The Casino Industry
Case Study By:
❖ Executive Summary
❖ Analysis Section (SWOT)
❖ Alternative Identification
There is very wide range of legal gaming / gambling across the globe. This includes various games of chance and gambling forms ranging from casino and card room gaming, lotteries, online gaming, race and sports wagering and charitable gaming, such as raffles, bingo and other low technology games. Legalized gambling has become more prevalent over the last 25 years as more jurisdictions take advantage of the revenue sources from the taxation and regulated gambling industries. Over this time many governments have allowed for the expansion of legal gambling, including casinos, or introduced regulatory regimes over existing gambling. The United States has approximately 845 casinos operating in at least 30 jurisdictions. Casino ownership in the United States is a mix of commercial and tribal ownership. In 2003, more than $800 billion was wagered at casinos in the United States. In particular, there has been a rapid growth in riverboat and tribal casino gaming over the last ten years. Collectively, tribal casinos took in $25.7 billion in revenue in 2006, compared with Nevada’s revenues of $12.06 billion for the same year.
Since Bugsy Siegel opened the first modern day casino in 1946, it has been an on-going competition to see who can build the most expensive and extravagant casino resorts in the United States. The money that is being spent on the casino resorts is made possible by the steady growth in gaming revenues. MGM Mirage is currently constructing a $7 billion building, City Center, which is expected to become the “hub of Las Vegas.” It is already becoming known as the most expensive privately financed project in American history. With many of the older casino resorts in Las Vegas being demolished, several more projects are being started to fill those vacancies. You might wonder if the amount of money being spent on the new casino resorts is worth it, but in order to survive in this industry, you need to be able to offer the best of the best to the casino consumer. In 2006, Las Vegas attracted about 39 million visitors which is a 10 million increase sine 1996. With the already high occupancy rates at the Las Vegas casino resorts and the high numbers of overnight casino gamblers, there is still room for expansion.
2,500 miles away, on the east coast, lies the United States second largest casino gaming location. In 1976, gambling was legalized in Atlantic City, New Jersey. Much like Las Vegas, Atlantic City has experienced spectacular growth in casino gaming revenues. While Atlantic City can’t compete with Las Vegas in many aspects such as the broad range of dining, shopping, and entertainment choices, it does offer its own advantages. Atlantic City officials have pointed out that one-quarter of the United State’s population lives close enough so that they can get to the city on just one tank of gas. Currently, Atlantic City has only 12 casinos and still manages to show a $5.3 billion casino revenue. This shows the strength of Atlantic City’s business strategy. Las Vegas has 190 casinos and is only bringing in about $1 billion more each year. The largest hotel in Atlantic City has 2,002 rooms while the largest in Las Vegas, the MGM Grand, has 5,035 rooms; yet the difference in total visitors only 5 million each year, in favor of Las Vegas.
Atlantic City and Las Vegas may get most of the attention when it comes to the casino industry, but there are other major sectors of the casino industry in the United States. The greatest growth has come in the form of waterborne casinos which are operating in 6 states. About 70 waterfront casinos are currently in operation, averaging almost $11 billion in revenues. The number of Native American casinos is on the rise, and 70% of the growth in United States gaming...
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