G2E 2011: MGM boss sees future in Asia
MGM Resorts International may be one of the Strip’s dominant casino operators, but the company’s future growth is tied to two areas — Asia and the Internet.
Chairman and Chief Executive Officer Jim Murren told an audience at the Global Gaming Expo on Wednesday that the company is prepared to expand in both markets.
MGM Resorts already operates one casino in Macau and has plans on the drawing board for a second resort. Also, Murren expects "two or three" new major gaming markets to open in Asia in coming years, and his company "will be there."
Meanwhile, he said MGM Resorts will soon announce a new division that will push the casino operator even further into the social media realm. Murren likened the new business to "MGM Resorts meets Zynga," the creator of FarmVille, CityVille, and other popular games played on Facebook.
The move could prepare MGM Resorts for a push into Internet gaming.
The company, which in 2001 operated a short-lived Internet gaming site licensed by the Isle of Man, favors passage of federal Internet poker legislation.
"The resort-based gaming industry should not be intimidated, nor will it be affected by Internet poker," Murren said during the G2E keynote address at Sands Expo and Convention Center. "I’m not naive (to think) that it could impact some smaller markets in the U.S. But the time for action is now on Internet poker."
Murren’s address was in the same G2E platform used a year ago by Caesars Entertainment Corp. Chairman Gary Loveman, who told industry leaders they needed to work more closely together.
Murren used the hourlong discussion to tout MGM Resorts’ newest initiatives, but also to boost the gaming industry’s spirits.
"Wall Street doesn’t realize how better off companies are today," said Murren, a former financial analyst.
He said the markets value MGM Resorts at "where it was three years ago," which doesn’t present a true picture of the company,
Murren said MGM Resorts, through its M Life customer reward program launched last year, is drawing more customers through social media. He discussed how the company uses Twitter to attract customers to special events.
"We’re investing a great deal into social media," Murren said.
MGM Resorts has 10 Strip properties, including the MGM Grand, Bellagio and CityCenter’s Aria. But the company’s future expansion is in Asia.
The company is opening a nongaming luxury hotel in China later this year under the MGM Grand brand, and has other nongaming properties in development. MGM Resorts is also developing a hotel-casino project in Vietnam.
In Macau, MGM Resorts is completing plans for a hotel-casino on the Cotai Strip, and is awaiting is the go-ahead from the Macau government.
"It will be one of our brands," Murren said.
Murren said he remains bullish on Las Vegas, but added that the market is changing.
The percentage of the company’s revenues from gaming has decreased from 54 percent in 2000 to 30 percent in 2010. But the amount of gaming revenues has increased. Customers are spending more on nongaming amenities, such as food and beverage, and that will continue to grow.
Las Vegas, Murren said, remains the nation’s No. 1 convention destination.
"In Las Vegas were a person," he said, "it would quote Mark Twain: ’Reports of my death are greatly exaggerated.’ ”
Contact reporter Howard Stutz at hstutz@reviewjournal.com or 702-477-3871. Follow @howardstutz on Twitter.
