioning and competitive edges that standout in the market amidst keen competition while complimenting each other to create diversified experiences to the patrons to Macau.

Q: The company has been in the news a lot at present with new ventures, firstly the Manila resort.

How is that progressing and what is MCE’s role in that?

LH: Our project in Manila where MCE is to develop and operate an integrated casino, hotel, retail and entertainment resort continues to progress as planned, with the opening date scheduled for around the middle of 2014. This new integrated casino resort will be branded “City of Dreams Manila”. City of Dreams

Manila will herald a new era of entertainment in Manila and will provide visitors with an exceptional world-class gaming and entertainment experience, delivering international standards of retail, food & beverage and hotel amenities, together with diverse and innovative lifestyle and entertainment offerings. I am confident that City of Dreams Manila will be the pride of the leisure and entertainment industry in the Philippines.

Q: The latest news was that MCE is interested in Japan should the laws change to allow casinos. How do you see the market potential in Japan?

LH: As a non-Japanese who has travelled to Japan more than a hundred times, every time I arrive I always discover new thing. I believe it is this sort of ongoing novelty that will whet people’s curiosity to come to this great country to experience

(Continued overleaf )

BUSINESSMAG • ISSUE NOVEMBER 2013

entertainment industry and thus we are setting forth the development of our next project, the Studio City, a cinematically-themed integrated entertainment, retail and gaming resort in Cotai, Macau, which is scheduled to open in mid-2015.

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Lawrence Ho Interview continued

“

LH: its unique culture, exquisite cuisine, beautiful landscape, powder snow, outdoor hot springs while snow falls on the head, and many other unique sensations.

Adding to Japan’s unparalleled competitive strength is its rich culture as evidenced in its sophisticated cuisine, unique social customs and refined performance and visual arts that are very appealing to visitors.

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A wide array of alternatives for casino gaming, such as horse racing, pachinko and soccer gambling are currently enjoying high popularity.

These players represent a large pool of potential casino visitors, further supporting evidence for the prediction that Japan will become one of the largest casino markets in the world after casino legalization.

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What’s more, Tokyo’s successful bid for the 2020 Olympics in Japan will act as a unique catalyst to spark the massive construction of overall infrastructure, hospitality facilities and entertainment amenities.

The world’s premier sporting event presents enormous opportunities for the development of integrated resorts, which are expected to expe-

rience strong demand for catering to the huge influx of tourists.

Drawing from MCE’s solid experience in creatively adapting facets of the local culture into our properties in Macau, MCE is confident it can offer the most innovative world-class entertainment and leisure attractions that will appeal to both domestic and foreign visitors in Japan, contributing meaningfully to the growth of tourism in Japan.

Q: It has been said by many that Japan could become the second largest gambling market outside of Macau. Is that your feeling also?

LH: I believe Japan can become the second largest gaming market globally. With a rich culture, there’s so much to do and see in Japan. Thus, I strongly believe IR developments with unique world-class entertainment amenities would meaningfully elevate the tourism landscape and economy diversity of Japan.

Q: With the company interested in or involved in so many diverse regions, will MCE be looking to bring in additional experts to advise on these new and potential

MCE is constantly evaluating opportunities in other jurisdictions across Asia including Japan.

We don’t just replicate our experience anywhere else, instead we create unique innovative entertainment driven resorts”

sectors?

LH: MCE is constantly evaluating opportunities in other jurisdictions across Asia including Japan. We don’t just replicate our experience anywhere else, instead, we create unique, innovative entertainment driven resorts that redefine excellence and enjoyment. Towards this end, we are very fortunate to have seasoned leadership team who led the success of our IR operations in Macau possesses the understanding of the relevant Asian consumer communities and the know-how to cater to these markets in order to establish a strong presence and successful IR elsewhere in Asia.

At the same time, MCE closely works with local government and collaborate with local business partners to quantify how any proposed development would promote tourism, encourage business, create local employment opportunities and boost both local economic and social development.

Speaking to leading figures in the gaming world Q: Would MCE ever consider the US gambling market as an option for expansion?

LH: The Asian market will remain as MCE’s focus.

Q: Back to Macau, How is the business there for the company?

The development of Studio City is proceeding on schedule and the integrated resort is expected to open in mid-2015. Studio City enjoys a strategic location and it will form synergies with MCE’s existing assets, and, in turn will further broaden our appeal to a wider spectrum of visitors to Macau, especially the increasingly important mass market segment.

The construction of City of Dreams Phase 3 is underway. This iconic development will provide another powerful advance to drive our premium mass market business, as well as expand our high end patronage at City of Dreams. This in turn, will enhance property-wide return on invested capital. The plan is currently being reviewed by the Government and we hope to com

mence development by late 2013 after securing formal approval.

Q: Much has been said about the future of Macau depending on middle-class Chinese players as opposed to the [VIP gamblers/ high rollers]. Do you see it the same way?

LH: The economy in Macau has seen a substantial growth in the past decade backed by the robust growth in the PRC economy, which helped set off the adverse effect brought about by the global financial crisis in 2008. The increasingly affluent PRC population has led to a greater demand in quality entertainment, providing a right opportunity for MCE as a unique entertainment provider and casino gaming operator to capture the immense business potential.

Q: Macau does seem unstoppable with month-on-month rises in revenues. Can you see the end of this and a flattening of revenues any time soon?

LH: Macau continues to deliver robust growth across all gaming and non-gaming segments in 2013, highlighting its unique position in catering to the rapidly evolving Asian consumer and expanding middle class. However, we are not in the position to make any forecast to the development of the market. At present, we are confident and optimistic towards the future development of the Macau gaming industry and MCE will continue to equip ourselves with the best types of unique entertainment so as to capture any opportunities that lie ahead.

Q: These are exciting times for the company with so many new opportunities. We know you cannot say where, but will there be more ventures in the near future?

LH: While focusing on our existing properties and new projects on pipeline, MCE will continue to explore further growth opportunities across a number of emerging gaming jurisdictions in Asia so as to maximize shareholder value and our people’s career development prospect.

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LH: We are optimistic about the outlook of 2013 in Macau. We have reported another successful quarter, with strong growth in our core segments driving record fundamental performance for the third quarter of 2013. City of Dreams, in particular, generated a strong year-on-year performance with improved EBITDA driven by the improvement in mass market segment, particularly at the higher end of the market where we have a significant competitive advantage.

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US GAMING NEWS

New list of companies allowed for New Jersey online gambling

T

he New Jersey Division of Gaming Enforcement (DGE) has approved bwin.party, Betfair, Ultimate Poker, Caesars, Amaya/Ongame, Bally Technologies and 888 in the latest release of companies now allowed to work in online gambling in the state.

All of the companies announced have been granted “transactional waivers,” which means they can now proceed to work on the 21st November soft launch while

more in-depth checks are done on all granted.

Once the five day soft launch is passed the 26th November big green light is still marked as the day online gambling for real money will begin.

The DGE has said that more licenses will be announced on the 15th November and said that an omission from today’s list “does not mean a waiver won’t be awarded before the launch” on November 26.

15th November to see who of the ones not issued a license yet will be invited to take part in the largest state so far to participate in online gambling.

All eyes will be on the

Atlantic Club files for Bankruptcy protection

T

The casino has confirmed that it will remain open while it seeks a buyer for the development with Michael Frawley, the casino’s chief operating officer, said its strategy of offering low-priced gambling, food and entertainment has been working but not fast enough. About 70% of the casino’s floor has low value slot games which just has not worked in bringing in increased revenues.

“We believe in our property’s positioning and the valuecentric niche we committed to nearly 18 months ago,” said Frawley. “Our creative branding campaign and the tremendous efforts of our employees have resulted in property growth within a continually challenged market. Unfortunately, the market has taken longer to rebound than we had hoped.”

Observers in Atlantic City however doubt that the casino can manage to stay open for too much longer as the club has very little operating expenditure left according to Eric Matejevich, co-chief operating officer of the casino’s parent company, who wrote that the company “does not have sufficient cash resources or committed financing to operate The Atlantic Club and service ordinary course obligations for an extended time period.”

BUSINESSMAG • ISSUE NOVEMBER 2013

he Atlantic Club Casino has officially filed for bankruptcy protection in Atlantic City. This makes the Atlantic Club the sixth of the twelve casinos in the state which have filed for bankruptcy over the last six years.

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US GAMING NEWS

MGM “no” to online poker in Nevada Optimal Payments in NJ

Optimal Payments Plc, a leading global online

“We have not launched (in Nevada) because we have taken the view that poker-only here is not a profitable enterprise,” he said. “Our company has always preferred and have been staunch supporters of a federal effort on poker. But I think our optimism on that has waned dramatically.”

The statement by Murren is no surprise as numbers for the two current online poker sites operating in Nevada show poor traffic, with Ultimate Poker who launched first in the state having an average of 132 players over a seven day period and WSOP who launched recently with 126 according to figures from PokerScout.

Indeed CMO of Ultimate Poker Joe Versaci recently said that the online poker market in Nevada had been a lot smaller than expected but believed it would grow and become a major contributor to the US online gambling market in the future.

However for Nevada to be worth anything at all it needs to work on a state compact with New Jersey as quickly as possible to help increase player numbers, so no surprise that not one other company has gone live in Nevada with online poker. Reducing the tiny numbers even more between another operator.

“We are excited to be an approved vendor in New Jersey and we look forward to leveraging our vast experience and expertise to help facilitate online payments for our partners in New Jersey,” said Joel Leonoff, President and CEO of Optimal Payments.

New Yorkers say “YES”

New Yorkers voted on Tuesday 5th November to

allow for another 7 casinos within the state independent of Indian tribal casinos. At the time of the report 60% of polling stations had reported in with 57% of those saying yes to more casinos.

In the plan for new casinos which has now been accepted the three areas where the first four casinos will be located are the Catskills, Southern Tier and Capital Region with a protection on them for 7 years against any further casino developments.

“The passage of Proposal One is a big win for local governments, school districts, and taxpayers across New York state,” Gov. Andrew Cuomo said in a statement.

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J

im Murren the CEO of MGM, a major casino operator in the US and in Macau has said his company will not be involved in launching an online poker offering in Nevada anytime soon. In a recent interview with Vegas Inc, Mr Murren said it was not a financially viable market with just online poker.

payment provider, announces that the New Jersey Division of Gaming Enforcement (DGE) has completed its review of Optimal’s vendor registration.

Optimal has been found suitable by the DGE to offer payment and risk management solutions to New Jersey licensed providers of Internet gaming. The regulatory suitability process is designed to assure the integrity of those persons and enterprises that provide goods or services to the New Jersey casino industry.

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EXCLUSIVE INTERVIEW

Former head of Europe’s largest online gaming company returns to business Q Thank you for speaking to us today Jim, it seems like exciting times for you since we last spoke a couple of years ago now. Can you tell our readers about the new company Pala Interactive?

JR Pala Interactive, LLC mission is to be a leading operator and services provider in the United States regulated online gaming market. We believe that we are uniquely positioned as a result of the following factors: 1. We are only focused on the US market; 2. We own and develop our technology platform and poker network; 3. We have a full spectrum of games across all distribution channels; 4. We are building the organization with some of the best and brightest people in the online and land based gaming market; 5. We have been fortunate to have secured Phil Ivey as our brand ambassador; 6. The Pala Band of Mission Indians, who are our majority shareholder, own and operate one of California’s larger casinos thereby positioning Pala Interactive to secure an online gaming license in the state of California; 7. We are well capitalized and ready to exploit growth opportunities in the US market.

Q How did you get involved in the company?

JR I recently returned to Canada having spent the last 6 years in Gibraltar. The timing of my return to Canada could have been better planned as I arrived in the dead of winter. Pala called and asked if I would be interested in helping them develop their online gaming strategy. Given the winter climate in Toronto, I was more than happy to visit Pala, California. To my surprise and pleasure Pala already had a solid understand of what it would take to succeed in the US market place and was also well advanced in terms of

developing their online strategy. I liked what I saw, specifically the competitive positioning of Pala and in July of this year I joined Pala Interactive as the CEO. Q Hasve Pala Interactive got any customers at present?

JR Our current focus is on the development of a regulated gaming platform, securing a New Jersey partner and gaming license and working with the California legislature in an effort to enact online poker legislation in 2014.

Q Pala Interactive is part of the Pala Band of Mission Indians, is that correct and is it owned by them or what is the relationship?

JR The Pala Band of Mission Indians (“PBMI”) have a majority ownership position in Pala Interactive, LLC. That being said, they are more than a shareholder. We plan to operate Pala Interactive, LLC under the PBMI license when the online gaming market opens in California.

Q We recently spoke to Mitch Garber the former CEO of partygaming and he said that the role was the toughest he had ever done. Would you agree that the position at bwin. party was a very tough role, with the stresses involved?

JR I believe any executive working at a European focused operator has been operating in a difficult environment. Europe is a highly competitive market place in the process of transitioning to a regulated market strategy. That transition has been anything but smooth but with the fullness of time I expect that we will see the majority of EU member states with a regulated market. As it relates to my position at Partygaming and bwinparty, was it a tough role, yes --- no question. That being said, I thoroughly enjoyed my time with the company and I look forward to the next chapter and challenge in my career.

He’s BACK

Interview

with

Jim

Ryan

The Infinity Gaming Magazine speaks to Jim Ryan former CEO of PartyGaming and co-CEO of bwin.party.

Now CEO of Pala Interactive LLC

Q Now firmly based in the US, what do you see as the future for online gambling/poker for the US? JR The opening of the US market will represent the single largest regulated market opportunity to present itself in the history of the online gaming sector. I see this as being great for the consumer, land based and online operators.

Q The clever money is on NO federal law for online gambling, is that how you see it?

JR The smart money is on a state by state implementation.

With Nevada, Delaware and New Jersey having passed online gaming legislation it would seem likely that the US market will continue to evolve on a state by state basis. That being said, one can never rule out federal legislation. My job is not to predict if there will be federal of state legislation, it’s to be ready for either.

Q Is California the key to success in the US for online gambling given the population?

A With a population of over 38 million, California repre-

sents the single largest market opportunity in the USA. Is it the key to success in the US, I would not go that far.

I believe the New Jersey market and others like it will be lucrative on a standalone basis. That being said, I believe the prospects of state compacts with California could greatly assist smaller markets with the success of their online strategies.

Q Observers believe that Indian tribes are on the whole against online gambling, is that your view or are there other circumstances that would argue that position?

JR As it relates to the California, that has not been my experience. California tribes understand the market opportunity and are actively in the process of developing a legislative position that will allow for the regulation of online poker in the state.

Q Nevada is now live with online poker, New Jersey and Delaware will not be too far behind in going real money live. Which states are next do you think to come online?

JR Ten states have reviewed the prospects for regulating online gaming in 2013. We believe a number of states are watching the evolution of the online markets in Nevada and New Jersey and expect a number of other states to seek to regulate with the objectives of implementing appropriate consumer protection measures, creating jobs and increasing tax revenues. 2014 will be interesting and we are watching California, Pennsylvania and Illinois.

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Q Looking back at your time there, what is your memory of working there?

JR I miss the company, its people and Gibraltar. I had an extraordinary experience living in Gibraltar for 6 years and the almost 5 years I spent working for PartyGaming and then bwinparty.

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GAMING

Russian gambling zone partner arrested

Summit Ascent Holdings Ltd which is the company controlled by Lawrence Ho the co-CEO of Melco Crown Entertainment in Macau made a statement to the Hong Kong stock exchange confirming that an indirect partner in a Russian casino project has been arrested by police in that country.

The charges against Mr Drozdov were reported in a local Russian newspaper on the 7th November

saying, Oleg Drozdov had been detained for investigation by Russian law enforcement. It’s reportedly regarding alleged malpractices by a business called OOO Vladivostokservis and relates to the construction of a solid waste treatment facility in Vladivostok in the Russian Far East. The malpractice involves some $11 million in construction fees when Mr Drozdov served a director of the firm.

Mr Ho’s company Summit Ascent said that the investigation into Mr Drozdov “does not relate, in any way, to the Primorye gaming project or to Oriental Regent or FGCE [First Gambling Company of the Far East]”. Summit Ascent added the investigation was in progress and

no charges had so far been made against Mr Drozdov.

The company continued by saying: “The company has also received direct assurances from Mr Sidorov, first vice governor of the Primorsky Administration, which administers the Gambling Zone of the Primorye Region, that the investigation and allegations relating to Mr Drozdov will not, in any way, affect the Primorye Gaming Project or the company’s investment in the Primorye Gaming Zone.”

IGT thank social gaming for profits increase

I

nternational Game Technology (IGT) announced their 2013 fiscal revenues with a 9% rise compared to the same period last year, the increase was driven by social gaming which enjoyed a 151% surge to $219 million.

IGT’s total revenues were $2.3 bil-

lion with reported operating results for the fourth quarter and fiscal year ending September 30, 2013.

“We are extremely pleased to report our fiscal year 2013 financial results,” said Patti Hart, CEO of IGT. “We continue to drive significant revenue and earnings per share

growth through the successful execution of our strategy and disciplined approach to capital allocation. Our goal, as always, is to maximize our returns to shareholders through targeted share repurchases, consistent dividends and robust earnings growth.”

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O

leg Drozdov who is a minority shareholder in the planned casino resort with Lawrence Ho in the Primorye gaming project has been arrested over allegations of malpractice in an unrelated case involving a solid waste scheme.

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FEATURE ARTICLE

Bitcoin: Opportunity or Over-hyped Red Herring?

By Christina Thakor-Rankin

Our feature writer Christina Thakor-Rankin looks at Bitcoins for her November article, are they really the answer to the digital world or just over hype?

O

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ne of the best things about the gaming and gambling industry is its insatiable quest for the next big thing - from the early adoption of mobile back in the 1990s to dipping a toe in the waters of social gaming, so it comes as no great surprise that one of the big talking points of the moment is bitcoin.

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Having spent the last couple of years exploring the phenomenon of social and virtual currency and its applicability to gambling, and having come to no firm conclusion, we have now turned our attention to another new form of currency bitcoin (BTC or XBT).

It is hardly surprising given the hype generated by recent stories such as Satoshi dice, one of the first bitcoin gambling sites, being sold for a reputed $11.5m, and players like ‘Nakowa’ turning a bad day into

a good one with a bitcoin equivalent to win $1.3m.

The last year has seen a huge surge in all things bitcoin. From online stores offering everything from top of the range electronics to Amazon Vouchers, to pizza, a Canadian coffee shop launching the first ever BTC ATM; and Africa’s cutting edge M-Pesa platform reportedly looking at adding BTC as a currency – and of course gambling - from sports betting to casino, poker, dice and games.

Throw into this heady mix the results of a recent anonymous survey of bitcoin gambling sites, which indicated that 4 out of 15 respondents were averaging profits of between 101 to 250 Bitcoin per month, and the top two were generating average monthly profits of between 1,000 and 5,000 Bitcoin – a ‘real ‘cash equivalent of

approximately $122,000 USD and $610,000 per month. It may also be worth noting that whilst only 15 responded, the survey was sent to 60 bitcoin sites in all, suggesting that he figures indicated provide only a ‘modest’ insight into the overall market.

With the estimated value of BTC in circulation at the end of August 2013 exceeding $1.5 billion it is small wonder that the gambling industry is interested.

So for the uninitiated – what is it and why all the fuss?

Bitcoin is a digital currency. This means that it is only available and used in the digital world – in simple terms its cash for the internet, and operates in the same way as ordinary cash, other than the fact that it has no physical form.

Once you have your bitcoins you can spend them just like any other currency.

It would seem then, given that BTC is just another currency, with no barrier to size of transaction or processing fees and no risk of chargebacks, that the gambling industry is missing a trick here - until we look at the finer details of exactly how BTC works.

Despite Germany defining it as ‘private money’, and US federal judge Amos Mazzant declaring, “Bitcoin is a currency or form of money” the currency remains unregulated and ungovernable.

BTC is a decentralised peer to peer currency. This means no-one owns

it, is responsible for it, and is essentially regulated by the growing global network of bitcoin users. All transactions are conducted online and are anonymous. No audit trail, no checks, no balances, no proof of ownership - Bitcoin is a money launderer’s dream.

As such BTC fails to support two of the core requirements of gambling regulation – player verification including financial due diligence and keeping gambling free of crime, more commonly associated with anti-money laundering regulations.

The irony is that whilst BTC ticks all of the right boxes commercially, it ticks very few from a regulatory perspective and in short, it would be incredibly difficult, if not impossible, for a regulated gambling operator to both accept bitcoin and meet its regulatory and legal obligations.

Hardly surprising then that of all the BTC gambling sites researched only one is licensed and regulated, and that in Costa Rica.

The increased profile of BTC, and its links to criminal, whether it’s Ponzi investor schemes, an FBI drugs bust

on Silk Road, the dark web’s narcotics shopping mall, to the Australian teenage entrepreneur who claimed hackers stole over $1.1m BTC from him, will undoubtedly result in attempts to bring it under control.

Until this happens however, bitcoin, in its present form remains an elusive dream for the regulated gambling sector.

ABOUT THE AUTHOR Christina Thakor-Rankin is Principal Consultant at 1710Gaming working with start-ups, investors, operators regulators, and industry groups internationally, covering all aspects of the gaming and gambling cycle - from initial research, licence and operational go-live, to new markets and opportunities, to customer engagement and experience. She has over 20 years industry experience and has previously held roles at William Hill, Blue Square, Tote (Sport) and Virgin Games managing multiple business disciplines, functions and teams.

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What was once the preserve of the techie-geek world has become main-stream. Anyone can use BTC. The first step is to download a digital wallet from bitcoin.org. Next go to an exchange such as Mt GoX, Bitbargain or Coinbase and buy, using the comfort of more conventional payment methods such as PayPal. At time of writing 1 BTC = £220.00 (or $360.00).

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US GAMING NEWS

Adelson wants to bomb Iran

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he boss of Las Vegas Sands Sheldon Adelson has a simple solution to the Iran issue, it is to drop a nuclear bomb in the Iranian desert as a warning to them to stop stalling on negotiations. If that does not work then the US government should then nuke Tehran.

Speaking at a forum at Yeshiva University the Republican Party supporter who is ranked the 12th richest man in America with an estimated fortune of $34 billion, ridi-

culed American efforts to negotiate with the Iranians and suggested the U.S. military should drop a nuclear bomb in the desert parts of the country as a warning shot.

The billionaire was asked by moderator Rabbi Shmuley Boteach what he thought about the mooted negotiations between the U.S. and Iran. “What are we going to negotiate about?” Adelson replied. The Chairman of Las Vegas Sands then went on to explain his bombing

strategy to show the Iranians the US means business.

“It’s the only thing they understand,” Adelson said “And do you see the current negotiations as a sign of weakness?” Boteach asked.

“Absolutely,” Adelson said. “It’s the worst negotiating tactic I could ever imagine, my entire life.” “Because you can’t get anything.”

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ennsylvania will not be joining the online gambling party anytime soon says the chairman of the Pennsylvanian Gaming Control Board William H. Ryan.

in the state first with the chairman saying, “what we are seeing is far more interest in legislation that would give the thousands of bars and social clubs the authority to have small games of chance.”

With Nevada already live with online poker and Delaware and New Jersey only a matter of weeks to going live there was some speculation that Pennsylvania could become the fourth state to join, but that now seems unlikely in the near to mid-term future.

“The strength of the lobbying groups in those areas is probably greater,” he said. “All of them have very close contacts to the representatives in both the House and the Senate.” The Pennsylvania Senate Appropriations Committee on Tuesday passed legislation that would allow bars to conduct games of chance, including raffles and drawings.

“I don’t see any real groundswell right now for Internet gaming,” Ryan said during a panel discussion on regulation with officials from New Jersey, Delaware, Massachusetts, and Florida.

However what is more likely is an expansion of gambling

The state would be a popular member of the online gambling business with a population of near 13 million it would rank much higher than the 8.5 million in New Jersey.

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Pennsylvania to keep out of online gambling for now

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MACAU GAMING NEWS

SJM Holdings the largest caino operator in Macau has announced their third quarter results with a rise of 10.3% to HK$1.83 billion compared to the same period last year which was HK$ 1.66 billion.

Macau has seen phenomenal growth in October with record revenues totaling HK$4.6 billion that is the biggest October revenues on record.

Gaming legend Stanley Ho is head of SJM which is run by his family as Dr Ho still recovers from serious illness, SJM held a gaming monopoly is Macau for over 40 years, but still holds a 26% share of gambling interests in the former Portuguese enclave.

Galaxy Entertainment post increased profits for Q3

Galaxy Entertainment posted a third quarter rise in profits to $413 million which represents a 24% increase from the same period in 2012, which was slightly higher than expectations.

Galaxy’s revenues climbed 16% with VIP turnover at Galaxy Macau, the company’s flagship casino, climbing 10% while the mass market segment jumped 11%.

Japan’s big developers plan super casino in Tokyo

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proposed new casino development in Tokyo, Japan is being lined up by Japan’s biggest property developer Mitsui Fudosan Co which has joined forces with media firm Fuji Media Holdings and builder Kajima Corp.

It has been over 10 years of lobbying from supporters of casinos in the country but next year it is believed that land based casinos will be allowed by the new government of the business-friendly Liberal Democratic Party.

Following Japan winning the 2020 Olympic Games bid it is strongly believed the government will legalise gambling to help pull in more desperately needed tax from the building of casinos.

The three companies want to build a complex in Odaiba, near Tokyo Bay, that would include a hotel, conference centre and a casino.

“Our role in this project would be to get involved and make a contribution to help Tokyo become a more attractive city,” said Masatoshi Satou,

Mitsui Fudosan’s executive managing officer. “But it is totally up to what happens to the bill and the direction of the government.”

Gambling giants MGM Resorts International, Las Vegas Sands Corp, Melco Crown Entertainment and Wynn Resorts Ltd have also shown interest in developing casino resorts in Japan, which is the last untapped country where operators believe huge profits can be made from Japanese gamblers.

KEEP UPDATED FOLLOW US ON

BUSINESSMAG • ISSUE NOVEMBER 2013

SJM announces a 10% rise in Q3 results

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MACAU GAMING NEWS

Melco announce amazing Q3 results

Third quarter profits were $315.2 millio compared to $226.4 million in the third quarter of 2012. That is an increase of 39% on profits.

Lawrence Ho, Co-Chairman and CEO of Melco Crown Entertainment, said, “I am pleased to report another successful quarter, with strong growth in our core segments driving record fundamental performance.

“Our committed focus on the mass market segments, particularly at the higher end of the market where we have a significant competitive advantage, continues to drive our Company’s overall profitability and outperformance in the mass market table games segment. Our premium mass offerings continue to lead the way in Macau, with City of Dreams further extending its number one position in this increasingly important segment, as is evident in the property’s leading mass market table yields.

“Studio City remains on budget and on track to open in mid-2015 with clear progress being made on the main superstructure following the successful completion of the foundation and piling work. This cinematicallythemed integrated resort located in Cotai represents a powerful and complementary addition to our current portfolio of operating assets in Macau, offering a unique array of entertainment and interactive attractions which will cater to a broad range of customers in Macau and help drive diversification of the Macau economy.

“We recently announced City of Dreams Manila as the

“City of Dreams Manila is Melco Crown Entertainment’s first foray outside of Macau, representing the next step in our mission of becoming the leading gaming and entertainment company in the region. We continue to investigate opportunities in other key Asian markets where they meet our strict approach to the deployment of capital, including Japan.

“Clear progress is being made on the various and wideranging infrastructure programs both in Macau and regionally, which continue to support visitation and the mass market segments in general. The Macau market has delivered impressive growth year-to-date across all gaming segments, showing the market’s unique position to cater to the expanding Asian middle class and, in particular, the inevitable shift to a consumer-led economy in China.”

Lawrence Ho - CEO Melco Crown Ent

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elco Crown Entertainment have announced their third quarter results with revenues up an amazing 24% from last year’s $1 billion to now at $1.23 billion with most of the increase coming from the mass market in Macau as opposed to previous years where VIP gamblers helped increase profits.

brand of our integrated casino resort in the Philippines which, together with an ultraluxurious Crown Towers branded hotel, demonstrates our commitment and confidence in this exciting leisure and entertainment market. We believe our experience in developing and operating integrated resorts in Asia, our unique competitive position in the VIP segments and experience in delivering world-class entertainment, together with our strong local partner, means we are in a unique position to capitalize on the economic growth in the Philippines and the region, and support the Philippine Government’s leisure and tourism objectives.

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ARTICLE

Casino Competition Ramps Up in 2013 – As Predicted Our feature writer Martin Baird in his November edition looks back his 2013 predictions, sadly on some he was right, which was not so good new for all.

By Martin R. Baird

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t’s nice to be right about something I predict, but I take no satisfaction in my prognostications about casino competition. Last December, I made some statements about casino competition in the United States for 2013 and I was squarely on the mark. Unfortunately, this is not good news for the gaming industry, but at least you were warned. I hope all casinos read what I had to say and took steps to get ready.

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Let’s take a look at my predictions and comments from late last year and examine what has happened so far this year. Keep in mind that outstanding casino customer service is probably your property’s only viable answer to what you are about to read.

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“The Headlines Are Already the Proof. Three headlines already tell the world that there is an increase in casino competition that will only blossom in 2013.”

What an understatement! Just look at Delaware alone.

Earlier this year, Delaware legislators approved $8 million in emergency funds for the state’s three struggling racinos and then they created the Lottery and Gaming Study Commission to address, among other things, declining casino revenues. Dover Downs has threatened to lay off employees if the state doesn’t lower its taxes.

Casino competition from neighboring states is clobbering Delaware casinos. According to Delaware.Newszap. com, Delaware’s casinos are buckling under the strain of out-of-state competition and debt. “We feel like we’ve flattened out here,” the website quoted Patty Key, chief operating officer of Harrington Raceway and Casino, as saying.

And Delaware isn’t the only state where casinos are coming to grips with regional competition. According to financial reports filed with the New Jersey Division of Gaming Enforcement, Atlantic City area casinos saw

their revenue drop 9.9 percent the first half of 2013 as compared to the same period in 2012. After hitting nearly $2.9 billion in 2007, revenue for Mississippi casinos fell 22 percent to $2.25 billion in 2012, according to the state gaming commission. The number of customers fell from 10.1 million in April, May and June 2007 to 6.4 million in the same three months of 2013.

The figures don’t include casinos operated by the Mississippi Band of Choctaw Indians, which doesn’t report data to the state. According to news reports, increased competition is drawing some players away from Mississippi to other states and casino executives say others never came back after the recession.

“States Will Want More and More Gaming Revenue.

State governments love tax revenue from casinos and they will want more as they grapple with budget deficits.” Isn’t that the truth? While Delaware casinos were struggling, the state increased its share of gaming revenue 7.5 percent to deal with budget shortfalls. New Hampshire State Reps. Peter R. Leishman and Katherine D. Rogers wrote a few months ago that voters don’t want more taxes to bring in more revenue. Leishman and Rogers went on to state: “So what is left? Maybe it is time for the House of Representatives to listen to the people of New Hampshire who have resoundingly spoken out in the past in favor of expanded gaming in the form of a casino. Only a few lawmakers stand in the way of the overwhelming public support for gambling.”

These comments go to the heart of both increased competition and tax revenues.

There’s more. In an article for The Press of Atlantic City, reporter Donald Wittkowski wrote, “Despite an explosive growth in casino gambling throughout the Northeast — some say the market is already oversaturated — the expansion continues. Tempted by the jobs and tax

ARTICLE

“Internet Gaming Is Looming. The website for the National Conference of State Legislatures reports that California, Delaware, Hawaii, Iowa, Illinois, Mississippi and New Jersey have introduced legislation authorizing forms of Internet gaming in their states.

The reason they are doing this is because they want to make sure they are not left out of this possible revenue stream.”

Oh yes, oh yes!

Take a look at this headline from The Star-Ledger in New Jersey: “Every Casino in N.J. Wants to Offer Online Gambling, State Says.” Reporter Ryan Hutchins wrote, “In a sign of how lucrative online gambling in New Jersey may become, every casino in Atlantic City plans to offer its own games in cyberspace, state officials announced today.” Earlier this year, New Jersey Gov. Chris Christie signed an internet gambling bill into law. In October, Borgata Hotel Casino & Spa in Atlantic City was awarded the first Internet gambling permit in New Jersey, giving it an early start as casinos jockey in the online gaming market. Online poker is legal in Nevada.

Washington, D.C., is well aware that states are taking

matters into their own hands. This year, two congressmen – Peter King of New York and Joe Barton of Texas – introduced bills allowing Internet gambling. Online gaming is poised to become a $7.4 billion industry in the U.S. by 2017, according to research and consulting firm H2 Gambling Capital. It’s coming folks! Internet gaming is getting a toehold in 2013.

All the above is just a few examples. I could tell you more, but I think you get the point. The already competitive gaming industry has gotten even tougher in 2013.

Don’t say I didn’t tell you so.

Martin R. Baird Bio Martin R. Baird is chief executive officer of Robinson & Associates, Inc., a Boise, Idaho-based consulting firm to the global gaming industry that is dedicated to helping casinos improve their guest service so they can compete and generate future growth and profitability. Robinson & Associates is the world leader in casino guest experience measurement, management and improvement. For more information, visit the company’s Web sites at http://casinocustomerservice.com and www.advocatedevelopmentsystem.com or contact the company at 208-991-2037. Robinson & Associates is a member of the Casino Management Association and an associate member of the National Indian Gaming Association.

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(Continued) revenue generated by the gambling industry, states are eager to cash in on casinos.” Of course, the Northeast isn’t the only region in the U.S. where this is happening.

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BUSINESSMAG • ISSUE NOVEMBER 2013

AFFILIATE ARTICLE

Should the relationship between affiliates and their merchants be re-invented?

By Ellen Learmonth

Mefilliate the evolution of the Affiliate

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s it just me or has the affiliate business become more competitive than ever? It’s not enough that we have to fight in an industry that has progressively become harder to increase the database of customers, but the affiliate relationship has become more demanding. Deal or no deal can depend on a minuet nuance or evolve in a dare to try situation.

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So the question isn’t when, but why is affiliate marketing losing ground? The answer is relatively easy to explain, but not so easy to understand. If you could look into the mind of the person or department responsible for profit and loss, then you’d see the affiliate depicted as a massive thorn in their side. But why? Affiliates do what they are supposed to do and deliver new customers!!! But, new customer lists are getting shorter and shorter, even if the revenue share deal isn’t, and this is something that is sticking in their throats. The days of the pampered affiliate is coming to an end.

Affiliates deliver, fact! But they also hold all of the cards and have been known to display diva tendencies towards unsuspecting merchants. As soon as a deal is struck, the control is never really in the hands of the merchant. In fact an affiliate sees the deal as more of a “favour” than a two-way business deal. Here’s the deal, here’s the bonus and here’s the target is not enough

because the affiliate wants better communication, more access to sensitive information (i.e. customer spend, life time values etc.) and unlimited attention. Failure to comply could and would result in no business what so ever. At no point in any of this are the reigns in the hand of the merchant. What’s worse, you the merchant, the customer and financial backer cannot make the affiliate advertise your products. The decision if, when, and where the adverts are placed is solely in the hands of the affiliate. Power to the People!!

The same cannot be said about the relationship between an advertiser and publisher. Here the advertiser is still king and very much the customer. Service is provided to the customer (advertiser) and the service provider (publisher) does everything to keep the paying customer happy. They are easier to manage too, with no need for access to internal information, easy to follow communication and good old fashioned work ethics to ensure that the campaign is successful. The object here is repeat custom, so everything is done to adhere to every request, suggest and insistence of the client.

This also includes the where, when and what adverts are placed.

Just to point out in case you were wondering, the decline of the affiliate isn’t down to their control issues or

–Let’s look at Affiliate relationships

Affiliates are starting to re-negotiating new forms of partner deals with the merchant and suddenly a CPA becomes flat fee combined with a fixed revenue share.

Business for the future involves a long term commitment

whereby both parties profit, but only if the introduced clients or customers deposit and redeposit. It’s not just a smart move by the affiliate, but a potentially profitable one that could see a constant stream of revenue well into the future.

The new hybrid affiliate-media partner is an affiliate that has media tendencies rather than an agency that has affiliate aspirations. These two advertising relationships are morphing, thus we would like to call evolutionary monster the “Meffiliate”!!! Does this mark the change of things to come? Yes, but only if the new Meffiliate recognises the relationship and commitments involved in becoming a service provider. Are they a perfect match??

NO!!! Because the Meffiliate evolution is going to take time.

ABOUT THE AUTHOR: Ellen Learmonth has been active in digital media for over 14 years covering all disciplines of online marketing with strong expertise in acquisition and affiliate marketing. She is passionate about innovation and new technology with a strong drive for creativity. Her 2006 World Cup Campaign earned two prestigious creative design awards at the New York Festival (Bronze) and The International Davey Award (Gold). Now living in London, Ellen is lending her expertise to some of the major gaming operators.

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diva like antics, but down to the fact that companies are starting to switch to a more SEO orientated business model. Enter stage left the seriously expensive SEO consultant and suddenly a list of “do’s and don’ts” appear, and all changes. At this point having little or no control over your affiliate partners is starting to show and the inevitable happens. Companies now want more for their buck and the introduction of an in-house SEO guru changes the parameters of the deal, so affiliates are starting to be more media agency than affiliate partner and the metamorphosis begins.

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MACAU GAMING NEWS

Record breaking October for Macau

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acau casinos saw another record breaking month for October with a massive 32% increase in revenues compared to the same period last year, the Golden week holiday for Chinese boosted figures to $4.57 billion for the month according to figures from the Macau Government Tourist Office.

The revenues were expected by analysts as Macau shows no signs of slowing down its incredible growth.

Gambling revenues in the gambling hub have risen by 18% to $37.2 billion in the first 10 months of 2013, which is close to the total $38 billion in revenues the city raked in for the whole of 2012, which is now six

times larger than total revenues for Las Vegas.

Total visitor arrivals grew 5.7 percent to 896,847 during the holiday between Oct. 1 and Oct. 7. Mainland visitors have helped fuel a boom in Macau, the huge increase is put down to middle class Chinese fueling the expansion in growth.

China moving closer to online gambling some $150 million to help it invest in the platform for online sports betting. However analysts say the opportunity for expansion for the company is limited at present because it will be tied into the states lottery service for welfare.

At present that lottery offer around a 68% return on players wagers and will be the same model for any online sport betting site. That is significantly lower than illegal sites that operate in China, there they offer some 95 to 98% return on bets.

Another stumbling block to success will be that 500. com will not be able to offer “in-play” bets which Chinese gamblers love, hence how many will migrate from illegal sites to the official one is questionable.

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Chinese nationals could soon be able to bet online on sporting events as the possibility of online sports betting looks likely to be a reality for mainland China.

It is being reported in China that a Chinese company 500.com ltd has got a an understanding from the Government’s Ministry of Finance to move ahead with a purpose built online gaming platform specifically for sports betting on mainland China only, excluding Macau which has already a closed monopoly for online gambling by Dr Stanley Ho the gaming industry legend that is legally authorised to operate an online portal for betting on football and basketball in Macau.

500.com which is based in Shenzhen is preparing to float on the US stock exchange, looking to raise

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LATVIA REVIEW

Betting Forums: Reputational Risk and Credibility?

We all know about forums, some are good some are clearly not forums and are used to promote certain companies.

In this special article by Wayne Openshaw we look at what makes a good reputable forum

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efor looking at the pros and cons of sports betting and casino forums, I think it is essential to look at the reason forums were ever developed.

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Most of online gamblers and online gambling operators are familiar with them they enable users of a website to interact with each other by exchanging tips and discussing hot topics related to a gambling websites theme and services. The emphasis here is on ‘SERVICE’.

It is well known that in most cases forum posts are either about sign up offers which are popular themes on any forum for bonus hunters, simply because a vast majority of ‘players’ are looking for maximum payout and benefit for the minimum input. However this is commonly accompanied by the downside of players who have tried to find loopholes in Terms and Conditions or as is common in Eastern European cases – uses forums to try and bribe or pressure gambling operators for payouts.

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Forums benefit online operators in 5 essential ways, allowing for the creation of robust online communities even with low traffic volumes since people often return to the site on a regular basis to review responses to particular threads of interest. The benefits of forums to website owners are essentially: 1. Giving the public information on your site.

2. Increasing traffic through repeat visitors and clickthroughs.

3. Data farming to capture email address and details of posters.

4. Enabling website owners to gain more credibility.

5. Allowing gambling operators to build relationship with potential visitors.

The quality of an online gambling forum is wholly dependent on the knowledge of its users about the topic at hand and the value the forum users can give based on their experience and knowledge by posting tips which other forum users or visitors can use. The benefit of responsible forums and forum management leads to a win situation for all involved, however!

The trend in most forums – and I hasten to exclude the reputable gambling forums who have shown administration responsibility – seems to be heading towards a very grey area concerning fairness, administration regulation and singular opinion. Most forums are trying to establish themselves as the check and balance to fair customer treatment and even going so far as to act as an arbitrator in disagreements between forum users and targeted gambling operators. At the same time, these forums have a disclosure on their sites where they expressly submit that the opinion expressed by the users is not ‘necessarily’ their own and in doing so excuse themselves from any libel or legal responsibility.

So, unless approached by the forum administrators or moderators regarding a negative post, online gambling operators are explicitly denied the right to post responses to negative threads regardless of their inaccuracy or

Forums: We all know about them - what makes a good one?

So where does the forum operator stand with regard to litigation in cases where negative, unjustified posts impact loss of business or brand dilution?

What course of action does the online gambling operator have against forums and forum administrators and users for libellous posting intended on causing harm or loss of business from unsubstantiated claims of unfairness or questionable service?

The online gambling industry is the most heavily regulated online industry as it is, online gambling operators are required to be legal entities within a licensed jurisdiction, pay taxes, undergo compliance testing and associate with responsible organisations to protect players, not to mention strict KYC

procedures and act responsibly in accordance with the Licensing Authorities’ Terms and Conditions and the requirements of usage laid down by software suppliers, yet are unable to protect themselves or claim restitution from ill managed and opinionated forums – many of whom will suddenly find a gambling operator in favour regardless should the gambling operator offer to buy advertising or agree favourable affiliate partnership deals. How many times have you read negative threads against an online gambling operator or seen bad ratings for online gambling operators who have their banners displayed on forums?

What are the current activities in forums, particularly the gungho Eastern European forums where there is a total disregard for reputational risk? Fraudsters seeking to get paid quickly, before chargebacks appear, frequently post on blogs and forum sites, or threaten to do so, regarding a payment policy or a declined payout after failing KYC reviews. They are masquerading as legitimate customers that are impatient and put pressure on gambling operators to change policies or make exceptions. They all seem to target new operators or new brands – hoping the newbies are so concentrated on establishing themselves as fair and nice to increase acquisition that they will neglect their own credible

stance against this type of threat. It is common knowledge that giving in to reputational blackmail is poor practice; the more insistent a player is about this, the more likely it is that he/she is a fraudster attempting to push for an ill-fated payout.

The normal course of action for a gambling operator is to resist making the payout, and if misleading information is posted regarding the business practices, contact the rating site and make your case. All of the reputable blog and affiliate sites will evaluate posted information and remove it if it is offensive, misleading, libellous or criminal in nature. However, Eastern European forums are totally oblivious to this practice and sadly so are some Money Saving forums who host betting threads. Are these forums guilty of aiding the course of bribery and/or coercion and should they be liable?

Simply yes because it is time for forums, forum owners, administrators and moderators who can and do have impact on operators to become more responsible and even accountable for the contents of their pages.

Wayne Openshaw (falconbet.com)

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accuracy, and if they do, it is heavily frowned upon by forum users and inevitably leads to a negative impact on the online gambling operator. In most cases however, the online gambling operator is never asked or approached for their comment on a negative thread and if they are, the comment does not or seldom makes the thread.

Given that any posting on a forum becomes accessible to the public domain and negative accusations are there for anyone using the worldwide web to see.

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EUROPEAN GAMING NEWS

bwin.party suffer 21% revenue fall for Q3 UK MP calls for online gambling inside casinos

Greece has blocked over 400 online gambling websites, including bwin. party, the company said action by the Greek authorities to block Internet access to over 400 gaming sites including its own would have a modest net impact on revenue and EBITDA this year.

“As we expected, our underlying third quarter performance appears to have represented the floor in what has been a transitional year for the group,” said chief executive Norbert Teufelberger.

He added that full-year 2013 cost savings were likely to exceed a target of 70 million euros, helping to offset the impact of the Greek dispute.

The company is targeting less countries with online gambling but focussing more on those jurisdictions that seem more lucrative. In closing bwin. party said it was on track and ready

to go when New Jersey launched online gambling come the 26th November.

Q3 revenues rise for Playtech Playtech announced their 3rd Quarter results with revenues up 13% to €90.6m for the three months till the end of September; the main driver of increased revenues was the companies online casino which saw an increase of 21% to €46.8m in the quarter.

The companies online bingo however continued to slide year on year now which was down 6% in the quarter.

Chief Executive Mor Weizer said: “Playtech has continued its growth through the third quarter and the management team is confident of achieving market expectations for the full year and beyond.”

The MP for Rochford & Southend made his comments following the regeneration of two major casinos in his borrough, the Genting Club employs 170 and the soon to be completed Grosvenor casino at the Park Inn Palace Hotel, which will be completed in the summer of 2014.

Mr Duddridge, who also praised the Genting Club and the Rendezvous Casino in the Kursaal for encouraging responsible gambling, said: “It is ironic games cannot be played online inside, even if one takes in one’s own iPad or iPhone.

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win .Party announced their third quarter results with a 21% drop in revenues to 145.7 million euros, the company focussed on its struggles in Greece as a main part for its continuing decline.

Southend MP James Duddridge has called for land based casinos in the UK to be allowed to offer online gambling inside their venues.

The conservative MP who is sitting on the parliamentary panel that is scrutinizing the latest gambling bill passing through the House of Commons said, “It would be much better to allow casinos to have gambling online within their own premises, that has greater protection for problem gamblers, the current position is ludicrous.”

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SPECIAL Feature Ireland

IRELAND “You cannot please all the people all the time” Our feature writer JJ Woods gives his opinion on the Report on hearings in relation to the Scheme of the Gambling Control Bill in Ireland

By J.J. Woods Background

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n 15 July 2013, Alan Shatter TD, Minister for Justice, Equality and Defence, announced government approval for the General Scheme of the Gambling Control Bill 2013 (the “Scheme”). This Scheme is a preliminary step towards legislation, which if enacted will provide a significant overhaul of the law in this area and a comprehensive new licensing and regulatory framework for gambling, both land-based and online. As it stands, the Scheme has no legal effect, but provides a good indication of the Government’s current thinking. Submissions on the Bill were invited and the hearings to those submissions took place in mid – October and the report was published last week. The report is available here www.justice.ie

The Submission Hearings The hearings to the submissions certainly ran smoothly in that there was no complex questions asked by the committee to the people

attending, and when certain questions were asked they were inaccurate especially regarding slot machines when one committee member was looking for an explanation as to why we had 20,000 Slot Machine venues in the country?

And a further question was looking for clarity as to why the results of virtual racing are predetermined? when it is the odds that are predetermined. One has to ask what preparation the committee did as the level of questioning was poor to say the least.

In fact at one stage the chairperson of the Irish Bookmakers Association explained that Virtual Racing was born out of Foot and Mouth disease approx 8 yrs ago (2005). The reality is that the disease broke out in 2001 and almost 1 year later the 1st virtual race was broadcasted in May 2002 which was Portman Park.

There seems to be some confusion regarding the existing representative bodies of the various Gaming

sectors for example there are two associations and possibly three who claim to represent the Slot and Amusement machine operators, one is IATA (Irish Amusement Trades Association) and the other LGAI (The Licensed Gaming Association of Ireland) and you also have The Irish Showmen’s Guild Ltd which are a travelling Funfair group but have amusements included.

Now when it comes to Private Members Clubs (casinos) GLAI (Gaming and Leisure Association of Ireland) claim to represent this sector but the reality is they represent less than 10% of the clubs in Ireland.

It is worth noting that the spokesperson of this group claimed that ‘’ Money laundering is a myth?- I suppose Hollywood in the 1930s must take much to blame for this ‘’ were his words.

Ireland seems to have a history of having several associations for the same sector and this practise needs to stop especially when it comes to

about Resort Style Casino which has been outlawed by the Bill.

the gaming industry. As the legislation progresses (slowly) there will be several associations and groups formed and it would be much more practical and effective in every sense if the various associations got together and formed one Gaming association.

The Report has several conclusions and I have chosen a few here: There seems to be a lot of emphasis on the Social Gambling Fund as it seem to be discussed quite a lot and I am not sure this is a good thing as it seems we are preparing a ‘’damage fund ‘’ before we get started.

Another conclusion in the committee report to be highlighted was : Under the 1956 Gaming and Lotteries Act ; A slot operator cannot receive a license unless they provide other forms of amusement in the same premises ! This really is the crux of the whole gaming issue and this is a wrong by the Government that should have been corrected years ago and I believe the very fact that it has not for so long shows how little the Government then and now know about gaming and the necessary regulations to protect the young and vulnerable. The result today is that children’s amusements are housed in the same buildings as hard gaming slot machines.

We do like several other countries who have a proper gaming legislation need a fund but the Bill has been so restrictive and negative up to now it seems that this is being put out as just another downside as opposed to being a positive approach towards responsible gaming.

The first rule of Gaming legislation in any country/jurisdiction is to protect the young and the vulnerable. The Irish government instigated this unacceptable ruling over 50yrs ago and never saw fit to change it in all that time which resulted in Candy Floss meeting Hard gaming full on.

Bizarrely one of the conclusions is further investigations into uncollected winnings at betting shops? Also highlighted was possibly a rethink

A surprise conclusion has been to consider an outright ban on all Virtual Gambling in betting shops and whilst the line of questioning at the

time than any other person or group at the hearings. In all the hearings themselves were dull but possibly the committee will agree that this is indeed a complex piece of legislation as the chairperson of the committee reminded us.

Conclusions There is a saying in Ireland; There’s always one ! an example of this is possibly an Irish Wedding where a person just shows up out of the blue and for sometime afterwards the other guests are left wondering who he actually was ? most people at the time just assume he is well known to the party.

This in my opinion happened at the Hearings and the guest was Bet Aware Ltd , the interesting points about this group are, They do not agree or disagree with gambling? but they do hold the belief that gambling is not entertainment or fun ? The spokesperson of the group explained to all concerned the definition of a bet and commented on several more issues resulting in the fact that he had more speaking

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This is where I believe the Government is detached in their thinking when we look at this type of Casino operation, Casino and Tourism go together or at least are close neighbours and Ireland has a specific reliance on that sector so it makes sense that this type of Casino be allowed. Ireland is famous for its Race Courses and Golf Courses and a Casino/Hotel near or at these courses would be a resort style facility so why outlaw it?

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we are poker

JJ Woods - The Gambling Control Bill

Overview The Gambling Bill 2013 or the report in my opinion has not set the international gaming world on fire, There is a distinct lack of interest from the major casino operator’s bar some of the eastern bloc operators who might take an interest.. The

Gambling bill for investors so far has no interest for them and will continue to do so until the taxes are announced.

Ireland is one of the last countries in the EU to deal with its Gaming Legislation which is sad considering it is the fastest growing industry in the world.

The Gambling bill is not investable for operators and the Government may find that it will have to offer tax incentives as it did some years back to lure operators to our shores.

They must also except that gaming

has a connection with Tourism which up to now they have not acknowledged.

Overall they need to stop treating the issue with kid gloves and understand that they cannot possibly satisfy all the groups who appeared at the hearings. The choice is a proper gaming legislation which will create new structures improve existing ones ,attract investors , create jobs and revenue for the Government or the alternative is be an island of tiny cottages , tiny casinos and backstreet slot arcades!

JJ Woods was born in Ireland but left in the 1970’s to live in London and he started his career in banking. After four years in Banking in London JJ trained in the Casino Industry. Over the last 30 years JJ has dedicated his career to the setting up, including: design, opening and management of Casinos around the world.

Throughout his time in Ireland JJ has also done several Radio, Television and Newspaper interviews on the subject of Casinos and gaming, he is above all extremely passionate about the Casino Industry and Completed a gaming submission to the Irish Government during Legislation Research. He is a leader in respect of the responsibility of customer care He was responsible for the following Casino designs and set ups in Ireland : Macau (Cork), Silks (Dublin). www.atlanticcasinoconsultants.com Email: info@atlanticcasinoconsultants.com

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earings about this form was not very accurate the committee obviously have an issue with this form of gaming.

Could it be that they are Fobt’s ( Fixed Odds Betting Telly’s) ??

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FEATURE ARTICLE

A Tale of Two Cities, Macau and Las Vegas Part 3

By Professor I. Nelson Rose © 2013, I. Nelson Rose. Prof. Rose is recognized as one of the world’s leading experts on gambling law, and is a consultant and expert witness for governments and industry. His latest books, INTERNET GAMING LAW (1st and 2nd editions), BLACKJACK AND THE LAW and GAMING LAW: CASES AND MATERIALS, and the recently published GAMING LAW IN A NUTSHELL, are available through his website, www.GAMBLINGANDTHELAW.com.

On June 27, the U.S.–China Economic and Security Review Commission held a hearing in the U.S. Senate Office Building on developments in Hong Kong and Macau. The second panel focused on “Money Laundering in Macau and Implications for the United States.” I was asked to testify, along with A.G. Burnett, Chairman of the Nevada State Gaming Control Board, and James H. Freis, Jr., Former Director of the U.S. Treasury Financial Crimes Enforcement Network (FinCEN). This article is an expanded version of my written and oral testimony. It is based on some of my prior published writings, including “China’s Gambling Problem,” “Does Macau Create Legal Risks for American Operators?” “Victim Of Its Own Success.”

Part 3 of Professor Rose’s must read article on Macau & Las Vegas

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robably the most common way to get cash to gamble in a casino in Macau is through a VIP gaming promoter. Some of the VIP gaming promoters are large and sophisticated. One, Asia Entertainment & Resources Ltd. (Stock symbol AERL) is traded on NASDAQ. Its website explains how the system works and even details what arrangements it has with which casinos.

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Of course, some the VIP gaming promoters are small and undoubtedly have ties with organized crime. As do some of the other large ones. The problems arise mainly from the archaic gambling laws of the PRC. Much of what the VIP gaming promoters do is completely legal. There is no law in the PRC against making arrangements for travel, although there are restrictions on advertising or promoting gambling. Under the laws of Macau, VIP gaming promoters are allowed to share directly in both the theoretical and actual losses of the high-rollers they bring to Macau’s casinos. It appears that China does not care if VIP gaming promoters loan

money for gambling, so long as only paperwork, not currency, crosses the border.

VIP gaming promoters are at the heart of gaming revenue for Macau’s richest casinos. They are so important, in fact, that VIP gaming promoters used to get a much larger share of money lost by high-rollers than the actual casinos. It is not clear, however, whether this money is all profits. VIP gaming promoters complained when the Macau government, at the urging of its casinos, put a cap on commissions, claiming that they have to give large kickbacks to losing high-rollers.

How do the VIP gaming promoters get their profits out of China? Some invest in other legitimate businesses on the Mainland, which are allowed to wire funds to Hong Kong and elsewhere. But some turn to those millions of shopping bags, or other, more nefarious, means.

The VIP gaming promoters supply Mainland visitors with the cash they need to gamble in Macau. The arrangements between the player and the promoter are secret

A Tale of Two Cities, Macau & Las Vegas and unknowable. A commonly heard allegation is that when a player shows up with what appears to be, say, a HK$1 million line of credit and makes bets of HK$25,000 per hand at baccarat (and the game is always baccarat), when the player returns to the Mainland to settle up he actually had a HK$10 million line of credit and was making bets of HK$250,000 per hand. There is no way for the casino or government regulator to know.

But the VIP gaming promotion system persists because it serves many functions, including for the casinos.

Visitors from the Mainland still have trouble getting their money to Macau; gambling debts are still not legally collectable; and there is still very little fiscal infrastructure, since most Chinese do not have bank accounts, let alone credit cards and credit histories. So the VIP gaming promoters bear the risk when they lend money for gaming.

Business in China is mainly conducted informally among people who

know each other, or the personal contacts of personal contacts. So it is extremely difficult for a U.S. company to break into this market without VIP gaming promoters, with their agents and subagents.

Anonymity works for casinos as well. PRC officials are not allowed to gamble in Macau. In fact, they are not even suppose to visit the SAR without prior approval. Casino operators can truthfully say that they do not know if a government official is making bets in their casinos, because they do not have the names of the high-rollers brought in by the VIP gaming promoters.

The problem of the VIP gaming promoters will not be solved until the PRC modernizes its laws. There has been some movement, but the PRC is still far behind the admittedly outdated laws of the U.S. (where gambling debts are also still generally legally unenforceable). As an example, gambling in Mainland China used to be punishable by

death. Today, an operator can still get three years in prison.

But the PRC still punishes regular citizens for promoting gambling, and for merely making bets. Gambling is lumped in with pornography in Article 32 of the Regulations of the PRC on Administrative Penalties for Public Security. It provides, “The following acts are strictly forbidden: (1) gambling or facilitating gambling . . . Whoever commits one of the above acts shall be detained for a maximum of fifteen days, fined simply or concurrently a maximum of three thousand yuan or given re-education through labour according to regulations. Criminal responsibility shall be investigated if the actions constitute a crime.”

Given the wording of the last sentence, it is clear that the PRC does not consider the facilitating of gambling as a “crime” per se, even though facilitators can be sent to a labor camp for up to 15 days. Portugal and other countries impose

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Casinos and the government obviously are not happy with these side agreements. Casinos make their money by having a small percentage advantage on every bet made.

The theoretical win for the casino on baccarat is about 1.2%. So, on bets of HK$25,000, the casino makes, on average, about HK$300 per hand over time. If the bets were HK$250,000, the casino would make ten times as much, averaging HK$3,000 per hand. And the Macau government is losing the tax revenue that the players’ actual losses would generate.

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(Continued)

A Tale of Two Cities, Macau and Las Vegas

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unishments like this on individuals who are considered risks to public safety and welfare. These are considered “administrative offenses,” not crimes.

In the PRC, it appears there are little in the way of constitutional rights or procedural safeguards to protect average citizens from these type of arbitrary punishments imposed by government officials.

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Focusing on VIP gaming promoters, it is not clear that this “Administrative Penalty for Public Security” would apply, if the facilitation took place in the Mainland, but the gambling occurred in Macau, where such activity is legal. It is thus doubly doubtful that a Macau or Nevada regulator would find a VIP gaming promoter unsuitable merely because the promoter might be in technical violation of an administrative restriction on facilitating gambling, by getting patrons from the Mainland to Macau. Even lending money to gamble legally does not appear to be a separate crime.

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The PRC’s restrictions on promoting gambling have been applied to advertising casino gaming in Macau.

The casinos themselves have found it difficult to know what is allowed, even when they don’t directly mention gambling.

Similarly, gambling debts cannot be collected through the court systems of the Mainland, although they are enforceable in Macau and Hong Kong. Because gambling debts are not legally enforceable on the Mainland, casinos are extremely reluctant to directly lend money to players.

So, how do the VIP gaming promot-

ers collect?

The most recent development has been the creation of licensed microfinance companies on the Mainland.

There are reportedly now more than 6,000 licensees, lending at least 600 billion yuan, or more than US$96 billion. Loans are supposed to go to small businesses. But VIP gaming promoters and their agents are getting licensed and taking the position that it is none of the government’s business what the loans are for. They even believe, or at least state publicly, that being a licensed micro-lender somehow makes their business of loaning money for gambling legal.

There is no way China can check every loan. Yuan-denominated loans now total 7.47 trillion yuan, or US$1.18 trillion.

Chinese law, of course, would not allow a lender to turn a non-enforceable gambling debt into one that the courts would enforce simply because the lender has a micro-finance license. There is also the possibility

of criminal charges being raised for promotion of gambling. Of course, all this would require that the player declare publicly that he and everyone else involved knew that the money was being lent for him to gamble in Macau.

How would an agent of a lender make sure the player does not talk?

For that matter, how have agents been collecting those hundreds of billions of yuans over the years, when gambling debts were, and are, not legally enforceable?

That is the greatest risk of China’s outdated laws against gambling.

Because gambling debts cannot be collected through the legal system, they are sometimes collected through illegal means. In a 2008 study by Macao Polytechnic of 99 high-rolling Mainlanders who made the Chinese newspapers for excessive gambling, seven died “extrajudicially,” meaning they committed suicide or were murdered.

One interesting side-note of this study:

Professor Rose looks back at the history of Macau

The biggest potential problem for American companies involved with a scandal in Macau is that they are all, by definition, licensed by at least one state of the U.S. The current problems involving LVS and MGM are typical of the type of trouble casino companies can face when they are associating with VIP gaming promoters or partners who bring unwanted scrutiny from state regulators.

Examples were the startling headlines from three years ago: From Reuters, the source of the original story: “SPECIAL REPORT-High-rollers, triads and a Las Vegas giant.” Others picked it up: “Las Vegas Sands (LVS) Accused Of Mob Ties;” “LV Sands ‘linked to Macau gang;’” and the worst, “Macau Murder for Hire Tie-ing Las Vegas Sands.” Reuters then ran the inevitable, “Nevada regulators analyzing Macau casino activity.” Even the hometown newspaper, the Las Vegas Sun, jumped onboard: “Macau giving fits

to Nevada regulators: Organized crime said to run rampant where state giants do business.

The murder-for-hire was real. Four men were convicted in Hong Kong of a plan to have a dealer at the Sands Macau killed, for supposedly helping a high-roller cheat a VIP room out of millions of dollars. But the other ties to LVS were weak.

Reuters reported that a witness, not a gang-member but only a “regular casino patron,” testified that a man who was alleged to have been running the high-roller room was also, allegedly, a member of organized crime, and, allegedly, the mastermind of the plot. This alleged mastermind also was a major investor in a publicly traded VIP gaming promoter.

It is important to note that the testimony was not strong enough to get the Hong Kong police, or anyone else, to arrest the alleged mastermind. As I wrote at the time: “It is doubtful there is enough here for the Macau government to do much in response to this news story, other than tighten its procedures and increase background checks on VIP gaming promoters.

But there certainly was enough to cause major headaches for LVS, and for the other companies associated with Macau’s casinos: MGM Mirage, Wynn Resorts, Galaxy Entertainment, Melco Crown Entertainment, SJM Holdings; and even Hard Rock, Hyatt Regency, Four Seasons and Mandarin Oriental. It also put pressure on Nevada and other U.S. state regulators to take another look to see whether licenses will be pulled, or at least more stringent restrictions should be placed on Macau VIP gaming promoters.

Murder-for-hire and casinos obviously made this a major story, and sexy enough to be published far and wide. The timing was particularly bad, coming on top of the ruling in New Jersey that MGM’s Macau partner, Pansy Ho, was unacceptable due to the alleged organized crime ties of her father, Stanley Ho.

An exciting conclusion to this epic will feature in the December issue

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The argument is often raised that the VIP gaming promoters are necessary because only local agents on the Mainland can know whether an individual is a good credit risk.

This study showed that many of the “high-rollers” who got in enough trouble that they were reported in Mainland newspapers were actually relatively poor bookkeepers, working for large companies. This means the VIP gaming promoters, or its agents, or its agents’ subagents, knew that the player was good for the money, not because he was a wealthy company owner, but because the bookkeeper was in a position to embezzle funds for gambling.

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EUROPEAN GAMING NEWS

Mr Green revenues soar by 53% for Q3

Ladbrokes confident of reaching year end targets Ladbrokes say they are “still within range” of reaching expected profit forecasts for the year, even thou rumours swirling around say that the UK bookmaker will have to announce reduced profits again for 2013 because of “recent adverse sporting results”.

William Hill to lay off service centre staff William Hill are to make 65 redundancies within the telephone betting and customer service department according to reports in the Gibraltar Chronicle.

The redundancies are because customers are now using electronic options in communicating with customer service and placing bets instead of using the telephone service.

Galaxy Entertainment to spend $5 billion in Japan & Taiwan Galaxy Entertainment Group are prepared to spend more than $5 billion in developing casino resorts in both Japan and Taiwan when and if the respective governments open up to legalising land based gambling.

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or the first nine months, Mr Green & Co AB (publ) reported a very high rate of growth both in terms of game win and EBITDA. Game win for the first nine months increased by 60.1% yearon-year and amounted to SEK 347.6 (217.2) million. During the third quarter, the game win amounted to SEK 124.1 (81.1) million, representing an increase of 53.0% compared with the year-earlier period. EBITDA also rose sharply during the quarter and totalled SEK 31.5 (21.7) million during the period, an increase of 45.3%. EBITDA for the first nine months was SEK 83.5 (20.8) million, which corresponds to a year-on- year increase of 300.6%. The growth is a result of Mr Green,s ability to create a secure and exciting game experience for players combined with a focus on new mobile platforms, such as tablet devices and smartphones.

Swedish gambling firm Cherry has announced that it has signed an agreement to acquire 49% of the shares in Web Resorts NV (Curacao) for €4.3m.

Web Resorts owns several domains including NordicSlots.com and NorgesSpill. com, which offer online casino from BetSoft Gaming. Cherry is a Swedish gaming company established in 1963 specializing in online casinos and online lotteries; (EuroSlots.com, EuroLotto.com, CherryCasino.com and SpilleAutomaten.com) and games development (Yggdrasil Gaming), through subsidiaries in Malta. Cherry is the market leader in casinos in restaurants and nightclubs in Sweden.

Cherry employs around 700 people and has more than 2 400 shareholders.

KEEP UPDATED FOLLOW US ON

BUSINESSMAG • ISSUE NOVEMBER 2013

Cherry buys 49% of Web Resorts

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EUROPEAN GAMING NEWS

Online operators concerned about electronic returns are in place to ensure that data is stored securely with controls to prevent access.

Our online system is encrypted and requires licensees to authenticate themselves before being able to submit and access their own data.”

Both online operators and software supplier companies will under the new reforms have to post their returns electronically to make savings within the industry. At present operators were allowed to post their returns by paper or electronically but that is all changing, but many are worried how safe the process is, so the Gambling Commission are hiring a group of legal advisers to explain the process to all those firms that have worries.

“We have been accredited against the ISO: 27001 standard since 2010. This is an internationally recognised standard for evaluating how securely an organisation manages and stores its information.

As a public authority, the Commission also adheres to the Security Policy Framework and supporting guidance issued by Cabinet Office to ensure that the information we process is handled and stored in a secure manner in line with best practice and HMG requirements,” it added.

“Concerns have previously been raised over the security of submitting data electronically,” the regulator said. “The Commission would reiterate that procedures

Audrey Ferrie a gambling law expert from Pinsent Masons said that gambling operators submit com-

mercially sensitive information to the regulator and therefore have a right to expect the Commission’s systems to be secure.

“Under the Commission’s plans, regulatory returns to be submitted electronically could range from sensitive financial information, such as details about revenue sharing agreements with other businesses, as well as the number of active customer accounts, information about unresolved disputes and suspicious activity reports,” Ferrie said. “Gambling operators are rightly eager to avoid this information falling into the wrong hands.”

The new reforms will be brought in early next year along with the contentious “point of consumption tax.”

Gala Bingo will struggle for buyer Gala Coral will struggle to find a buyer for their Gala Bingo division according to a recent interview with its own Managing Director Simon Wykes.

In a recent article in the Times any private equity company looking to snap up Gala’s ailing bricks and mortar bingo units will have to lay aside substantial funds to renovate and modernise the business.

The gambling company that recently sold off their Gala Casinos to Rank and is now looking to offload its bingo sector for £250 million prior to an expected Public offering is seeing desperate declines in trade for bingo halls as their core customers, women aged between 40 and 50 years of age look to spend their money elsewhere. The problem according to Simon Wykes is the strict regime on VAT for bingos in general, clubs are not able to reclaim VAT on development or infrastructure.

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he new reforms by the Gambling Commission for online gambling operators to submit their regulatory returns electronically is causing concern among online gaming firms that the process may not be safe.

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EUROPEAN GAMING NEWS

Unibet post impressive results

· Gross winnings revenue amounted to GBP 56.1 (43.8) million for the third quarter of 2013 and GBP 169.5 (140.3) million for the period January to September 2013. · Profit from operations for the third quarter 2013 amounted to GBP 9.2 (4.5) million and GBP 29.0 (22.6) million for the period January to September 2013. · Profit before tax for the third quarter of 2013 amounted to GBP 9.2 (4.0) million and GBP 27.9 (22.1) million for the period January to September 2013. · Profit after tax for the third quarter of 2013 amounted to GBP 8.2 (3.4) million and GBP 25.4 (19.8) million for the period January to September 2013. · Earnings per share for the third quarter of 2013 were GBP 0.292 (0.120) and GBP 0.908 (0.710) for the period January to September 2013. · Operating cash flow before movements in working capital amounted to GBP 14.2 (8.7) million for the third quarter 2013 and GBP 43.4 (34.2) million for the period

January to September 2013. · Number of active customers at the end of the quarter was 453,753 (382,378).

“Unibet delivered 28 per cent year on year growth in gross winnings revenue in the third quarter (22 per cent excluding the impact of exchange rate changes). This was achieved despite the excellent summer weather in many of our key markets and high numbers of favourites winning. The growth was wholly organic and demonstrates continued increases in market share.”

“It is also satisfying to report that underlying EBITDA for the third quarter increased in line with the growth in revenues, demonstrating improved scalability despite the significant investments Unibet has made in information mining, local regulation and in Kambi.”

“Unibet’s mobile offering continued to develop and mobile revenues represented 23 per cent of gross winnings revenue for the third quarter 2013 compared to 8 per cent for the same period last year. This proportion is significantly higher in certain key markets.”

“In the period up to 3 November, average daily gross winnings revenue has increased by over 21 per cent compared to the third quarter 2013”, says Henrik Tjärnström, CEO of Unibet.

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nibet the Swedish online gambling operator has announced impressive results for the ninemonth period January 1 to September 30, 2013, with net profits almost tripling and mobile revenues soaring. Here are the main points from Unibet:

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EUROPEAN GAMING NEWS

Sheriff Gaming suspension continues

For the owners of Sheriff Gaming that had its B2B license suspended in early September by the Alderney Gambling Control Commission (AGCC) until a hearing on the 29th October in London which was told that company must cease trading and offering their online gaming services until such time as the hearing concluded is now in limbo following the decision by the AGCC. The suspension followed raids by Dutch police into Sheriffs parent company the Bubble Group and its owners for suspected drug dealing, illegal gambling operations and money laundering. The iGaming Post reported at the time the raids taking place that police had confiscated properties, vehicles and bank accounts.

The Dutch firm supplies services to operators such as Betsson, Bet 365, Gala Coral, Unibet, Microgaming BetClic and many others, but will now have to continue suspension these services until the AGCC makes a final decision on the B2B license holder.

It is a major blow to Sheriff Gaming and observers question if the company can return after such serious

allegations even if they have their license restored, also will so many high profile customers as the company has want to be associated with them after such an investigation? It is very bad times at present for a company that was doing so well.

No timeline or reason has currently be given by the AGCC on the decision to continue the suspension however industry insiders say that no final decision will be made until authorities in Holland complete their investigations, this could take months or even years said one industry veteran who did not want to be named.

Ladbrokes to spend £50 million on revamp Ladbrokes says it will invest £50m on a major brand revamp over the next two years.

The UK bookmaker will spend the money in new technology, strengthening of their retail sector, development of “operational excellence” and the recruitment of a Brand Marketing Director to ramp up promotional activity.

Albania will shut down all overseas online gambling sites in the countries effort to stop the outflow of money from one of the poorest regions in Europe.

Prime Minister Edi Rama said the government would prepare legislation to block gambling on websites based abroad, where Albanians are estimated to be spending spent €500 to €700 million ($690-965 million) a year, according to calculations from domestic and international gaming observers.

Since the new government party took charge with a landslide victory in June of this year, it has been busy closing down casinos and betting shops totalling 1,300 across the country for operating without proper licenses and tax evasion.

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he Alderney Gambling Control Commission (AGCC) has decided to continue its suspension of license holder Bubble Group following its hearing in London.

Albania to shut down online gambling

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EUROPEAN GAMING NEWS

UK Gambling Commission release survey on Brits gambling Overall, 73% of past four week gamblers had gambled ‘in person only’. A further 15% had done so both ‘online’ and ‘in person’, and 12% had gambled ‘online only’.

Gambling participation in the past four weeks

Participating ‘online only’ was the most popular method of gambling for sports betting and spread betting.

An average of 55% of respondents had participated in at least one form of gambling in the previous four weeks.

This compares to 57% in 2012.

Among past four week bettors, betting in person at a bookmakers was the most common option for all types of betting activity.

A larger proportion of male than female respondents had participated in gambling in the previous four weeks (60% of males and 50% of females).

Gambling involvement

An average of 15% of respondents had participated in at least one form of online gambling in the previous four weeks. This compares to 14% in 2012.

A larger proportion of male than female respondents had participated in online gambling in the previous four weeks (18% of males and 11% of females).

If those respondents only playing the National Lottery online are excluded, the proportion of respondents who had participated in online gambling falls to 8%. This compares to 8% in 2012.

Participation in each activity The most popular gambling activity was National Lottery tickets (44% of respondents). This was followed by other lotteries (12%) and scratchcards (9%).

No other individual activity was participated in by more than 4% of respondents.

How people gamble

The most common frequency of participation for past four week gamblers was ‘once a month, less than once a week’ with this being the most common frequency for ten activities, although for a significant number of activities respondents indicated that their participation was ‘once a week’.

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he UK Gambling Commission has released their latest gambling research findings which was conducted by ICM Research. The highlights of the findings were:

For participation in all individual activities, respondents were more likely to report that they gambled ‘online only’ than they were to report they did the activity both online and in person, with the exception of virtual dog and horse races.

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