Millions of People Go To Las Vegas Every Year Because It Has So Much More

A small and relatively insignificant news item caught my eye recently. In the report, the Golden Nugget Casino in Lake Charles, Louisiana is postponing its opening for nearly six months. I don’t really understand the reason, but in part it was due to Louisiana’s regulatory requirements. The Nugget wanted to change the conditions of its license for the amenities it would provide and needed the Louisiana Gaming Control Board’s approval. The Nugget wanted to add hotel rooms instead of providing croquet, tennis and boating facilities. What? You have to be kidding me! What part of gaming regulation is croquet, tennis, boats or hotel rooms for that matter?

The opening of the highly anticipated Golden Nugget Casino in Lake Charles may not come until December 2014 after the Louisiana Gaming Control Board approved a condition modification on Thursday. The decision allows the casino to move the project completion date from July 12 to on or before Dec. 30. The board also approved the Golden Nugget changing conditions in the license for the amenities it would provide. Instead of a croquet area, tennis courts and pleasure docking, Golden Nugget will replace that with an increase of rooms from 700-720, which will change the percentage of mix from VIP and guest rooms. Golden Nugget also plans to build its own clubhouse for the golf course. Gerron Jordan, KPLC-TV, 6-20-14

What is and what is not the proper subject of gaming regulation has been a very important part of the expansion of gaming. As gaming expanded around the country, most jurisdictions wanted more and better regulation than they saw in Nevada. They said, “We don’t want another Las Vegas in our state!” So instead copying Nevada, states promulgated very lengthy and detailed regulations covering everything imaginable, including croquet, hotel rooms, the number of slot machines and even how many table games a supervisor could supervise. In the end they got exactly what the asked for, but not a bit more.

That “not a bit more” can be very important – just ask the good people of New Jersey. Atlantic City’s grand casino experiment is failing, and it is failing as much for what the city is and is not as it is from the competition in neighboring states. The casinos in Atlantic City are exactly what the regulators wanted, but nothing more. And that means that Atlantic City casinos are just boxes, exactly like the casino boxes in other jurisdictions. So when citizens of those other jurisdictions ask themselves, before leaving home in Pennsylvania, Ohio, New York, Massachusetts, Maryland, Connecticut or wherever they call home to go to Atlantic City, they ask “Why go all that way if our local casinos are the same as Atlantic City’s casinos?” They answer the question by staying home.

The people who have chosen to stay home in the last six years have caused the revenues in Atlantic City to drop by nearly 50 percent. The impact on Atlantic City has been disastrous, but there is more to the story. The last of Atlantic City’s grand casino ventures, Revel, is in bankruptcy for the second time in two years. There are many reasons for Revel’s troubles. It cost too much to build and it opened during the Great Recession. Revel caught the full force of the wave of competition as the casinos in Pennsylvania were making themselves felt on the Boardwalk and the original management’s strategy was terribly flawed. As significant as all of those factors are, they are not the real reason Revel is a failure. Revel is a failure because all of the casinos in Atlantic City are exactly what regulators wanted and nothing more.

What was supposed to be the crown jewel in Atlantic City’s glittering gaming empire is in danger of becoming its biggest failure. A mere 26 months after its opening, the $2.4 billion Revel Casino Hotel stands on the brink of shutting down after its employees were notified that the sprawling adult playpen could close before the end of the summer if a buyer is not found… But Revel has been on the market virtually since it opened amid great fanfare in April 2012, and serious suitors have been few and far between. The Seminole Indian tribe of South Florida, which has hit the jackpot with its chain of Hard Rock Cafe-themed casino-hotels, has been prominently mentioned as a possible buyer, but has balked at the price tag, reportedly in the $300 million range… Revel seemed doomed after casinos became legal in Pennsylvania and other nearby states, and after the crippling recession. It didn’t help that the original management team decided to forego such standard casino strategies as having a multitiered reward-card system, private high-roller lounge, a buffet and smoking. Chuck Darrow, Philadelphia Daily News, 6-20-14

In contrast, Las Vegas is in recovery. Genting is planning a billion dollar project, SLS is opening in a month, Caesars has opened the world’s tallest observation wheel and a $500 million outdoor mall. And the city just hosted the largest music festival in North America. None of those things could have happened in any of those jurisdictions which regulated everything and got exactly what they required and nothing more. Las Vegas got more, lots more. Nevada gaming regulation regulates gambling, not hotel rooms or croquet. Nevada gives casinos a broad guideline as the minimum standard casinos must meet, each in its own way. Nevada does not allow its casinos to do anything that would cause harm to the industry or damage the reputation of the state. Because of Nevada’s broad guidelines, casinos are free to build as many rooms as the market or the budget will bear. The management can opt to spend $100 million on a swimming pool, a night club or a thrill ride. The result is more – much, much more and that more will bring 40 million people to visit Las Vegas this year. Those people will come from every country in the world and every state in the nation. People will continue to come to Las Vegas. They have casinos at home, but Las Vegas offers so much more. Billions and billions of dollars have been invested on the Strip in Las Vegas. Each resort is different from the others and each is much more than a gambling hall, a casino. Unlike casinos in Atlantic City, Detroit or New Orleans, the resorts in Las Vegas are vast true destination resorts. They have a dazzling array of amenities, products, services and things to do and see. Las Vegas is the product of entrepreneurial spirit and imagination, not a casino district built to conform with regulatory control and limitations.

Electronic dance music fanatics will just be ending their nightlong rage and starting their trek home for bed from the 2014 Electric Daisy Carnival at Las Vegas Motor Speedway as morning-shift workers wake for breakfast and prepare for a hard days work. The sun comes up as dawn breaks for two very different groups headed in opposite directions…. It’s time again for the largest multi-day music festival in North America with a total of 400,000 fans (or, more accurately, the total attendance) expected this weekend. Robin Leach, Las Vegas Sun, 6-20-14

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