With the basic legislative framework now in place and the Japanese central government bureaucracy beginning to fill out the policy details, the season has come for the sixteen or seventeen interested IR operators to concretely develop their strategies to woo local governments and to position themselves to be chosen as partners.
Some operators are clearly farther along than others. Some have functioning ground games and expanding local networks, while others seem to have progressed little beyond the embryonic stage, waiting for the IR Implementation Act to be passed before committing significant resources to Japan.
The non-Japanese major market players that already have substantial offices of their own in Tokyo are Caesars Entertainment, Galaxy Entertainment, Genting, Melco Resorts & Entertainment, and MGM Resorts. Each of these companies—save the tight-lipped Genting—hold their own company events to explain to the Japanese media and elements of the business community the special features of their brands.
Caesars has probably done the best job among the operators to underline their commitment to responsible gaming, with Jan Jones Blackhurst, executive vice-president of public policy & corporate responsibility, and her team frequently participating in roundtables and lectures about gambling addiction countermeasures. Caesars has also highlighted its entertainment credentials by sponsoring a Celine Dion concert in June.
Galaxy has held events emphasizing its partnership with Société des Bains de Mer and the Principality of Monaco, declaring that they are poised to deliver the “the best of the East and the West” should they win a bid. Galaxy is poised to clarify other aspects of its campaign in the months ahead.
Melco has opened offices in both Tokyo and Osaka, where it conducts tours exhibiting handsome scale models of its IRs in Macau and Manila, and showing off its MelGuard casino entry system, meant to convey both the company’s cutting edge technology and commitment to security. Chairman and CEO Lawrence Ho states that he wants to make Japan his company’s global headquarters and that the sky is the limit on how much money he is willing to invest.
MGM arguably has the best established ground game in Japan, having spent years talking to local governments and the business community. They are most visible in Osaka, now routinely participating in major local festivals, not only introducing themselves to officials and potential business partners, but engaging with the general public as well.
International major market players not on this list are Las Vegas Sands, Wynn Resorts, and SJM Holdings.
Sands is almost universally regarded as top contender for one of Japan’s major market IR licenses, but their ground game is not as apparent as some of the others. They have not established their own Japan representative, and are instead running their campaign out of Singapore.
Last October, however, Sands did on one occasion unleash its star power, bringing David Beckham, Joe Walsh, and others to Tokyo and Osaka. It was almost certainly the single-most expensive and luxurious event put on to date by an international IR operator.
As for Wynn, they do appear to be sincerely interested in Japan, but have been content to wait until the national legislation was in place before assembling their local team. It probably won’t be too long before they become more active and visible.
For its part, SJM has recently proclaimed interest in a Japanese bid, but its not clear whether or not they will make any serious effort in this direction.
Hard Rock is probably in a category of its own. Although they have the financial muscle to contend for a major market, they instead have decided to focus on one of the most promising local locations—Tomakomai, Hokkaido. Indeed, they are about to open an office in that city. Music and entertainment, clearly, take the lead in their wooing strategy. Last November they sponsored a rock concert in Yokohama.
Next comes the smaller IR operators who are bypassing the major markets in hopes of convincing a smaller local government that they will be a loyal and reliable partner, more committed to the local community than the larger corporate enterprises. In this category are 500 .com, Barrière, Bloomberry Resorts, Clairvest, Mohegan Sun, and Rush Street Gaming.
A final category to be noted are the Japanese players: Heiwa, Sega Sammy, and Universal Entertainment. Heiwa tried and failed to convince the local government in Kitahiroshima, Hokkaido, to make an IR bid. Similarly, Sega Sammy failed to entice the governor of Miyazaki Prefecture into supporting a bid built around its Phoenix Seagaia Resort. Universal’s local IR strategies appear to have been disrupted by the messy situation surrounding former Chairman Kazuo Okada.
Some of these operators are betting big on Japan, but with only three IR licenses available in the first round, there will be more of them walking away empty-handed than with a firm grasp on the prize.
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