NEVADA FOCUS: Las Vegas’ biggest trade show hurt by tech
LAS VEGAS – Sky-high hotel room rates, traffic snarls around the convention center and jammed cell phones are the norm in November when Las Vegas’ largest trade show comes to town. But this year’s Comdex delegates will find a different convention and a changed Las Vegas when they arrive for the weeklong electronics show.
A technology industry slump and Sept. 11 jitters mean the world’s biggest computer show will be a compact version of itself when Comdex kicks off Sunday with Microsoft Corp. Chairman Bill Gates’ keynote address at the MGM Grand Garden Arena.
+Comdex+ organizer Key3Media expects 50,000 fewer attendees than in 2000 – at approximately 150,000 attendees it will be the smallest +Comdex+ crowd since the early 1990s.
Those fewer delegates – who have been asked to leave their laptop computers at home as part of increased security measures – will find fewer exhibits to visit and they’ll save steps in the convention hall, which is using about three-quarters of the space of past shows.
Outside the hall, fewer limousines will clog Las Vegas Boulevard, and conventioneers are likely to save more than 30 percent on their hotel bills in a city that has struggled since the terrorist attacks. No segment of the tourism-dependent city seems to have been spared.
At the Riviera hotel-casino, the “Crazy Girls” special +Comdex+ edition of the topless show that is added each year for the computer crowd that spends little time at the gambling tables has been canceled due to “budgetary cutbacks,” said John Neeland, resort spokesman.
“The whole town is different,” he said.
As many as 15,000 workers were laid off when tourism slumped badly in September and Las Vegas convention authorities, who rely on large trade shows to fill rooms during slow fall periods, were relieved when +Comdex+ organizers committed to bringing even a downsized version to town.
That’s despite the profile of the typical +Comdex+ delegate. Unlike most Las Vegas visitors, many attendees won’t even drop a single quarter in a slot machine or play a hand of blackjack.
Instead, they indulge in business dinners at gourmet restaurants and head to the neon city’s numerous strip clubs.
The Las Vegas Convention and Visitors Authority reported that +Comdex+ had an economic impact of $254 million – not counting gambling – on the city in 2000.
The 30 percent decrease in +Comdex+ attendees means the city stands to lose an estimated $52 million in nongambling revenue, the authority said.
“But it’s comparing apples to oranges because the tech industry isn’t what it was last year,” authority spokeswoman Erika Brandvik said.
While some big-name companies like Microsoft and Oracle say they are bringing the same number of representatives or more than in past years, attendance won’t approach the 1996 peak of 216,300 visitors. Last year’s show drew about 210,000.
Most companies, like handheld computer provider Handspring, say they will have fewer people on the trade show floor.
“Almost every company has reduced the number of people,” said Fred Rosen, Key3Media chief executive. “If a company sent 30 people in the past, now they are sending 20.
“Even we’re bringing fewer people.”
Only about 750,000 square feet of convention space – to be consolidated at the Las Vegas Convention Center – is expected to be taken by 2,000 vendors, compared with 1 million square feet and 2,300 vendors last year.
At Las Vegas Limousines, which has the second largest fleet – 168 – of limos in the city, +Comdex+ reservations are down about 20 percent, said Bobby Wong, assistant general manager.
“Scheduled charters are down a little bit,” he said. “This time last year we had a lot more requests.”
Nationwide convention business has faltered since Sept. 11 amid concerns about travel, security and anthrax. And +Comdex+ was shaping up to be a challenge before the terrorist attacks, as a downdraft in the technology industry forced companies to slash travel budgets, organizers said.
“There’s been consolidation in the industry combined with softening in the economy,” said Michael Gasta, vice president of sales for Park Place Entertainment Corp. “There’s less people being sent to trade shows because they (companies) are trimming the fat. Post Sept. 11, everything got magnified and now even less people are attending large trade shows.”
A National Business Travel Association survey after the Sept. 11 attacks found that 58 percent of corporations expected to reduce travel.
”+Comdex+ is reflective of the economy,” Rosen said. “This is the technology event in North America. If the whole industry is healthy we do great, if not, we reflect how the industry performs.”
Hotel-casinos normally charge some of their highest rates during the trade show that in past years left a “No Vacancy” sign on the city’s 125,000 rooms.
Fewer +Comdex+ attendees mean hotel room rates have been slashed, resort operators said.
A survey conducted by Wall Street’s Bear Stearns Co. shows room rates on the Las Vegas Strip are going for an average of $119 per night on Nov. 14 – down 36 percent from the same time last year.
Only four hotel-casinos are quoting rates higher than last year’s, while others are down 50 percent or more, the survey said.
“It might be a little less stressful to find accommodations for +Comdex+-goers this year, but it’s not going to be a ghost town,” Brandvik said.
The discounts mean fall’s mega trade shows like +Comdex+ and the automotive aftermarket’s Specialty Equipment Market Association won’t put resort operators in the black, but the conventions help build midweek numbers that have continued to lag since September.
“If we didn’t have +Comdex+ and SEMA, we would be digging out deeper,” said Gasta of Park Place, which owns five Strip hotel-casinos. “Even at a discounted rate, it’s a hell of a base.”
Rooms at resorts owned by MGM Mirage, the biggest hotel-casino operator on the Las Vegas Strip, are nearly sold out for +Comdex+, though at lower rates than in the past, spokesman Alan Feldman said.
“But they will still be among the highest rates we’ve seen midweek since Sept. 11,” he said. “The shows are crucial to us, never more so than now.”