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The Macau Metro Monitor, May 4th, 2010

ICONIC CLASS Global Gaming Business Magazine

Las Vegas Sands is counting on the convention business but it has been slow to ramp up, according to LVS COO Michael Leven. "Honestly, I would have liked to see more business on the books than we have right now," he says. "I think the nature of the facility being built over three to four years has caused meeting planners to delay making any commitments. But over the past few months, bookings have really picked up. Eventually, we'll own the MICE business in this town." "Based on the numbers we're seeing at Resorts World and what we expect to see at Marina Bay Sands, I think it's going to take a couple of years to reach the 65-45 mix that we have anticipated," Leven explains. "The casino business in the early going is going to dramatically exceed the MICE business and the room business. First of all, they're all not going to be ready immediately, and then there's a booking cycle that takes a while to kick in. So I think it's going to be well into 2012 before that starts to level off. You can't sustain these kinds of buildings without the gaming revenue. I've been in the hotel business long enough to know something about that income. The casino business is likely to be 75 percent to 80 percent of EBITDA, certainly for the first seven months, and likely for the first full year as well."

Leven doesn't believe there is opportunity for the company in the Bay State. "Massachusetts has some problems," he says. "You need to be in a location that is favorable and there are weather problems nine months of the year. We've had those conversations. If you're not contiguous to Boston and that infrastructure, you can't expect to drive enormous midweek convention business."

Maybe the most significant-but little known-initiative instituted by Jacobs is a leveling of the VIP commission rate with Melco Crown, which owns City of Dreams, across the street from the Venetian. The move allows the two integrated resorts to compete on a level playing field. Steve Jacobs, President of Sands China, said, "We lost a couple of junkets, but in about 60 to 90 days, they came back. What we found and what we proved through this experiment is if the brand is strong enough-if there's enough adhesion between the products and the services-the guests and the high-rolling VIPs like to play where they feel lucky and where they call home. It certainly benefited us and City of Dreams. The rates downtown now are at 1.4, 1.45, 1.5-which makes no sense to me at all. None. That being said, I think as long as we continue to develop product and experience ahead of just pure commission, we'll be fine."


According to Lusa, gross gambling revenues reached 14.1 billion patacas ($1.76 billion) in April.  SJM Holdings continues to lead in market share at 33%; Sands China had slightly more than 21%; Wynn Macau had 14%; and Melco Crown Entertainment controlled 13%.


Stanley Ho's Macau sports betting monopoly, Macau Slot, has won another one-year extension, just in time for the World Cup. Macau Slot is 48% owned by Ho's private Sociedade de Turismo e Diversoes de Macau (STDM).