Slot makers discounting prices
LAS VEGAS – Slot machine manufacturers are discounting prices and pinning hopes on new kinds of revenue while casinos hold back on spending to update their floors, a casino industry analyst said last week.
Robin Farley of financial firm UBS told investors that casino revenues have gotten more stable but casinos haven’t boosted spending on the popular gambling devices.
Farley said a possible big order for WMS Industries Inc. machines could influence purchases by other casinos.
Slot machine makers and other suppliers to the gambling industry were in Las Vegas for the industry’s largest conference, the Global Gaming Expo.
As they demonstrated new titles and technologies to prospective buyers, executives for slot machine makers say their market has changed because casino expansion that was the norm for some 20 years is severely limited today.
“It’s not an expansion market anymore. It’s a replacement market,” WMS President Orrin Edidin told The Associated Press. “This is a tough sell because they’re looking at our offers and saying, ‘Where’s the value add that compels me to need to buy this now, or can I wait?'”
Edidin said it’s up to slot makers to convince operators that buying their machines will lead to gamblers dropping more money inside. WMS, for example, has been touting that machines in five casinos today that use its portal applications to customize and change games generate 35 percent more money wagered than the same machines without the applications.
Eric Tom, chief operating officer of Reno-based International Game Technology, said manufacturers are focusing on having fewer titles that prove to be more popular.
IGT has been trying to develop slot machines that cater to players that don’t typically play them, including young gamblers, middle-aged men and gamblers who like a lot of action, Tom said.
Farley said most manufacturers have plans in place for how they will react if online gambling is fully legalized in the United States.
But that’s not the case yet even though there are bills making their way through Congress.