1. Welcome to VegasMessageBoard
    It appears you are visiting our community as a guest.
    In order to view full-size images, participate in discussions, vote in polls, etc, you will need to Log in or Register.

Why Gaming is a dying business model in Vegas..

Discussion in 'Misc. Vegas Chat' started by Funkhouser, Nov 19, 2013.

Thread Status:
Not open for further replies.
  1. Funkhouser

    Funkhouser In Charge of the Big Door

    Joined:
    Aug 20, 2011
    Messages:
    2,107
    Location:
    Cincinnatti, OH
    Trips to Las Vegas:
    45
    Just read an article in Vegas Inc. interviewing SLS President Rob Oseland
    About SLS converting the Sahara. Key comment on how these executives building new places are viewing the landscape of their business. It kind of re-iterates why Downtown Grand is going in the direction they have.

    Quote:

    "In the past, casinos were the focal point of the resort experience. As Las Vegas grew up, we built bigger and bigger and grander places, and we lost that connectivity. The lure and luster and excitement of the casino has been left behind for other experiences. It’s food and beverage and nightlife oriented. The casino ends up competing for the space."

    Here is a link to the full article.

    http://www.vegasinc.com/news/2013/nov/19/will-sls-change-game-north-strip
     
    Last edited by a moderator: Nov 20, 2013
  2. LucyR.

    LucyR. VIP Whale

    Joined:
    Feb 17, 2012
    Messages:
    1,872
    Location:
    Los Angeles,CA.
    Trips to Las Vegas:
    20
    VEGAS is a fun place like an amusement park

    I don't gamble so I know what it is like to go to Vegas and never gamble. I just have fun looking at the beauty of the night lights, beautiful hotels, eating different types of foods, shopping and having fun talking with people on the bus
    and everywhere I go. Plus, it is still a great deal on hotels. I also have lots of reward points that I can use on Southwest airline.

    Vegas started out as a gambling town and now it is more of a family place
    where generations of families get together in Vegas. People pay hundreds of
    dollars just to see the Famous singers and fantastic shows.

    I like meeting people from all over the world who go to Vegas.

    It has always been an entertainment city for me. LucyR
     
  3. Auggie

    Auggie Dovahkiin

    Joined:
    Jan 8, 2009
    Messages:
    5,749
    Location:
    Burnaby, BC
    Trips to Las Vegas:
    14
    I think with a quote like that you have to take that its SLS/Sahara talking: they can't make the casino the focal point because they aren't going to be getting much, if any, walk up traffic and because what you can find in their casino is what you can find in every other casino there aren't going to be that many gamblers who will just head on over there to play in their casino unless there is some extra draw.

    And thats really about the same with Downtown Grand: they have all those people walking around Fremont Street under the canopy and they have to do something to get them to make the hike over to their property to check it out. While the place is new sure that'll draw a crowd, but a year from now they will need something more to get people to come on over.
     
  4. 44inarow

    44inarow VIP Whale

    Joined:
    Sep 8, 2012
    Messages:
    1,787
    Location:
    New York, NY
    Trips to Las Vegas:
    23
    Not to mention, just look at what's happening over at Cosmopolitan -- without getting into the merits of that thread, they're showing positive improvement by "only" losing $19mm a quarter three years after they opened, and that resort is probably the poster child for being "food and beverage and nightlife oriented". I think it's somewhat laughable to say that casino gaming is a dying business model when the resorts that have tried to back-burner the casino (e.g., Cosmopolitan in Vegas, Revel here in AC) have had serious difficulty turning a profit.
     
  5. bsnm

    bsnm Tourist

    Joined:
    Sep 22, 2011
    Messages:
    80
    Location:
    Arizona
    Trips to Las Vegas:
    26
    Better food/beverage and nightlife in other cities. Cheaper shopping too. Far less travel expense.

    Without gaming I have no reason to go to Vegas.
     
  6. dvandentop

    dvandentop VIP Whale

    Joined:
    Sep 16, 2013
    Messages:
    1,763
    Trips to Las Vegas:
    15
    Same here
     
  7. Keyser Soze

    Keyser Soze Low-Roller

    Joined:
    May 2, 2013
    Messages:
    484
    Location:
    right behind you
    Trips to Las Vegas:
    999
    Dining- I enjoy a good steak, but otherwise I just grab a quick bite wherever I'm at.

    Shows- I don't go to many. When I do, I use it as an opportunity to catch a quick nap.

    Clubbing- not a chance.

    Shopping- if I can't get it on Amazon, I don't need it.

    Basically, if it wasn't for gambling, you couldn't pay me to go to Vegas. But that's just me.
     
  8. Packer Backer

    Packer Backer Low-Roller

    Joined:
    Dec 17, 2012
    Messages:
    167
    Location:
    Cornell, CA
    Trips to Las Vegas:
    13
    In the article they also give Kudos to the Riviera, their neighbor..
    "On the Riviera helping the recovery …
    The Paragon Gaming Group has come in as a management group. They are the former owners of the Sahara. They’re going to help push some life back into it."
    Is that where the folks from the SLS will go to gamble???
     
  9. topcard

    topcard Older than the Stardust!

    Joined:
    Aug 8, 2012
    Messages:
    2,666
    Location:
    Fort Worth
    Trips to Las Vegas:
    82
    ...which is why downtown now gets 99% of my business.
    :wave2:
     
    Seems like forever from now, but the flights are booked, so it counts!
  10. Funkhouser

    Funkhouser In Charge of the Big Door

    Joined:
    Aug 20, 2011
    Messages:
    2,107
    Location:
    Cincinnatti, OH
    Trips to Las Vegas:
    45
    One comment on Cosmo, that place would have to do incredibly well, better than their neighbors to see a profit. The write down and debt on that place was too great at opening to see DT investors ever get their money back. I thought most of the loss was write down related this quarter.
     
  11. TIMSPEED

    TIMSPEED !địt mẹ!

    Joined:
    Aug 8, 2013
    Messages:
    4,572
    Location:
    Modesto, CA
    Trips to Las Vegas:
    001
    I'd be curious to see...if they said "NO MORE GAMING" in these casinos (ie: Vegas just became a bunch of RESORTS)...how long they'd last...a year maybe?
    I'd also bet that the MAJORITY of people that come to Vegas, come because SOMETHING is "comped" via a casino there (ie: THEY'VE GAMBLED!)
     
    Palace Tower Suite!
  12. Kickin

    Kickin Flea

    Joined:
    Aug 10, 2012
    Messages:
    3,414
    If the banks wrote down any of Cosmo's debt that would be recorded as income for Cosmo, not a loss. But there wasn't any special writedown listed this quarter on any asset either. Their opex is just too high but what is interesting is that revenue grew in every area EXCEPT for the nightclubs and dayclubs.

    They don't break out the numbers specifically but mention in their latest financials that revenues from Marquee were down "due to increased competition" and f&b revenues grew everywhere except for their nightclub and dayclub business.

    I agree with 44inarow that there is a lot of hyperbole that gets thrown around with the "dying" of gambling, or gambling becoming "unimportant", etc. Gambling revenue as a share of the total has undoubtedly gone down, but it is still the single biggest contributor to revenue at almost every major strip hotel especially when you factor in the 15-20% comps on average that is paid out to other departments.

    SLS will obviously talk their own book. Every business does that. But one thing that has so far held true is the places that tried to be "resorts that happen to have a casino" have had to quickly change their tune after seeing their numbers. That may work for boutique type properties, but it hasn't been working for guys with thousands of rooms.
     
  13. smartone

    smartone VIP Whale

    Joined:
    Jul 17, 2011
    Messages:
    5,264
    Location:
    Northern Nevada
    Trips to Las Vegas:
    204
    Absolutely!
     
  14. ardee

    ardee VIP Whale

    Joined:
    Oct 13, 2007
    Messages:
    2,414
    Location:
    SoCal
    Trips to Las Vegas:
    88
    "De-emphasized gaming" will last about as long as "family-friendly" Las Vegas, and with about the same success.

    Hookers and blow. Free booze and gambling. Anything else is doomed to failure.
     
  15. chitownjohn

    chitownjohn High-Roller

    Joined:
    Nov 28, 2010
    Messages:
    659
    Location:
    Chicago
    Trips to Las Vegas:
    30
    Right now Vegas has a really good blend of gaming, food, entertainment and lodging, it truly does have something for everyone which couldn't be said 20 years ago.

    In terms of the gaming aspect, gaming as a pct of revenue is around 37% compared to 45% in 2000. Gaming revenues are increasing, just not as fast as F&B, thanks to the bottle service crowd. Vegas is a gaming city, it will always be there.

    It will be interesting to see how vegas continues to evolve and cater to all demographics especially the boomer generation which has the greatest amount of wealth and disposable cash.
     
  16. Electroguy563

    Electroguy563 Over-Fried Gambler

    Joined:
    Apr 26, 2011
    Messages:
    3,594
    Trips to Las Vegas:
    15
    Gambling will always be the fuel as to why many people go to Vegas. We all know Vegas is always changing, always evolving.

    More emphasis on shows, night clubs, fine dining, etc., etc. Many resort destinations have all these.

    Gambling PLUS the above is why Vegas is, and always will be, something special.

    In my opinion, of course.:beer::thumbsup:
     
    Going to Hawaii's 9th Island!!
    Going to Hawaii's 9th island!!
  17. Tbone3336

    Tbone3336 VIP Whale

    Joined:
    Sep 1, 2010
    Messages:
    1,442
    Location:
    New Jersey
    Trips to Las Vegas:
    21
    I have to agree with most posters here so far, as living in south jersey, 45 mins from A/C and less than 45 mins to 5 other casinos in PA and DE, there is no place for gambling like Vegas. I can gamble at Philly Sugar house or even A/C's boardwalk, but it is the other food and bar and architecture and shows and sights in Vegas that add the topping that while different, not even AC in the height of summer can offer in an all in one package. While I agree the dollars on gambling went down, I would imagine if gambling shrunk by to much their visitation numbers would follow. That is why bars and clubs in A/C and different venues change out every year or two. One example, albeit not terribly apt, from AC that I see is the Wild West Casino attached to Ballys, they closed down 90% of their gaming floor and are highlighting Beer Pong and their western bar, and this past Saturday while walking into there from Ceasars which was hopping through to Ballys, which was crowded, this place was a ghost town on a late Saturday afternoon. No way beer pong and a western bar and the few remaining slots bring in enough to cover the cost for that building even if owned outright.

    Maybe us VMB members are a small minority though as most on here seem like gamblers and maybe the reality is many others would continue to go to Vegas with no or little gambling? I highly doubt it, but one never knows I guess. No where that I know of can I walk from one casino to the next and see different themes/Archtitecture/Art/Bars/Eye Candy/Restaurants/and enough gambling to satisfy you than you can in Vegas all in what, 4 walkable miles. It is the whole package that no place else even comes close that I know of. So if Excalibur were to remove their Gambling, I would never set foot in there, even though now there are not many reason to stop in there that I like, but just for the experience I do most trips. I do not do that in AC, for no casino in AC has that draw for me, just to go to see something different.
     
    Last edited: Nov 20, 2013
  18. Jimbo338

    Jimbo338 VIP Whale

    Joined:
    Oct 8, 2000
    Messages:
    5,497
    Location:
    Laconia, NH
    Trips to Las Vegas:
    20

    Well said, Electro:
    Gaming is what provides for the other opportunities. Everyone can find parts of what LV has to offer elsewhere but no one else has the all......all provided by the gaming. A big gambler I certainly am not but where else could I go for LV prices and choose between so many things to see and do?

    Jimbo338
     
  19. sco5123

    sco5123 VIP Whale

    Joined:
    Jul 29, 2011
    Messages:
    2,698
    Trips to Las Vegas:
    11
    Are you serious? :eek: Wild Wild West casino was very beloved! I wonder why they closed everything up.
     
  20. tex55

    tex55 Low-Roller

    Joined:
    Aug 11, 2012
    Messages:
    275
    Location:
    Southlake, Texas
    Trips to Las Vegas:
    71
    I have a hard time believing that people will fly 3-4 hours to come to Vegas for fine dining and shows. Gambling has to be the differentiator. Went into in the Cosmo last weekend, and the casino was still pretty dead. They also continue to lose millions. There has to be a connection there.
     
Thread Status:
Not open for further replies.