Gaming Executives Discuss Industry Trends and Future Projects

Strategic Insights -

Terry Lanni, Chairman of MGM Mirage, and Gary Loveman, Chairman of Harrah's Entertainment, participated in a public discussion on a weekly public affairs program for KLVX-TV, Channel 10. The debate covered growth on the Strip, gaming expansion in Macau and Singapore, Internet gaming opportunities, and the impact of Gulf Coast hurricanes on their businesses. Both executives expressed optimism about Las Vegas' future.

Key Takeaways:

  • MGM Mirage's Project CityCenter development will cost between $5 billion and $6 billion, with Lanni saying it will be a major economic driver for Las Vegas.
  • Harrah's is considering various options for its properties along the east side of the Strip, including renovating Bally's without removing the entire hotel.
  • The Gulf Coast hurricanes caused significant damage to both Harrah's and MGM Mirage properties, with Beau Rivage in Biloxi, Mississippi estimated to require over a year to rebuild.
  • Harrah's will rebuild its Biloxi casino but is still evaluating whether to rebuild in Gulfport, Mississippi.
  • Lanni emphasized the need for gaming to be considered for federal hurricane relief.
  • Both executives agreed that the federal government should lift restrictions on Internet gaming and regulate the industry in the US.
  • Loveman stated that about 2,000 employees at Bally's have requested transfers, indicating the significant impact of the potential renovation.
  • MGM Mirage and Harrah's are both exploring opportunities in Macau and Singapore.

Statistics:

  • The estimated damage from Hurricane Katrina to Beau Rivage is $500 million.
  • The total damage to the region from the Gulf Coast hurricanes is estimated at $50 billion, with MGM Mirage's damage representing 1 percent of the loss.
  • About 70 percent of Internet casino customers are from the US.
  • The cost of MGM Mirage's Project CityCenter development will be up to $6 billion.

Sources:

  • "Nevada Week in Review," a weekly public affairs program for KLVX-TV, Channel 10
  • "Las Vegas Review-Journal" on http://www.lvrj.com
  • Knight Ridder/Tribune Business News