Gambling

MGM Says Macau Foreigner-Only Gaming Zone Plan Was a Clunker

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Posted on: March 18, 2024, 07:42h. 

Last updated on: March 18, 2024, 07:42h.

Efforts to introduce foreigner-only gaming zones at Macau casinos have fallen flat with international gamblers, according to MGM Resorts CEO and president Bill Hornbuckle.

Bill Hornbuckle, MGM Resorts, Macau, foreigner-only, gaming zones
MGM CEO and president Bill Hornbuckle, above, says RFID systems are the best way to track the gambling habits of foreign tourists, and this is why Macau casino operators are adopting the technology. (Image: Bloomberg)

As first reported by Inside Asian Gaming, Hornbuckle said that the experiment, which was encouraged by Macau’s government in December 2022, simply didn’t work. The MGM Resorts boss was speaking Friday at the JP Morgan Gaming, Lodging, Restaurant & Leisure Management Access Forum in Las Vegas.

The zoning system was part of Macau’s push to increase the number of foreign tourists in the gambling hub, as opposed to visitors from the Chinese mainland, Hong Kong, and Taiwan.

At the time, Macau was entering its first retendering process for casino licensees, which was an opportunity to overhaul its gaming regulations for the first time in 20 years.

‘They Didn’t Like It’

It was hoped the introduction of foreigner-only gaming zones would aid the implementation of a new tax system. Operators now receive a waiver of up to 5% of the 40% the government collects on gross gaming revenues for attracting a quota of foreign visitors.

Special gaming chips within the zones would allow auditors to track the amount of money being gambled by foreign visitors – at least that was the plan.

The foreigners didn’t bite, according to Hornbuckle. The zones were not compulsory, meaning that overseas visitors could gamble on the main gaming floor if they wished. It was up to operators to encourage them to use the zones.

“When the new regs. came out and the marketplace was asking for international business outside of Greater China … the only way to track that effectively, because it was a different tax bracket, was to put [foreign visitors] in independent private rooms. That means everyone from Thailand has to go over to a little room and gamble,” Hornbuckle explained.

“They didn’t like it,” he said, adding that no one wants to be “isolated and told where to go.”

RFID the Answer

Hornbuckle said that MGM’s decision to invest in radio-frequency identification (RFID) chip technology for its Macau properties meant that foreign players’ chips could still be tracked without the need to segregate players.

This is, in part, why Galaxy Entertainment and Melco Resorts & Entertainment have recently announced they intend to introduce RFID technology to their table games.

In pre-pandemic 2019, 91% of visitors to Macau were from mainland China, Hong Kong, and Taiwan. Just 3.58% of gaming revenues in the casino hub were estimated to have been generated by foreign tourists.

China’s government has long requested that Macau diversify its tourism sector by attracting foreign visitors and building more non-gambling amenities. Operators were required to pledge billions towards this vision as a condition of their new licenses.

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