hat can you tell us about your experience at the 2015 SAGSE exhibition that took place a few weeks ago?
It was exciting for us to be part of this edition of SAGSE. We had great feedback from our customers, who had the chance to see our latest products. We are eager to partner with the casino operators in Latin America, delivering great product for them to engage players.
One of the reasons I decided to attend the exhibition in Buenos Aires was because I wanted to know what people had to say about the future of Argentina. From what I've heard, everyone feels that better days are ahead. I hope it comes true, not only for the gambling industry but for Argentina itself.
At the G2E CEO Roundtable Mr Mark Frissora said that there was a lack of innovation in casino games. What are your thoughts on this?
As everyone knows, the hot topic these days is skill-based gaming, for which regulations are still being formed. We will see more and more innovation in that area over time. We have seen some significant innovations in the industry in the last few years, particularly if you look at the line of cabinets produced by Aristocrat. Our Arc Double, Behemoth, Helix and Verve have really modernized the gaming floor and have created more innovative, immersive experiences for players.
I think the discussion around innovation, is really more about the operators and manufacturers finding ways to better engage with millennial players. Millennials have become increasingly important to casino operators, particularly those that run integrated resorts in Las Vegas. The dynamics in Las Vegas within the last decade have changed. Non-gaming and gaming revenue have flipped. Years ago, 70 percent of casino revenue came from gaming, whereas 30 percent came from non-gaming. Now, it's the other way round. And, Las Vegas has seen the average visitor age decrease so there is a great desire to find gaming product that appeals to millennials. For millennials, there's a lot more to do in Vegas than there ever was before: nightclubs, dayclubs, restaurants, shows, shopping. We are competing for millennial attention with the non-gaming amenities, so the challenge is to make gaming more attractive to them and better compete for their attention and dollar. I'm not against non-gaming attractions in Vegas, I believe they represent great opportunities to drive more people to Nevada. As manufacturers, though, we need to develop products that appeal to these types of players whether it is creating more socially immersive experiences or skill-based games. That being said, there is strong content out there that appeals to younger players. Aristocrat has taken a lead in this space creating content that appeals to a broad swath of players, particularly younger entertainment-seekers. Our licensed themes like Britney Spears, Game of Thrones, The Big Bang Theory, Sons of Anarchy, Ted and many more appeal to a millennial audience who enjoy these brands and want to interact with them on the gaming floor.
Are you taking into account the skill-based element when designing your products?
We're looking closely at skill-based gaming. We have some product ideas, and we've been working with regulators in Nevada to help craft regulations that provide us with the flexibility to develop our products. Although we're focused on the markets we're currently serving, skill-based games are a part of our thinking.
When asked about mergers and acquisitions in the industry, Pierce noted: “VGT was our most recent acquisition and it has delivered in line with our expectations and commitments. The acquisition brought together complementary businesses with aligned cultures and a shared focus on great games and outstanding customer service.
As you would expect, we continuously evaluate potential acquisition opportunities that could create value for our customers and shareholders. We evaluate each potential opportunity against a strict investment criteria and we will only execute on a transaction which we believe has a strong and defensible strategic rationale and plan for integration.”