| Before June had a chance to really get going, Illinois passed a gaming tax increase. Harrah's, along with every operator, will be impacted. The Wall Street pundits speculate that all of the operators will try to reduce expenses, possibly even try to reduce revenues to stay within the lower tax bracket. Reducing expenses may mean laying-off employees. It may mean cutting down on participation games and it may mean reducing marketing efforts. Reducing revenue is more intriguing; the operators can reduce hours, lower limits, and reduce complimentaries. But there may be one more unusal way to reduce revenue, send the players to another casino, in another state. It will be interesting to see if Harrah's tries to move some of their customers to the lower-tax-land of Indiana or even Nevada, New Jersey or Mississippi. The ability to move players from one jurisdiction to another has always been one of the goals of the "Total Rewards" program. This will be an excellent and financially advantageous time to test the system. As a national company, Harrah's illustrates better than any other company that operating margins or the value of an individual player will differ radically from one jurisdiction to another. Regardless of the debates in Washington, the Internet is becoming increasingly more important and at least for some, profitable. Marriott booked 20,000 rooms in one day, $5 million in sales; and Youbet continues to grow with revenues increasing over 300 percent in one quarter. "It's the first time we've broken through 20,000," in hotel rooms booked online in a single day, said Marriott International spokesman John Wolf. The rooms represent about $5 million in gross sales, up from the record of about $4.8 million when just under 19,000 room-nights were booked one day earlier in the month. Marriott International's online sales topped $1 billion last year, a nearly seven-fold increase in two years. Jerry W. Jackson, Orlando Sentinel, Knight Ridder/Tribune Business News, Hotel Online, 5-21-03 Youbet.com, Inc., the leading online live event and wagering company, today announced that First Quarter 2003 marked the company's fourth consecutive quarter of record growth. The gross handle for the first quarter set a new record at $61.0 million, up substantially from $27.1 million in the first quarter 2002, and includes a record-breaking gross handle of $21.1 million for the month of March, 2003. Gross revenues increased 323% to $11.0 million for the quarter ended March 31, 2003 as compared to $2.6 million in the first quarter of 2002. Net revenues, after payments to our track partners and licensing fees, were $3.8 million for the first quarter 2003 compared to $1.7 million in the first quarter of 2002. Business Wire, Yahoo Business, 5-16-03 The growth rates are stunning in both cases and both have implications for all of the gaming industry. There are some in the industry that think it makes sense to try and stop the growth of Internet gaming, but for the rest of the industry it makes more sense to try and understand it and find ways to integrate the Internet into the business and operations. Gaming regulation is not simple and is becoming more complex. Meanwhile back in Washington D. C., Congress is looking at Internet gaming, and once again sports betting. Hold on to your parlay card, McCain is back. Sen. John McCain is taking another swing at banning Nevada casinos from taking bets on college sports. The Arizona Republican reintroduced a bill Tuesday that would strip Nevada casinos of their legal right to take bets on college games. McCain has tried twice before, but his legislation has never made it to the Senate floor. "By allowing betting in any state, we send a confusing message to our youth as to whether gambling on amateur sports is, in fact, legal or illegal," McCain said. Doug Abrahms, Reno Gazette-Journal, 5-7-03 |
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