U.P. Casinos Show Profits

Even though its Greektown Casino fell into bankruptcy, 2008 proved a bumper year for the Sault Ste. Marie Tribe of Chippewa's five casinos in Michigan's Upper Peninsula, tribe officials announced Monday.

The 2.5 percent increase in profit compared with 2007 brought in $31.28 million for the tribe, and came as the Sault's Kewadin Casinos arm, which operates the U.P. gambling halls, went through a year of cost-cutting.

"In a state and national recession and at a time when revenues and profits are down significantly in gaming markets across the nation, we are proud to report relatively strong performances at our five Kewadin Casinos in Northern Michigan," said Joe McCoy, chairman of the Sault Tribe, in a statement.


For the complete story, please see Nathan Hurst, U.P. casinos report a profitable year, The Detroit News, March 3, 2009.

Are Detroit's High Rollers Feeling a Pinch?

Are Metro Detroit's high rollers getting lowballed by the city's casinos?

Ask industry experts and big bettors, such as businessman Tom Fetzer of Birmingham, and the answer is a resounding "yes."

"I'm not a casual gambler," said Fetzer, who estimates his monthly play at MGM Grand Detroit averages $4,000. "And I've come to expect to be rewarded for it."

Instead, Fetzer and other big-time gamblers say they're seeing casinos' recessionary cost-cutting in the form of reduced comps. In recent weeks, regular players say they've noticed reductions in rewards such as cash back and free hotel stays from MGM as well as a pullback in freebies from the city's other two gambling halls, MotorCity and Greektown.

Short for complimentary, "comps" are the givebacks casinos award players to retain loyalty and keep their dollars flowing into the house's coffers. Comps range from cash back on slots and video poker machines to free hotel nights to gratis designer goods, all meant to keep big players playing. Experts say comps can be the most effective marketing tool casinos have to entice players to spend big.

And those high rollers -- a loosely-defined term for players who bet big and a lot -- often are the spenders who can make casinos enormously profitable.

The pullback in giveaways is a cost-cutting strategy that hasn't been seen in other recent recessions. In the most recent downturn of 2002-03, for example, experts said many casinos ratcheted up comps to keep gamblers playing through the tough times.

For the complete story, please see Nathan Hurst, Casino perks cut, high rollers claim, The Detroit News, March 2, 2009.

Will the Strip Close Underperforming Casinos?

As we've discussed bingos aren't the only gaming environments suffering under the current economic reality. Las Vegas continues to struggle as visitors dwindle and the ones who still make the trip tighten their belts. Below is an another article detailing the Strip's continued problems.


"Wall Street is suggesting the unthinkable. Strip casino operators might actually close under-performing resorts because it makes sense in the current economic environment.

JPMorgan gaming analyst Joe Greff posed the concept to Wynn Resorts Ltd. Chief Executive Officer Steve Wynn during a conference call when the company was explaining cost cuts of $75 million to $100 million. Greff wondered whether the competition might reduce capacity.

Wynn pondered the notion, but wouldn't speculate.

Macquarie Research gaming analyst Joel Simkins thoroughly addressed the idea in a Feb. 20 investors report. He said the casino industry could downsize operations in the way other consumer-service businesses have.

"The sector stands on the precipice of a shake-out and capacity rationalization," Simkins said. "It is reasonable to assume that 5 to 10 percent of the excess supply in the industry could be shuttered in one to three years."

For the complete story, please see Howard Stutz, INSIDE GAMING: Casinos may have to profit or perish, ReviewJournal.com, March 1, 2009.

High Stakes Internet Poker Match Sparks Interest

Money will change hands. While the flow of dough in the highest stakes poker games on the Internet has been considerable over the years, the running frequency of the biggest ‘nosebleed stakes’ games has gone down. Blame the recession, the UIGEA (Unlawful Internet Gambling Enforcement Act) of 2005, or simply the fact that the former top players just aren’t good enough any more, but where there were once ample opportunities for the cyber-based card sharp to relieve some hapless rube of his riches, there now exists merely a boneyard of lost wealth.

A loss, too, for the poker industry compounded by the straitjacket of prohibitive US legislation – many sites block financial transactions from American players. There could well be a queue of rich competitors in line waiting to play, but if there is, they won’t have easy means to do so. Not to mention that at a time when money is short for many, the idea of losing grotesque amounts of cash at the click of a button is not an appealing notion.

For the complete story, please see Ben Lobel, The High Stakes Poker Showdown, Exec Digital.

Caesars Windsor to Suspend Sports Betting for Final 4

The Caesars Windsor casino will suspend betting on men's Division I basketball for one week ending April 6, when the NCAA championship game will be played across the Detroit River in Detroit.

The NCAA says the city of Windsor supported its request to Ontario Lottery Gaming Corp., the government agency that owns Caesars Windsor, to halt otherwise legal college basketball betting at the casino. Casinos in Michigan and most other states are banned from offering sports wagers.

For the complete story, please see Ontario casino halts betting during NCAA Final 4, ChicagoTribune.com, February 27, 2009.

Fort Wayne Casino a Possibility

Fort Wayne Mayor Tom Henry wants voters to decide whether the state's second largest city should seek a state casino gambling license.

The Democratic first-term mayor said a citywide referendum should be held as early as this fall to decide whether the city should pursue a license.

Henry also said the ongoing debate over whether legalized gambling should be expanded in Fort Wayne should continue through a referendum campaign.

"The decision about gaming is not mine alone," Henry said.

For the complete story, please see Ft. Wayne mayor wants referendum on casino license, TheRepublic.com, February 28, 2009.

MGM's Billboards Causing Controversy

A pair of golden eyes glowering at motorists from a billboard on the Lodge Freeway were supposed to draw attention to the MGM Grand Casino -- but one local pastor sees only Satan, and a creeped-out councilwoman wants the sign removed.

The billboard, near the Detroit casino off the Lodge, depicts a huge pair of eyes on a black background, with a small golden silhouette of MGM's signature lion on the sign's upper right-hand side.

Councilwoman Alberta Tinsley-Talabi said Friday she was shocked by the billboard, calling it "sinister." She said she complained to MGM and asked it be taken down. The Rev. James A. Smith, pastor of Maranatha Gospel Church in Romulus, is taking her one step further, planning to mount a campaign to pressure the casino to do so.

"I was shocked when I saw it," Smith said. "It looks like a demon glaring at you; nobody with kids in their car should be forced to look at that. No Christian should."

For the complete story, please see George Hunter and Christine MacDonald, MGM's 'golden eyes' billboards called sinister, The Detroit News, February 28, 2009.