Episode #72 is up!
Thank you all for voting for us in the Trippies. Thanks to you, we took home our first prize. Personally, it's something I've really wanted to win since we started the show. I know Jeff would have been really proud. I can't thank you all enough.
You know, we're still trying to find our way without Jeff. It's tough to find a rhythm. I hope you enjoy this interview, despite the fact that it was somewhat self-indulgent on my part, digging into technical topics that may be more interesting to me than others.
Still, gaming technology is fascinating... and will only become more important - so I recommend you listen.
This time on the show:
- An interview with Aron Ezra and Keith Michel from Bally Technologies.
** Sure Bets **
Vegas Mate 3.5, the latest version of my award-winning iOS travel app, is now on the App Store. This update is free for all existing users.
We've added iCloud support. What that means is if you have both an iPhone and iPad, when you create a trip plan on one, it will be synced to the other automatically.
In addition to that, we've improved the search quite a bit for special terms like 'view', 'brunch', etc... It even works with the names of some of the famous chefs. Now that we have the mechanics for improved search, we'll be adding to this regularly so that no matter what you're searching for, you'll find it.
The 'Places' and 'Nearby' tabs have been combined - you can now sort places by name, distance, rating or cost easily.
For iPad users, there's a new feature that lets you view hotel prices, by date, on the map. So for instance, you can put in your dates and see a color-coded heat map of where the expensive hotels are. It's a fun way to get an idea of where you might want to stay as you're planning a trip.
Vegas Mate 3.5 has a new 'featured content' tab where you'll find special articles and from time to time, messages from other people that we want to highlight.
Also, the app is now more aggressive about updating certain bits of content in the background so you'll get some of that stuff, like restaurant hours, just as soon as we input it. We discovered that some people were not applying the content updates and didn't have the most recent data so we're doing some technical wizardry to help make that more automatic.
And on top of all of the above, we've got some bug fixes and other random improvements.
If you have a minute, please go hit the App Store and leave a review. These are cleared out with each update and they make a big difference for us picking up new users.
The app has a constant stream of updates and new features. If you want to say thanks, this is the best way to do it.
This link will take you right into the iTunes page.
From time to time, we'll allow partners to bring messages to our users via the Featured tab. If you're interested in learning more about this, check out this page.
I also need to take this opportunity to thank the testers.
This release took forever to get straight, mostly because iCloud sync was a lot of work. Thank you guys and gals... and special thanks to Pete and Paolo who both went above and beyond.
The December and January sales rush for Christmas and CES brought in ton of new users, plus a lot of usage from existing folks that were visiting the city. Your help is much appreciated by all of us.
NOTE: The original 3.5 release had a bug that could cause crashes for some users. Please grab the 3.5.3 update in the App Store.
Just wanted to say a big thank you to everyone that voted for us in the Trippies 2012 awards.
That blog award covers not just posts from me but also Jeff Simpson and Dave Schwartz, as well as some great comments from regulars and newbies. Also thrilled to see that Jeff won the Twitter award. I know he would have been very proud.
There's a lot of good stuff on the list. Check it out!
Yesterday I wrote a few reports for the Center for Gaming Research summing up the financial performance of the "average" casino on the Strip, in Downtown Las Vegas, and in Reno. Because people here like talking about the Strip more than, say, Reno/Sparks, I'll break down the Strip results for you.
Disclaimer: I really have no idea what I'm talking about. For all I know, Okada is a lunatic and Wynn Resorts are protecting themselves from a madman with some sort of hidden agenda. Still, for the purposes of this post, let's assume he's a reasonable, successful businessman that's a bit weirded out that a company he owns 20% of is being secretive about their finances.
Well, I guess he's not gonna be chairman anytime soon.
Today we learned that Kazuo Okada, the largest individual shareholder in Wynn Resorts and a board member, is suing the company (SEC document). Why? He questioned a few of the company's large financial transactions and wanted to examine the books. The company said no. He believes that his shares, and probably more importantly his place on the board, gives him the fiduciary bonafides he needs to get that access.
The way the suit reads, Okada was against a $135 million donation to the University of Macau. He objected. The board didn't listen and went ahead anyway and from what I can tell, that set him off.
He wants the details on that transaction, wants to know where a $120 million he invested in the company in 2002 went (supposedly earmarked for Macau development ; the company at first claimed they didn't know he invested it - not confidence inspiring) and additional details on the amended shareholder agreement that went through after Steve and Elaine Wynn divorced in 2010 (the agreement split the ownership but effectively left the voting control with Steve).
What would one find if they examined the books of the pre-public company? Well, we have no idea... but I don't think it would be a surprise to see some lavish spending on executive travel to Macau, office suites and the like. Maybe something more juicy? Maybe, uh, 'gifts' to government officials in China? Without any details, we can't judge but something about that time period has Okada at least curious... Maybe there's some potential for embarrassment if some of this comes out? Who knows.
As far as the Macau University donation goes, given the term of the payments and them coinciding with the current expiration of Wynn's concession in 2022, I can't help but wonder if this 'civic good' is at least partially motivated by that renewal process. From what we're told in these documents, a donation of that size was unprecedented... and as far as I know, none of Wynn's kids want to go to school there (the Steve Wynn Center for Gaming Research? Paging Dr. Dave).
Why would the company say no? Either there's something in there they don't want to share or they simply don't believe the request is legitimate... but given that it's now a public spectacle, there has to be more to it. Perhaps the relationship between Okada and Wynn has completely broken down?
For Okada to go to court against a company where his investment is worth over a billion dollars, he had to be really pissed. How could this impact future gaming expansion in Japan, where Okada's partnership was seen as giving Wynn Resorts a powerful leg up? One thing for sure: this will be something to watch.
Update: Wynn Resorts responded today with a strongly worded press release suggesting that Okada's request was without merit and pointed to a potential falling out between Okada and the board over his participation in a casino project in the Philippines.
The Gaming Control Board released the November 2011 revenue results for Nevada casinos this morning. I've banged out two reports, and am now ready to pull everything together in a quick, easy-to-read narrative.
Between gambling, food, booze and rooms, I spend a lot of money in Vegas casinos every year and yet I've never had a host that I could call to reward me for my loyalty. As a result, I haven't been shown much... and hey, as a 'journologger' (love making up terms), maybe I shouldn't be seeking that out anyway. I'm not too worried about myself but I definitely see a weakness here. Lets look more closely.
Over the past decade and especially since the Great Recession, we've seen some of the historical institutions of the casino industry remake themselves. These days, gaming revenue makes up only 39% of the average total, a shift from 15 years ago when it was closer to 58%.
What should be the next sacred cow to fall? The casino host.
Ok, maybe 'fall' is not the right way to look at it - how about transform instead? There was a time when the goal of these sales-oriented-sometimes-mercenary employees was simply to get you on property to sit at a slot machine or hit a dice table, plied by free drinks and a couple of comps to the coffee shop. At this point, that's old-style thinking.
Capturing every ounce of revenue from both gaming and non-casino operations should be the goal of every property GM or president. Why is it then that loyalty programs are still mostly gambling centric? How about a new class of 'property hosts', rewarding recurring visitors, not just to the penny slots but to the suites as well? The current system is a relic of a previous age.
Along with revenue diversification should come promotional and loyalty diversitifaction as well. We've seen some of that with new programs designed to highlight the 'leisure spend' dollar - but not nearly enough. Plus, they still charge for crappy Wi-Fi that barely works (no, I'm not gonna stop bitching about that).
Sure, Las Vegas casinos will always need a few high-end hosts to take care of the big players but there's a whole new and emerging market of customers who want to be taken care of for just spending money on stuff outside of the casino: Rooms. Suites. Shows. Clubs. Food. Retail. Better food. Golf.
Free tip: Care about these people, even if they don't gamble. You'll make more money.
If I spend $1,800 on a couple of nights in a suite, why is that worth less than dropping the same amount on Wheel of Fourtune? Sure, you had to pay a housekeeper to clean the room but the marginal cost there is negligable (or at least that's what they taught me in college). Sure, casino dollars may drop fastest to the bottom line but this a newly competitive economy. Money is money is money.
Now, there are definitely properties that have been working to moderninze along these lines, even if they still use the older nomenclature of 'casino host'. The Cosmopolitan, Las Vegas Sands (Venetian & Palazzo) and to some degree Caesars' Total Rewards and MGM, among others, have all started to credit for some non-casino spend.
Great but not enough. Looking at overall spend should be the standard, not a 'revolutionary practice' or half-measure.
This is not new ground to cover. Some Vegas casinos have affiliations with national hotel brands that have this mastered and in some cases allow customers to spend those points in Clark County. Learn from them!!
The traditional marketing strategy of casino-centric hosts is outdated. The sooner it is replaced by something that captures and rewards every dollar coming into the city, the better off the Strip operators will be, serving happier and more loyal customers.
On January 27th, Steve Wynn will turn 70.
It's a big milestone for the man who many credit with re-making The Strip. Competitors like Sheldon Adelson have shown that you can successfully run a gaming company well past that age (Adelson will be 80 next year) and The Steve will likely be at the head of Wynn Resorts for quite some time.
Still, it's worth exploring: what is the succession plan at one of hospitality's most admired companies? One of the advantages that Wynn Resorts has is a deep bench of talented people. That said, there's only one Steve.
We lost Steve Jobs in 2011 and there are parallels here. Both men built companies very much in their own image and were well known for being 'Tastemakers in Chief' - a powerful trait that allowed both Apple and Wynn Resorts to delight millions of customers as their leaders have had a good sense of what people are willing to spend money on.
Today, Steve Wynn serves as both CEO and Chairman of the Board at Wynn Resorts. Beyond that, he's the defacto head of the design apparatus, working closely with both Roger Thomas and DeRuyter Butler to imagine new projects and renovations.
My guess is that when Steve does eventually step down, we'll see not only a split of the CEO and Chairman roles but beyond that, others in the Wynn organization stepping up to fill the enormous hole that's left by him moving on. No one person can replace him.
When it comes to the Board of Directors, the two obvious choices for the chair are ex-wife Elaine Wynn or partner Kazuo Okada. Given Okada's desire to stay out of the spotlight until now, the smart money here is on Elaine. She knows the company well and would be an excellent steward, assuming she would want to serve. As a major shareholder, her interests are in the right place and let's be honest, her name is on the building too - she'd do the right thing for the company. If Elaine is unwilling or unable to serve, I'd look to Linda Chen as a possible chairwoman, assuming she didn't get the CEO nod (see below).
The CEO job is harder to call but I think there are at least three likely candidates. First off, you can forget about them going outside to find someone - this is a company that elevates to the top job from within. My picks for the corner office: Marc Schorr, Linda Chen or as a longer shot, Matt Maddox.
Marc Schorr: Perhaps the obvious choice - the current COO has been a Wynn confidant for decades. Interestingly, when at Mirage Resorts, it was current MGM exec Bobby Baldwin, not Schorr, that Wynn trusted with Bellagio, the company's most important asset (Schorr was president of The Mirage at the time of the merger). That said, Schorr proved his loyalty by coming along with Steve to Wynn and has been rewarded with a lot of responsibility. People familiar with the executive suite will tell you that there are few major decisions that don't touch Schorr's office. If Steve Wynn has a number two, it's definitely Marc, making him an obvious choice. Would he want the job? My impression of Schorr from afar has been as more of a background guy - the kind of person that every big company needs in the number two spot - someone who can crack heads and deal with the knucklehead stuff that shouldn't be on the CEO's desk... but who knows, maybe this is the gig he's been training for.
Linda Chen: Another long-time Wynn employee, Linda has been bringing in massive amounts of international business since The Mirage era. A member of the board as well as the president of Wynn International Marketing, Chen is also COO of the Macau subsidiary. Steve Wynn has indicated that Wynn Resorts is becoming more of a Chinese company and our own analysis has shown that from a financial perspective, that's undisputed. Macau is where all of the growth is and will be for some time. It would make good sense to have a Chinese-American running the company in the 21st century.
Matt Maddox: The 35-year-old CFO is an undisputed financial wizard. One of the company's strongest assets of late has been their balance sheet and financial structure, allowing them to weather the 2008-era storm that almost caused MGM and Las Vegas Sands to default. Maddox was the executor of that winning strategy and is thought to be well liked by Wynn and other managers. Putting him in the top job would be a bold move and is probably a long-shot... but I would not at all be surprised to see him running the company someday. Former Mirage CFO Dan Lee, another financial genius who worked with Wynn, eventually left to run Pinnacle. That may not have ended well but things with Lee there could have easily gone differently - Pinnacle made a lot of progress with Dan at the helm. Will Maddox end up running a Wynn competitor down the road?
Who do you see as the next generation of Wynn Resorts leadership?
As I've said for months now--and proved, using geometric logic, quarterly reports, and benchmarks for the Strip--the Cosmopolitan has not done a great job of marketing their casino. Like the Paris balloon, it's an inside joke that's not even so inside anymore. With the appointment of Tom McCartney as property COO, some people (me included) have guessed that this would change. And, less than a week into his tenure, I've got some evidence that it is.
Yesterday was a momentous day in Las Vegas casino history. There was no closing of the doors (or taping-up of notes) or implosion, but one of the real stalwarts left the building. The Las Vegas Hilton is no more. Yes, the building is still there, along with the employees, and you can still book a room (for now, at least) and roll dice, but the name has been removed in place of the oh-so-exciting "LVH--The Las Vegas Hotel and Casino." After the jump, I'll recap the history of the property, hitting the high notes and a few low ones.
Are you coming into town next week for CES? Is this your first time in Vegas or maybe even in a casino? We've got some tips that you might find helpful for getting around, finding a charger, getting online and more...
Got more to add? Feel free to share your tips in the comments.
Also, if you're heading to Vegas and have an iOS device, pick up Vegas Mate in the App Store.
Hunter's already taken a look ahead at 2012. While I've still got a few hours left in the first day of the new year, I'd like to take a look back at 2011 and talk about six candidates for "Las Vegas Casino Story of the Year." These are the stories that I think most defined the year and, when historians look back at it, will be the ones that get the most attention.