Tuesday, May 06, 2008

CC Inspired

Craig put up a bunch of links re: Casino/Vegas troubles. Tropicana group has filed for chapter 11 to restructure their business. Seems they plan to sell the AC locations to get out of debt and maintain their Vegas business. They complained a little over a month ago that there were investors trying to push them into bankruptcy so they could get at that decent chunk of real estate they have on the strip.

Nothing in Vegas is permanent. The Flamingo, Tropicana, Circus Circus, Sands, and many others will likely be memories within a decade. No city in the world seems happier to knock down the old to put up the new. There's nothing wrong with that, since Vegas has this odd sense of impermanence to it. It feels as if it could all be blown away with a strong enough wind. Even the hotel-casinos in the middle range of age are starting to feel old - The Monte Carlo, MGM Grand, Bally's, Harrah's, The Mirage, and more feel somehow inadequate when compared to the behemoths that surround them. Oddly, places that have somehow survived - The Imperial Palace, Casino Royale, and their ilk, seem more permanent than their neighbours. They're the anchors of seediness that keep the strip "real".

And right now, Vegas is starting to feel the squeeze. I was wondering about this as the offers for cheap stays started arriving en masse in my physical mailbox. "Book by May 31st for stays until July 30th!" Really? They need to offer me a deal that covers the WSOP period? They must be getting desperate. Gambling revenues are down, room vacancies are up, and the foreign business coming in isn't making up for the lost domestic tally. A weak dollar, a weak economy, and a housing collapse are forcing people to reprioritize. It seems betting against the house is coming somewhat low on that list.

The increase in quality casinos outside of Nevada isn't helping either. I can drive to Niagara in 90 minutes or less for my craps fix. My poker club runs limits I'd play in the casino, and a better structure and quality of play for tournaments than I'd find at a casino. This is repeated for people all over North America.

But this is Vegas, and it will adapt. Just as it builds, it can stop building. These are people who know how the long tail and lateral business streams work. Vegas has changed over the years from a cheap vacation to a splurge. This was possible because people were willing to spend. Now, they aren't. I expect that if things continue down, it will swing the other way. Cheap rooms, generous food comps, free nights, and more low-limit tables appearing. Maybe it won't be so hard to find $5 tables on a Friday night anymore. At the end of the day, the more people they have, the more money they make. The high-rollers will still be there. Who they lose are the casual gamblers - the people with families looking to get away for a weekend and sin a bit, the bachelor(ette) parties looking to sin a lot, the college kids, the poker players looking to try their hand in the heart of it all, and so on. Making it more affordable for them to show up is what built Vegas in the first place.


lj said...

sounds like we'll be in vegas the same time. woot.

OhCaptain said...

I just got back from a weekend in Vegas. I hadn't been there in 11 years, so I really noticed the changes.

It was impossible to find a $5 blackjack table. I found a few places with $10 tables, but this small number of tables were full.

I remember when the Stratosphere was the talk of the town. Now, it feels like a dive. (extra soft and squishy tournaments though :-))

We had a great time. For us, its still a destination with things that we can get around here. Poker tournaments in Southern Minnesota are few and far between. We travel to Iowa for NLHE, Vegas is just more fun than Iowa.

Our entire trip was a promotion from a local casino and when we got to Vegas, the offers for more free stuff were everywhere. Lots of free slot play. Heck, I made $100 using the free slot play...but then again, I hate slots and only did it cause they were offering me free money. I like free money.

Astin said...

LJ - IF I go. Still undecided on making the trip.

Cap - I've never even been as far as the Stratosphere. I tend to stop when I hit the Wynn. That whole section of strip is going to disappear soon. Unless they stop building due to the downturn.

Slot players have smartened up and become very selective about what they play. They need to drag the casual players to the bandits and make new slot addicts.

But don't get me wrong - I love Vegas, for about 3 days at a time. But I can see why people aren't going as much these days.

anton said...
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