Today, Macau’s satellite casinos are shutting down or completely disappearing from the gaming tables because they no longer attract players, while they were previously considered a touristic attraction.
Problems on many fronts:
Much of Macau’s satellite casinos are facing problems on many fronts, such as outdated facilities, reduced spending, lower wagering amounts and difficulty luring young players, according to industry insiders.
Casinos like these are mostly visited by local communities, given the location of a large proportion of satellite casinos on the Macau Peninsula, particularly in residential regions compared to other, bigger entertainment venues.
In this regard, Billy Song, president of the Macau Responsible Gaming Association, confirms that “the satellite casinos are not attractive for investment anymore, as the casino’s operators are not planning to inject more into renewing these facilities during the three-year transition period.”
Promotional plans for business improvement:
“There will be different results in different properties but that the decline is a reality in the industry. To try and mitigate this, some satellite casino operators have launched promotional plans to boost their business, even if they do not use so many sources to lure clients, some strategies can have high ROI,” according to Song’s optimistic view.
He emphasized: “But, the hardware is their disadvantage, so they need to strengthen their service quality to draw some traffic.”
Satellite casino operators don’t want to renovate existing facilities:
Looking back at time when he observed the situation, Song said that “existing satellite casino operators are not willing to renew their facilities, as the contract to share the profit is short.”
As Macau has a total of 30 local casinos, 11 gaming facilities are satellite casinos that continue to work under the new 10-year gaming concessions at the beginning of 2023. In addition, 9 of the 11 satellite casinos are under SJM Holdings Ltd’s license, one is under Galaxy Entertainment Group Ltd’s permit and one is under Melco Resorts and Entertainment’s license.
Furthermore, according to Macau’s new gaming law “satellite venues have three years to transition to a management company, where such an entity will not be allowed to share in the gaming revenue, but only receive a management fee from a concessionaire.”
However, seven satellite casinos halted their operations in Macau in 2022. That was before the Legislative Assembly validated the new gaming law legislation.
Although the government has changed its starting idea, which gives three years to operators to keep the old satellite casino regime, there are frequent cases that some operators simply decide to give up. Such a case is the former satellite casino Million Dragon Hotel. It is reportedly planning to shut down the hotel and become a residence for City University of Macau students.
Another example is another hotel, owned by the same owner Chan Meng Kam, China Dragon Hotel, which was turned into a student dormitory in August 2022, as reported by AGB.
Still, experts have long supported the official closure of Macau’s satellite casinos, which are far smaller in scale, opulence and offerings than the billion-dollar integrated resorts. However, by all accounts, satellite casinos, much like junkets, are likely to become one more thing that will go down in history in the Macau gaming story that few will miss.
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