Have you been to Harrah’s Casino in Tunica, Mississippi? If you’ve been you know it’s a pretty impressive property, even more so than some of the casinos in Las Vegas. You’ve got a spa, a shooting range, a golf course, and an impressive casino. The only thing it doesn’t have? Gamblers.
That’s not to say that the Blackjack tables are empty and the casino floor is a ghost town. But it’s getting there. Gambling revenue is declining and it shows at Harrah’s. The entire industry in Mississippi saw its revenue shrink from $1.2 billion back in 2006 to just $738 million last year.
On June 2nd, Caesars will close the Harrah’s property. That will force 1,300 employees out of work. So what’s the deal here? Are people not gambling? Well, yes and no. People are gambling, but they’re just choosing to gamble elsewhere.
There seems to be a saturation of gambling in the US. Consider this. In 1988, only two states offered casino gambling. Today, you don’t have to head to Vegas to gamble. Chances are there’s a casino in your own backyard or within a couple hours’ drive of your house.
And while Tunica is closing, other casinos are still being erected, hoping to cash in on America’s appetite for gambling. We don’t think this is a great idea.
There seems to be a move to online gambling in the US as more players choose to stay home and cash in online at sites like Prism Casino. This isn’t just a random anecdote. Land-based casino vendors are suffering — a sign that land-based gambling isn’t what it used to be.
On March 25th, IGT, the world’s biggest slot machine maker for land-based casinos, announced that they’re slashing their workforce by 350 people. That’s about 7 percent. While the number of new casinos going up far outweighs the ones closing their doors, IGT actually earns a share of money bet on some of its leased machines. Fewer people gambling means less revenue.
As the economic situation improves, perhaps we’ll see more people head out to gamble. Or maybe, just maybe, land-based casinos no longer have the allure that they used to. Maybe, like mail and banking, casino fun now belongs online.