Slot makers face challenge: Casinos with less cash

AP News
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Posted: Nov 18, 2009 5:29 PM

Casinos are buying fewer slot machines than they have in a decade as they stretch their spending, a slot machine maker said Wednesday.

Nick Khin, Americas president for Aristocrat Technologies, Inc., said the four major slot makers combined sold fewer machines during the third quarter than during any period in the last decade.

"We're certainly not predicting a significant improvement in 2010," Khin said, citing consumers' anxiety. "The players that are coming to the casinos need to be a lot more secure than they currently (are) today, with regards to their employment and their income."

Khin spoke on a panel Wednesday at the Global Gaming Expo, a four-day industry conference in Las Vegas where the biggest slot makers _ including International Game Technology, Bally Technologies, Aristocrat and WMS Industries Inc. _ and many others in the industry showcase new games and products for casinos.

Keith Smith, another panel member and CEO of casino operator Boyd Gaming, said replacing slot machines, which cost more than $10,000 each, is more expensive than ever, and casinos must consider other elements to keep customers happy.

"One word: price," Smith said. "There's a finite amount of capital that can be reinvested in these operations. It has to be spread over a large square footage whether you're upgrading hotel rooms, restaurants slot floors or technology."

Khin said slots stay 25 years on a casino floor on average, and he doesn't think that will change anytime soon.

Rob Bone, vice president of marketing for WMS, told The Associated Press on Wednesday that getting casinos to buy new slot machines comes down to convincing them that new machines will make them more money.

"Our goal really is to show that when you focus on the player, and you focus on the people that ultimately ring the register, that's where you're going to get the biggest and most meaningful return," Bone said.

The three most important elements of a casino are cleanliness, a friendly staff and a variety of games, he said.

WMS has been pushing slot technology it hopes parallels how people interact with computers, including machines that remember individual players, save game status and display leaderboards across networks of machines.

But Smith said that as machine costs rise, they will stay on casino floors longer, and he doesn't expect that to change.

"Technology is important, player response is important _ what the players are looking for _ but at the end of the day, a lot of it's driven by the price of the machines."