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Asia’s casino market is set to be the success story of the next half-decade
The US will finally lose its position as the world’s biggest casino market in 2013 when it is overtaken by Asia Pacific, according to a new forecast from PricewaterhouseCoopers (PwC). In its annual report on gaming, the firm predicts that global casino revenue will rise by a compound annual rate of 9.2% over the next five years, from a current $117.6bn to $182.8bn in 2015.
But the US casino sector will under-perform that growth, rising just 5% annually, and as a consequence, at the end of the five-year period it will account for a significantly smaller share of the global market than it does today. Currently, about 49% of the global market is in the US; by 2015, that will have dropped to 40%. Growth in EMEA will be even slower, at 2.4% annually, which PwC blames partly on “the impact of adverse regulatory developments” as well as on economic conditions. EMEA has about a 14% share of the global market now, but in 2015 that will have dropped to 10%. The market share lost by the US and EMEA will,
predictably enough, be taken by casinos in the Asia Pacific region, where 18.3% annual growth will lead to a share of about 43% in 2015, up from around 30% now. Asia Pacific is
Asia will hit the American casino business directly
predicted by PwC to overtake the US as the world’s biggest casino market in 2013. Within Asia, PwC regards Macau as “the jewel in the gaming crown”. But across the region, it says, gaming is being driven to new heights by economic growth, local love of gambling, the increasing number of facilities, improvements in transportation links, and lifting of regulatory burdens. Singapore, for example, will reach $7.2bn in annual
revenue by 2015 – yet the figure was zero as recently as 2009. PwC expects business to carry on building in the Philippines, too, and to become big in Japan if authorities approve plans for casinos.
And it is not just the success in comparative terms of the Asian markets that will lead the US to lose its dominance. They will actually hit American business directly. Observes PwC: “Some high-roller customers that would otherwise travel to the US will be diverted by these overseas attractions. The impact will be on US gaming centres like Nevada, which have a higher reliance on foreign tourists to drive revenues.” “We talk about the global economy, but this has never been more evident than in casino gaming. The turbulent global financial markets have curtailed consumer spending in some of the major markets for casino gaming. But we’ve
seen huge growth in Asia as the affluent middle classes seek new forms of entertainment, and gaming’s intense balance of risk and reward has a special appeal for many people,” said Marcel Fenez, Global Entertainment and Media Leader at PwC. Among the less important corners of the gaming globe, meanwhile, Latin American market share will remain roughly static at 3%; annual growth will be close to the world average at 8.1%, but starting from its current low base of just $3.8bn a year means that the region will not leap up the charts. The Canadian sector, like the much larger US one, will lose market share, from about 5% to about 3%.
What e-gaming needs Online, the picture may be rather different. Although only the third-largest land-based market, EMEA is the biggest for e-gaming – led by the UK, which legalised it in 2005. If online is to flourish globally over the next half-decade, PwC sees four requirements. First, it says, there must be increasing acceptance by regulators of cross-border gaming, to create markets that are large enough to thrive. There must be “realistic taxation levels”. Regulatory
approaches will have to become more fine-tuned to specific types of gaming, for example Poker, sports betting, and lotteries. And finally, on the operator side, it will be critical to combine e-gaming with social networking. Said Mary Lynn Palenik, Director of Gaming Research & Analysis at PwC: “Whether you look at the physical casino market or online gaming opportunities, the over-riding challenge is the same. “In this digital world where consumers can access vast quantities of information and experiences from wherever they are without the need to travel to another location, the gaming industry will face tough competition for its share of consumer discretionary spending.”
World casino market share forecast 49%
US
Asia Pacific 30% EMEA
Canada
14% 5%
LatAm 3%
40% 43% 10% 3% 3%
(Figures do not total 100 because of rounding.) GAMINGPEOPLE
ALEA Mark Hands has joined Alea, the casino in the English city of Nottingham, as Director.
DRGT Georg Steiner has been named Senior Business Development Director at DRGT.
FUTURELOGIC Nikolai Tchekan is now Regional Sales Manager for eastern Europe at FutureLogic. He previously worked for Unidesa, Octavian and Bally Technologies. The firm also has a new Systems Product Manager, Rob Wheeler, who joins from Bally Systems, and a new Systems Support Engineer, Mike Clarke.
GROSVENOR CASINOS Vince Turnbull, Resident Chef at Grosvenor Casino Victoria in London, has been named the operator’s Chef of the Year.
ICE TOTALLY GAMING Judges of January’s Totally Gaming Awards include Jan Jones of Caesars Entertainment, Lynda Atkinson of Genting Casinos, Dick Flink of Holland Casino, Per Jaldung of Casino Cosmopol, Dietmar Hoscher of Casinos Austria International, Paul Talboys of the Bingo Association, Clive Hawkswood of the Remote Gaming Association, Friedrich Stickler of Austrian Lotteries, and Cristino L. Naguiat of the Philippine Amusement and Gaming Corporation.
MARYLAND LIVE! Three executives have joined the new casino development at Arundel Mills. They are Mario Maesano, Vice President of Marketing; Ted Mazotas, Jr., Vice President of Information Technology; and Lynn A. Norris, Vice President of Human Resources.
OPENBET Amanda Bicknell joins OpenBet as Sales Director responsible for sports betting and casino business. She was previously a Business Manager at Microsoft.
SCIENTIFIC GAMES John Parsonage joins Scientific Games as Group Director for Product Management, while Michael Koch takes on the role of Technology Managing Director. Parsonage has worked at Sky Betting and at Sportingbet, Koch at Aristocrat Leisure, Gtech and Wincor Nixdorf.
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