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After unplugging for 3 months, I’m back and headed to G2E as I have for the last decade. To prepare for my trip, I reread my notes from last year and spoke to a number of vendor contacts.  Below is a summary of my thoughts heading into the show.

– Anna Massion

Industry commentary

  • Based on data we’ve collected, replacements have been stagnant the last 12 months excluding the RFP units shipped to Canada.  The larger venders we’ve spoken to have confirmed that they have seen no pick in replacement demand from their customers.
  • The competitive environment remains fierce, with smaller players getting some of the pie that used to go to the big 5.  The promotional environment around G2E remains heavy but no different than in past years based on our conversations.  BYI remains one of the more disciplined players and WMS claims it is as aggressive as in the recent past.  Their Blade cabinet is still new and capturing about half of their domestic demand.
  • Manufacturers and operators alike continue to struggle to attract new slot players and the existing customer base continues to age
  • WMS’s new poker concept has yet to make any real dent into IGT’s dominance of the video poker market
  • Everyone is still focused on how to monetize on i-gaming but there is nothing new to report in the real money space.
  • On the systems front, BYI is still the leader and seems to be making slow and steady headway with DM applications.  IGT is still giving it away as a tool to garner more floor share.  Hearing the same thing to a lesser extent with ALL (Aristocrat).  Konami has an robust system but has yet to turn operator interest into big contracts.

BYI

  • As much as BYI wants to keep the focus on their games, systems and interactive, we have no doubt that there will be many questions surrounding their pending acquisition of SHFL.  Here is what we will be focused on:
    • How BYI can leverage SHFL’s success in Australia? While BYI has a small presence in Australia they haven’t been able to garner much traction in that market. Moreover, we know that SHFL has started trying to see if their Australian success can be transported to the NA video slot market.  Can BYI help push more of SHFL’s Australian product into other Asian markets? This is one of the bigger revenue “synergy” opportunities of the deal in our opinion.
    • If and when real money online wagering materializes in the US, BYI should be able to leverage SHFL’s proprietary table content
  • Bally’s products have been performing well this past year, especially on the video side, which has been a historic weak spot for them.  Some of their competitors attribute part of this success to their new relationships with 3rd party developers (i.e. High-Five).
  • Bally will be showcasing two new cabinets (part of the Bally’s Pro Series cabinet family) that support almost all of their content
    • Wave:  40-inch concave LCD touchscreen.  March 2014 release
    • Pro V55 Jumbo: A nine-foot cabinet with a 55-inch vertical touchscreen display (supports all V32 content).  December 2013 release
  • 5 new licensed themes:
    • New WAPS:  Titanic (March 2014 release) and Magic of David Copperfield (June 2014 release)
    • Followup WAPS:  MJ and Grease follow-ups
    • Premium Lease:  ZZ Top Live from Texas
  • 10 new game mechanics will be showcased
  • 100 new titles;  including games from their new Reno studio (run by former IGT executive), content from Australia and 3rd party developer content
  • Systems:  More emphasis on the Elite Bonusing Suite and the competitive advantage it creates for casinos from a marketing standpoint.  Will also demonstrate DM wagering features – allowing patrons to enter into tournaments when they want to, not when the casino prompts them too
    • Super Slot Line: Wireless solution to a serial floor. Doesn’t require you to ramp up your floor to high speed to enable your floor.  Much cheaper solution.  Opens the door for older casinos to upgrade their floors and start using DM and Bonusing Suite.
    • Chip Recognition
  • I-gaming:  Nothing new per se but will showcase how they can present operators with a single view of the player across online, mobile, and traditional brick-and-mortar gaming platforms and provide complete cross-platform gaming experience for both free play and wagering.

IGT

  • While we don’t have specifics, we’ve heard that IGT continues to be aggressive in its pricing strategy; no doubt using its product breadth to achieve scale orders
  • New MegaJackpot titles:
    • Avatar:  Center Stage Platform
    • Avatar Treasures of Pandora:  New Crystal Core Cabinet
    • Bridesmaids
    • Jurassic Park:  IGT Duo 103” and 70” Center Stage
    • Wheel of Fortune Ultra 5 and 3 Reels:  will introduce 3D reels
      • New game mechanics
    • Card Up! Dragon & Phoenix:  allows players to choose volatility of bets based on color, suit or individual features in a table-games style bonus format.
    • San Xing:  rewards players with progressive awards during bonus rounds when selected lanterns are matched up during gameplay.
    • Seaside Park:  awards players with credits and the opportunity to win multiple progressives through interactive bonus rounds.
  • For sale games:
    • Atari Centipede:  Video Reel Edge
    • Winner’s Choice:  New multi-game 4-1 experience
    • Sweet Three:  Based on proven classics allows a trio-slot game that creates progressives with frequent jackpots
  • New Video Poker themes and more playlines
  • Systems:  Features that encourage social play

KONAMI

  • Has experienced declining YoY sales to NA over the last 9 months and the September quarter is likely to see more of the same.  Konami is suffering from their lack of new products, the stagnant state of the replacement market, and no Canadian exposure.
  • Expanding their manufacturing capacity in Nevada and are building a world class development facility that will double their manufacturing and R&D capacity.  The project should be completed in Summer 2015.
  • Promotions:  offering volume-based incentives in-line with prior years’ offers based on orders of 8 or more machines.  Post promotion pricing in the range of $14.5k
  • New & Newly Released Products
    • New Multi-Game (Selection):  Multi-game that has instant load time. Getting great feedback during the company’s pre-G2E meetings.
    • Titan 360:  Multi-player slot machine released in Harrah’s AC this July.  Doing 3x house average. They only have 5 units out in the field at this point but expect to have strong demand if the number keep coming in the way initial results have.
    • Podium Goliath: 93" tall, includes dual 32" high-definition LCD displays, 360 degree attract lighting, an ergonomic button panel, and an enhanced sound system. It supports KONAMI's K2V and KP3 library, including stand-alone progressives.
      • Timing: Beta testing currently, should be ready to commence shipping December 2013
    • Game with 6 huge reels on top (unnamed):  release scheduled for June/July 2014
    • Dungeons & Dragons (Leased product):  will not be on the floor planning to showcase it at NIGA 2014
  • In Development
    • Developing a new box which is currently still in “concept” stage which they believe will set the industry on “edge” when released.

WMS

  • Steady as she goes:  WMS will continue to focus on their Blade & Gamefield cabinets and content  - will showcase 45 new Blade titles to add tp the current 14
  • Working on a Blade Stepper, which will be the first new stepper introduced to the market in a while, meant to appeal to the traditional gaming player that likes the traditional three wheel experience.  They are apparently receiving great reviews of the product during their pre-G2E meetings.
  • On the participation side
    • New Monopoly game on the Blade
    • Iron Man just released on Gamefield and is killing it so far but it’s still very early
    • Clue and Beetle Juice for Gamefield
    • Introducing Wizard of Oz in the motion chair this winter
    • Willy Wonka was released in June 13 and is doing very well
    • Superman was released in March 13 and is doing “ok”
    • Kiss Game has run its course – they have a few hundred out on the field but aren’t placing any more
  • Displaying 100 new games (same as last year) including some targeted for the Asian market, although they are getting positive feedback from their US customers on the Asian content as well
  • Video Poker: Coming out with a new version. Have sold over a 1,000 in FY13. Games are doing on par with the competition. They expect to sell about 1,000 in FY14.
  • They are done with their Canadian fulfillments but there may be some follow up orders
  • September Q:  Always a tough Q for WMS, especially with the early G2E show.  They aren’t discounting as much as the competition since the Blade cabinet is new.  ASPs may be depressed though since the September Q has more of an international focus (which like lower priced products).