December 16, 2015—Junket operators and promoters are changing careers in Macau’s troubled market. Many junket promoters are starting to buy up casinos or at least invest in casinos to offset the losses sustained in Macau due to the VIP crackdown. VIP revenue has been following the entire year and last year, after Mainland China started their new protocols against junket operations. The reaction of promoters becoming casino owners is thought to be a reaction to a change in coming revenue. Macau will open the first casino with no VIP gaming.
The change is a natural evolution in the casino business. Macau started with numerous VIP rooms, which were mini-casinos. Now the industry is moving to bigger casinos to get more action from all gamblers, not just VIPs. The December issue, Inside Asian Gaming, examines how junket operators are starting to turn towards ownership of casinos.
These operators have not given up on their junket business. Rather, many have moved to the Philippines, while the turmoil in Macau continues. The issue also stated the studies were conducted on Jimei Group, Hengsheng Group and Suncity. An interview with Alvin Chau, who is the biggest player in junket operations, stated he is moving into casino ownership.
Ricardo Siu, who researched junket operations and casino revenue, states junkets can make more money with VIPs than casinos. However, with the slowdown of VIPs heading to Macau it is natural that junket operators have to look for new revenue. Certainly, money can be made when it is able to come to Macau, but for now VIPs are staying away.
It is wise, according to Tony Tong, to diversify. It is possible junket operators will lose more customers if casinos are not willing to cater to them because the casinos need to protect themselves against new laws.