#M-11-1 #BELENOVA #LEONT’EV OF BARRIERS C A S I N O BARRIERS OF MARKET MARKET THE THE THE ANALYSIS FOR THE ENTRY AND EXIT
Aug 17, 2014
#M-11-1#BELENOVA
#LEONT’EV
OFBARRIERS
C A S I N OBARRIERS
OF
MARKETMARKET
THETHETHE ANALYSIS
FOR THEENTRY AND EXIT
THE TOP CASINOS IN LAS VEGASTHE TOP CASINOS IN LAS VEGAS
THE BELLAGIOMANDALAY BAY RESORT & CASINOTHE MGM GRANDCAESARS PALACETHE LUXOR HOTEL & CASINO
INTRODUCTIONINTRODUCTION
T
R
M
T
RANSPARENT (?)
EGULATED
ONITORED
AXED
INTRODUCTIONINTRODUCTION
> NYSE / NASDAQ > TAX: 6,75% - 55% > ITS OWN BUSINESS CYCLE > A VERSION OF IRRATIONAL EXUBERANCE
88NON-STRATEGIC!
!
BARRIERS
!
!
BARRIERS
> MARKET CAPACITY
CAPITAL REQUIREMENTS <
CRIMINALITY <
> ABSOLUTE COST ADVANTAGE
RELATIVE COST ADVANTAGE <
> ADMINISTRATIVE BARRIERS [GOVERNMENT REGULATIONS]
MARKET INFRASTRUCTURE <
> QUALITY OF GOODS & REPUTATION OF A FIRM
LICENSING PROCESSUPFRONT CAPITAL COSTS
DESIGN DEVELOPMENT CONSTRUCTION
HIGH LEVEL OF TAXATION
NON-STRATEGIC BARRIERSNON-STRATEGIC BARRIERS
CITYCENTER - $8,5 BILLION
CONSTRUCTION
CAPITAL REQUIREMENTSCAPITAL REQUIREMENTS
TECHNOLOGICAL INNOVATIONS
GAMING EQUIPMENT
WYNN ENCORE - $2,5 BILLIONRED ROCK- $1 BILLION
OR JUST LAND - $1,2 BILLION
ADMINISTRATIVE BARRIERSADMINISTRATIVE BARRIERS
> LICENSING PROCESS > NEVADA GAMING COMMISSION > STATE GAMING CONTROL BOARD > AGA: AMERICAN GAMING ASSOCIATION > NRS: NATIONAL REGULATORY SERVICES > TYPES: RESTRICTED & NON-RESTRICTED
> LICENSING PROCESS > NEVADA GAMING COMMISSION > STATE GAMING CONTROL BOARD > AGA: AMERICAN GAMING ASSOCIATION > NRS: NATIONAL REGULATORY SERVICES > TYPES: RESTRICTED & NON-RESTRICTED
55STRATEGIC!
!
BARRIERS
!
!
BARRIERS
> LIMIT PRICING
EXCESS CAPACITY <
> PRODUCT DIFFERENTIATION
LONG-TERM CONTRACTS: < SUPPLIERS & CUSTOMERS
> REPUTATION OF ‘TOUGH’ COMPETITOR
CULTURAL LANDMARK
STRATEGIC BARRIERS
PRODUCT DIFFERENTIATION
THE KILLING (OFF)
$100,000 ENTERTAINMENT EVENTS
$50,000
STRATEGIC BARRIERS
COMMENTS
WELCOME
AND
ARE
QUESTIONS