Dhorra Moirra (Editor)

Casinos in Japan: Not Dead Yet

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In Monty Python's words, the expansion of the game in Japan seems far from over.

It is good news for the world's largest casino operators.

They see the Rising Sun as the Holy Grail.

Reuters reported this week that Japan's casino expansion bill will not be voted on when it adjourns on November 30.

Grant Goversen, executive director of Macau-based Union Gaming Group, told investors that the two issues had scuttled the solution. It's the scaring of a senior member of the ruling coalition government and the political unrest in the Japanese prime minister's cabinet, which was a major sponsor of casinos.

"The chances of passing a game expansion bill this fall are down," Govtsen said.

He also cited a recent poll showing that 60 percent of Japanese people are against casinos.

Nevada-based casino companies have heard this before.

Attracting casinos to Japan has been a back-and-forth process going back more than a decade.

This year's efforts, such as Prime Minister Shinzo Abe's support for making casino expansion part of his legislative agenda, the hosting of the 2020 Summer Olympics in Tokyo, and the push for increased tourists through the development of a Las Vegas-scale convention and meeting center, seemed to have a bridge based on several factors.

Last spring, Japanese lawmakers introduced a gaming bill, held a debate, but never voted for it.

The move was seen as a victory in the casino industry.

"I think there's a lot of exaggerated coverage of what's going on in Japan," said Alan Feldman, senior vice president of MGM Resorts International. "We've known for a long time that this wasn't going to be easy." I just think that efforts will not stop unless there is a change in the ruling party, the prime minister, and the House of Representatives."

Mr. Feldman estimates that he has traveled to Japan 12 to 15 times over the past two years on behalf of MGM Resorts. He has become accustomed to air routes from Los Angeles and San Francisco and Vancouver, British Columbia, to Tokyo and Osaka.

"I haven't played Seattle yet," Feldman said.

Along the way, he crossed paths with representatives from Las Vegas Sands, Wynn Resorts, Caesars Entertainment, and Malaysia-based Genting Berhad. Even officials from local casino operator Boyd Gaming Co. and Illinois-based Rush Street Gaming Co. have been spotted in Japan.

The casino industry sees Japan as an untapped market. The investment community predicts that gaming revenue in Japan will reach $10 billion to $15 billion annually, above the annual gross output of Nevada and Singapore.

Feldman and other game executives shake off the idea that Japan is against games.

Japan's Pachinko industry is estimated to be worth 20 trillion yen, the International Business Times reported.

Feldman said the key to Japan's casino expansion is a complex resort plan, which makes casinos just part of the entire project. He said Japan lacks large-scale convention facilities such as MGM Resort's Mandalay Bay Convention Center, MGM Grand's Conference Center, and Sands Expo & Convention Center.

"It's a miserable scale for big markets like Tokyo and Osaka," Feldman said.

Last week, Las Vegas Sands Chairman Sheldon Adelson said on the company's Q3 earnings conference call that Singapore's Marina Bay Sands is the perfect model for Japan.

"Our unique convention-based integrated resort development model will bring meaningful benefits to Japan in terms of business and leisure tourism, employment and economic growth," Adelson said.

But Adelson said Las Vegas Sands would withdraw from the bidding process in Japan if legislation was enacted that would ban Japanese citizens from entering casinos.

"We are not interested in foreigner-only resorts," he said.

Casino advocates believe Japan's compromise is for casinos to follow the Singaporean model of requiring residents to pay entrance fees.

Govtsen said if Japan's casino action dies this year, the expansion of the game will again be part of the agenda when the National Assembly returns to session in early 2015.

If postponed, the casino will not be ready in time for the 2020 Tokyo Olympics.

Feldman said the Japanese are looking beyond the Olympics and hope to use the integrated resort as a way to boost visitors after the hoopra surrounding the summer games subsides. 릴게임

Meanwhile, when it comes to game expansion in Japan, casino operators are always looking at the bright side of life.



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