Pop goes the expo: Celebrity and cinema dominate G2E

Gaming analysts were turned into film critics during last month’s Global Gaming Expo.

Knowledge of the entertainment industry was a required tool when visiting the booths of the major slot machine manufacturers inside the Sands Expo and Convention Center.

You also needed to avoid the roaming zombies from Aristocrat Technologies and the Na’vi warriors patrolling the International Game Technology space.

Credit Suisse gaming analyst Joel Simkins told investors in a post-G2E report the show had the “most licensed premium content available for the participation segment we have seen in some time.”

It also didn’t come cheap.

Securing branded content from feature films (“Avatar,” “Bridesmaids,” “Back to the Future,” “Beetlejuice,” “Flashdance,” “Titanic”); television (“Batman,” “True Blood,” “The Walking Dead”); and entertainment (The Rolling Stones, David Copperfield, ZZ Top ) comes with a hefty price.

“Some vendors are mindful of the costs to secure branded content,” Simkins said. “We are surprised that suppliers remain so heavily skewed to this segment. Shelf space isn’t growing in this segment and operators continue to prune games where they can. Keep in mind that the ‘batting average’ in this segment tends to be very low.”

Every analyst had a different opinion on which manufacturer had G2E’s biggest “wow” factor.

Bally Technologies topped many lists. The company unveiled new games based on “Titanic,” magician David Copperfield, and recording artists ZZ Top. Bally also previewed updated games based on previously-released titles: Michael Jackson, NASCAR and “Grease.”

“Overall, we thought Bally had a strong G2E presence including three new licensed wide-area progressive games, two new game platforms, and several systems advancements that allow for further connectivity and a single view of the casino’s customer,” Eilers Research principal Todd Eilers told investors.

Bally’s management is hopeful “The Magic of David Copperfield” has worldwide reach. The illusionist, who appears regularly at the MGM Grand, spent a few hours at Bally’s G2E booth on the show’s opening day to meet with attendees and casino executives who make decisions on buying slot machines.

Copperfield turned into Bally’s best salesman.

“It’s like watching my career appear before my eyes while you vibrate in the chair and get a massage,” Copperfield said. “These people do an excellent job.”

The game, which is expected to be on casino floors early next year, has bonus features based on Copperfield’s magic, including the “death saw” and levitation. Players sit in surround-sound chairs and the game offers video clips of Copperfield’s 30 years in show business.

The magician said Bally’s work on the “Michael Jackson: King of Pop” slot machines gave him confidence the designers would keep with the theme of his performances.

“I was happy with what they did with Michael’s brand,” Copperfield said. “I put my trust in them and they delivered.”

Game content may be king, but Bally also impressed analysts with a new slot machine cabinet it plans to launch in December. Brean Capital gaming analyst Justin Sebastiano said the casino operators might be willing to bite the bullet on the somewhat expensive cabinet.

“Slot managers have said that they are willing to purchase the premium-priced cabinet because it can play almost all Bally content, which makes the investment worthwhile,” Sebastiano said.

Attention was also directed toward IGT. The company began G2E with a new logo and brand identity launch. It followed with announcements that it sold 7,000 video poker machines to Caesars Entertainment Corp. and reached a new slot machine system and MegaJackpot deal with Station Casinos.

IGT also hijacked the media’s attention with the unveiling of two games based on “Avatar,” the highest-grossing feature film ever.

Deutsche Bank gaming analyst Carlo Santarelli said IGT showed “a meaningful improvement” in content and innovation.

“But with operator sensitivity to participation product and no tangible signs of replacement demand acceleration, we’re not sure it matters greatly,” Santarelli said.

Midsize and smaller slot machine makers — including MultiMedia Games, Spielo, Konami Gaming and Aristocrat Technologies — also wowed G2E attendees with innovative games and content. Analysts said continued success by smaller companies will fragment the market.

Macquarie Securities gaming analyst Chad Beynon wasn’t sure all the G2E flash was enough to spur sales.

He said American Indian casinos will continue to drive slot machine replacement sales, “particularly with mediocre commercial regional gaming trends.”

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