Inside Asian Gaming is keeping a close watch on developments in Singapore ahead of the impending arrival of the city-state’s first casino in December. In search of further insights into the Lion City’s future impact on the regional gaming market, IAG caught up once again with TCSJOHNHUXLEY’s Tristan Sjöberg
In the April issue of Inside Asian Gaming, Tristan Sjöberg, managing director for Asia of casino equipment supplier TCSJOHNHUXLEY, explained why his company chose to base its Southeast Asian operations outside Macau in Singapore. The Singapore office has been open since last year, but is set to gain added appeal straight after G2E Asia as the latest products displayed at the expo are shipped straight to the spruced-up showroom there.
While Macau has pretty much hogged the gaming limelight in Asia—and, indeed, the world—since May 2004, the suspension or slowing down of construction on the majority of its future casino properties has shifted the hopes of industry suppliers to Singapore. The December opening of Las Vegas Sands Corp’s Marina Bay Sands integrated resort (IR) will be quickly followed by the unveiling of Genting Group’s Resorts World at Sentosa in the first quarter of 2010.
Dr Sjöberg offers an update on the Lion City ahead of the arrival of its sprawling IRs.
IAG: Have there been any developments since we last spoke that provide greater clarity on how things will shape up in Singapore?
Dr Sjöberg: The Casino Regulatory Authority (CRA) of Singapore hosted a half day seminar on how the licensing of suppliers such as ourselves will take place. They showed us exactly how they were going to implement the licensing, and what needs to be licensed. That was very useful for us. That mainly relates to the electronic gaming machines, such as slot machines, or gaming machines, such as TouchBet®. Where the terminal does the transaction, even if it’s cash-in/ticket-out, that will be governed by the electronic gaming machine act. They’re going to go down a licensing path similar to New South Wales, Nevada and New Jersey, which we of course encourage because it is a way to ensure good probity checks on suppliers. There has been more regulation coming out in terms of that. Also, they’ve also just come out with the junket legislation.
Which markets will be handled by the Singapore office, and which ones by the Macau office?
We’re almost doing it like a geographical split. The Macau office will obviously focus on Macau. Some of the customers in the Philippines will be serviced by the Macau office, and some by the Singapore office. The Korean accounts will also be handled from Macau.
Down here in Singapore, we will handle everything that’s North of Singapore, such as Laos, Myanmar, etc, and even India. And Malaysia will obviously be serviced by Singapore. Although when specialised expertise is needed we will draft that in from the relevant regional, or indeed worldwide, offices.
Do you anticipate strong growth in Singapore and the neighbouring markets over the next few years?
Yes, we do. There’s a reason why 3,000 companies have their regional headquarters in Singapore. It’s a very good business environment to base yourself from.
In terms of the gaming industry, we do see more growth here [in Singapore]. The whole industry in Asia is now really looking towards Singapore to give them a bit of a boost, and to see how Singapore can implement gaming licenses. Macau has always been a bit of a one-off, because they’ve had legalized gaming for so long, and they had a monopoly for so long. The Macau market has really developed in a very different way from what the rest of Asia can potentially develop into. Now they’re looking towards Singapore to see what Singapore will do in terms of developing a new market from scratch. A lot of countries in Asia are now looking at Singapore to set an example they could eventually follow. For example, places like Thailand, Japan, etc, and even Taiwan to a certain degree. People I talk to in Taiwan say the Taiwanese legislators are looking a lot at Singapore and seeing how they’re doing it.
Will Singapore create a totally new gaming market, or will it just cannibalise a lot of existing markets around Asia?
It’s something we can only speculate on at this point in time, but in 12 to 18 months, we’ll probably have a much better answer to that.
It will probably cannibalise a little bit from all the other different areas around Asia that have legalized gaming. But I really think it’s going to create a huge new marketplace. It will allow for growth from areas where gaming is prohibited, or available only in a very limited capacity, such as India and Indonesia. Players from these places will now really focus on going to Singapore. So in that respect, Singapore will actually create a market, and especially create new local and regional demand. I’m sure it will have some effect on the established gaming markets available right now, such as Macau, and to a lesser degree, Cambodia, possibly also Genting Malaysia. But I don’t see the Genting Highlands Resort in Malaysia suffering so much.
Why don’t you see Genting Malaysia suffering? Won’t its customers come to Genting’s newer Resorts World at Sentosa instead?
I think it [Genting Malaysia] has got such an established reputation that it’s become a destination in its own right. There will probably be a small drop, but I really can’t see a big slump in revenue for Genting Malaysia because it’s just too established
There’s talk of construction resuming in Macau this year. How optimistic are suppliers about that actually happening?
I am optimistic. Over the last six to eight weeks, I’m certainly getting more of a positive vibe from the operators I speak to. I do think that construction will kick off again later in the year.
There will only be two major openings this year in Macau—City of Dreams and L’Arc Macau. I don’t think there will be any more openings this year, but I do think that construction will resume later in the year on the projects that have been deferred—probably at the end of the third quarter. That’s a hope that I have.
Obviously, the visa restrictions implemented by Beijing have had an effect on Macau over the last six months, but I think that will moderate. The effect will obviously be the most severe right at the start of it, then even if the government in Beijing keeps the current legislation in place, I think the effect will moderate and Macau will resume its growth over time. That happens whenever you introduce a new legislation like that. I think it will be single digit growth, as opposed to double digit growth that we saw twelve to thirty six months ago.
What are the products you’ll be highlighting at G2E Asia?
We’re going to make a big splash about the Unity™ II, which is now coming to Asia, which is the player selectable Novomatic multi-game terminal. So we’re making a lot of noise about that. We’re seeing a lot of renewed interest for TouchBet® in the Philippines and right across Asia, thanks to Unity™ II. This is very exciting news for us. The other thing we’re focusing heavily on is proprietary games, such as the DEQ G3 system and the exciting NX2 Macau, which is a Baccarat sidebet game that we have high hopes for in the Asian market.
We’ll also be launching a table game called Lunar Poker. That’s going to be a really nice game. It’s often labelled ‘Caribbean Stud on steroids.’ It’s basically a stud game that allows the player an option to buy a sixth card. The maths are in the house’s advantage, as with any casino game, but the player’s emotional urge to buy a sixth card is quite strong and it allows the player the opportunity to get that flush or full house. It’s been very well received in Eastern Europe and Russia, where it’s been used for some time now. We’re now taking it to Asia and hopefully worldwide.
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