Likening the casino industry to the home
improvement industry, Michael Pollock recently said that Atlantic City was
to Home Depot, what "racinos" in neighboring states are to
mom-and-pop hardware stores. Pollock, a long-time casino industry analyst,
likes to makes seemingly off-the-wall analogies between casinos and
otherwise completely unrelated business models. It's part of what
sets his trade newsletter, Gaming Industry
Observer, apart from the dry, lifeless writing
style usually associated with trade publications.
Pollock was the moderator of a panel discussion last
Friday, Feb. 20, that considered topics related to the gaming industry in
Atlantic City. The Economic Impact Symposium may have been more aptly
titled "Reacting to Competition from Within and Without" since
all of the speakers focused on how Atlantic City casinos must deal with
competition from each other, from within the state (threats of video
lottery terminals, or VLTs, at New Jersey racetracks), from neighboring
states that currently offer casino gaming, from nearby states that will
authorize it in the next few years and even from casino operators overseas
and in cyberspace.
The panel was kicked off by opening remarks from
Atlantic County Executive Dennis Levinson, who reminded those in attendance
that a State Senate panel was to meet on Monday, Feb. 23 to discuss the VLT
issue. The result of that panel is a likely agreement that would have the
casino industry subsidizing the horseracing industry to the tune of $2
million per month for the next fours years in exchange for the promise that
the letters VLT won't be uttered in the statehouse until 2008.
Levinson included VLTs in the internal competition
category when he said, "The competition from without, we can't
do anything about - the competition from within we must do something
about."
Dr. Richard Perniciaro, an expert on regional economic
issues, outlined the competition facing Atlantic City, updating the
symposium's attendees on the status of gaming initiatives in the
legislatures of nearby states. In closing, Perniciaro asked, "What do
you do in the face of competition?" He answered by showing a slide of
baseball star Alex Rodriguez in his new Yankee uniform and saying,
"You get better, like [Yankees owner] George Steinbrenner likes to
do." Then, showing a slide of Donald Trump saying,
"you're fired" (like he does each week on his hit TV show
The Apprentice),
Perniciaro said, "Or, you're out."
Following Perniciaro were Pollock; gaming analysts Eric
Hausler; Showboat General Manager Michael Walsh; Howard Kyle, Chief of
Staff to the Atlantic County Executive; Mac Seelig, President of ACCoin
& Slot; and Atlantic City Planning Director Keith Mills. All of the
panelists offered interesting insights and exhibited a strong feel for what
the industry must do to overcome building competition.
Atlantic City is now like Home Depot a
"category killer" in our regional market, says Pollock. And
"category killers will continue to succeed if capital investments
continue," he adds.
But that's the big "if" in question.
Whether the casino industry continues to invest in
Atlantic City won't depend so much on whether gaming is
legalized in Pennsylvania or New York, but on how stable the investment
climate is in New Jersey. That, of course, will be largely dependent upon
the VLT and tax issues. Thankfully, Governor McGreevey has recently been
making every effort to work with the casino industry, unlike last year.
What a difference a year makes.
We're all ears ...
Go to acweekly.com/feedback to share your thoughts. A form on that page will facilitate your comments. Send e-mail to editor@acweekly.com or send faxes to 646-7338. Snail mail is still an option:
Attn: Editor
Atlantic City Weekly
P.O. Box 1293
Pleasantville, NJ 08232
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