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Health, Beauty & Fashion

MBS does a balancing act with local gamblers

...doesn't inhibit people from coming in for an evening of entertainment. So I like it. 'Frankly, I would be surprised...drives tourists and drives conventions and meetings and entertainment and builds an enormous amount of jobs,' he said...
The Business Times - June 10, 2011
By: Grace Leong
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MBS does a balancing act with local gamblers

(SINGAPORE) The Singapore government has told Las Vegas Sands to ensure that not more than 30 per cent of all visitors to its casino at Marina Bay Sands are Singaporean, a top company executive revealed.

'We are basically told that as long as only about 30 per cent of the people coming in are Singaporean, then it shouldn't be a problem. If the amount of Singaporean attendance gets much higher than that, there may be some cause for concern,' Michael Leven, Las Vegas Sands president and chief operating officer, said.

That 30 per cent figure isn't published, he said in an interview last week with Inside Asian Gaming. 'That's what our numbers have been, roughly 30 per cent Singaporean. That doesn't seem to cause any problem.'

To this day, only about 3 per cent of Singapore's population has ever played in a casino, he said.

But a spokesman with the Ministry of Community Development did not confirm the 30 per cent cap, saying only that 'the IR operators have been told very clearly that the casinos are tourist products and they are not to target the domestic market'.

In response to speculation that the Singapore government may further limit local access to casinos, Mr Leven said that the company hasn't had problems with the 30 per cent cap, but doesn't rule out the possibility of more intervention.

'You're always going to have in the casino business some people who overplay. That's part of the business, but the great majority of people can control themselves and I don't think we're creating more poverty in Singapore because of our presence. But if that were to happen, the government would have every right and every reason to come in and try to restrict play.'

But he said that Sands needed local gamblers in order to support its investment in integrated resorts. 'We have to have some local play in order to be consistent when we don't have conventions and we don't have tourists. Otherwise, you've got an awful lot of overhead sitting there not generating any revenue.'

While the $100 entry levy hasn't deterred locals from going to the casino, Mr Leven said that he believes the fee does prevent the very low income person from coming in.

'I think casinos need to be careful not to attract the kind of people that can't afford to come in. The people who would normally play a lottery, for instance, where they can play pennies or dollars,' he said.

'But I think when you come into a large casino like ours or Genting, the fee structure only inhibits those low-end people. It doesn't inhibit people from coming in for an evening of entertainment. So I like it.

'Frankly, I would be surprised, if we expand in other countries in Asia, that we don't have an entry fee in almost every country, if not every country.'

In discussions with governments in Japan, South Korea and Vietnam - countries targeted by Sands for potential gaming expansion - Mr Leven said that there were political reasons why certain constituencies have concerns about local gaming.

'So they begin to see the virtue of our system because our system drives tourists and drives conventions and meetings and entertainment and builds an enormous amount of jobs,' he said.

While Sands rival Genting Singapore has managed to hang on to the lion's share of the gaming market in Singapore because of its contacts in Malaysia and aggressive wooing of VIP highrollers, Mr Leven said that MBS has caught up in the mass market segment, which Sands expects to dominate in Singapore.

'In the early days, Genting won both the market share game in VIP gaming as well as mass market. We are now winning the mass market game and they continue to lead in the VIP game for a variety of reasons.

'On the VIP end, they're more aggressive than we've been and doing a better job. But they had a headstart on us because of all their contacts in Malaysia. And we'll eventually catch up and probably that market will be split, but I think we'll continue to dominate the mass market.'

But Mr Leven also acknowledged picking up a few tips on its mass market floor strategy from Genting Singapore.

'The mass market floor in Singapore constantly changes. One of the things we learned from Genting was the electronic table games, which they put, and the stadium table games. We didn't know about that. We saw that there and we immediately ordered them and put them in. They've been very good,' he said.

Sands has made over 2,000 changes in the past six months on its MBS gaming floor: changing slot machines and other electronic gaming machines, tables, and putting in new games, he said.

'Most people don't realise that there is both an art and science to the gaming business. It's not just getting people in there to play. You have to put the right game in the right place so that revenue per square foot is maximised,' he said.

 

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