Gaming Revenue and Customers
In the past few years, these properties have been looking to increase revenue from hotel rooms, clubs, bars and restaurants. Gambling will always be a part of the Las Vegas casino experience, but it plays a different role than it used to. Today, revenue earned from gambling is on par with other segments of the casino-resorts.
During last week’s quarterly earnings call MGM Resorts discussed their focus on "high-margin” gamblers. These gamblers fall into two groups. The smaller group are high rollers, who risk so much money that wins and losses can swing revenue in a major way. The larger group are small to mid-level recreational players who are more interested in being entertained than finding the best value.
Casino Games
Casino operators have been looking for the right mix of gaming and non-gaming revenue for years. You may have noticed this if you've recently visited Las Vegas. The casino floor doesn't look the same as it used to. As of March 31, there were 5,663 total games in Nevada casinos. This is the lowest number since 1998 when there were 5,673.
Casinos throughout the state of Nevada aren’t all like you see in Las Vegas. Many of them don’t have table games like blackjack, poker, etc. So, looking at the number of table games in Nevada casinos may provide better insight. As of March 31, there were 693 table games in Nevada casinos. The last time we saw fewer table games in Nevada casinos was 2004 when there were only 589 games.
No matter which casino you visit, the majority of the casino floor is occupied by slot machines and, even though they are high-margin games, they’re also occupying less space than previous years. As of March 31, Non-Restricted casinos (16 or more slot machines) had 150,629 slot machines (this number includes video poker machines). The last time there were fewer slot machines in these casinos was 1993 when there were 149,653 slot machines.
Casino Layout
Over time the casinos in Las Vegas got larger. At first, the room was to make way for more gambling. More recently, much of the space devoted to table games and slot machines has been cleared to make way for more restaurants, non-gaming bars (GASP!) and nightclubs. Even space devoted to gambling might have space for people who just want to sit and drink. Maybe this customer will hit the tables or place a wager on a game but they can still enjoy the space.
Many casino floors in Las Vegas today are vastly different than 3 years ago, let alone 10 and 20 years ago. Casino operators aren’t in the business of losing money. Even with fewer games on casino floors today, they don’t necessarily want to make less revenue. Expect to see more tweaks to gaming rules in favor of the casino.
Gaming Odds
Blackjack that pays 6:5 instead of 3:2 was just the beginning. Last year Wynn dropped the odds in their craps games to a 2x max. A passline wager with 2x odds is still one of the better bets in the casino but the higher the "free odds" you can play the better the actual odds are for the player. Over time the relatively small house edge increase (0.00374 to 0.00572) will help casino operators generate more revenue.
Not all games in the casino today are worse. There are still better games to play in many casinos but you’ll have to search for them. Video poker machines with better pay tables or better blackjack rules may be available, but not necessarily easy to find. The games with a larger house edge are usually in the most desirable areas to play. Video poker at casino bars and blackjack dealt by dealers wearing next to nothing usually (not always) have worse rules for the gamblers.
If you haven't been to a Las Vegas casino in awhile, you may be in for some surprises. Many casinos are laid out differently and some have worse odds. The overall Las Vegas casino experience still can't be matched. The main difference is that everyone has something different to offer and you'll probably want to be selective where you spend money.
