Alabama bound- update – from Biloxi

One of the major regional gaming trade shows, the Southern Gaming Summit, is being held in Biloxi, Mississippi this week.  Traditionally, the show has attracted the operators and vendors from Louisiana, Missouri, Mississippi, Indiana, Illinois, West Virginia and the Indian tribes that have casinos in the region; it has always clearly been a casino driven event.  But, this year, the Gaming Summit has a new addition, Bingo World is part of this year’s show.  In fact, judging by the stories surrounding the conference and bingo, it is close to being the most important element in the conference.  The newspapers in Alabama have more articles about the speakers, vendors and issues than the hometown Biloxi Sun-Herald has.

Like all gaming trade shows and conferences there are speakers from all parts of the industry talking about the issues, challenges and trends in the industry and  as is usually true the hot topic is the major factor impacting the industry currently; in Biloxi this week everyone is talking  and worrying about of the oil spill on the Coast’s economy and in particular the casinos.  And there is also the constant worry over hurricanes in the region, twice within in decade the Coast casinos suffered a direct hit by a major storm;  Biloxi had just about recovered from Katrina when the current economic storm hit it and now there is an oil slick lurking off the coast.

However, the real and constant threat to casinos in Mississippi is the same threat that faces the casinos in New Jersey, Illinois, Indiana, Nevada and the rest of the country – competition.  And that too is being discussed with much angst by casino operators in the region. The casinos in Mississippi have already had some bad news in April when Florida finally agreed to a compact with the Indian tribes in the state and at the same time authorized expansion of the existing non-Indian gaming in the state. Florida has been a traditional and major source of customers for Mississippi casinos.

The second and potentially largest competitive threat comes from Alabama; although slot machines are illegal in Alabama there are thousands of them, called bingo machines, in the state.  For months now the governor and attorney general have been trying to shut the bingo machines and the host bingo casinos down, the state legislature has been debating legislation that would authorize them and the courts have dealt will a variety of issues related to the issue. But in the meantime many of the “casinos” are still operating and taking business from Mississippi casinos and the threat of expanded gaming in Alabama is being taken seriously in Biloxi this week.

There is another side to the bingo machines, the manufacturers and they are not pleased with the current state of affairs; the bingo places not operating have caused some serious downsides to some of them; both Bally and Multimedia Games cited the loss of revenue from Alabama in their quarterly statements. Multimedia games lost participation revenue from nearly 2000 games – a number in its financial statement.

All of this fueled much of the debate in Biloxi, as one would suspect, the bingo guys are hoping for more “bingo” in Alabama and the casino guys are hoping for bingo to go the way of the dingo – away.


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May 2010
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