Atlantic City Say It's Increasing Comps

Atlantic City casinos rely on increasing comps to lure in gamblers
By DONALD WITTKOWSKI Staff Writer | Posted: Saturday, October 15, 2011 10:30 pm

ATLANTIC CITY — Cruises, posh suites and exclusive box seats at sporting events. Cars, shopping sprees and private parties. Turkeys for Thanksgiving and hams for Easter. And much, much more.

In the gambling world, these are the “comps” that casinos give to their customers to reward them for their business and loyalty. Nevada’s casinos began showering customers with complimentary gifts when legalized gaming began there in 1931. Comping is an equally important part of Atlantic City’s casino scene and in other gaming markets across the country.

The good news for gamblers is that Atlantic City’s casinos are becoming even more generous with their giveaways. As gaming competition has grown in Pennsylvania and other surrounding states, the slumping Atlantic City market is increasingly using the power of the comp in the fight for customers.

“The Atlantic City casinos are spending more on their customers with comps and other offerings than ever before,” said Joe Lupo, senior vice president of operations at Borgata Hotel Casino & Spa.

Casinos consider comping as a way of “reinvesting” in their customers. The idea is simple: If casinos give something to the customers, then the customers will return the favor by spending more of their money at the slot machines and gaming tables or in the casinos’ restaurants, bars, nightclubs, retail shops and spas.

Atlantic City’s 11 casinos spent nearly $1.7 billion for comps in 2006, when the market peaked at $5.2 billion in gross gaming revenue. Comp spending on a dollar basis has declined in each year since then. In 2010, comp spending amounted to about $1.3 billion, while gross revenue from slot machines and table games came in at $3.6 billion.

However, comp spending as a percentage of gross gaming revenue has increased during the same five-year span, meaning that the casinos are actually more charitable now with their customer freebies. The so-called reinvestment percentage for comps has climbed from 32 percent in 2006 to nearly 38 percent in 2010 and almost 40 percent through July of this year, figures compiled by Borgata using data from New Jersey’s Casino Control Commission and the Division of Gaming Enforcement show.

Measured as a percentage of total casino revenue — from gaming and nongaming sources — the rate of comps in Atlantic City rose from almost 26 percent in 2006 to 27 percent in the first six months of 2011, analysis of the data shows. . . .acpress

The trouble with AC is they just don't have any customer service skills.

Quote: SanchoPanza

ATLANTIC CITY — Cruises, posh suites and exclusive box seats at sporting events. Cars, shopping sprees and private parties. Turkeys for Thanksgiving and hams for Easter. And much, much more.

Whats that smell? Oh, its desperation.

Never mind..

Quote: EvenBob

Whats that smell? Oh, its desperation. Never mind..

What surprises me about AC is how unrelentingly the bad news comes month after month. The drop started well before the recession (in slots only) as Philadelphia racinos opened, and continues to get worse every single month.

There must be some politicians that really detest gambling in NJ. You would think by now they would open at least a slot parlor in Northern NJ, to stop the $billion flow into other state's coffers.

Since Table Games more or less held there own for the first few years, some analysts said they should concentrate on that point as their strength. But now the drop in table games is going worse than slots (as a percentage).

Year	Slots ($bn)	Table Games ($bn)	Slots	Table Games
2006	$3.80	$1.41	0.0%	0.0%
2007	$3.46	$1.46	-8.9%	+3.0%
2008	$3.13	$1.41	-9.6%	-3.0%
2009	$2.72	$1.22	-13.1%	-13.5%
2010	$2.48	$1.09	-9.0%	-10.9%
2011	$2.31	$0.97	-6.7%	-10.4%
Drop since 2006	($1.49)	($0.44)	-39%	-31%

The 2011 numbers are a projection based on first 9 months of data.

PA slots for the last 12 months were $2.37 billion.

Quote: pacomartin

What surprises me about AC is how unrelentingly the bad news comes month after month.

That shouldn't come as such a surprise from a city that not only fails to practice customer service, but that also fails to want to protect its customers. One startling result: 12 casino-related homicides this year.

Police returned to patrolling casino parking garages Thursday in Atlantic City against the wishes of the resort's mayor.
Posted: Friday, October 7, 2011 1:00 am | Updated: 6:44 am, Fri Oct 7, 2011.
By EMILY PREVITI and LYNDA COHEN Staff Writer |

ATLANTIC CITY - Police went back on patrol in casino parking garages Thursday against the wishes of some members of local law enforcement and against the orders of Mayor Lorenzo Langford. In a decision released Thursday, Atlantic County Prosecutor Ted Housel asserted Atlantic City Deputy Police Chief Ernest Jubilee's authority in ordering the increased patrols 10 days ago, in the wake of the second fatal carjacking in the resort in the past 16 months.

State officials and legal analysts supported Housel's decision. But Langford said he was not done fighting the prosecutor's decision to void his earlier order to stop the patrols. "I suspect that this matter will end up in court for a declarative judgment as to whether (the order) is germane to ‘policy' or akin to ‘day-to-day operations.' Whatever the court ultimately rules, so be it," said Langford, who ignored questions about whether he actually intended to initiate court proceedings.

Gov. Chris Christie, who has sparred publicly with Langford for months over state intervention in the resort, called Langford's actions "rash and irresponsible" in a statement. . . .

The carjacking Sept. 15 that claimed the life of a Middlesex County man was the only homicide of a dozen in the city so far this year linked to a casino, Langford wrote Thursday in an email. "As concerned as I might be for tourists who come to this town, my first concern is for the residents in the neighborhoods," Langford wrote. acpress[/]

That article says this was the only homicide link to a casino this year...

Atlantic City has become a sick joke.

When casinos were first being talked about, in the 70's, the promise was that it would revitalize the town, gentrify it.

Ha!

It's still a no-man's-land ghetto a stone's throw away.

But, it can be saved, and brought back from the brink.

It would involve marketing Atlantic City as a world class vacation site.

It will require major urban renewal, and destruction of substandard housing.

A new attraction, preferably a major Disney theme park, and an upgraded airport capable of handling traffic like in Las Vegas would be required as well.

I just don't see it ... but just maybe ...

I go to AC once a month. Last month i went twice. I stayed at the Showboat the first time, then Caesars. When I was at Caesars, I walk all around the outlet center that's at the end of the AC Expressway. It was busy and I felt safe and I imagine the other customers did too. I didn't notice any extra security for this area and it's outdoors and open to the public and just a stone's throw away from what some would call a no-man's-land ghetto.

I've also walked up and down the boardwalk at all times of night and all seasons of the year. I've never felt put upon by pan-handlers even though the homeless are there. I've never felt unsafe. At the North end of the boardwalk, the construction of The Revel is continuing. It's freakin' massive!! When it opens in May or June, it's going to rock! I took some pictures, I'll try to attach one before I'm done with this post.

I haven't really noticed an uptick in comps. I hope it's true though. I really like spending weekends there. I would like to get one of those ocean facing balcony rooms. I guess i'll have to gamble a little more to deserve that though. I know the crappy revenue numbers don't lie but every time I'm there, the casinos are hustling and bustling with people, some drunker than others but overall everyone is having a real good time. A typical weekend in AC is certainly more crowded than Las Vegas during Superbowl weekend and that's supposed to be a big weekend for Vegas.

I don't typically defend "cities" from criticism but the whole "AC is a ghetto" meme is a bit overplayed. In many cities, a drive up Marlin Luther King, Jr. Blvd. would have you checking the locks on your doors, but in AC, I could see myself living on that street. Sure, some parts suck but I think AC is much better off today than it was in 1970.


This picture doesn't convey the scale of the Revel, I should have had someone stand in front. It's going to be big, figuratively and literally!!

But will Revel turn things around for Atlantic city? It seems like it will not stop PA from overtaking AC, but just steal from the aging casinos already there.

Year	Slots ($bn)	Table Games ($bn)
NJ 2006	$3.80	$1.41
NJ 2007	$3.46	$1.46
NJ 2008	$3.13	$1.41
NJ 2009	$2.72	$1.22
NJ 2010	$2.48	$1.09
NJ 2011	$2.31	$0.97
PA last 12 months	$2.37	$0.58

Quote: s2dbaker

...This picture doesn't convey the scale of the Revel.

To say it will be a monster is putting it mildly.

Perhaps one of these pictures will do better justice:

This perspective, taken from the boardwalk in front of Taj Mahal (the white buildings), shows that the top of the Revel hotel in the background (which wasn't even topped off at this point) is going to be much taller than ShowBoat (the beige building). I shot this one myself.
Admin note: removed image www.djteddybear.com/images/revel.jpg

Here's an ocean view that REALLY puts it in perspective. Note ShowBoat's height (or lack of it) on the left edge. I don't know if this is a photo or a touch-up or fully artists rendition, but the purple sky is kinda odd. Then again, I think purple is Revel's color.
Admin note: removed image www.djteddybear.com/images/revel_constr.JPG

Quote: DJTeddyBear

To say it will be a monster is putting it mildly.

A lot of people don't know this, but there was a passenger train that operated from 1929 to 1941 called the Blue Comet that whisked people from the Northern New Jersey to Atlantic City without the need to go through Philadelphia. In an episode of The Sopranos one of the characters is buying a model of the train.

It's been 70 years, but I believe the tracks are still there, preserved for freight use. Perhaps a shorter train would reinvigorate interest in going to Atlantic City.

Quote: pacomartin

A lot of people don't know this, but there was a passenger train that operated from 1929 to 1941 called the Blue Comet that whisked people from the Northern New Jersey to Atlantic City without the need to go through Philadelphia. . . . It's been 70 years, but I believe the tracks are still there, preserved for freight use. Perhaps a shorter train would reinvigorate interest in going to Atlantic City.

The Trop used to have a dining area that used the Blue Comet name.

As far as instituting service, NJ has been unable to do that for 40 years in the case of using an existing train line that would replace more than 400 daily bus runs on highways jam packed by some of the most explosive population growth in the U.S.

I agree with SD. My wife and I go up once a month for the weekend and we have never had any problems. Just like any city you need to be careful and use your head. We have walked up and down the boardwalk at all hours, the outlets are safe and they have really brought in and have a lot of really nice restaurants now. The other end of AC towards Margate is actually a very nice area. I mean are there terrible sections to avoid that are unsafe, of course but with the Revel and eventually the Hard Rock coming I think it will further help the city. The Friday power lunch from 11-4 at the Knife and Fork is fantastic for anyone getting up there early on a Friday.

I don't think I've seen a direct increase in my comps at Borgata this year. But one thing I have noticed, Borgata significantly tightened comps earned for video poker players. I'm very consistant with my play year to year, and this year has been no different. My total 'comp dollars' earned for my level of play this year is WAY less at Borgata than it has been in previous years even with the same level of play.

I suspect that the comps earned from video poker were reduced at Borgata in the past year. The net impact to me is pretty noticable. I'm not a big time player, but I've earned probably about half of the comp dollars this year than I would typically have earned over the past 3-4 years at Borgata and no longer qualify for free rooms on Friday's (probably as a result of the low comp rates for video poker).

Comps might have been loosened in AC, but if you are a video poker player who frequents Borgata, I think the opposite has happened. Its still worth going to Borgata though, they have the best paytables on video poker overall in AC. Anyone else a regular video poker player at Borgata? Have you noticed the same thing?

Year	Slots ($bn)	Table Games ($bn)
NJ 2006	$3.80	$1.41
NJ 2007	$3.46	$1.46
NJ 2008	$3.13	$1.41
NJ 2009	$2.72	$1.22
NJ 2010	$2.48	$1.09
NJ 2011	$2.31	$0.97
PA last 12 months	$2.37	$0.58

Revel has a planned opening date of May 15, 2012 . The 2012 EAST COAST GAMING CONFERENCE will be head on April 24-26, 2012 in Raleigh (not Atlantic city).

My personal opinion is that you will see the table games for NJ and PA very close by the end of April 2012. Bethlehem Sands is planning major work on convention center, conferences, shopping, and a new entertainment venue by that date. The opening of the Aqueduct casino in New York City should hurt both AC and PA. But I am betting on AC taking the bigger hit.

After that time, I think Revel will end up stealing from the customers that already go to AC, and not adding new business.

I agree eventually Revel will just take from the already established casinos customers. At first the novelty should bring in a decent amount of people who may be going to Delaware or Pa. but I think it will be hard to maintain itself just on these customers. Hopefully the openning though will scare the existing casinos into giving out more comps and deals.

Quote: hook3670

I agree eventually Revel will just take from the already established casinos customers. At first the novelty should bring in a decent amount of people who may be going to Delaware or Pa. but I think it will be hard to maintain itself just on these customers. Hopefully the openning though will scare the existing casinos into giving out more comps and deals.

Atlantic City is trying to come up with variations that you can't get in Pennsylvania. Resorts casino has introduced the Naked Circus.


I didn't realize that New Jersey counted comp play as revenue, while Pennsylvania does not. Figuring in the difference, PA beat NJ for the month of August (but not July or September). October revenue is not completely posted.

Sands in Bethlehem PA just opened their shopping mall, and will add the convention center and entertainment venue in the next few months. The presumption is that PA, with cold weather approaching, will take the lead again (at least until Revel opens).

The aqueduct casino should have a profound affect on the traffic at the older New Jersey casinos.

Well, you gotta try. Atlantic City does have a competitive advantage.

Atlantic City has the potential to provide much better slots than Pennsylvania due to the widely different tax rates. Pennsylvania taxes its slots at 55% of revenue from slots and 16% from tables, while New Jersey taxes at 9.5% for table games and slots. Atlantic City is experiencing its loss due to Table Games being legalized in Pennsylvania and the general expansion of gambling in the Phliadelphia area. There's no reason why the operators in Atlantic City shouldn't push the fact that their slots could be much better or provide more incentives for people to go to Atlantic City. Their table games could offer a better return as well (better odds, 3:2 blackjack, better payoffs).

Location-wise, a good chunk of money spent on cleanup will go a long way. The ocean is pleasant there. The city could be pleasant. It's only 90 minutes or less from Philadelphia to Atlantic City.

I think that Atlantic City will level off once Pennsylvania has completed its expansion.

Casinos everywhere seem to have been tightening things up for their video poker players, particularly those that seem to hog machines.

I think its Maryland that currently has an unbid for casino license because the state's tax rate is so high it is described as confiscatory.

Politicians in NJ tried to take the casino revenue and keep it as State Revenue without doing much to improve Atlantic City which is where the casinos were located and the revenue was sorely needed.

A few smidgens of casino-comp money won't make up for mismanaged tax revenue.

The thing that made the industry grow in Nevada was not just a "de jure monopoly" but a tax rate that was reasonably quite low and allowed for growth rather than politicians grabbing the gold prematurely.

Quote: boymimbo

Well, you gotta try. Atlantic City does have a competitive advantage.

Atlantic City has the potential to provide much better slots than Pennsylvania due to the widely different tax rates. Pennsylvania taxes its slots at 55% of revenue from slots and 16% from tables, while New Jersey taxes at 9.5% for table games and slots. Atlantic City is experiencing its loss due to Table Games being legalized in Pennsylvania and the general expansion of gambling in the Phliadelphia area. There's no reason why the operators in Atlantic City shouldn't push the fact that their slots could be much better or provide more incentives for people to go to Atlantic City.

There is no evidence that tax rates are used by casinos to give players a competitive advantage. PA does have a slightly higher House Advantage, but largely they make up for the high tax rates because they have very little competition, as the next closest casino is usually 50-100 miles away. They also limit the total number of machines compared to other states. The per dollar play on a machine in PA is very high.

I have suggested many times that Las Vegas could try to entice people with better rates on certain machines. However, with the exception of a few places downtown or on the fringe, most casinos do not go this route.

Quote: FleaStiff

I think its Maryland that currently has an unbid for casino license because the state's tax rate is so high it is described as confiscatory.

Do you consider a 67% tax rate as confiscatory? :) Actually, it's two unbid licenses. Penn National which owns Charles Town and Perryville is now lobbying to add table games since it owns Rosecroft Raceway which is just outside the beltway in Md. The current governor wants the 2 unbid sites to be built before he thinks about tables....

-B

I wonder if Maryland puts in tables if the rules will be even remotely reasonable, HE wise. Could curb my AC trips if they are. We'll see, probably CSM with H17, only double 10 and 11, no RSA, blackjack pays 6:5. It'd just be appropriate to the state.

Quote: pacomartin

I have suggested many times that Las Vegas could try to entice people with better rates on certain machines. However, with the exception of a few places downtown or on the fringe, most casinos do not go this route.

I think this has a bearing on just how many people are perceived as knowing what house edge means or caring about it. The casinos seem to prefer to compete on "the sizzle" rather than "the steak". They want to compete on cleavage, music, concerts, clubs, parking, day care, points and puffery ... almost anything except House Edge.

Quote: toastcmu

Do you consider a 67% tax rate as confiscatory? :) Actually, it's two unbid licenses. Penn National which owns Charles Town and Perryville is now lobbying to add table games since it owns Rosecroft Raceway which is just outside the beltway in Md. The current governor wants the 2 unbid sites to be built before he thinks about tables....

-B

That is an interesting word, confiscatory. The state government thinks that basically since they are permitting a vice, it will be less of the vice if all of the profits go to the public good. At least that is the reasoning.

Although the two racetracks in the Philadelphia area (Philadelphia Park and Chester) were the first casinos to open in PA, it took over four years for the 3rd casino (Sugar House) to open. The state also had a fourth license planned for Philadelphia. They gave it to Foxwoods in Connecticut, but so far they haven't built it yet so the state took back the license. There is no sign that it will ever be built.

Ultra high tax rates discourage any competition, since the operators will only operate if they have a guaranteed base. It is not clear that PA would have been viable unless they agreed to offer table games at the much lower tax rate of only 14%.

Singapore has set a new model by agreeing to give two licenses at reasonable tax rates. In exchange they expect an incredible casino and conference center. They expect the casino to benefit the entire city state by increasing tourism for the entire country.

I think that Maryland could benefit from some of the same thinking. Baltimore is a popular spot for conventions. They might benefit the entire city with a real eye-popping casino, instead of a bunch of mediocre slot clubs attached to race tracks.

Currently the debates raging in Florida relate to "casinos or Mega-Centers featuring a large casino". The debates also relate to various euphemisms for monopoly such as zone of non-competition or exclusivity. Turning a bean field on a reservation into a casino has proven profitable to the Seminoles, so too has building casinos in larger cities and denser population areas but the Seminole-Florida compact gave them nothing as far as their oft-desired zone of protection from competition. The Seminoles ofcourse say that their bankers are the ones who are insisting on the "temporary" zones of non-competition.

I see advantages in rowboats, yachts and mega-yachts. I think they all survive on our waterways and in our marinas.

Someone recently posted that casinos have been a boon for "has been entertainment acts". Perhaps so.
What will Mega-casinos be a boon for? "has been neighborhoods full of boarded up or marginal businesses"?

Of course there is a way to look at Las Vegas and the Nevada School System being 51st in the nation: Vegas doesn't need rocket scientists, it needs waiters, half naked waitresses, dealers, dishwashers, bell men and hookers. So that is the education system they get.
Florida seems to graduate more drug dealers than rocket scientists too.

Quote: pacomartin

That is an interesting word, confiscatory. The state government thinks that basically since they are permitting a vice, it will be less of the vice if all of the profits go to the public good. At least that is the reasoning.

Its the operation, not the enabling legislation, that allows advertizing based on false hopes, intense sales in minority areas, sales in liquor and convenience stores, sales of other merchandise rather than profits from other merchandise, etc.

Maybe we should turn lottery sales over to Aunt Dotty?

Quote: PacoMartin

I think that Maryland could benefit from some of the same thinking. Baltimore is a popular spot for conventions. They might benefit the entire city with a real eye-popping casino, instead of a bunch of mediocre slot clubs attached to race tracks.

I would believe so as well, but the politics involved so far seems to discourage that kind of thinking. Since Baltimore has a high percentage of 'impoverished' population, the Maryland legislature is worried about degenerate gambling within the city. There was an article the other day that State congressman are already trying to make table games illegal in the state or banning the aforementioned Rosecroft Casino from ever happening. My guess is they are worried about creating another "AC" in the state of Maryland.

-B

Quote: toastcmu

I would believe so as well, but the politics involved so far seems to discourage that kind of thinking. Since Baltimore has a high percentage of 'impoverished' population, the Maryland legislature is worried about degenerate gambling within the city. There was an article the other day that State congressman are already trying to make table games illegal in the state or banning the aforementioned Rosecroft Casino from ever happening. My guess is they are worried about creating another "AC" in the state of Maryland.

-B

I think that it is fascinating that politicians try to keep out table games thinking that will protect the 'impoverished' population. Just the opposite is true. Slots are much more appealing and far more addicting to the poor then horseracing or craps ever will be.

Quote: pacomartin

I think that it is fascinating that politicians try to keep out table games thinking that will protect the 'impoverished' population. Just the opposite is true. Slots are much more appealing and far more addicting to the poor then horse racing or craps ever will be.

Yes, and I somehow think that those politicians know that.

For the latest from Maine ballot boxes on the casino in Lewiston: link. All the small town referendums have shot down the additional casinos in Maine by overwhelming margins.

Quote: boymimbo

Atlantic City has the potential to provide much better slots than Pennsylvania due to the widely different tax rates. Pennsylvania taxes its slots at 55% of revenue from slots and 16% from tables, while New Jersey taxes at 9.5% for table games and slots.

New York State takes an even bigger bite:

"The state collects the lion’s share of revenue from Aqueduct’s Resorts World New York under the terms of a deal that allowed developers to turn the ailing racetrack into the state’s newest gambling parlor. Of the $1.5 million in daily revenue, approximately $1 million heads to Albany, where it’s dedicated to financing New York education programs and propping up the horse-racing industry. A portion also goes to the Division of the Lottery to oversee the racino. The racino operator keeps less than a third -- 31.5 percent of the gambling revenue."--nypost

Quote: SanchoPanza

New York State takes an even bigger bite:

Philadelphia PARX makes $380 million on slot play in a year with 3400 machines. You have to figure that the Aqueduct casino has an immediate audience of about 4.5 million people in Brooklyn and Queens, with 250 subway stops. Nearly everyone can get there within 40 minutes. You also have another 4 million in the other three boroughs of New York City, and 2.8 million on Long Island.

These machines will no doubt be the busiest in the world, with potential revenue of close to a billion dollars. I am not surprised that the state is taking close to 70%.

Quote: toastcmu

I would believe so as well, but the politics involved so far seems to discourage that kind of thinking. Since Baltimore has a high percentage of 'impoverished' population, the Maryland legislature is worried about degenerate gambling within the city. There was an article the other day that State congressman are already trying to make table games illegal in the state or banning the aforementioned Rosecroft Casino from ever happening. My guess is they are worried about creating another "AC" in the state of Maryland.

-B

I fully expect MD to have a table games referendum next year, and I imagine it's going to pass. MD allows "e-tables" at all its casinos, and David Cordish has said his 4000+ machine casino will have e-versions of just about every table game out there. So, basically, MD has full casino gaming options, just no live tables. Therefore, I'd expect the casinos to push the issue as a job creation measure, like Penn National did in Charles Town WV, and have similar success. Also, I think people in MD are just sick of the gambling bickering that's been going on for years. People saw how ugly the local fight over the Arundel Mills casino got, and I don't think they want a statewide fight like that over table games. The only hurdle will be getting the legislature to allow the issue to come to referendum. Since the Senate leadership wants that to happen, I think they have the clout to push it through (ie. no one who opposes it will get anything on their wish list), and it'll be approved by voters.

A couple things:

1) Regarding comps in A/C, yesterday we got a free room at Showboat, a casino we've never stayed at before. The last time we stayed at a Caesar's property was March 2010. And I had $90 in free slot play at Borgata, a place we play maybe twice or three times a year. (I turned it into $400 in the $5 WoF slot. No rooms at Borgata because they're hosting a convention, a poker tournament, and it's restaurant week.)

2) One thing I've seen in PA casinos that I've NEVER seen in AC casinos: EVERY seat taken at the slots. On the final Saturday of the month, some PA casinos have a special promotion, and they truly pack 'em in. Big time. In AC, even when the casinos were rocking about half the machines were available. But Sands on the final Saturday is jammed elbow-to-elbow like a disco club on New Year's Eve.

Remember AC of long ago: every blackjack seat taken and everyone having to put up with Over The Shoulder betting?

Now its Pennsylvania that has wall to wall slot mania with people unwilling to trek the extra time/distance/costs to get to the same machines they have in AC.

I doubt Acqueduct opening up will even be noticed in Pennsylvania.

Quote: FleaStiff

I doubt Acqueduct opening up will even be noticed in Pennsylvania.

I tend to agree with you, as long as it is only VLT's it will have little effect. But Sands Pennsylvania brings in dozens of busloads every day from Queens, Bronx, and Chinatown. Almost every single bus rider is Asian. The local county is 2.42% Asian according to the census bureau, and most of them are South Asians (Indian subcontinent), so the East Asian population almost doubles every day with the bus influx.

Lehigh Valley (where Sands Casino is located) is kind of extreme commuting to New York city, but there are 55 scheduled buses a day that make the trip. It is my understanding that those buses can be standing room.

I'm a bit weak on geography.

I know Chinese and Japanese gamble. So too do various migration groups such as Vietnamese.

Indian? Are they inveterate gamblers?

East Asian (Malaya etd_) I thought they were generally muslim and didn't want their people to gamble, only foreigners.

Quote: pacomartin

I tend to agree with you, as long as it is only VLT's it will have little effect.

I don't know about that.

I'm not sure the average person knows, or has even heard the terms VLT or Class II. Or if they have, I'm not sure they know what it means or even care.

Quote: FleaStiff

Now its Pennsylvania that has wall to wall slot mania with people unwilling to trek the extra time/distance/costs to get to the same machines they have in AC.

The machines may look the same, but that 55 percent tax rate for Pennsylvania slots has to hurt someone's bottom line--either the house or the players'.

Quote: Mosca

In AC, even when the casinos were rocking about half the machines were available. But Sands on the final Saturday is jammed elbow-to-elbow like a disco club on New Year's Eve.

AC says it's fighting back, to the tune of 40 percent comps, at least in the way that they figure it:

"Statistics released last month show that Atlantic City’s 11 casinos spent an average of about 40 cents of every dollar they won in gambling on promotional allowances and expenses in September. Comps include everything from room stays and drinks to cash gifts, tickets to events and promotional gaming credits — free dollars for slot-machine play or a bet at a gaming table that must be used at the issuing casino.

Not all of the free rooms, buffet meals or free slot play is cashed in every month. Resorts, for example, reported $14 million in promotional gaming credits in September. However, only $2.6 million of that amount was actually wagered, according to data filed with the state Division of Gaming Enforcement.

In September, the percentage of gaming wins reinvested in comps ranged from 36 percent at Trump Taj Mahal to a high of 56 percent at Resorts Casino Hotel. . . . At many casinos, the number of people getting gaming credits also was up with the casino investment in promotional dollars. Gamblers offered gaming credits by Resorts were up 81 percent, from 54,368 in September 2010 to 98,474 in September 2011.

The only operation to see a larger increase in the number of individuals receiving gaming credits than Resorts was the Atlantic City Hilton, which gave away promotional gaming credits to 68,824 people in September 2011, more than twice the number who received credit offers in September 2010. Hilton officials declined to comment.

Comps across the city’s 11 casinos totaled more than $115 million in September, down slightly from $118 million in September of the previous year. Yet as a percentage of wins, comp spending has been on the rise since 2006. Reinvestment percentages for comps across the city’s casinos climbed from 32 percent in 2006 to about 40 percent the past two years. . . . Borgata spent 39 percent of its nearly $59 million in gaming win on comps in September. That’s up from 38 percent in September 2010. The September 2011 figures, however, include one more Friday than the previous year’s figures, which could account for some of the overall comp increases in the resort, Lupo said.

Trump Plaza and Trump Taj Mahal, both owned by Trump Entertainment, spent among the lowest percentages of gaming win on comps, coming in at 37 percent and 36 percent, respectively. The company declined to comment. Casinos under the ownership of Caesars Entertainment either increased or maintained the percentage spent on comps. Showboat maintained a 40 percent reinvestment rate, and Caesars maintained a 37 percent reinvestment rate. Bally’s and Harrah’s both increased their percentage spent on comps slightly."--acpress

Quote: SanchoPanza

The machines may look the same, but that 55 percent tax rate for Pennsylvania slots has to hurt someone's bottom line--either the house or the players'.

Not necessarily.

PA has over 12 million people, and 11 casino positioned according to population as much as possible. They can also attract people from across state lines. The amount of play per machine is double or triple what it is in Nevada. While they may give away watered down drinks and subsidize buses, they do not have rooms and they don't sell food at a loss. The "Win Percent" is slightly higher than Nevada, but it isn't 50%-100% higher. The buildings in PA generally cost a fraction of what the casinos cost to build in Nevada. Slots in PA bring in about $200million /month which over 12 million people is dramatically lower than the slot revenue of the Nevada casinos relative to the local population (roughly 2.7 million people in Nevada).

My perception of what the 55% tax rate does, is the casino has no vested interest in growing their slot business. Within two months of the opening, it sets a level which doesn't change that much over the year. The casinos will turn all their attention to fostering a growing table game business where the tax rate is 16%.

All the growth in the last five years in the slot business has been driven by opening new casinos. Now that PA is almost built out, and a new casino has not opened in the last 12 months, you will probably see the business plateau.

The only casino that is investing large dollars in trying to grow is Sands Bethlehem and PARX. That is because they have a large potential given that they are so close to the New Jersey state line with easy access to population centers.

Quote: Mosca

A couple things:

1) Regarding comps in A/C, yesterday we got a free room at Showboat, a casino we've never stayed at before. The last time we stayed at a Caesar's property was March 2010. And I had $90 in free slot play at Borgata, a place we play maybe twice or three times a year. (I turned it into $400 in the $5 WoF slot. No rooms at Borgata because they're hosting a convention, a poker tournament, and it's restaurant week.)

I'm not a high roller by any means. However, I can get comp rooms at the AC Trop and Borgata anytime other than summer season. AC is practically throwing comps at people to get them to come these days, and the tables are getting cheaper and cheaper (50c roulette and $3 craps at Trump Plaza). The casinos in surrounding states are newer but don't have the real casino feel the AC ones do. They feel like slots joints with some table games dumped on top of them. The exceptions to this would be Parx (it really does feel upscale), and Charles Town, much as I hate to admit. They've renovated a lot of the facility and the tables are pretty well integrated into the main parts of the casino. They're just crazy expensive on wknds.

Quote: FleaStiff

I'm a bit weak on geography.

I know Chinese and Japanese gamble. So too do various migration groups such as Vietnamese.

Indian? Are they inveterate gamblers?

East Asian (Malaya etd_) I thought they were generally muslim and didn't want their people to gamble, only foreigners.

To the best of my knowledge Indians are not gamblers. The Indian population in America is growing at 10 times the general rate of population increase, but they are still only about 1% of the population. As an immigrant population group, I think they are proving to be wildly successful, to rival the Japanese Americans and Jewish Americans. They seem to have a large percentage of doctors, successful engineers, politicians, and television actors.

There are about 20 smaller enclaves in urban areas of the country that are known as Indian communities, but by and large most Indians are integrating with the general population. Since they are among the most educated ethnic minorities, they are more likely to live in the suburbs.

While Muslims officially do not drink or gamble, you will inevitably find places where they can go to indulge. Bahrain (where the US Navy is located) was full of Saudi men who leave their home country for a few days to go to bars and listen to music. In Saudi Arabia itself there are no bars, and virtually no public secular places outside of coffee houses and camel racing arenas. Even restaurants are typically booths surrounded by curtains so the families can eat in privacy.

Excellent analysis Paco. I completely agree. Obviously the casino (and the state) has hit a home run with players who are not willing to drive for hours to get to Atlantic City, Foxwoods, or Mohegan Sun.

Quote: boymimbo

Excellent analysis Paco. I completely agree. Obviously the casino (and the state) has hit a home run with players who are not willing to drive for hours to get to Atlantic City, Foxwoods, or Mohegan Sun.

A few days ago Nevada hit an all time low in over a decade of $4.6 billion for gaming revenue off the strip (i.e. Vegas, Reno, Laughlin, etc.). Revenues have not been this low since 1999. At least you can say that the Vegas strip has stabilized for the last two years.

Similar to Atlantic City these markets are probably never going to recover.

Sooner or later, NJ is going to have to rethink their laws. PA Sands has just had a soft opening of an off-price shopping mall at their Bethlehem Casino. I noticed that the largest offprice shopping mall in NJ is near the Newark airport. They have empty dockland right next door.

Even if NJ doesn't want to create competitor for the resort market in another part of the state, they should just think about poker and slots.

Quote: SanchoPanza

The machines may look the same, but that 55 percent tax rate for Pennsylvania slots has to hurt someone's bottom line--either the house or the players'.

True, but I've never heard of a heroin addict much caring about the middle man's profit margins, only the supply!

That is not to say all slots players are gambling addicts or anything like it. Its simply that they come for "the experience" and leave after "the experience" ... and their eyes will glaze over if you start talking about VLTs, Class two, Class three or whatever tax rate you want to talk about.

They trek to the casino, feed the slots, feed themselves via a discount coupon from the bus, play some more and go home. Fix obtained. Desires sated.

Couple of comments (I haven't been here in a while again, very busy...):

I went to Sands with my mother on a random weekday I had off, and we went to the "casual dining area". We were the only non-Asian people in an area about the size of a small mall food court. I mentioned it and then we started looking around and it was unreal. Bethlehem, PA! After 15 minutes, an elderly white couple and two African-American men entered the area, but before that, it was about 200 Asians.

Also, was there a thread that discussed the public referendum on Sports Betting in NJ? It passed close to 2 to 1 on Election Day. Obviously still some serious hoops to jump through. They should have done it in the 90s when they had the exemption...

Quote: cclub79

Also, was there a thread that discussed the public referendum on Sports Betting in NJ? It passed close to 2 to 1 on Election Day. Obviously still some serious hoops to jump through. They should have done it in the 90s when they had the exemption...

That was thanks to (Dollar) Bill Bradley, the New York Knick senator who also simplified our tax returns so wonderfully. He feared that action in New Jersey would sully the pristine N.B.A. Heaven forfend!

Quote: cclub79

I went to Sands with my mother on a random weekday I had off, and we went to the "casual dining area". We were the only non-Asian people in an area about the size of a small mall food court. I mentioned it and then we started looking around and it was unreal. Bethlehem, PA! After 15 minutes, an elderly white couple and two African-American men entered the area, but before that, it was about 200 Asians.

If you look in the bus waiting room you wouldn't even see the elderly white couple and the two African-American men. I don't know how they do it, because the buses go to Chinatown, Queens, Bronx, and all over northern New Jersey. But it's like there is a sign on the buses, that only one demographic is permitted.

Does this imply Asians thrive on untaxed revenue or simply are more financially sound (perhaps due to not trusting banks)?

How have the few Asian owned and operated casinos in Vegas done during the economic downturn? They've prospered, not folded.

Quote: SanchoPanza

That was thanks to (Dollar) Bill Bradley, the New York Knick senator who also simplified our tax returns so wonderfully. He feared that action in New Jersey would sully the pristine N.B.A. Heaven forfend!

To clarify ..... he was a former NY Knick who became NJ senator.