Refurbished gaming room at The Glebe Hotel, Sydney
GAMING
FOCUS ON GAMING
WITH THE AGE AHEAD IN AUGUST, CRAIG HAWTIN-BUTCHER REVEALS SOME OF THE KEY GAMING NEWS STORIES BEING REVEALED IN THE RUN-UP.
THE VIEW FROM VICTORIA CONSULTANT TIM STILLWELL OF SHINEWING AUSTRALIA ROUNDS UP HIS PERSPECTIVE ON THE STATE OF GAMING IN VICTORIA. Victoria is in our humble opinion a very highly regulated gaming industry, compared to the other states. That creates opportunities but also creates protection for operators. By that I mean… we have a much lower available gaming machine count in terms of state-wide gaming machines that are legitimately available versus what the northern states, NSW and QLD have. So on a per capita basis, we are much lower in terms of our footprint in gaming. In Victoria we have lower maximum bet per spin rules – $5. With our venues (other than very limited exceptions), we have a restriction of having ATMs in venues. In terms of the operating entity itself, we are a very highly regulated environment, which does provide the consumer greater clarity around the choices they make in-venue. The government has also implemented some rules down here to further limit cash withdrawals that can be made at venues. We have a multi-faceted withdrawal protocol whereby there needs to be human interaction, as opposed to an ATM. You can withdraw cash in-venue, but it has to be through a point-of-sale withdrawal facility or equivalent. Late last year, they reduced the amount of cash to $500 that could be taken out per card per venue. Down here, generally speaking promoting gaming activities is prohibited. The only thing you can really do is have one sign with the
10 | JUNE 2019 AUSTRALIAN HOTELIER
“There’s only been one new gaming venue – and it was actually a club – that’s been constructed in the last five years” – Tim Stillwell word pokies written on it on the façade of your building. What this has meant – as these regulations steadily came in over the last 10 years – is it has required the Victorian operator to become very sophisticated, very strategic about how they ensure their gaming operations remain viable, whilst still being able to co-exist with their food and beverage and broader hotel offering. Given it’s still viewed as a gaming venue even though it’s only one part of the offering these regulations do still have an impact on the broader operation of the hotel. It means if you have patrons with no interest in the gaming aspect, it is a much different experience. Take for example the cash withdrawal experience, though you have more card-based transactions, which in my experience are over 80% for food and beverage… This means operators down here have to again find ways to strategically
ensure that patrons have an uninterrupted and seamless experience in their venue. The one thing we see coming as a positive, which the northern states have had access to for a while, is ‘TITO’, or ‘Ticket In, Ticket Out’. That is effectively a mechanism whereby rather than players only utilising machinebased winnings, it allows them to transition between machines with these TITO… That will have a beneficial impact not only in venues but also their customers’ ability to experience different products within a gaming venue in a more seamless manner. That’s coming into effect, we believe, later this calendar year. A lot of people ask me ‘how do you get into the industry?’ We have a much lower number of gaming machines in Victoria on a per capita basis… We have a fairly robust approval process for new venues via the VCGLR regulator. It is very difficult to get a new venue approved out here by virtue of getting those approvals approved at that level. Our industry is heavily regulated in terms of barriers to entry for new entrants. There’s only been one new gaming venue – and it was actually a club – that’s been constructed in the last five years, in a town or city that’s growing rapidly. It’s very difficult to obtain the entitlements and to be granted approval for a new venue. But that’s where firms like us come in to identify where those better opportunities are. Some of the reasons why there’s been little development is clearly not just the regulatory matters around the gaming industry, but it’s more to do with finance and access to funding in the current environment. I still believe firmly that there will be opportunities, albeit limited, for green-field sites and existing gaming hotels will continue to retain or grow their values.