This business spread throughout the gaming industry, where there is a general acknowledgement that the industry’s growth may be limited if it relies solely on the conventional gaming business.
“Game operators may seek to expand their casinos, their range of games, reinforce the level of service, and so on, but what really counts is the bigger picture,” Innovation Group chairman Steve Rittvo said during the Global Gaming Expo Asia 2014 held in Macau on Tuesday and Wednesday.
|A ball sits on a roulette wheel in the Cammegh booth at the Global Gaming Expo in the Venetian Macao resort and casino in Macau, China, Tuesday. (Bloomberg)|
And the trend nowadays is the integrated resort model, which moves toward a balanced business portfolio between the gaming and the nongaming sectors.
Augustine Vinh, chairman and CEO of Stellar Management, agreed that there has been a general shift from gambling to family-centered activities.
“Singapore is currently one of the leading gaming markets in Asia, but casinos only take up less than 10 percent of the resort areas,” he explained.
An integrated resort, or IR, according to Rittvo, is a large-scale destination with a variety of components beyond just a casino and a hotel.
Representative examples are the Marina Bay Sands and Resorts World Sentosa in Singapore, as well as the Venetian Macao, where the G2E conference took place, and the Mandalay Bay Las Vegas, he said.
“The exact definition is yet to be established, but IRs generally involve a total cost range of $10 billion to $360 billion, and include landmark tourist attractions, such as the Gondola rides within the Venetian Macao,” Rittvo said.
Now that the IR model has dominated the gambling market in Macau and Singapore, global operators are turning to new potential markets, such as Japan, South Korea, Vietnam, Taiwan, Laos, the Philippines and others, he added.
“But the concept of IR is not just about super large scale but more about innovating the structure of the conventional gaming industry,” said William Shen, vice president of Asian Development, Ceasars Entertainment.
The Asian game consumers, having been exposed to the highly competitive market for years, have come to have a discerning eye for luxury, he claimed.
From this perspective, South Korea is facing a considerable challenge in the global market as the government only granted casino access to foreigners.
"The integrated resorts, including casinos, will reach a limit in growth unless their nongaming sectors are activated, and this needs the active participation of the local population," said Ed Bowers, senior vice president of global gaming development, MGM Resorts International.
"If Korean people may enjoy everything in the resorts but the casino, they are likely to turn to other entertainment."
By Bae Hyun-jung, Korea Herald correspondent